Carrier stays in US

[KUSA]

You also need to consider this 7 million does not include the cost to the entire US economy because, essentially the same AC units, delivering the same benefit and utility to the end user, if made in the US, would now impoverishes the end users all over the US more.

Carrier's annual revenue does not appear easy to find because it is privately held.  But typical appliance industry generates about $250,000 in annual revenue per employee.   The Indiana plant therefore generates roughly $250,000,000 in annual revenue.   Let's say for the sake of argument the entire sales from the plant is to American consumers.   Let's say moving the plant to Mexico allows each AC unit be sold for 5% less.  That means if the plant had been moved to Mexico, the American consumers of carrier Ac Equipment would be enriched to the tune of 5% X $250,000,000 or $12.5 million, each year, relative to if the plant stayed in Indiana.  Or keeping the plant in Indianan impoverishes the American consumer to the tune of 12.5 million a year, every year, until eventually it becomes unsustainable and either closes or moves overseS anyway, before considering the cost of the tax break.

So, by keeping the carrier plant in the US, you gain some short term savings in unemployment benefits, yes.  But in addition to the 7 million in extra tax it cost the American economy, it also cost the American economy an additional $12.5 million per year, every year.

At the same time, it disincentivize the workforce at that plant from retraining themselves for new roles in which their contribution actually enriches the American economy, rather than impoverishes it.

Well why don't we have every product made in foreign countries? We would be so much richer that way. Everything would be so cheap that we could all sit around counting our money.

---

why hasn't Brian37 trained himself to be in a good position, instead of bitching about his poor fortunes on here?

Because he is a god damned nutless leach. A pure worthless piece of garbage.

[Anomalocaris]

You also need to consider this 7 million does not include the cost to the entire US economy because, essentially the same AC units, delivering the same benefit and utility to the end user, if made in the US, would now impoverishes the end users all over the US more.

Carrier's annual revenue does not appear easy to find because it is privately held.  But typical appliance industry generates about $250,000 in annual revenue per employee.   The Indiana plant therefore generates roughly $250,000,000 in annual revenue.   Let's say for the sake of argument the entire sales from the plant is to American consumers.   Let's say moving the plant to Mexico allows each AC unit be sold for 5% less.  That means if the plant had been moved to Mexico, the American consumers of carrier Ac Equipment would be enriched to the tune of 5% X $250,000,000 or $12.5 million, each year, relative to if the plant stayed in Indiana.  Or keeping the plant in Indianan impoverishes the American consumer to the tune of 12.5 million a year, every year, until eventually it becomes unsustainable and either closes or moves overseS anyway, before considering the cost of the tax break.

So, by keeping the carrier plant in the US, you gain some short term savings in unemployment benefits, yes.  But in addition to the 7 million in extra tax it cost the American economy, it also cost the American economy an additional $12.5 million per year, every year.

At the same time, it disincentivize the workforce at that plant from retraining themselves for new roles in which their contribution actually enriches the American economy, rather than impoverishes it.

Well why don't we have every product made in foreign countries? We would be so much richer that way. Everything would be so cheap that we could all sit around counting our money.

Why don't you fast forward into the early 19th century and educate yourself with the avant garde ecominc concept of "comparative advantage "?

[henryp]

You also need to consider this 7 million does not include the cost to the entire US economy because, essentially the same AC units, delivering the same benefit and utility to the end user, if made in the US, would now impoverishes the end users all over the US more.

Carrier's annual revenue does not appear easy to find because it is privately held.  But typical appliance industry generates about $250,000 in annual revenue per employee.   The Indiana plant therefore generates roughly $250,000,000 in annual revenue.   Let's say for the sake of argument the entire sales from the plant is to American consumers.   Let's say moving the plant to Mexico allows each AC unit be sold for 5% less.  That means if the plant had been moved to Mexico, the American consumers of carrier Ac Equipment would be enriched to the tune of 5% X $250,000,000 or $12.5 million, each year, relative to if the plant stayed in Indiana.  Or keeping the plant in Indianan impoverishes the American consumer to the tune of 12.5 million a year, every year, until eventually it becomes unsustainable and either closes or moves overseS anyway, before considering the cost of the tax break.

So, by keeping the carrier plant in the US, you gain some short term savings in unemployment benefits, yes.  But in addition to the 7 million in extra tax it cost the American economy, it also cost the American economy an additional $12.5 million per year, every year.

At the same time, it disincentivize the workforce at that plant from retraining themselves for new roles in which their contribution actually enriches the American economy, rather than impoverishes it.

Americans, as a group, pay 12.5 million more a year if Carrier goes to Mexico.  But Americans also lose 50ish million in wages and benefits if Carrier goes to Mexico.  

Obviously oversimplified, but losing 50 million to save 12.5 million is a bad deal for America, isn't it?  

The sustainability is the tricky part.  First worlders are smart enough to recognize that buying things made by Malaysian children is bad for our economy, but too dumb to stop buying things made by Malaysian children.  Us older folks remember the 80's? when they were slapping made in america stickers on everything.  Basically saying, hey it cost 30 cents more, but your cousin Frank can keep his job.  And Americans said, I like Frank, but I'd REALLY like 6 nickels.

With Trump, and really, around the world as anti-globalism is picking up steam, people are basically asking the government to fix it for us, because we can't help ourselves.  I think that's what people want.  For the system to be rigged so we can't keep making the stupid choices we've been making for the past couple decades.  Because we can't help ourselves when it comes to choosing whatever costs less, no matter the circumstances.

[Anomalocaris]

You also need to consider this 7 million does not include the cost to the entire US economy because, essentially the same AC units, delivering the same benefit and utility to the end user, if made in the US, would now impoverishes the end users all over the US more.

Carrier's annual revenue does not appear easy to find because it is privately held.  But typical appliance industry generates about $250,000 in annual revenue per employee.   The Indiana plant therefore generates roughly $250,000,000 in annual revenue.   Let's say for the sake of argument the entire sales from the plant is to American consumers.   Let's say moving the plant to Mexico allows each AC unit be sold for 5% less.  That means if the plant had been moved to Mexico, the American consumers of carrier Ac Equipment would be enriched to the tune of 5% X $250,000,000 or $12.5 million, each year, relative to if the plant stayed in Indiana.  Or keeping the plant in Indianan impoverishes the American consumer to the tune of 12.5 million a year, every year, until eventually it becomes unsustainable and either closes or moves overseS anyway, before considering the cost of the tax break.

So, by keeping the carrier plant in the US, you gain some short term savings in unemployment benefits, yes.  But in addition to the 7 million in extra tax it cost the American economy, it also cost the American economy an additional $12.5 million per year, every year.

At the same time, it disincentivize the workforce at that plant from retraining themselves for new roles in which their contribution actually enriches the American economy, rather than impoverishes it.

Americans, as a group, pay 12.5 million more a year if Carrier goes to Mexico.  But Americans also lose 50ish million in wages and benefits if Carrier goes to Mexico.  

Obviously oversimplified, but losing 50 million to save 12.5 million is a bad deal for America, isn't it?  

The sustainability is the tricky part.  First worlders are smart enough to recognize that buying things made by Malaysian children is bad for our economy, but too dumb to stop buying things made by Malaysian children.  Us older folks remember the 80's? when they were slapping made in america stickers on everything.  Basically saying, hey it cost 30 cents more, but your cousin Frank can keep his job.  And Americans said, I like Frank, but I'd REALLY like 6 nickels.

With Trump, and really, around the world as anti-globalism is picking up steam, people are basically asking the government to fix it for us, because we can't help ourselves.  I think that's what people want.  For the system to be rigged so we can't keep making the stupid choices we've been making for the past couple decades.  Because we can't help ourselves when it comes to choosing whatever costs less, no matter the circumstances.

Urrr, no.  The carrier workers who are prevented from working inefficiently mostly don't become permanently unemployed.  So the lost wage argument is specious.   What they would lose for hopefully a slightly longer period is a certain degree of cushy assurance that they can go on being inefficient, undereducated or undertrained in useful skills in areas where American can really have a competitive advantage, and still continues to rally corrupt political showmen such as the Donald to their aid in their parasitic effort to continue to pretend to add value to their country while really impoverishing the American economy.

[henryp]

Americans, as a group, pay 12.5 million more a year if Carrier goes to Mexico.  But Americans also lose 50ish million in wages and benefits if Carrier goes to Mexico.  

Obviously oversimplified, but losing 50 million to save 12.5 million is a bad deal for America, isn't it?  

The sustainability is the tricky part.  First worlders are smart enough to recognize that buying things made by Malaysian children is bad for our economy, but too dumb to stop buying things made by Malaysian children.  Us older folks remember the 80's? when they were slapping made in america stickers on everything.  Basically saying, hey it cost 30 cents more, but your cousin Frank can keep his job.  And Americans said, I like Frank, but I'd REALLY like 6 nickels.

With Trump, and really, around the world as anti-globalism is picking up steam, people are basically asking the government to fix it for us, because we can't help ourselves.  I think that's what people want.  For the system to be rigged so we can't keep making the stupid choices we've been making for the past couple decades.  Because we can't help ourselves when it comes to choosing whatever costs less, no matter the circumstances.

Urrr, no.  The carrier workers who are prevented from working inefficiently mostly don't become permanently unemployed.  So the lost wage argument is specious.   What they would lose for hopefully a slightly longer period is a certain degree of cushy assurance that they can go on being inefficient, undereducated or undertrained in useful skills in areas where American can really have a competitive advantage, and still continues to rally corrupt political showmen such as the Donald to their aid in their parasitic effort to continue to pretend to add value to their country while really impoverishing the American economy.

It's not about lost wages to individuals.  It's 50 million dollars that Carrier was giving to Americans that is now being given to Mexicans.  That money is leaving the country.  The new jobs that they would get are unrelated to Carrier leaving.  Those jobs will be available independent of Carrier's actions.  But now some other unemployed person will be able to get them instead.

And the inefficient/competitive advantage stuff is BS.  3rd world countries not caring about their people is not an efficiency we want to compete with.  Which is why so many people were hoping Trump/Bernie did some combination of making Companies with workers in the US more efficient via tax cuts/regulation cuts, and evening the playing field with 3rd world countries via trade alterations.

[Anomalocaris]

Who gives a rat's ass whether a genuine efficiency is what you would want here or not?  If you don't want this efficiency here, and you can match this efficiency, and you can't find something else to do where you do enjoy an margin of advantage in genuine efficiency, what entitles you to eat at the expense of those who had real merits in the form of genuine efficiency advantage, whether they are in Mexico or not?

Ah yes, bestial tribalism where the circumstances of a person's birth is given more value than the competitive merit he can demonstrate. Or "economic nationalism"

[mihoda]

But Anomalocaris, you forgot the compelling argument of nationalists: America First. Even if we're all poorer for it.

[Pat Mustard]

I don't care if the government is saving money, I care that a corporation, to use a little hyperbole, held the government hostage with this deal. Being rewarded for keeping 800 jobs... not even the full 2,100... you know what I mean when I talk about a precedent, right?

I'm highly sceptical that $7 million is the final tally.  Pence as governor of Indiana could have worked that deal by himself.  No need to bring in the Donald except for the dog and pony show.

On the other hand we have Carrier's parent company, United Technologies, that is a big part of the military industrial complex.  A few extra F35 orders might sweeten the deal.

Yeah, I'd add an extra few zeros on the end of that reported figure. I'd guess that it's going to be at least three orders of magnitude greater, into the billions category. Carrier'd save $7m and more per diem just by moving to Mexico, and a lot more if they moved to a slave labour country like China.

---

$12,500,000 divided by 1,000 workers means we could afford to give each worker $12,500 per year just to break even. 

Ah, no.  You don't compensate people for making you poorer.   In effect trump and pence has just became enablers of a crime of extortion in which each of these 1000 works are extorting $12,500 from the US economy, every year, in addition to the $7million the carrier corp has extorted from government tax receipt.  Worse.  The loot from the extortion is in effect being used to facilitate these workers' ability to avoid being retrained to be really productive, as oppose to doing make work and pretending to be contributing.

Oh I wouldn't be all that surprised that Carrier will still turn around and tell its factory floor workforce that they still need to take a 10% paycut off the top, and an end to benefits like healthcare or defined benefit pensions, in order to compete and ensure the jobs don't go to Mexico, or worse. The profit will be kept at the top (where no value is added), as is always the case with capitalistic systems of industry.

[henryp]

Who gives a rat's ass whether a genuine efficiency is what you would want here or not?  If you don't want this efficiency here, and you can match this efficiency, and you can't find something else to do where you do enjoy an margin of advantage in genuine efficiency, what entitles you to eat at the expense of those who had real merits in the form of genuine efficiency advantage, whether they are in Mexico or not?

Ah yes, bestial tribalism where the circumstances of a person's birth is given more value than the competitive merit he can demonstrate.  Or "economic nationalism"

You're mistaking self interest for entitlement.  Americans don't 'deserve' the jobs.  They want the jobs.   And nationalism is only important, because it is also tied to our individual interests.  The US having a better economy typically good for individual Americans.  So as a group, most of us want our leaders to act accordingly.

What you seem to think people are entitled to, is fairness.  But people aren't entitled to that either.

[Tonus]

Erm...

UT CEO: end result is fewer jobs

In a wide-ranging interview with CNBC's "Mad Money with Jim Cramer" that aired Monday, Hayes set out the comparative advantages of moving to jobs to Mexico, the motivation behind his decision to keep those jobs in Indiana, and the ultimate outcome of the deal: There will be fewer manufacturing jobs in Indiana.

(...)

JIM CRAMER: What's good about Mexico? What's good about going there? And obviously what's good about staying here?

GREG HAYES: So what's good about Mexico? We have a very talented workforce in Mexico. Wages are obviously significantly lower. About 80% lower on average. But absenteeism runs about 1%. Turnover runs about 2%. Very, very dedicated workforce.

(...)

GREG HAYES: So, there was a cost as we thought about keeping the Indiana plant open. At the same time, and I'll tell you this because you and I, we know each other, but I was born at night but not last night. I also know that about 10% of our revenue comes from the US government. And I know that a better regulatory environment, a lower tax rate can eventually help UTC of the long run.

But here's the kicker

The result of keeping the plant in Indiana open is a $16 million investment to drive down the cost of production, so as to reduce the cost gap with operating in Mexico.

What does that mean? Automation. What does that mean? Fewer jobs, Hayes acknowledged.

Carrier makes money while they enter a transition phase where the jobs that stay in the USA are not moved to another country, but replaced by automation.