Angry over cutbacks, Trump threatens to end subsidies to GM

President Donald Trump tested the limits of his presidential authority and political muscle as he threatened Tuesday to cut off all federal subsidies to General Motors because of its planned massive cutbacks in the U.S.

Posted: Nov 27, 2018 9:43 PM

WASHINGTON (AP) — President Donald Trump tested the limits of his presidential authority and political muscle as he threatened Tuesday to cut off all federal subsidies to General Motors because of its planned massive cutbacks in the U.S.

Trump unloaded on Twitter a day after GM announced it would shutter five plants and slash 14,000 jobs in North America. Many of the job cuts would affect the Midwest, the politically crucial region where the president promised a manufacturing rebirth. It was the latest example of the president’s willingness to attempt to meddle in the affairs of private companies and to threaten the use of government power to try to force their business decisions.

“Very disappointed with General Motors and their CEO, Mary Barra, for closing plants in Ohio, Michigan and Maryland” while sparing plants in Mexico & China, Trump tweeted, adding: “The U.S. saved General Motors, and this is the THANKS we get!”

Trump’s tweets followed a short time after National Economic Council Director Larry Kudlow said the White House’s reaction to the automaker’s announcement was “a tremendous amount of disappointment, maybe even spilling over into anger.” Kudlow, who met with Barra on Monday, said Trump felt betrayed by GM.

“Look, we made this deal, we’ve worked with you along the way, we’ve done other things with mileage standards, for example, and other related regulations,” Kudlow said, referencing the recently negotiated U.S.-Mexico-Canada trade agreement. “We’ve done this to help you and I think his disappointment is, it seems like they kind of turned their back on him.”

The White House rebuke appears to fly in the face of long-held Republican opposition to picking winners and losers in the marketplace. A day earlier, Trump issued a vague threat to GM warning it to preserve a key plant in the presidential bellwether state of Ohio, where the company has marked its Lordstown plant for closure.

“That’s Ohio, and you better get back in there soon,” he said.

It’s not clear precisely what action against GM might be taken, or when, and there are questions about whether the president has the authority to act without congressional approval.

Buyers of electric vehicles made by GM and other automakers get federal tax credits of up to $7,500, helping to reduce the price as an incentive to get more of the zero-emissions vehicles on the road. But GM is on the cusp of reaching its subsidy limit.

White House press secretary Sarah Huckabee Sanders said she did not have any additional information on the president’s threat.

Trump has long promised to return manufacturing jobs to the United States and particularly the Midwest. At a rally near GM’s Lordstown plant last summer, Trump told people not to sell their homes because the jobs are “all coming back.”

In a statement Tuesday afternoon, GM tried to appease the Trump administration while at the same time justifying the decisions it announced Monday. “We appreciate the actions this administration has taken on behalf of industry to improve the overall competitiveness of U.S. manufacturing,” the statement said.

Many of the workers who will lose jobs if the plants close could transfer to another GM factory where production is being increased, spokesman Patrick Morrissey said. For instance, GM plans to add hundreds of workers at its pickup truck assembly plant in Flint, Michigan, Morrissey said. Workers also will be added at an SUV factory in Arlington, Texas.

But those expansions aren’t enough to accommodate all of the roughly 3,300 U.S. factory workers who could lose their jobs.

GM said it has invested more than $22 billion in U.S. operations since 2009, when it exited bankruptcy protection.

Trump has made direct negotiation with business leaders a centerpiece of his administration, including talks with defense contractor CEOs on bringing down prices on new systems, including the upcoming replacement to the aircraft that serves as Air Force One. He has never been shy about voicing his frustration with their decisions.

But Trump’s deal-making image is far from flawless. Three weeks after his election, Trump traveled to Indianapolis to announce a tax-incentive agreement partially reversing the closure of a Carrier factory, which was set to close, cutting about 1,400 production jobs.

Trump frequently criticized the closure plans during the 2016 campaign, and promised to prevent similar occurrences in the future. Under that deal, Carrier pledged to keep nearly 1,100 jobs in Indianapolis, including some 800 furnace production jobs it planned to cut with outsourcing. But about 550 jobs were still eliminated at the plant.

GM’s attempt to close the factories still has to be negotiated with the United Auto Workers union, which has promised to fight them legally and in collective bargaining.

The factory announcements likely represented GM’s opening bid in contract talks with the union that start next year, said Kristen Dziczek, vice president of labor and industry with the Center for Automotive Research, an industry think tank in Ann Arbor, Michigan. The factories slated for closure could get new products in exchange for items the company wants from the union, she said.

Keeping open a plant slated for closure is not without precedent for GM. In 2009, for instance, GM announced that it intended to close a huge assembly plant in Orion Township, Michigan, north of Detroit. But it later negotiated concessions from the union and reopened the plant to build the Chevrolet Sonic subcompact car. The factory is still in operation and now builds the Sonic and the Bolt electric car.

The reductions could amount to as much as 8 percent of GM’s global workforce of 180,000 employees.

The restructuring reflects changing North American auto markets as manufacturers continue to shift away from cars toward SUVs and trucks. In October, almost 65 percent of new vehicles sold in the U.S. were trucks or SUVs. That figure was about 50 percent cars just five years ago.

Jerry Dias, president of the Canadian trade union UNIFOR, said Tuesday that GM’s CEO had insulted the president of the United States and prime minister of Canada.

“If you are going to have a company that’s going to show us their middle finger then I think our government should show them our middle finger as well,” Dias said.

___

Lemire reported from New York. Associated Press writers Tom Krisher in Detroit, Rob Gillies in Toronto and Jill Colvin in Washington contributed reporting.

___

Follow Lemire on Twitter at http://twitter.com/@JonLemire and Miller at http://twitter.com/@zekejmiller

___

This story has been corrected to show Kudlow said, “It seems like they kind of turned their back on him,” not “It seems like that they kind of turned his back on him.”

Trending on AP News
The Latest: GM to slash 14,700 jobs in North America
AP FACT CHECK: Trump's false equivalence on migrant policy
Man charged in white nationalist rally to argue self-defense
by Taboola

Terre Haute
Clear
71° wxIcon
Hi: 75° Lo: 45°
Feels Like: 71°
Robinson
Clear
71° wxIcon
Hi: 73° Lo: 42°
Feels Like: 71°
Indianapolis
Few Clouds
68° wxIcon
Hi: 73° Lo: 46°
Feels Like: 68°
Rockville
Clear
70° wxIcon
Hi: 73° Lo: 45°
Feels Like: 70°
Casey
Clear
70° wxIcon
Hi: 73° Lo: 44°
Feels Like: 70°
Brazil
Clear
71° wxIcon
Hi: 74° Lo: 45°
Feels Like: 71°
Marshall
Clear
71° wxIcon
Hi: 73° Lo: 43°
Feels Like: 71°
Sunshine and pleasant for your Sunday
WTHI Planner
WTHI Temps
WTHI Radar

Latest Video

Image

Sunday Morning Forecast Update

Image

Paris Tigers Let Us Play Movement

Image

Girls Golf Sectionals

Image

Humane society in need of help, fundraiser makes a dent

Image

First responders honored at annual event

Image

Family speaks after guilty verdict

Image

A family in Orange Beach, Alabama rode out and survived Hurricane Sally only then to have their hou

Image

Saturday Morning Forecast Update

Image

PIke Central vs Washington 9-18-20

Image

Linton vs Booneville ITZ 9-18-20

WTHI Events

 

Illinois Coronavirus Cases

(Widget updates once daily at 7 p.m. CT)

Confirmed Cases: 275041

Reported Deaths: 8672
CountyConfirmedDeaths
Cook1385765157
DuPage16622550
Lake16285484
Will13330372
Kane12554325
St. Clair6239183
Madison5291130
Winnebago5218149
McHenry4385118
Champaign432020
Peoria317448
McLean312019
Rock Island277171
Kankakee263176
Unassigned2241236
Sangamon222244
Kendall187925
LaSalle159055
Tazewell153818
DeKalb142438
Macon135836
Coles134228
Williamson129634
Jackson122524
Clinton105120
Boone101223
Adams97110
Randolph91111
Effingham8091
Whiteside67619
Grundy6255
Monroe62515
Ogle6196
Henry6145
Morgan61221
Vermilion5884
Knox5813
Bureau56711
Jefferson55537
Union49524
Marion4910
Macoupin4867
Franklin4772
Stephenson4616
McDonough44415
Logan4281
Christian42710
Woodford3865
Cass38011
Jersey37813
Crawford3481
Iroquois34819
Shelby3454
Perry33214
Lee3251
Montgomery31813
Livingston3125
Fayette3063
Warren3002
Bond2864
Douglas2735
Saline2453
Lawrence2422
Wayne2405
Jo Daviess2352
Greene2075
Moultrie2073
Carroll2044
Cumberland1934
Jasper1929
Washington1891
Hancock1833
Pulaski1561
White1560
Clark1462
Fulton1440
Johnson1440
Richland1444
Clay1380
Wabash1371
Piatt1290
Mercer1275
Mason1221
Menard1150
Edgar1097
Pike1081
De Witt971
Ford944
Massac932
Marshall920
Alexander691
Gallatin682
Scott670
Hamilton650
Henderson620
Edwards600
Stark502
Schuyler440
Putnam420
Brown360
Calhoun350
Hardin340
Pope261
Out of IL20

Indiana Coronavirus Cases

(Widget updates once daily at 8 p.m. ET)

Confirmed Cases: 110759

Reported Deaths: 3503
CountyConfirmedDeaths
Marion20645758
Lake10172317
Elkhart6321108
St. Joseph600797
Allen5921200
Hamilton4646109
Vanderburgh327129
Hendricks2638121
Monroe236836
Johnson2250122
Tippecanoe218413
Clark210156
Porter203344
Cass19279
Delaware184261
Vigo175722
Madison156575
LaPorte135637
Floyd130061
Howard127063
Kosciusko118717
Bartholomew114557
Warrick111935
Marshall98024
Boone94446
Dubois94018
Hancock90042
Noble87632
Grant86733
Henry75424
Wayne73714
Jackson7319
Morgan69438
Shelby66329
Daviess63927
LaGrange62911
Dearborn62128
Clinton59112
Harrison55624
Putnam5209
Montgomery50221
Lawrence50028
White47814
Knox4769
Gibson4644
Decatur45339
DeKalb44211
Miami4223
Fayette41713
Greene41535
Jasper3802
Steuben3647
Scott35310
Sullivan32812
Jennings30812
Posey2940
Franklin29325
Clay2925
Orange28224
Ripley2788
Carroll26913
Wabash2608
Washington2571
Starke2487
Wells2472
Whitley2476
Adams2403
Jefferson2403
Fulton2302
Huntington2173
Spencer2154
Tipton21522
Randolph2067
Perry20213
Newton17011
Jay1680
Owen1641
Martin1590
Rush1494
Pike1361
Vermillion1250
Fountain1152
Blackford1142
Pulaski1131
Crawford1020
Brown1013
Parke932
Benton880
Union770
Ohio767
Switzerland680
Warren401
Unassigned0225