Trump keeps publicly shaming companies. Does it work?


But this is not politics as usual. This is the Trump administration. A very public dressing-down of GM’s CEO, Mary Barra, and a union official by the commander in chief somehow feels very normal.

Trump promised in 2016 to save manufacturing jobs and bring back US industry. He can credit the Rust Belt with handing him the White House, so he has been particularly aggressive in shaming companies moving production overseas.

He’s personally tried to broker deals to keep specific plants open, threatened retribution for specific companies, broken ground at new plant sites and bragged, cajoled and seethed on Twitter, always with an eye to those manufacturing jobs, mostly in the key Rust Belt states.

A campaign pledge on Carrier and the aftermath

During the 2016 campaign, the closure of a Carrier plant in Indiana became the symbol for the decline of US manufacturing jobs. Trump promised that if he were elected, the company would stay. Indeed, that’s sort of what happened. After the election but before he had been sworn in as President, Trump was stepping in to save that very specific plant in Vice President Mike Pence’s home state of Indiana. And he was able to declare victory when the plant was kept open after being promised millions in tax breaks. But the owner of Carrier, United Technologies, said it would still move some production to Mexico. In the end, about 800 of the 1,400 workers at the factory kept their jobs, according to a CNN check in July of 2017. About 600 workers, at that point, had been laid off despite the deal between Trump and the company.

Ford will carry through with Mexico plans

GM has routinely drawn Trump’s scorn even as Ford has gotten his praise. That doesn’t mean Ford is doing exactly what the President wants. Around the time he was hatching the deal to save some of the Carrier workers’ jobs, Trump was threatening GM with a tax on cars imported from Mexico. Ford said it would change its plans to assemble new electric cars in Mexico. At the same time, it announced plans for a new electric car plant in Michigan. Trump, then President-elect, was pleased.
“Thank you to Ford for scrapping a new plant in Mexico and creating 700 new jobs in the U.S. This is just the beginning – much more to follow,” he tweeted.
A year later, in December of 2017, Ford again shifted plans and announced it would make those electric cars in Mexico after all. But it would keep the new investment in Michigan and focus there on self-driving vehicles, according to reports. Ford also said, in response to an aggressive tweet from Trump, that it won’t move production of a version of the Ford Focus into the US in response to the tariffs Trump could impose on cars made outside the country. It just simply won’t sell the car in the US.

Trump wanted a boycott of Harley-Davidson

It was his tariffs on steel and aluminum that caused frustration between Trump and Harley-Davidson, the iconic American motorcycle manufacturer based in Wisconsin. The threatened tariffs led to the European Union pledging countertariffs. Harley-Davidson, stuck in the middle, said it could lose $100 million per year, so the company decided to move some production overseas to avoid the EU tariffs.
Shortly thereafter, Trump was urging a boycott.
“Many @harleydavidson owners plan to boycott the company if manufacturing moves overseas. Great! Most other companies are coming in our direction, including Harley competitors. A really bad move! U.S. will soon have a level playing field, or better,” he said on Twitter last August.

GM plant in Lordstown, Ohio

The idling of the General Motors plant in Lordstown, Ohio, is what has angered Trump at the moment. He called on CEO Barra and the local union representative, David Green, to come together and save the plant, which produces the Chevy Cruze, a low-cost sedan the company doesn’t want to sell anymore. CNN profiled the workers at the plant, who have been offered jobs elsewhere, often for less pay.

In a series of pointed tweets, Trump said the economy is good, so Chevy should keep the plant, the closure of which was announced back in November. He complained about the United Auto Workers and that talks between GM and the UAW aren’t happening fast enough. And he pointed out that Toyota, the Japanese company, is investing in the US by opening new plants. He didn’t point out that the Toyota plant is opening in Alabama. (The South has emerged as a hub of new auto manufacturing by foreign makers thanks to lower manufacturing costs and less powerful unions.) He also didn’t mention his threat of new tariffs on Japanese cars, which Toyota says could put its US investment at risk.

Previous GM threats

In November, when GM first announced its large restructuring, which will mean a 15% workforce reduction for the company in North America — 8,000 fewer US jobs — Trump threatened the subsidies that GM receives from the federal government. He called out Barra by name that time too, driving down GM stock prices. It turned out, however, that the main federal subsidies that benefit GM are paid to consumers in the form of a tax credit for electric vehicles.

Foxconn’s about-face

Trump traveled to Wisconsin in June of 2018 to great fanfare and grabbed a shovel to break ground on a massive new flat-screen factory for the Taiwanese company, which was set to receive billions in subsidies from the state. But the plans kept changing. When Foxconn announced it would not open the factory after all, but rather invest in Wisconsin in other ways and create non-manufacturing jobs, Trump intervened. He called Foxconn Chairman Terry Gou and voila, Foxconn changed course again. Now it will utilize the site to make smaller flat-screen panels than originally anticipated. Foxconn announced Monday that it was indeed moving ahead with the smaller-scale facility.

Manufacturing jobs have increased under Trump

Trump has maintained a dedicated focus on the Rust Belt and on manufacturing jobs. He likes to say there has been a sort of renaissance under his watch. It’s certainly true that the number of manufacturing jobs has increased. But the share of the US economy dedicated to manufacturing jobs has not risen and it likely won’t since the US economy has moved away from manufacturing, which used to be the largest portion of the US workforce but now accounts for less than 10%.
There actually have been more manufacturing job openings recently than people to fill them, according to data from the Bureau of Labor Statistics. That may be because, as CNN found at the Lordstown plant, people aren’t always keen to leave their hometowns to find work or because they don’t have the skills needed for different manufacturing sectors.
To understand why the economy is so important to him, look no further than CNN’s new poll conducted by SSRS, which finds his overall approval rating inching to 42%, his approval rating on the economy at 51% and 71% of respondents saying the economy is in good shape. Simply put, the economy overall is the very best good news Trump has, and it is key to his re-election prospects.

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