Tuesday, June 26, 2018

Trump Nationalizes Harley-Davidson

President Trump has started a trade war in recent days.  He's imposed tariffs on imports that have been rejoined with countertariffs on American goods.  Among the ripostes delivered to Trump's tariffs have been countertariffs from the EU.  The EU measures led Harley-Davidson, the Milwaukee-based maker of iconic motorcycles, to announce that it would shift some production overseas.

President Trump did not take kindly to this news.  He declared in a tweet, "A Harley-Davidson should never be built in another country--never!"  Then he stated that if Harley-Davidson shifted production overseas, "they will be taxed like never before."  (See https://www.cnbc.com/2018/06/26/trump-says-harley-davidson-using-trade-tensions-as-an-excuse.html.)  Trump seems to be saying that he would impose stiff tariffs on Harleys made overseas when they are imported into the U.S.

Trump's message is clear:  don't move production overseas.  He is, in effect, trying to usurp the authority of Harley's management and board of directors to run the company and make decisions that they believe to be in the best interests of the company and its shareholders.  When the government takes control of a company, that's nationalization.  While Trump isn't trying make all the decisions for management; most likely, it's still up to them what brand of coffee to provide in the employee lounge and which employees get reserved parking spots.  But when it comes to crucial matters that could affect the survival of the company, Trump evidently has an office in the executive suite, and it may be the biggest corner office.

The notion of a Republican President dictating to a private corporation how to run its business is bizarre.  There was once a time when the Republican Party stood for the principles of free enterprise and the private ownership of property.  But no more.  America's businesses now seem to have a new purpose:  to make President Trump look good.  And they had better do it well or they evidently will be taxed like never before.

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