ADMINISTRATION WANTS COMPREHENSIVE IMMIGRATION REFORM
May 27, 2010 – NAM Capital BriefingPresident Obama met with Republican leaders this week to discuss immigration reform. With the goal of showing his dedication to border security, the President then deployed troops to the Mexico border to better intercept the flow of drugs and guns across the border. The Administration was clear that this effort is not in lieu of comprehensive reform and hopes to move toward that goal.
DEMS STRUGGLE TO PASS JOBLESS AID BILL
May 27, 2010 – Today in Manufacturing.net
House leaders hope to vote Thursday on bill to extend benefits, but they are running into opposition from some lawmakers concerned about overall cost... continue
ECONOMY GROWS AT SLOWER-THAN-EXPECTED PACE IN 1Q
May 27, 2010 – Today in Manufacturing.net
Economic rebound last quarter turned out to be slower than first thought, one of the reasons unemployment is likely to stay high this year... continue
EFFORTS TO RESTRICT EMPLOYER COMMUNICATIONS UNDERWAY
May 27, 2010 – NAM Capital BriefingThe Department of Labor has begun to pursue new regulations on how employers can obtain legal advice on complex labor law questions. Currently, employers who receive legal advice on basic labor law questions do not need to necessarily disclose the details of their activities. However, the Department is looking to expand the scope of employer activities required to be disclosed under current labor law, which will severely restrict employers’ free speech and place significant burdens on employers seeking to comply with existing laws. These efforts are further demonstration of the desire to enact the goals of the Employee Free Choice Act through federal rulemaking. The NAM participated in a stakeholder meeting with Labor Department officials this week to express our concerns with these efforts.
INCREASING MFG. JOBS THROUGH CLEAN ENERGY
May 27, 2010 – Late Wire from Manufacturing.net
Desperately in need of new jobs to help sustain our economy, the U.S. government has been pushing for advancement in the clean energy sector -- and with good reason ... continue
May 27, 2010 – Los Angeles Times
According to the LA Times, "Small businesses in California are being hit this year with double-digit hikes in health insurance costs that could hurt the state's economic recovery as companies curtail plans for hiring and expansion to pay their insurance bills. Five major insurers in California's small-business market are raising rates 12% to 23% for firms with fewer than 50 employees, according to a survey by The Times."
Similar increases are being felt by many small businesses across the nation; thought to be the result of escalating costs for medical care and pharmaceuticals. " The Times adds, "Economists and small-business advocates worry that insurance costs -- on top of taxes and rising wages -- will hamper the ability of small firms to expand and scare away new small companies."
JOBLESS CLAIMS FALL LESS THAN EXPECTED
May 27, 2010 – Today in Manufacturing.net
Applications for unemployment benefits fell by 14,000 to 460,000 last week, the Labor Department reported; analysts had expected the level would fall further to 455,000... continue
OBAMA ADVISER: MORE MUST BE DONE TO HELP ECONOMY
May 27, 2010 – Today in Manufacturing.net
Head of White House Council of Economic Advisers advocated further measures like fiscal relief for state and local governments and extension of unemployment benefits... continue
May 27, 2010 – Washington Post
In a speech in California, President Obama said "he would work to pass energy reform legislation this year, a push he called more urgent given the increased risks surrounding oil drilling in the Gulf of Mexico and other parts of the country." He said the spill "'only underscores the importance of developing' other sources of energy in the United States." He further stated that "the energy reform legislation he favors would help encourage that transition from fossil fuels to solar, wind and other types of power."
According to the Washington Post, "Obama used his appearance at Solyndra...to speak forcefully about the gulf spill and the lessons he said it has exposed about the perils of a fossil fuel-based economy."
SENATE PASSES FINANCIAL REFORM MEASURE
After weeks of intense debate, the U.S. Senate on May 20 passed its financial reform bill, the Wall Street Reform and Consumer Protection Act (H.R. 4173), which replaced the Restoring American Financial Stability Act (S. 3217). The 59-39 vote was largely along party lines, but four Republicans supported the measure while two Democrats broke ranks to oppose it. The legislation represents the most extensive overhaul of financial services regulation in decades and aims to prevent another financial crisis like the one that began in 2007. It could have a significant impact on manufacturers across the United States.
One of the most important aspects of the bill for manufacturers is its approach to the regulation of over-the-counter (OTC) derivatives. Manufacturers of all sizes use customized OTC derivatives to manage the risk of many day-to-day business operations, such as the price of commodities, interest rates and foreign exchange rates.
Throughout the debate, the National Association of Manufacturers (NAM) advocated for derivatives reform language that included a strong and clear exemption to protect responsible end-users from unnecessary government oversight. However, the exemption language in the Senate-passed bill, as well as that in the House version approved in December 2009, does not meet this test. In addition, other provisions in both bills could effectively eliminate the exemption for many companies and, in some cases, could impose capital and margin requirements or higher costs.
U.S. companies could lose millions, and in some cases, billions of dollars if a clear exemption is not included in the final text. Commercial end-users like manufacturers simply do not and cannot pose a systemic risk to the financial system because their transactions represent only 10-15 percent of all OTC derivatives transactions and are spread across tens of thousands of companies.
As the House and Senate move to reconcile their bills, the NAM will continue to urge lawmakers to explicitly exempt reliable end-users from the bill’s costly and onerous regulations and to remove provisions that would negate the exemption.
The NAM also is concerned about the Senate bill’s definition of companies covered by the systemic risk regulator. The bill that passed the Senate did, however, include an amendment authored by Sen. David Vitter (R-LA) and Sen. Mark Pryor (D-AR) clarifying that manufacturers would not be considered “nonbank financial companies” under the bill. This provision exempts manufacturers from the onerous oversight of the systemic risk regulator. Without this exemption, many manufacturers in the United States would have been forced to comply with new regulations, such as higher capital requirements and tighter limits on investments, diverting resources away from innovation and job creation and making many manufacturers less competitive globally.
The NAM has other significant concerns about both versions of the bill. Manufacturers have consistently opposed executive compensation restrictions, such as “say on pay” language that would mandate a non-binding shareholder vote on executive compensation arrangements as well as language granting the Securities and Exchange Commission (SEC) authority to issue rules on proxy access. Proxy access would ease the way for shareholders at all publicly traded companies – not only banks – to nominate board directors. On the contrary, corporate governance language would allow special-interest groups like organized labor and other activists to force their political agendas upon stockholders.
The two chambers now move to a conference committee to iron out the differences between the House and Senate-passed bills. Earlier this week, the Senate appointed its conferees tasked with reconciling the two bills. The House is expected to name its conferees after Memorial Day, and House Financial Services Committee Chairman Barney Frank (D-MA) will serve as chair of the conference. The NAM expects work to begin in June with the possibility of a final bill reaching the President’s desk by the July 4 recess.
While the make-up of any final financial services reform legislation remains unclear, it appears that many of the Senate provisions have the support of the Administration. As conference negotiations commence, the NAM will stay in close contact with key members of Congress to ensure that the concerns of manufacturers are taken into consideration. Preventing another financial crash is vital to the long-term health of the U.S. economy. In fixing what went wrong, Congress must protect those, like manufacturers, who behave responsibly and are vital to our economic competitiveness.
STATEMENT FROM ADMINISTRATOR MILLS ON URGING CONTINUED SUPPORT FOR SMALL BUSINESSES' RECOVERY LOAN PROGRAMS
May 27, 2010 – Daily PulseQueue Activated as SBA Presses for Longer Term Funding
WASHINGTON - U.S. Small Business Administration Administrator Karen Mills today issued the following statement regarding efforts to ensure continued funding for two key provisions first implemented as part of the American Reinvestment and Recovery Act (ARRA) of 2009.
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VOTE ON TAX EXTENDERS BILL POSSIBLE TODAY
May 27, 2010 – NAM Capital BriefingThe House may vote as early as May 27 on a scaled-back version of H.R. 4213, the tax extenders bill. Based on informal reports, some House members still have concerns about voting for the package because of its impact on the federal deficit. In addition, it is unclear if the Senate has the necessary 60 votes for passage. Nonetheless, Congress is working to complete final action on this bill before Memorial Day. The NAM sent a letter May 25 to the full House citing that “…the onerous tax increases also included in the House amendment to H.R. 4213 released on May 20, 2010, could outweigh the benefits of the pro-growth changes by imposing significant new costs on American businesses and threatening job creation, U.S. competitiveness and overall economic growth.” Provisions supported by the NAM include extension of the R&D tax credit, energy efficiency and renewable energy tax credits and other incentives in the bill, a provision that will allow struggling companies to use their AMT credits, and the extension through 2012 of the Build American Bonds program. The NAM opposes provisions including the $14 billion in punitive changes in international tax laws and increased taxes on oil and gas companies.
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