How Will GOP Gains Impact Manufacturing?
By AMY LAWRENCE, Features Editor, Manufacturing.net
On November 2, Americans went out and voted to make sure their voices were heard.
The results: Republicans control the House; Democrats control the Senate, but the Republicans made strong gains. Several states saw a drastic shakeup in their local government — Republicans made double-digit gains in the Michigan House of Representatives alone.
Michigan had made headlines as its auto industry collapsed and GM and Chrysler headed for bankruptcy. Perhaps this drastic shakeup is what the state needs to turn things around.
So will we see any bipartisan deals that will benefit the manufacturing community in the U.S. and finally bring down the nation’s unemployment rate? John Engler, NAM President, is optimistic.
“The people aren’t willing to wait another two years for another election,” Engler said. “The Republicans are under pressure to deliver on their promises and many members of the Senate are up for election in two years. They have incentives to work together now.”
Regardless of political parties, NAM will work with Congress to make sure that policies match campaign rhetoric, noted Jay Timmons, NAM Executive Vice President.
“There is optimism and excitement in the manufacturing community for a reinvigorated focus in Washington,” Engler added.
In a nation where the unemployment rate is 9.6 percent, which is probably closer to 15 to 17 percent real unemployment, job creation will be a top priority for the 112th Congress.
To help create jobs, Engler suggests investing in infrastructure projects.
“We should invest in upgrading federal buildings and improving their energy efficiency,” he said. “Infrastructure spending could create thousands of jobs.”
Engler also pointed out the need for a ‘methodical, sustained effort’ by policymakers to properly execute programs.
“The drilling moratorium has been lifted, but companies aren’t getting any permits,” Engler said. “Some of our member companies have said that they don’t need capital to get started on new projects; they just need permission.”
Also likely to come under scrutiny are the EPA regulations on greenhouse gases.
“It won’t be like the 70s. The government won’t sit on the sidelines. The Republicans will want to keep considerable oversight over the regulations,” Engler said. “Keeping things up in the air won’t inspire confidence or investments.”
Tax cuts are another priority for NAM and the new Congress.
“Taxes shouldn’t go up because we’re still in recovery,” Engler noted. “If they do, it would be shocking.”
Of particular importance for manufacturers is the R&D tax credit that expired 10 months ago.
“A one or two year extension isn’t enough,” according to Engler. “In the case of the R&D credit, a one year extension would really only be a two month extension. It needs to be permanent. We don’t want to see R&D go offshore because Singapore has better incentives.”
From creating a competitive tax environment to creating jobs — not to mention fulfilling the President’s goal of doubling exports — the new Congress has some high expectations to live up to.
“There are some strong voices for manufacturing in the Senate,” said Engler. “This election was fought over the economy and jobs, and we’re optimistic.”
“We’re pro-economic growth right now and election night was a good night for manufacturing,” concluded Timmons.