Recently, there has been a lot of reaction to the news that Carrier has decided to keep its plant open in Indiana, saving 1,000 jobs in the process. This was a hot button issue during the Presidential Election as Donald Trump threatened to go after Carrier and other companies who send American jobs overseas. With the combination of Trump's word on creating a better business environment and state incentives, Carrier decided to keep the plant in the United States.
We have studied how governments can play a huge role in the business environment. They can create barriers to entry through massive regulations, subsidies, etc. as well as create hostile business environments through excessive taxation.
Questions:
1. Is it appropriate for the government, or in this case President-Elect Trump, to threaten and coerce U.S. companies to engage in certain actions? Why or why not?
2. If there should be limits on the type of actions the government can take, what are they?
3. As of now, President-Elect Trump's threat worked and saved 1,000 jobs. But according to many economists and journalists (including the WSJ journalist below), imposing tariffs on other countries' goods will only drive up prices and hurt our economy overall. Do you agree with this sentiment? Why or why not?
Link/ article:
Carrier to Stay in USA article: https://finance.yahoo.com/news/carrier-gets-state-incentives-trump-020708937.html
Tariffs are a Bad Idea article: https://www.wsj.com/articles/donald-trumps-tariff-party-1467240379
Read the articles provided above. Answer all the above questions in at least 1-page. No introduction or conclusion needed. Directly answer all the questions.