From the Publisher: The Art of the Deal

0
328
Arnold G. York

I’ve been playing around with some ideas about what I would do if I were Donald Trump and about to be sworn in on Jan. 20.

Let’s take some of the trade deals that Trump would like to renegotiate or modify like with China, for example. He could go to the congress and ask for new laws, which would make it tougher on the China trade or currency manipulation. That would, of course, lead to retaliation by China and a long period of acrimony and negotiation. Or, he could send a high level delegation to China or — better yet — invite the Chinese leader to Washington, D.C., or New York if he decides to make his Fifth Avenue building the center of the executive branch, and have what the British would call a little chin wag. In fact, he could move the executive branch around from a Trump building to a Trump Golf Course and do quite well. First, he could pick up a nice piece of change in the rentals and the publicity for all his hotels would be spectacular. 

Well, back to the Chinese and whether he went there or they came here, it would lead to months, if not years, of negotiation. On the other hand, there might be a simpler way. Every day, ships arrive from China carrying goods that have to clear through American ports. I don’t know how long it actually takes to land the goods, but let’s, for the sake of argument, guess it’s two days. Suppose — just suppose — we created new regulations and now it took six days to clear the goods through the ports. 

Of course, with the new regulations, you’d have to get all the inspectors retrained on the new standards and new forms so you take half the inspectors and send them for retraining for a week and the following week you send the other half of the inspectors away for a week. As to the forms when the goods come in you say, “Oh, we’re so sorry but you submitted on federal form 141048B.2(3), which I’m sure you’re aware has been superseded, effective immediately by federal for 141048B.2(4), so you’ll have to resubmit the form before we can process it, and I wouldn’t worry, it probably won’t take more than another week.” 

Very quickly, you would have loads of cargo ships circling off Long Beach and Los Angeles and everyone would be screaming in a multitude of languages, and then it would be time to sit down and talk to the Chinese and see if we can reason together.

Now, he has to deal with the problem of having American jobs leaving the USA for points known and unknown, particularly jobs in the Rust Belt, states where Trump won the presidency and where he probably has to deliver some jobs reasonably quickly. The high profile case is Carrier Air Conditioners in Indianapolis, Ind., where they decided to close down the air conditioning plant, putting 1,400 people out of work, which converts to 1,400 families being impacted, and 1,400 entire neighborhoods impacted. The company said they have to move to Mexico for financial reasons, to stay competitive or to produce bottom line revenues that meet Wall Street projections. Moving from Indianapolis, where their workers are paid $20 per hour, to Mexico, where their workers will be paid $3 per hour, will save the company a sizable amount of money — actually about $50 million per year. Now Carrier, which is already a very profitable company, is owned by United Technology, a conglomerate that has total revenues of about $56 billion in net sales per year and a profit of about $7.6 billion in 2015. It appears to be a well run profitable company and it annually also does a considerable amount of business with the U.S. government — in fact, it is among a major group of defense contractors. United Technologies is the conglomerate; subsidiaries include Pratt and Whitney engines, whose military sales amount to about one-third of their revenues; Sikorsky, which makes helicopters like the Black Hawk helicopters for the military; and Hamilton Sundstrand, which makes sophisticated aerospace components for many military aircraft. I just can’t believe that a little meeting between the new President-elect and the chairman of United Technologies couldn’t produce a meeting of the minds about the value of keeping jobs in the USA. I’m sure some bright people could develop some sort of point system that, for example, if you export 1,400 jobs then you get penalized 1,400 points in your next bid for defense contracts.

I’ve always felt that most politicians are very bad deal makers. For example, when we spent practically a trillion dollars bailing out the auto industry and the banks and insurance companies after the 2008 crash, we the American people should have ended up owning 30-40 percent of those companies on the back end as sweetener for the loan. After all, they were coming to us the U.S. citizenry for a hard money loan to bail them out because no one else would lend them the money. And what did they give us? They gave us a promise to pay us back, when they could, if they could. It never seemed like such a great deal to me.

Well, now we have a deal maker coming into the White House and, if he’s as good as he claims he is, I can’t see that he’s going to have a lot of problems with United Technologies or all the other companies that do a vast amount of business with the U.S. government. We are all businesspeople and we all want to keep our customers happy and the U.S. government is one very big customer.