Trump’s corporate takeover: from Foxconn to Healthcare

Ever since Trump had entered the White House, he has done a 180 on a lot of promises: cutting social security and medicare, prolonging the war in Afghanistan, not providing health care coverage for all, flipping a middle finger to LGBT rights, increasing defense spending while cutting virtually every other government department to tackle the conservative demon that is ‘regulation’ and so on.

But from all his big words and famous statements: ‘build the wall’, ‘crooked Hillary’ and so forth, one quote comes to mind: ‘drain the swamp’.

7 months later, his cosy relationship to big business elites and CEO’s could not be anymore comfortable. From his ‘attempts’ to fight big pharma, cutting back Obama-era climate policies to serve the fossil fuel industry and to signing a $110 billion arms deal with Saudi Arabia, it’s clear at this stage he isn’t draining the swamp, but adding toxic waste to it. One place in particular he flaunts his establishment colors however is the classic staple of Reaganomics: tax giveaways.

Around a month ago, Donald Trump and Foxconn (worlds largest contract electronics manufacturer) CEO Terry Gou announced a $10 billion deal over 4 years that would bring an LCD production plant to Wisconsin in an effort to boost jobs. The Wisconsin state assembly voted 59–30 to approve it, and will now move forward to a state senate vote sometime soon. The deadline for the vote is September 30th.

It sounds good on paper; Trump after all promised to bring manufacturing industries back to America and make them stay there (and Foxconn does make parts for Apple), and it is estimated to create between 3,000–13,000 jobs. But there’s a catch.

The Wisconsin taxpayer would have to give out $3 billion in tax subsidies to Mr.Gou.

The subsidy package was negotiated by Wisconsin Governor Scott Walker. The subsidy itself according to the Chicago Tribune includes:

“…tax credits based on jobs created and capital investment, exemptions from environmental regulations and exemptions from state and local sale taxes on construction materials.”

And if you want to do a bit of quick math, Wisconsinites will essentially be paying at least $200,000 for a single job if the deal passes the senate. Furthermore, according to the Washington Post which examined the legislative analysis of the project, it will take 25 years to break even.

To add insult to injury, Illinois has a higher unemployment rate, and it’s a neighboring state. I’ll leave the rest to your imagination.

This whole shady deal, promoted by Trump as some kind of victory for rust belt America, is just a tax giveaway designed to be a jobs booster, but is in reality nothing more than corporate welfare at its finest. Trump virtually cut every departmental budget this year, yet somehow we do have the money for a $3 billion tax break for a jobs deal that may not even pan out. As you’ll begin to see however, tax breaks are Trump’s answer to most things in life.

As the Trump administration are desperately trying to get rid of Obamacare and replace it with Trumpcare, you may be forgiven in thinking that Trump is just, passionate, about healthcare. You gotta give it to the Republicans in some way, they really are persistent. But an article by Robert Reich (served in several administrations, including being the secretary of labor under Bill Clinton) in the Guardian indicates that this whole 8 year ‘healthcare’ tirade has been nothing more than battle to get tax cuts for the 1%.

“America’s wealthiest taxpayers (earning more than $200,000 a year, $250,000 for couples) would get a tax cut totaling $346bn over 10 years, representing what they save from no longer financing healthcare for lower-income Americans.

That’s not all. The bill would save an additional $400bn on Medicaid, which Mitch McConnell, Paul Ryan, and Donald Trump are intent on shrinking in order to cut even more taxes for the wealthy and for big corporations.

If enacted, it would be the largest single transfer of wealth to the rich from the middle class and poor in American history.

Trump also spoke of the need for massive infrastructure spending during his campaign, saying we need much more than what Clinton was offering (double in fact). However, instead of the federal government funding the roads, bridges, schools and more, it will largely be in the hands of private contractors.

As the article from Business Insider states: “Interestingly enough, the plan does not call for tax increases to finance the projects. A tax credit would be offered to private companies to finance projects, while the companies would also have to take equity investments in the projects. According to Yahoo Finance, $167 billion of the $1 trillion investment would be equity investment, while the rest would be debt raised by private partners.

Additionally, all projects built under the plan would be required to generate cash flow, like toll roads or airports that produce tax revenue instead of free parks or highways without tolls. The equity investment partners would also take the revenue, essentially privatizing much of the new infrastructure and making riskier investments more palatable.”

To put this into context of a hostile corporate takeover, the utilities and infrastructure we pay taxes to fund and thus help each other with, will now be owned by private enterprise. They exist for one purpose: profit. So expect repeated tolls or even shoddier airport service (as if it is not bad enough already). But this is Trump, so naturally there will be a tax incentive lying around in this plan.

According to an article penned by none other than Bernie Sanders in commondreams.org, he states that his plan would create tax loopholes for wealthy investors, and rewards businesses for hiding their profits overseas with huge tax cuts:

“Private equity financing is markedly more expensive than traditional government financing, however — by as much as three to six times. Considering the scale of infrastructure development under consideration, that difference could be enormous. For example: the charge for a $100 million-dollar investment using traditional government bond financing (at 3 percent, over 30 years) is about $90 million. For private equity capital, at a 15 percent return, the total skyrockets to $450 million.”

For example, in Chicago, a private investor group led by Morgan Stanley will collect $11 billion as part of its 75-year contract to run the city’s parking meters. Not only have they raised parking prices by as much as 800 percent in some neighborhoods but incredibly, the city has been forced to pay $31 million and counting to cover lost revenue whenever a street is temporarily closed for maintenance. Chicago is already struggling with high crime and unfunded teachers’ pensions, yet it is diverting resources to pad the bottom line of these investors.

So while millions struggle with insurmountable student debt costs, minimum wage workers barely getting enough (especially many rust belt states who genuinely earn the bare minimum) to get by, the gap between the rich and poor growing ever wider, we have a president who has never had any intention of draining any swamp and making Washington work for us. This was a long-term scheme in the making to make America one giant tax loophole.

In a CNN article by Jeffrey Sachs, who is a university professor and director of the Center for Sustainable Development at Columbia University, he does a very good analysis of the overall Republican tax giveaway lottery. In it, he writes:

“There is indeed no case whatsoever for reducing the personal income tax rates on high-income Americans. The richest Americans are already enjoying an era of unprecedented wealth and prosperity. Their tax revenues and more are needed to fund the federal government…"

The simple fact is that the billionaires who steer the Republican Party, including the Koch Brothers, Robert Mercer, Sheldon Adelson, and of course Donald Trump, are not thinking about the country’s needs, but only about their own insatiable greed.”

Americans have had to tolerate decades of a political establishment disregarding the policy ideals they wish to see enacted across the country, and being ignored and left behind by an elitist media class that is inherently fixated on breaking news stories as a poor substitute for true investigative journalism and covering issues that accurately resonate with the average working class citizen. For the first time ever, millions of people believed they were finally going to get a president that was going to overthrow an elitist superstructure.

7 months later, the message is clear: Trump could not be anymore of an establishment Republican if he tried.

#DonaldTrump