Battle lines

At what point does governmental prerogative to craft regulation devolve into bullying that forces the private sector into poor decisions?


Photo: AP
Photo: AP

First, there was US president-elect Donald Trump’s deal with air-conditioning and heating company Carrier to keep 1,000 manufacturing jobs—slated to move to Mexico—in Indianapolis. Then, he threatened to slap a heavy import tax on General Motors for cars manufactured south of the border. Hours after that, Ford cancelled plans for a Mexican plant and promised to set up production facilities in Michigan instead.

Trump is signalling that he means to follow through on his campaign trail rhetoric about bringing manufacturing jobs back to the US. His pick of Robert Lighthizer, whose protectionist credentials date back to the Ronald Reagan administration, as US trade representative drives home the point.

But at what point does governmental prerogative to craft regulation devolve into bullying that forces the private sector into poor decisions? And what shape will the blowback take? Mexico might not be able to push back, but China is in a different weight class, after all.

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