Tiffs with multinational
corporations are bogus
Donald
Trump seems to live in a world in which there is global trade but no foreign
direct investment. He recently denounced BMW imports at a South Carolina rally while ignoring the German automaker’s production facility a short distance away in Spartanburg, which has been in operation since 1994.
The
president also seems to be less than fully informed when it comes to the
foreign operations of U.S. corporations.
He
has been berating Harley-Davidson for announcing plans to shift some production
to Europe to circumvent the tariffs the EU is imposing on selected American
products in response to Trump’s trade policies. In his tweet tirade, Trump
demand that Harleys “never be built in another country—never.”
In fact, Harley
already has offshore production facilities.
One of those is in India, which was originally announced in connection with President Obama’s November 2010 trip to that country to promote U.S. commercial interests. Republicans denounced the trip, not because of job offshoring but rather because of exaggerated reports of the cost of the delegation.
One of those is in India, which was originally announced in connection with President Obama’s November 2010 trip to that country to promote U.S. commercial interests. Republicans denounced the trip, not because of job offshoring but rather because of exaggerated reports of the cost of the delegation.
Harley
initially used the Indian operation to assemble bikes shipped in knocked-down
form from U.S. plants, but later it began using locally produced components. In
2012 Harley outsourced much of its IT work to the Indian company Infosys, some
of whose employees on the account worked in the U.S.
There were reports in 2014 that Harley IT workers were being asked to train Infosys employees on H-1B visas who were replacing them.
There were reports in 2014 that Harley IT workers were being asked to train Infosys employees on H-1B visas who were replacing them.
The
company also has an assembly facility in Brazil and a manufacturing plant in
Australia that produces high-finish wheels.
In
its 10-K filing Harley states: “The motorcycles assembled at the Company’s
international facilities have the same authentic look, sound, feel and quality
of a motorcycle manufactured by the Company’s U.S. facilities.”
Moreover,
Harley announced earlier this year that it is shifting some production from a
plant in Kansas City to one in Thailand.
The
Harley situation is just the latest in a series of tiffs between Trump and
large corporations in which it is difficult to support either side. Harley
certainly needed to be called out for engaging in more and more offshore
outsourcing while continuing to promote an all-American image.
Trump’s
criticism of the company, however, is far from coherent.
It
seems to be based mostly on his feeling that he was personally betrayed by a
firm that he touted as a symbol of American greatness.
Trump
seems to have picked a fight with Harley in the same way he has gone after
other companies, starting with Carrier soon after his election.
He
has done so mainly to burnish has own tough-guy image while in the end failing
to extract any real concessions. The same goes for is supposed battles with
pharmaceutical producers, aerospace manufacturers, automakers and others.
Trump’s
objective is to give the impression he is taking a hard line against big
business, while he is actually catering to every desire of corporate America
when it comes to regulation and taxes.
It
is the flip side of his posture toward workers, in which he pretends to be
their defender but is in reality undermining employment safeguards and labor
rights. How long can the skullduggery continue?
