Free Markets

Vice President-Elect Mike Pence on the Carrier Deal: 'The Free Market Has Been Sorting It Out and America's Been Losing.'

The GOP drops the pretense of being a free-market party.


Mark Lyons / Newscom

At the tail end of 2008, Mike Pence, then a Republican congressman from Indiana, appeared on Fox News to state his strong personal opposition to a bailout to the Detroit auto industry. "As the American people know," he said, "we can't borrow and spend and bail our way back to a growing economy or a healthy domestic automotive industry." At the same time, he also declared his opposition to the Troubled Asset Relief Program that came in the wake of the financial crisis, writing a letter to congressional colleagues insisting that government should not intervene to protect businesses from failure. "We now have a deal that promises to bring near-term stability to our financial turmoil, but at what price?" he wrote. "Economic freedom means the freedom to succeed and the freedom to fail." On Fox, Pence stressed not only his own opposition, but the large number of Republican legislators who stood unified in opposition to the deal. He was acting as a representative of the party's stance.

In the years since, Pence appears to have changed his mind.

At a press conference yesterday Pence, now the governor of Indiana and the Vice President elect, announced that he and President elect Trump had brokered a deal with air-conditioning maker Carrier to keep about 800 jobs in the United States that had previously been set to go to Mexico. In exchange for keeping some jobs in the U.S., Carrier would receive $7 million in incentives from the state of Indiana.

At the conference, Pence defended the arrangement by declaring that "the free market has been sorting it out and America's been losing." After which, according to The New York Times, President-elect Donald Trump cut in to agree, saying, "Every time, every time."

Trump's enthusiastic dismissal of free market mechanisms should come as little surprise. As a businessman, he built his real estate empire on crony capitalist dealmaking, repeatedly urging government officials to give him special treatment so that his own projects would succeed. On the presidential campaign trail, he was frequently disdainful of the free movement of goods and workers across borders.

But the statement from Pence, who is the Trump administration's closest link to conventional Republican politics, should be taken as a declaration of intent for the GOP as a political institution. Although Republicans have frequently and sometimes flagrantly acted in opposition to basic free market principles, the party has typically maintained a surface pretense of adhering to a pro-market understanding of the world. The GOP wasn't exactly a free-market party, but it often pretended to be.

Even President George W. Bush, when announcing his administration's response to the financial crisis, framed his lack of orthodoxy as an exception necessary to uphold the larger idea, saying that he has "abandoned free-market principles to save the free market system." Even a break from free-market ideas had to be framed as a defense of free-market philosophy.

In announcing the Carrier deal, Pence has made it clear that the party has abandoned free-market principles, period. Under Trump, the GOP has dropped the pretense.