The U.S. Carrier factory where President Donald Trump says he saved 800 jobs from moving to Mexico notified 300 people last week that they were being laid off.

The layoff notices began Thursday, exactly six months since Trump took office. The layoffs are part of a deal Trump made with the company in December to prevent deeper cuts at the Indianapolis plant.

The layoffs are the first of a group of 630 job terminations planned for the year as the company moves some of its operations to Mexico. Carrier – owned by United Technologies Company (UTC) – announced in December that its fan coil department would relocate to Mexico by the end of 2017.

WATCH: Despite Trump’s efforts, Indiana Carrier lays off employees

The Carrier plant, which makes gas furnaces, became an issue in last year’s presidential election when UTC announced plans to eliminate about 2,100 jobs in the state and transfer those operations to Mexico. As a presidential candidate, Trump roundly criticized that decision.

After winning the election, Trump worked out a deal with his vice president-elect, Mike Pence, who was then the governor of Indiana, to provide as much as $7 million in tax incentives and training grants for Carrier in exchange for keeping about 700 of those jobs in the state.

In a letter sent to the Indiana Department of Workforce Development in May, a human resources manager for Carrier said, “While the entire facility is not closing, the separations are expected to be permanent.”

In addition, UTC is expected to lay off an additional 700 workers at factories in the town of Huntington, Indiana, near the city of Fort Wayne.

However, Carrier has also said it will honor its commitment, made in 2016, to employ about 1,100 people in Indianapolis.

Robert James, head of the United Steelworks Local 1099, the Carrier workers’ local union, told VOA the union is trying to negotiate retirement incentives and “voluntary separation” incentives, or buyouts, for the workers to cut down the number of actual job losses.

During the 2016 presidential election campaign, James was most concerned about job security. When he spoke to VOA in April of 2016, he was expecting to lose his job when Carrier moved the work to Mexico.

A lot has happened since.

“We appreciate what President Trump did,” James said at the time, referring to Trump’s efforts to keep the Carrier facility open and employing workers in Indianapolis making furnaces.

Uncertainties

While a lot of positive developments have happened since VOA last spoke to James, he recently said a cloud of uncertainty still hangs above the facility.

“What we saw in December when President Trump came to Carrier … it was a dog and pony show.” Because only some, not all, of the jobs were saved, he added.

“He stood up there before 100 people who were in that room and told those 100 workers that there were 1,100 jobs being saved. And he was wrong,” James said.

According to James, only 730 are slated to stay in Indiana.

Mohan Tatikonda, a professor of Operations Management at the Kelly School of Business at Indiana University, said most factories like Carrier “have already moved.”

Tatikonda said lower-skill jobs such as those at Carrier naturally flow to a lower-wage environment, eventually.

“We can be happy – it [[saving some jobs]] made a difference for so many families, but it wasn’t a lasting solution, and it is not a solution that is in any way replicable or applicable to other factories,” Tatikonda said.

While James’ job at the plant is secure, for now, he is focused on helping those who are leaving this year to look for other work, including “some the same age as I am that is going to make it a lot harder. Because when you are in your 50s, trying to look for a job – that’s not a good thing,” he added.

Earlier this year, Trump tweeted twice about former union leader Chuck Jones after Jones criticized the deal. Trump said Jones had done a “terrible job” negotiating for the workers and suggesting that he “spend more time working.”

Jones has since retired.

Carrier said the employees who lose their jobs will get severance pay. It says at least 30 people are taking advantage of educational funding offered by Carrier.

VOA’s Kane Farabaugh contributed to this report.
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The United States and Britain are launching preliminary talks in Washington on a trade deal that will set up a new trade relationship between the two countries, after Britain’s exit from the European Union. Britain hopes removing barriers under its current EU arrangement will boost trade with the United States by $40 billion by 2030. But as VOA Europe correspondent Luis Ramirez reports from London, no one is expecting these to be easy negotiations.
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The Federal Reserve has already achieved one of its two mandates: With the unemployment rate at just 4.4 percent, the Fed has essentially maximized employment.

 

It’s the Fed’s other goal — price stability — that’s stayed persistently out of reach. Inflation has been edging further below the Fed’s 2 percent target. Problem is, too-low inflation tends to slow consumer spending, the U.S. economy’s main fuel. Many consumers delay purchases if they think the same price — or a lower one — will be available later.

 

Low inflation will likely be a key discussion point when the Fed holds its latest policy meeting this week. The central bank has raised its benchmark interest rate twice this year, but no one expects another hike when its meeting ends Wednesday. And unless inflation picks up, some analysts foresee no further rate increase this year.

 

Fed Chair Janet Yellen deepened the uncertainty earlier this month when she sounded less sure about her position that a slowdown in inflation this year was due to temporary factors.

Yellen conceded that Fed officials were puzzled by recent developments. Her remarks lifted financial markets as investors interpreted her words to suggest that the Fed might slow its pace of rate increases.

 

“In the past, Yellen was pretty confident that inflation would come back, but that is now in doubt,” said Sung Won Sohn, economics professor at California State University-Channel Islands.

 

Over the past 12 months, the inflation gauge the Fed monitors most closely has risen just 1.4 percent, according to the latest data. That’s down from a 1.9 percent year-over-year increase in January. In part, it’s why some economists say they suspect the Fed may be keeping its rate increases on hold, waiting to see if inflation in coming months rebounds from its current slowdown.

 

After leaving its key rate at a record low near zero for seven years after the financial crisis erupted in 2008, the Fed has raised it modestly four times — in December 2015, December 2016 and twice so far this year, in March and June. Even now, the rate remains historically low, in a range of 1 percent to 1.25 percent.

 

Months ago, the Fed had signaled its readiness to raise rates three times this year on the assumption that it needed to be more aggressive to ensure that consistently low unemployment didn’t contribute to high inflation later on.

 

In June, Yellen and other officials sought to explain away the unwelcome slip in inflation as a result of such onetime factors as a plunge in consumer cellphone charges and a dip in prescription drug prices.

 

But in delivering the Fed’s semiannual report to Congress this month, Yellen acknowledged some doubt. She described inflation as a “two-edge” problem, with the threat that prices could either rise too slowly or suddenly jump if a tight job market triggered wage pressures that stoked inflation.

 

Yellen didn’t rule out another rate increase this year. But investors have themselves grown more uncertain, with the CME Group’s closely watched gauge foreseeing a 47 percent chance of another rate increase by year’s end.

 

Diane Swonk, chief economist at DS Economics, said she still thinks the Fed will raise rates one more time this year — in December — but only if her forecast of a rebound in inflation comes true.

 

“I think we are going to get to a third rate hike this year, but it will be driven by the inflation data,” she said. “There is a real desire on the part of the Fed to hit the pause button until the haze clears and they can see more clearly what is happening.”

 

Mark Zandi, chief economist at Moody’s Analytics, said he believes the Fed will act again by December, in part because of concerns that stock prices and other asset prices have been lifted too high by investors who have become too optimistic about how long the Fed will delay its tightening of credit.

 

“The valuations in financial markets are very high right now,” Zandi said. “This has got to be making Fed officials nervous.”

 

Zandi also said he thought the Fed could provide details this week about its plans to start paring its enormous $4.5 trillion in holdings of Treasury and mortgage bonds, which it accumulated after the 2008 financial crisis in a drive to ease long-term borrowing rates.

Some say they think the Fed will begin in either September or October to begin shrinking those holdings, a move that is expected to put gradual upward pressure on long-term borrowing rates, including mortgages.

 

Eventually, Zandi predicted, as the job market strengthens further, the Fed will have to switch from worrying about inflation that is too low to inflation that will start to exceed its 2 percent target. He said he foresees three additional Fed rate increases next year.

 

 
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Lucy Harris thinks Britain’s decision to leave the European Union is a dream come true. Nick Hopkinson thinks it’s a nightmare.

The two Britons — a “leave” supporter and a “remainer” — represent the great divide in a country that stepped into the unknown just over a year ago, when British voters decided by 52 percent to 48 percent to end more than four decades of EU membership.

They are also as uncertain as the rest of the country about what Brexit will look like, and even when it will happen. Since the shock referendum result, work on negotiating the divorce from the EU has slowed to a crawl as the scale and complexity of the challenge becomes clearer.

Harris, founder of the pro-Brexit group Leavers of London, says she is hopeful, rather than confident, that Britain will really cut its ties with the EU.

“If we haven’t finalized it, then anything’s still up for grabs,” she said. “Everything is still to play for.”

She’s not the only Brexiteer, as those who support leaving the EU are called, to be concerned. After an election last month clipped the wings of Britain’s Conservative government, remainers are gaining in confidence.

“Since the general election I’ve been more optimistic that at least we’re headed toward soft Brexit, and hopefully we can reverse Brexit altogether,” said Hopkinson, chairman of pro-EU group London4Europe. “Obviously the government is toughing it out, showing a brave face. But I think its brittle attitude toward Brexit will break and snap.”

Many on both sides of the divide had assumed the picture would be clearer by now. But the road to Brexit has not run smoothly.

First the British government lost a Supreme Court battle over whether a vote in Parliament was needed to begin the Brexit process. Once the vote was held, and won, Prime Minister Theresa May’s Conservative government officially triggered the two-year countdown to exit, starting a race to untangle four decades of intertwined laws and regulations by March 2019.

Then, May called an early election in a bid to strengthen her hand in EU negotiations. Instead, voters stripped May’s Conservatives of their parliamentary majority, severely denting May’s authority — and her ability to hold together a party split between its pro-and anti-EU wings.

Since the June 8 election, government ministers have been at war, providing the media with a string of disparaging, anonymously sourced stories about one another. Much of the sniping has targeted Treasury chief Philip Hammond, the most senior minister in favor of a compromise “soft Brexit” to cushion the economic shock of leaving the bloc.

The result is a disunited British government and an increasingly impatient EU.

EU officials have slammed British proposals so far as vague and inadequate. The first substantive round of divorce talks in Brussels last week failed to produce a breakthrough, as the EU’s chief negotiator, Michel Barnier, said Britain must clarify its positions in key areas.

Barnier said “fundamental” differences remain on one of the biggest issues — the status of 3 million EU citizens living in Britain and 1 million U.K. nationals who reside in other European countries. A British proposal to grant permanent residency to Europeans in the U.K. was dismissed by the European Parliament as insufficient and burdensome.

There’s also a fight looming over the multibillion-euro bill that Britain must pay to meet previous commitments it made as an EU member. British Foreign Secretary Boris Johnson recently asserted the bloc could “go whistle” if it thought Britain would settle a big exit tab.

“I am not hearing any whistling. Just the clock ticking,” Barnier replied.

EU officials insist there can be no discussion of a future trade deal with Britain until “sufficient progress” has been made on citizens’ rights, the exit bill and the status of the Irish border.

“We don’t seem to be much further on now than we were just after the referendum,” said Tim Bale, professor of politics at Queen Mary University of London. “I’m not sure anybody knows just how this is going to go. I’m not sure the government has got its negotiating goals sorted. I’m not sure the EU really knows what [Britain’s goals] are either.

“I think we are going to find it very, very hard to meet this two-year deadline before we crash out.”

The prospect of tumbling out of the bloc — with its frictionless single market in goods and services — and into a world of tariffs and trade barriers has given Britain’s economy the jitters. The pound has lost more than 10 percent of its value against the dollar in the last year, economic growth has slowed and manufacturing output has begun to fall.

Employers’ organization the Confederation of British Industry says the uncertainty is threatening jobs. The group says to ease the pain, Britain should remain in the EU’s single market and customs union during a transitional period after Brexit.

That idea has support from many lawmakers, both Conservative and Labour, but could bring the wrath of pro-Brexit Conservatives down on the already shaky May government. That could trigger a party leadership challenge or even a new election — and more delays and chaos.

In the meantime, there is little sign the country has heeded May’s repeated calls to unite. A post-referendum spike in hate crimes against Europeans and others has subsided, but across the country families have fought and friendships have been strained over Brexit.

“It has created divisions that just weren’t there,” said Hopkinson, who calls the forces unleashed by Brexit a “nightmare.”

On that, he and Harris agree. Harris set up Leavers of London as a support group after finding her views out of synch with many others in her 20-something age group.

“I was fed up with being called a xenophobe,” she said. “You start this conversation and it gets really bad very quickly.”

She strongly believes Britain will be better off outside the EU. But, she predicts: “We’re in for a bumpy ride, both sides.”
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Authorities in Madrid asked Spain’s anti-trust watchdog on Saturday to investigate whether Uber’s new low-cost airport transfer service constitutes unfair competition.

The city council’s request follows the ride-hailing app’s return to the Spanish capital last year after the CNMC competition regulator called for the government to lift a ban on the U.S. company.

The firm’s recently launched Uber Airport service offers a tariff of 15-29 euros for a ride between Madrid’s Barajas international airport and the city center. Standard taxi fares for the trip are fixed at 30 euros.

“(Uber Airport) could violate several articles of the Law of Unfair Competition and consumer rights, if it is proven that the service is being operated at prices below operational costs and with the sole intention of gaining customers through unfair competition,” Madrid City Council said in statement.

No one at Uber could immediately be reached to comment.

European regulations

Uber, which expanded into Europe six years ago, has come under attack from established taxi companies and some EU countries because it is not bound by strict local licensing and safety rules that apply to some of its competitors.

Spanish taxi drivers have held three strikes so far this year, arguing that ride-hailing apps, which are regulated in Spain under VTC licenses typically used for private, chauffeur-driven vehicles, constitute unfair competition because they do not meet current regulations and pay less tax.

In May, the European Court of Justice (ECJ) dealt a blow to the company by ruling that it should be considered a transport service and not an app.
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The state government in India’s capital told Philip Morris International Inc and other tobacco companies Saturday to remove all advertisements from tobacco shops in the city, warning them of legal action if they do not comply.

The order, sent by Delhi state’s chief tobacco control officer S. K. Arora, comes days after Reuters reported that Philip Morris was promoting Marlboro cigarettes, the world’s best-selling brand, by advertising them at tobacco shops and distributing free cigarette samples. Government officials say such tactics flout the law.

The strategy was laid out in hundreds of pages of internal Philip Morris documents reviewed by Reuters that cover the period from 2009 to 2016. 

​Tobacco ads illegal

Indian officials have previously said tobacco advertising using brand names or promotional slogans is illegal under the country’s Cigarettes and Other Tobacco Products Act and its accompanying rules. But Philip Morris and India’s leading cigarette maker ITC Ltd say they comply with regulations and that the law allows advertising inside a kiosk.

Arora said the federal health ministry had told him that all brand advertisements, irrespective of where they were placed, were not allowed in the country.

Philip Morris and ITC did not immediately respond to requests for comment Saturday.

Tobacco companies have continued to advertise at sale points despite repeated warnings from the Delhi state government in recent years. Philip Morris has been paying a monthly fee to some tobacco vendors to display the company’s colorful advertisements, the Reuters investigation found.

Arora also told Reuters he “will investigate and conduct raids” to check on distribution of free cigarettes at social events. 

“If violations are found, action as per law will be taken,” Arora said.

Tobacco law enacted in 2003

India enacted its national tobacco control law in 2003 and has since added rules to strengthen it, but government officials say companies get away with violations because law enforcement is weak.

The federal health ministry Friday said it planned to seek an explanation from Philip Morris and other tobacco companies about their marketing practices following the Reuters investigation that was published earlier this week. 

Philip Morris and ITC did not respond to requests for comment.
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An Australian man who died in a Sydney car crash may be the 18th death linked to faulty Takata air bags, after police said he was killed when hit in the neck by shrapnel from an air bag.

Police did not say the air bag in the Honda CR-V was from manufacturer Takata, whose faulty air bags have been linked to 17 deaths and more than 180 injuries worldwide.

However, Honda Australia director Stephen Collins confirmed on Saturday that the vehicle involved was linked to the worldwide recall.

“The vehicle involved, a 2007 Honda CR-V, was the subject of Takata airbag inflator recalls,” Collins said in a statement, in which he offered the company’s condolences to the family of the dead driver. “Honda Australia is working closely with authorities to provide whatever assistance is required.”

Takata has declared 2.7 million vehicles to have potentially defective airbags.

Takata Corp filed for bankruptcy last month after being forced to recall around 100 million air bags worldwide, but that figure could be set to double pending an ultimatum set by U.S. regulators.

Dozens of models of vehicles and nearly 20 automakers have been affected by the air bag recalls, with Takata’s automaker customers having so far borne much of the estimated $10 billion cost of replacing the faulty products.

Some automakers still use Takata inflators for replacements in the recalls, although some including Honda Motor Co, Toyota Motor Corp and Nissan Motor Co have said they will stop using Takata inflators for new contracts for future models.
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