Jay Timmons, president and CEO of the National Association of Manufacturers, issued a statement in response to President Obama’s letter to Congress calling for higher taxes on domestic oil and gas production. Excerpt:

That misguided policy would result in more inflation, higher prices at the pump for already beleaguered Americans, and increased costs for products consumers need and use every day.Manufacturers support efforts to increase the use of clean energy sources and are helping to lead the way in meeting future energy demands with new energy sources. Until those alternative sources are cost-competitive with oil and gas and sufficient to meet this country’s demand for energy, manufacturers believe the United States should expand access to domestic energy by opening additional areas of the country – offshore and onshore – to exploration and development.

Timmons concluded: “President Obama wants to raise taxes on energy companies and, at the same time, reduce the cost of gasoline. He can’t have it both ways.”

John Felmy, chief economist of the American Petroleum Institute, had several pithy comments for the reporters. From USA Today, “Obama, Republicans tangle over oil subsidies“:

This is a proposal born of desperation that would do nothing to reduce gasoline prices,” said American Petroleum Institute chief economist John Felmy. “It would reduce investment in new oil and natural gas projects, cost new jobs and decrease oil and natural gas production.” (continue reading…)

In a post, “Cantor’s Pro-Growth Call,” CNBC host Larry Kudlow points to an important speech from House Majority Leader Eric Cantor at  Stanford’s Hoover Institution. Kudlow reports:

Cantor is afraid the Republican budget-cutting message is a little too austere, so he’s attempting to balance the necessary budget cuts with a pro-growth, tax-and-regulatory reform message.

Cantor focuses especially on getting business tax rates down to at least 25 percent. He also proposes a tax holiday to repatriate the foreign earnings of U.S. companies. So many CEOs have made the same argument. And this was done successfully in 2004-05. If enacted, maybe $1 trillion in cash will flow back home for new investment and jobs.

Along with a lower, more globally competitive corporate tax rate, the National Association of Manufacturers has long supported the “holiday” strategy to repatriate foreign earnings, which enjoys vigorous bipartisan support. From Politico, March 4, “Big Business to Congress: How about a tax holiday?”

The tax holiday is an idea that draws bipartisan support from tax-cutting Republicans and pro-business Democrats. And with unemployment stuck in the high-single digits and economic growth still frustratingly slow, the prospect of drawing hundreds of billions of dollars parked overseas back to the United States may become increasingly difficult for skeptics to resist.

“The states are getting ready to lay off thousands of people, the Middle East is burning, unemployment is stuck at 9 percent,” Jason Mahler, a lobbyist for Oracle and former chief of staff to Rep. Anna Eshoo (D-Calif.), told POLITICO. “What else are you going to do in terms of stimulus that’s of any consequence? The quiver is empty.”

The text and video of the Majority Leader’s speech at the Hoover Institution are here.

P.S. Kudlow spoke enthusiastically on his radio show last Saturday about manufacturing as a major force driving the economic recovery. Thanks, Larry!

When business calls for the federal government to show restraint on taxes and regulation, that is not a call for inaction.

In its weekly Intelligent Investing feature, Forbes.com interviews David M. Cordani, President and CEO of Cigna and a member of the National Association of Manufacturers’ board of directors. From “Get Briefed,” in which Cordani reviews the new health care law, which he says addressed one challenge — access to care. Now, it’s time to “tackle the remaining twin challenges of managing health care costs and closing gaps in quality of care.”

The empirical data is in: consumer-oriented plans bend the cost curve in a positive way, without compromising care.

Our ChoiceFund study, a multi-year study comparing the actual claims experience of 655,000 individuals covered in Cigna’s traditional managed care plans and those covered with our consumer directed plans, shows that medical costs for individuals in consumer-directed plans went down 26% over four years, while levels of care for their preventive medicine, chronic disease management and evidence-based treatments were higher than their counterparts in traditional managed care health plans.

If the share of Americans enrolled in consumer-directed plans rose from a current 18% to 50%, and the results of the Cigna study were applied, the U.S. could achieve $350 billion in savings over 10 years.

In a recent Wall Street Journal column, John Lechleiter, president and CEO of Eli Lilly, looks further down the road and sees a serious threat to U.S. leadership in life sciences, including pharmaceutical R&D. From “America’s Growing Innovation Gap“:

The evidence is certainly mounting that we are facing today nothing short of an innovation crisis in America’s life sciences. The industry I know best, biopharmaceuticals, is facing unprecedented pressure. R&D costs continue to rise, fewer potential new medicines gain regulatory approval, and key products lose patent protection. In fact, the number of new molecular entities approved by the FDA over the past five years—92—is lower than in any other five-year period since I entered the industry in the late 1970s.

Meanwhile, the rest of the world is not standing still. The U.S. is not the only country looking to the life sciences to drive economic growth, and the very qualities that brought much of the world’s research capacity to our shores could just as easily attract that work to Asia or elsewhere.

In examining the growing conflict between business and the Obama Administration, CNBC host and commentator Larry Kudlow included Lechleiter as one of the business leaders warning against overregulation and taxation. (continue reading…)

Haven’t quoted Larry Kudlow in quite some time. Rectifying that now, noting his post in NRO’s The Corner, “Washington Needs to Help Businesses for a Change“:

You can begin by stopping the taxing of overseas corporate profits. Do not hike the minimum wage. Back off cap-and-trade. Do not nationalize health care. Stop the anti-trust assault on phone companies, pharmas, Google, airlines, and multi-nationals.

And how about a six-to-twelve-month payroll-tax holiday? That would make it cheaper to hire new workers. What about a corporate tax cut? And immediate cash expensing for business-investment write-offs? In other words, cut the tax cost of hiring, investing, and doing business. Because it’s businesses that create the jobs and the incomes for families all throughout America.

And if you are still worried about the housing story or bank toxic assets, how about a capital-gains tax holiday?

Does anyone in Washington understand the way the world really works? It’s called incentives. That’s what this is all about. And we’re going to need many more of them if businesses, investors, and families are to start prospering once again.

As we’ve noted before, too many politico like jobs just fine, it’s the jobs-creators they’re not so fond of. And those jobs-creators are business.

CNBC host and analyst and all-around smart guy Larry Kudlow comments on the inclusion of pro-growth tax relief in the Obama stimulus plan, “Team Obama Adds Business Tax Cuts.” He’s positive, but says more can be done:

However, as yet there is no Obama signal for the most powerful tax incentives that would slash the 35 percent top corporate rate to something around 20 percent. This should apply both to large C-corps and small-business S-corps. It would attract investment, improve future job creation, and relieve consumers who really shoulder the corporate tax costs. Additionally, full cash expensing for business investment write-offs would provide an even greater bang for the buck.

So while the new tax-refund plan and faster depreciation are positives, they are still much weaker than a full-bore supply-side tax-rate reduction that could even morph into full-fledged corporate tax reform. Now we wait for a Republican response, which hopefully will be bold corporate tax reform as well as reduced individual tax rates (at least for the middle class).

In our continuing campaign against the use, and especially the Washington Post’s use, of the inaccurate and inflammatory term “nationalize” to describe the U.S. government’s purchase of $250 billion in preferred bank stock, we report progress! In today’s Post, two legit uses.

Op-ed columnnist David Ignatius refers to global developments as “quasi-nationalization” in  “A Bailout Beijing Would Cheer“:

Free-market partisans in the West were shocked by the Chinese intervention and decried it as a dangerous precedent. But it helped stabilize the Hong Kong market. Now, that earlier bailout seems modest indeed — compared with the quasi-nationalization of the world’s leading banks we’re seeing this week.

Fair enough, and especially in an opinion column. The other mention is in a story about UBS’s difficulties, reporter Howard Schneider writes in “Swiss National Bank Takes $60B in Toxic UBS Assets“:

Swiss authorities moved to stabilize their storied banking system today, agreeing to move $60 billion in troubled assets from the books of financial giant UBS and into a special government-backed fund.

The Swiss government also invested $5 billion of public money into the bank, a reversal for a country that had taken a more hands off approach even as its European neighbors moved to shore up or even nationalize their financial institutions.

Accurate and fair.

Now, it’s possible the news has simply moved on and the bad newswriting featuring the term “nationalization” will return. But it’s also possible the editors and reporters acknowledged that the purchase of up to 3 percent of a bank’s assets does not equal government control and ownership, i.e., nationalization.

Seems like Treasury Secretary Paulson is also making the point, as reported in Bloomberg:

“The steps we’ve taken are absolutely the right steps, they’re bold steps, they’re strong steps to stabilize the financial markets and inject confidence into the banking system as well as capital,” Paulson said in an interview on CNBC television tonight. “I’m very confident that the moves we’ve taken will do just that.”

Paulson defended his proposal as “anything but” a nationalization of the country’s banking industry. He also distanced his effort from a U.K. plan to set aside as much as 50 billion pounds for equity stakes in the banks, provide 250 billion in interbank loan guarantees and 200 billion in a special liquidity program.

“What we’re doing is very different than what the British are doing,” he said.

Thank you, Mr. Secretary.

Larry Kudlow’s CNBC interview with Secretary Paulson is here.

Did you know the only successful accomplishment of the Bryanite populist movement of the 1890s was to update the old phrase, “Behind every cloud there’s a gold lining?” Really. Debased the sentiment in the process, but what the hell.

In any case, Larry Kudlow always seems to find the silver lining in the dark clouds of the market, swirling as they do. And he provides campaign advice to John McCain, but that’s beyond our purview.

Kudlow:

Another bad day for stocks, which seems to be a habit lately.

Fear is the big factor. Fear over the latest credit-crunch freeze-up in short-term lending markets. Fear over deepening recession. Fear over profits. Fear that Treasury-Fed bailouts — which grow larger by the minute — somehow won’t be enough. And fear that John McCain is going down in a three-house, Reid-Pelosi-Obama sweep that will raise taxes, embrace trade protectionism, end union secret ballots, and spend us into oblivion.

Amidst all this pessimism, permit me three silver linings: First, the strong dollar. Second, plunging energy prices that will generate an economy-wide tax-cut effect. And third, rapid money-supply growth after 18 months of flat money. In fact, on this last pint — which is so important — it looks like the Fed has un-pegged its fed funds target rate and is instead focused on pouring cash into the liquidity-starved global banking system. Meanwhile, the Treasury purchase plan for toxic assets will get off the ground sooner, not later. And the Fed is now backstopping the commercial paper market.

Against the rising tide of pessimism I would argue that these positives are planting the mustard seeds that will grow into the next bull-market prosperity. Believe it or not.