What does a TRUMP presidency look like?

[alfred russel]

Trump's fleet of Boeings are all over 20 years old.  And are not command and control platforms for the National Command Authority.

So if there is a time sensitive national emergency and Trump is in Trump Force 1, he will be unavailable to make the crucial decisions? And this is a bad thing? 

But apparently this is all over the CEO of Boeing making comments about Trump's trade policies yesterday, so there ya go.

Boeing is stupid. In any other banana republic, CEOs of major corporations would know that you can't express criticism of the government without consequences.

Amazon needs to keep its head on a swivel.

[CountDeMoney]

So if there is a time sensitive national emergency and Trump is in Trump Force 1, he will be unavailable to make the crucial decisions? And this is a bad thing? 

When he is unable to launch a retaliatory strike because the EMP blast corkscrews his unshielded gold-plated ass into the ground, then yeah, that's a bad thing.

Boeing is stupid. In any other banana republic, CEOs of major corporations would know that you can't express criticism of the government without consequences.

Amazon needs to keep its head on a swivel.

Boeing is stupid?  Why is the future POTUS threatening companies like a Soprano?
If I were a Captain of Industry, I would not appreciate being directly threatened by the President-Elect.  Our government's relationship to business is adversarial enough as it is.

[derspiess]

Another theory I heard somewhere is that this is payback for Boeing being all buddy-buddy with Obama and Clinton.

[celedhring]

I'm sure all those downtrodden American workers that voted for him would be pleased to see Boeing contracts going to Airbus instead. 

[derspiess]

Dunno what bothers me more-- Trump referencing workers as frequently as a 1920s Fascist or Communist rabble-rouser, or Obama saying "workin' folks" 

[The Larch]

Much cheaper to sign a 50 year contract with a recreated Trump Airlines.

I guarantee you the real reason he wants to ditch Air Force One is because he wants to fly in his own plane.  Has his name on it.

Trump's plane is also a Boeing. And apparently the secret service has already said that he won't be able to use it instead of Air Force One, although I don't know how they'll be able to force him.

Trump's fleet of Boeings are all over 20 years old.

Just like the current batch of VC 25s, that were introduced in 1990.

[The Larch]

Another theory I heard somewhere is that this is payback for Boeing being all buddy-buddy with Obama and Clinton.

Boeing is a major military contractor, of course they're going to be all buddy-buddy with every single high ranking politician.

[OttoVonBismarck]

Larry Summers has a take on the Carrier deal I largely agree with, and had previously mentioned--it was by no means any sweetheart deal for Carrier, and was almost certainly done out of fear of future Presidential wrath. That in itself is a pretty concerning thing if you think about its broader implications.

Let's be clear: Donald Trump is practicing presidential extortion of individual companies for symbolic political gain

Last week, I was sharply critical of the President-elect's effort to pressure Carrier into keeping jobs in Indiana on the grounds that it was a step towards degrading American capitalism from being rules-based to being deals-based.  The Carrier case has generated much discussion, so I want to follow up and make clear why my concerns are now considerably greater than they were even last week.

First, no one should be confused. This was more of a mugging than a bribe. The tax incentives offered by Indiana total $7 million over 10 years or less than $1,000 per job-year. Incentives at this level would be standard in any business location decision. So, given the stakes involved, the decision was surely based on the reasonable judgement by United Technologies (the parent company of Carrier) that it did not want to be on the wrong side of the incoming President.

Second,the President-elect made clear that he wanted it to be seen as a precedent and would plan on pursuing policies of this kind in the future. It polled well and was  hailed by some like Peggy Noonan and Steven Pearlstein as successful symbolic politics. On the current trajectory, micro-intervention policies are surely likely to grow, so the question of their ultimate consequences is not a small one.

Third, apart from the process and values questions stressed in my distinction between rules and deals capitalism, there is a certain incoherence in the economics here. If it is cheaper to produce air conditioners in Mexico than in America, won't Mexican production by non-American companies ultimately render Carrier in Indiana non-competitive?  If Carrier does not export capital to Mexico, won't Mexico run a larger surplus with America? And isn't this what the President elect sees as bad? If foreign companies are allowed to run production chains that include Mexico, and American companies are not, won't American employment ultimately suffer?

Fourth, there is a very legitimate question on which Pearlstein lectures economists regarding the extent to which companies should be run ruthlessly for the benefit of their shareholders rather than with broader interests in mind.  This is a question Andrei Shleifer and I posed in the late 1980s in our paper on Breach of Trust in Hostile Takeovers, and it figures prominently in the report of a recent commission I co-chaired on Inclusive Prosperity.  I expect to return to this subject in the near future.  But surely the right way to address it is through considering the relative virtues of different systems of corporate governance, not with intermittent bluster directed at particular companies.

Fifth, as many commentators have pointed out, and I tried to acknowledge, rules vs. deals capitalism is a continuum rather than a binary choice.  For example, as vividly described in Steve Rattner's book Overhaul, the auto industry bailout, which I helped supervise in 2009, involved ad hoc judgements regarding particular companies. We were very much aware of the dangers of our emergency actions. So we sought and received presidential approval for principles making clear that even in the context of the bailout, the government would not take advantage of its power to impose our preferred policies in areas ranging from environmental protection to union rights to plant location on automobile companies. And we insisted that the companies be returned to full private ownership as rapidly as practicable.  Yes, in the case of the auto companies and in the case of the banks there can be argument with some of the choices made, but the principle that government should do the minimum necessary to respond to the crises and not seek to bully its way to preferred outcomes was clear.

It is certainly also true that there are many policies ranging from Buy America to support for renewable energy to allocating tax credits to granting licenses to defense procurement where the government finds itself making choices that bear on individual companies.  As an economist, I would support the elimination of a wide variety of policies that promote or reward rent-seeking.  In areas like defense procurement or the granting of licenses it is surely best when to the maximum extent possible policy is governed by rule rather than discretion.  And where discretion must be exercised, it is best kept as far away from politics and the President as possible.

There are difficult judgments to be made in managing the relation between business and government.  For example, in many ways, conflict of interest and synergy are opposite side of the same coin. But this should not cause any confusion about cases of presidential extortion of individual companies for symbolic political gain. Such actions are dangerous, and the more so when they generate popular acclaim.

Lawrence H. Summers, the Charles W. Eliot university professor at Harvard, is a former treasury secretary and director of the National Economic Council in the White House. He writes occasional posts on Wonkblog about issues of national and international economics and policymaking.

[CountDeMoney]

Trump's fleet of Boeings are all over 20 years old.

Just like the current batch of VC 25s, that were introduced in 1990.

So fucking what.  What are you, an Airbus contractor?  Shut the fuck up already.

[Berkut]

Blahblahblah. Crooked Hillary killed state department officials with her illegal email server.

[derspiess]

[OttoVonBismarck]

That's called a c-uck out. Similar to a stroke out. It happens to people that have been triggered by Trump's regrettable election win.

[derspiess]

That's called a c-uck out. Similar to a stroke out. It happens to people that have been triggered by Trump's regrettable election win.

Well, I hope he gets some help.

[CountDeMoney]

Too busy ordering a large cheese with pepperoni. And kiddie ass.

[OttoVonBismarck]

Too busy ordering a large cheese with pepperoni. And kiddie ass.