House Speaker Paul Ryan on Thursday defended President-elect Donald Trump’s deal with Carrier Corp. that reportedly provides tax incentives to the Indianapolis-based manufacturing company to keep 1,000 jobs in Indiana rather than moving them to Mexico.
Ryan, R-Wis., emphasized to reporters that he does not know the terms of the deal, which have not been spelled out publicly. But he pushed back against critics such as Sen. Bernie Sanders, I-Vt., who said the deal sets a dangerous precedent.
“I’m pretty happy that we’re keeping jobs in America, aren’t you?” Ryan said, adding that he believes his friend, Vice President-elect Mike Pence, played a key role in the deal as the current governor of Indiana. “I think it’s pretty darn good that people are keeping their jobs in Indiana instead of going to Mexico.”
Trump and Pence were taking a victory lap in Indianapolis on Thursday after news of the deal broke Tuesday. Carrier Corp. manufactures heating and air conditioning systems. Carrier officials indicated that Indiana offered some type of tax incentives for the company to remain in the state, and analysts speculated that the company may also have wanted to ensure that it did not threaten its federal contracts by angering the new Trump administration.
Sanders said the deal is dangerous because it encourages U.S. companies to threaten to move jobs overseas as a way to pressure state and federal governments to give them tax incentives to stay.
“Trump has endangered the jobs of workers who were previously safe in the United States,” Sanders wrote in an op-ed in The Washington Post. “Why? Because he has signaled to every corporation in America that they can threaten to offshore jobs in exchange for business-friendly tax benefits and incentives.”
Ryan said the Carrier example underscores the need for the new Congress to pass tax reform that lowers taxes on U.S. companies.
“This is what tax reform is all about….making the tax code far better for American businesses to stay in America,” said Ryan, adding that the U.S. government taxes its corporations at a higher rate than most foreign competitors do.
“We are killing jobs and competition in America because of our tax code,” said Ryan, who has made an overhaul of the tax system a top priority for the next Congress. “Tax reform is central to fixing the problem.”
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