Deere takes its turn on Donald Trump's stage
Ex-president's tariff threats fit a pattern.
Donald Trump has suddenly found a new cause: John Deere workers.
They now join the proud ranks of the people of Indianapolis, Indiana; Lordstown, Ohio; and Burlington, Iowa. All places where Trump made bold promises to save American jobs.
All places where his promises failed miserably.
This week, a month and a half before the election, Trump launched a specific new campaign promise to save American jobs: He said, if elected, he would impose a 200% tariff on Deere & Co. products coming from outside the US if it proceeds with plans to move some of its production to Mexico.
Trump likes to promise workers he’ll save them from corporate America. He’s been doing it for years.
In Lordstown, where an automobile factory planned to close, he picked it up as a campaign issue in 2016, and later told the workers that “all” their jobs were coming back. “Don’t move. Don’t sell your house,” Trump implored in 2017. He failed them. The Lordstown plant closed, and the automaker that was running the place declared bankruptcy. (Now, an electric vehicle plant has opened, and the union there is praising the Biden administration for its efforts to turn things around.)
In Indianapolis, during the 2016 campaign, Trump criticized the owners of Carrier furnace for planning to move production to Mexico and eliminate 1,400 jobs. After being elected, Trump came back with his typical over-the-top promises. “These companies aren’t going to be leaving anymore,” he said. “They’re not going to be taking people’s hearts out.” Armed with millions of dollars in state incentives, Trump announced a deal to save the plant. But with a sharply reduced number of jobs.
“Four years later,” the Indianapolis Star reported, “the hulking factory on the city's west side remains an apt symbol for the status of the nation's manufacturing sector, though not one Trump talks much about on the campaign trail anymore.” The manufacturing jobs lost in the state to foreign countries during Trump’s term dwarfed those that stayed at Carrier, the Star said in 2020.
In Burlington, where Trump campaigned before the 2016 Iowa caucuses, boldly promising he’d transform the country, workers told him in 2018 they needed his help when the German-owned Siemens factory was planning to close. Workers begged Trump, then the president, to step in. He did not. As the leader of the local union wrote in the Des Moines Register: “Instead, Siemens is being rewarded for sending our jobs to foreign workers with nearly $550 million in lucrative contracts from the Trump administration. Siemens is raking in profits thanks to our hard-earned taxpayer dollars.”
Now, we’re in the midst of another campaign, and it’s Deere’s turn to get used by Trump.
Deere & Co. isn’t likely to gain much sympathy in this fight. The company has laid off hundreds of workers, including in the Quad-Cities. In June, it also announced it was relocating some of its production in Dubuque to Mexico, which Deere said it expected to complete by the end of 2026.
Ever alert to a political opportunity, Trump made his tariff pitch in dramatic fashion Monday. He said Deere announced only “a few days ago” it planned to move “a lot of their manufacturing business” to Mexico, and that he was going to intervene in order to stop it from happening.
What a crock.
This didn’t just happen. The company said more than two years ago it was transferring tractor cab production from Waterloo to Mexico in order to balance workforce needs and open up space for new products in Iowa. The Dubuque announcement was in June. Meanwhile, Deere says only 4% of its US sales are manufactured in Mexico.
That is not “a lot of their manufacturing business.”
Besides, if this is such a big deal, why didn’t the former president say something about it back in 2022?
It's not like he hasn't been to Iowa plenty of times over the past two years.
Why, six weeks before the general election, are Deere workers suddenly so important?
Trump didn’t even announce his tariff threat in Iowa, where Deere workers are losing their jobs. He did it in swing-state Pennsylvania, which not coincidentally, is where his political fortunes lie.
If Trump follows through with this plan, Iowans will undoubtedly be hurt more than helped.
The reasons are apparent.
Tariffs, by design, raise the price of imported goods. They are taxes paid by US importers, who then pass those costs along until they get to consumers. Trump has falsely claimed for years that it is foreign countries that pay these taxes, but reputable economists and tax experts have made it clear: Tariffs impose costs on buyers, not on sellers.
It is true, some economists complain that critics of tariffs don’t get the big picture and discount the value of domestic production. But in the case of Deere, it seems doubtful a company with a presence in Mexico since 1952 would just reverse course now.
No, what probably would happen if Trump got elected and followed through with his plan is Deere’s prices would go up. Farmers and consumers would then get stuck with the added costs.
As Peter Orazem, an economist at Iowa State University, told a TV station, “the consumer loses, and the company loses.”
In this scenario, there would be only one winner: Donald Trump.
That is no coincidence.
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Appreciate your reminders of Trump’s past job-saving promises that he never lived up to keeping!
Deere's already renovated and retooled its main Waterloo tractor assembly plant -- a massive capital investment. It's a little late to turn back the clock with a tariff even if that was a good idea. Deere's also outsourcing non-factory jobs. Not sure how a tariff will help those folks. The hope is that a big new tractor coming out of Waterloo will offset at least some of the job loss. Maintaining profitability and shareholder value is the bottom line. But many employees are shareholders too.