With inauguration just over a month away, President-elect Donald Trump is already touting his negotiating skills to keep American jobs on U.S. Last week Trump announced that his deal with United Technologies, the parent company of Carrier, would ensure that 1,100 jobs at an Indianapolis, Indiana factory, would not be moving to Mexico. In exchange, the company will receive $7 million in tax credits over the next ten years. According to a recent poll by Politico/Morning Consult, 60 percent of voters say the Carrier deal gives them a more favorable view of Trump – including 87 percent of Republicans, 54 percent of independents and 40 percent of Democrats. Despite the popular reception among the voters polled, critics say this could set a dangerous precedent. Soledad O’Brien analyzes the economic implications of the deal with business analyst James Pethokoukis from the conservative American Enterprise Institute.

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*THIS IS A ROUGH TRANSCRIPT. THERE MAY BE ERRORS. O’Brien: James Pethokoukis is an economist at the conservative AEI and he has called this deal chilling. Nice to have you with us Pethokoukis: Thank you O’Brien: So the responses have been divided between people cheering, Hey jobs were saved, and if you are one of the 730 to 800 people whose jobs were saved there, to others bemoaning the way this was done. Where do you stand on it? Pethokoukis: I’m concerned. I want make companies making decisions based on what is best for customers, shareholders and over the long term what is best for their employees. What I don't want is businesses making decisions on the whims of politicians including the president of the US. This is a weird situation - we have a business telegraphing that the economics of their business to be competitive that they need to be making products somewhere else where labor costs less and they made that decision. and then the president says "I know better," you can make these jobs here, maybe less profitable but you'll be ok. We elected him president, not chairman of the board of every company in America. O’Brien: It’s hard to say saving jobs as a bad thing Pethokoukis: Right, it's the job of the president to take a longer view. If they had moved somewhere in us, would he have saved them? He might not. Workers have to be prepared, not only might their jobs go overseas but they might go elsewhere. For the long term viability of Carrier - they are owned by united technologies, which has govt contracts. I'm sure at the end the of the day and the CEO implied this, it was less about tax credits that they got. They were worried about losing govt contracts, kind of a punitive action here. They felt forced to do this and the cost of keeping these jobs in Indiana and not what they wanted to do in order not to lose govt contracts. If this was a stand alone company, carrier, without a big wealthy parent, they would really be at risk. O’Brien: this is a quote - The free market is sorting it out and America has been losing. That's from Pence. I thought republicans were all about the free market and free enterprise. I haven't heard elected officials on GOP side decrying what they are seeing happening Pethokoukis: Right. Its their president, he won, he beat Clinton. This is one of the first big things that he has done even though he is not president, he is the president elect. The polls say this is popular. At this point they are going with their guy and what the polls say. That is wrong, what pence said. We have had more open trade over the past 30-40 years, this economy has created 15 million jobs since the early 1980s. The market is doing fine but doesn't mean there won’t be losers or people left behind and the govt should have been doing more all this time to help people who have lost their jobs but free trade is good for America, NAFTA is good for America. O’Brien: But a lot of churn to an individual person is a horrible thing. isn't this what the election in part was won on? This sense that this is the way the market goes and if you’re an unlucky one, sorry because these are market forces. Pethokoukis: We are not going back to the 1950s and 1960s. these manufacturing jobs are not coming back. But you mention oh what about the workers - too bad you lose your job? No, I think that's where govt has a role to play, more broadly making sure we have dynamic economy where companies want to be based here for starters, two education system and training system for workers, that's important. O’Brien: A water bill passed in the Senate and a provision about buying American steel that house republicans removed so now I’m confused about what the republican party wants because I would have thought.. Pethokoukis: The republican party I think is confused that's why. By making companies buy American steel you are raising the cost for every company that uses steel and therefore the products they make, whether used by consumers or businesses, are more expensive. If Clinton had won and taking the exact same decisions, republicans would be screaming, they would be calling her an authoritarian, calling her a socialist but because Trump won, it is fine. I think the republican party is trying to figure out what exactly they believe about economics. If America is somewhere else, they need to go somewhere else O’Brien: And if it’s not free trade anymore that's kind of interesting, thanks so much James nice to talk to you Pethokoukis: thank you for having me
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