After witnessing the deal president-elect Donald Trump made with Carrier, in which Trump pressured Carrier to keep some jobs in the United States rather than move them to Mexico, Caterpillar chief executive Doug Oberhelman articulated the feeling that many business executives may be privately harboring, warning, “Some of us may bear our turn in the bullseye.” Trump offered $7 million in tax breaks to Carrier, but the implied threat to parent company United Technologies likely paved the way for the deal.
Last Sunday, Trump posted a threat to businesses on Facebook:
The U.S. is going to substantially reduce taxes and regulations on businesses, but any business that leaves our country for another country, 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. ...... without retribution or consequence, is WRONG!
There will be a tax on our soon to be strong border of 35% for these companies wanting to sell their product, cars, A.C. units etc., back across the border. This tax will make leaving financially difficult, but.....these companies are able to move between all 50 states, with no tax or tariff being charged.
Please be forewarned prior to making a very expensive mistake! THE UNITED STATES IS OPEN FOR BUSINESS!
The Chicago Tribune reports that Oberhelman, the chairman of the Business Roundtable, tried to put the best face on the situation, claiming that he thinks the business leaders Trump is consulting connote a focus on business that Oberhelman hasn’t seen in a “long, long time” and that Trump’s team "will use every tool they can get" to promote growth.
But Oberhelman also allowed that he is concerned about Trump's "rhetoric" on trade policy triggering retaliatory tariffs on U.S. manufacturers,. "I have been a little concerned about some of the rhetoric," he said, adding that businesses like Caterpillar do plenty of business with Brazil, India and China, and businesses "are looking at being held out of a lot of the markets."
There are many people who disliked Trump’s actions with Carrier, from conservatives who regarded it as a betrayal of conservative principles, like James Pethokoukis of the American Enterprise Institute who stated it was too early to know “how much of this was just one-off behavior and how much of this is going to become the modus operandi of the new administration,” to those from the other side of the aisle, like Larry Summers, the former Treasury secretary, who snapped, “This was more of a mugging than a bribe.”