INDIANAPOLIS, INDIANA & SANTA CATARINA, MEXICO - U.S. President-elect Donald Trump sternly warned American businesses again Sunday that if they move their operations overseas they would face a 35 percent tax if they then try to sell their products back in the United States.
In a series of Twitter comments, Trump said he plans to "substantially reduce" taxes and regulations on businesses. But he said that any company that "fires its employees, builds a new factory or plant" in another country "and then thinks it will sell its product back into the U.S. without retribution or consequence, is wrong!"
The U.S. is going to substantialy reduce taxes and regulations on businesses, but any business that leaves our country for another country,— Donald J. Trump (@realDonaldTrump) December 4, 2016
fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the U.S. ......— Donald J. Trump (@realDonaldTrump) December 4, 2016
without retribution or consequence, is WRONG! There will be a tax on our soon to be strong border of 35% for these companies ......— Donald J. Trump (@realDonaldTrump) December 4, 2016
The billionaire real estate mogul, who assumes power January 20, said the border tax on products manufactured in other countries "will make leaving financially difficult.... Please be forewarned prior to making a very expensive mistake!"
The U.S. has lost 5 million manufacturing jobs since 2000, many to automation and some to overseas locations where company owners are paying workers substantially less than they have been in the United States. But in his lengthy campaign for the White House, Trump vowed to curb the corporate departures and to bring back jobs that have already been moved overseas.
The view from Indianapolis
“I think Trump needs to do everything he possibly can to keep these jobs in this country,” says Chuck Jones, local union president for the Steelworkers Union in Indianapolis, Indiana.
Jones represents workers at Carrier where Trump claimed an early success, along with Vice President-elect Mike Pence, by offering $7 million in tax incentives last week to the air conditioning company to keep 800 jobs in the Midwestern state of Indiana that Carrier had earlier said it was moving to Mexico.
While his union supported Democrat Bernie Sanders in the primary and no one in the general election, Jones welcomed Trump's focus on jobs.“I'm glad to see something is being said. For a number of years, nothing was being said or done about these jobs leaving this country," said Jones. "All these people want is an opportunity to have a job. We aren’t asking for givebacks or handouts. Just give us a job.”
Trump did not mention that the company still plans to move another 1,100 Indiana jobs to Mexico. Trump touted the Carrier deal while touring its Indianapolis operation even though he had attacked such tax incentive pacts during his campaign.
Carrier worker Will Cornett is one of the lucky ones who will be keeping his job in Indianapolis. It is something of a family affair. Many of his family members work here too. “Me, myself, my mother. And I have a younger brother, also have an uncle who works on the night shift.”
Cornett was an early Trump supporter - and he is still very much in the president-elect's court. “I’m with Trump 100 percent," he says, "Trump train all the way.”
How it looks in Mexico
Carrier still has two plants in the town of Santa Catarina, Mexico.
So how does Santa Catarina's mayor, Hector Castillo-Olivares, feel about the loss of jobs that were originally headed in his direction?
"It doesn't worry us, because ultimately, at the end of the day, we keep improving and maintaining the conditions that make businesses look to come here," he said. "The gap left open by one investor will be filled by another investor."
Nineteen-year-old Zahin Gonzalez-Trevino worked for Carrier for about six months, earning $73 a week before he was laid off when production dropped. For himself, he's not worried. He says it is not hard to find a job in Santa Catarina if you know where to look.
But he is more skeptical of what Trump may do to change the U.S./Mexico relationship
“Who knows what he's thinking. He needs to think about both sides, not just do things pell-mell. Think about how things are, not just say it. See who it affects, what upside there is to taking it away."
Mayor Castillo-Olivares is not worried. He says hard-working and welcoming people will keep the foreign companies coming to Santa Catarina. He suggests Trump come too.
“We invite him to get to know our people, the quality of our government…our infrastructure…and the foreign capital we have in Santa Catarina.”