This may well be a foretaste of things to come. Even as their team gets ready to take office, the US President and Vice-President elect have convinced Carrier Corp., the heating and air-conditioning company, to reverse course. Carrier was intending to move a manufacturing plant to Mexico for saving costs resulting in a loss of about 1,000 jobs when the President-elect’s team convinced them to remain in the US, saving all those jobs. Hurrah, Superman can go back into the phone booth and change!

The residents of Indiana should be happy that they did the right thing by voting for the Republican ticket. Mike Pence, the Vice-President-elect who is currently governor of Indiana, must be proud that he has delivered.

The papers tell us that the details of the incentives given to the company will be revealed very soon. We shall wait for it with bated breath. But we need to keep the economists away for that grouchy lot have always complained about the distorting effects of such incentives. Surveys of executives have shown that they give a lower priority to such incentives as compared to labour force, transportation and business climate factors. Other studies show that tax incentives may be okay to rectify market failures, and at best help in recovering investment costs. Otherwise, the effect of incentives to attract or retain investment is generally inconclusive.

Perhaps the Trump administration can be given the WTO help line number to call and find out if these incentives would be considered subsidies, making a challenge likely in case of exports by Carrier. Or we could refer the administration to the on-going Apple Corp. dispute with the EU on the attractive tax advantages it inveigled out of Ireland. The EU wants the money back.

Non-economic distortions also abound due to such policies. Ad hoc and individualised deals may make other large employers wonder if they have to first announce a move out of the country, and then wait for a call from the White House dangling carrots for them to remain.

Recall the game China would play with the US before it joined the WTO to ensure renewal of the Most Favoured Nation status? It would arrest a prominent human rights activist before the renewal date, the US would be upset and call on China to release said person, negotiations would begin, and the US would successfully obtain the release of the activist in return for renewal of the MFN status!

The Pew Global Attitudes Project in a survey in 2003 across 44 countries found that generally most people like globalisation, including its manifestations of trade, finance, travel, communication, and culture. Support for free markets was higher at that time in the high income countries.

I‘m sure a similar survey done now will show less support for trade in the developed world. But people are conflicted when it comes to such choices. For instance, in 2003, although people supported free markets, they did not want large inefficient enterprises to shut down due to loss of jobs.

This is why we elect leaders who have a vision for the future, and expect them to tell us the bad news and guide us down a difficult path to a better future. The variety we seem to have elected in the US would prefer to give us fish today than teach us how to fish.

The writer is a professor at Suffolk University, Boston

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