Why the NAM Urges the Senate to Get the Ex-Im Bank Back Up and Running

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Securing a level playing field internationally is vital to manufacturers in the United States, which already export about half their production, supporting millions of workers across the country. While there’s been a lot of focus on foreign barriers that impede U.S. exports, one of the most concerning problems is of our own making: the Senate’s failure to confirm nominees to the Board of Directors of the U.S. Export-Import Bank. The U.S. Ex-Im Bank is a federal agency that provides loans and other tools to aid businesses in the U.S. seeking to export their products to foreign markets. Without these nominees, the Ex-Im Bank cannot even consider major deals over $10 million or even act on the reforms that Congress set out it when it last reauthorized the bank in 2015.

With the Ex-Im Bank severely weakened, manufacturers in the United States are losing sales to foreign competitors who are backed up by nearly 100 other export credit agencies around the world. Indeed, virtually every major country, from Canada to China and the UK to Ukraine, provides export financing tools that are being used to the detriment of manufacturers and workers in America. For example, China’s two Export Credit Agencies routinely help their companies out-muscle their U.S. rivals. Last year, China provided $45 billion in medium- and long-term investment support for projects around the world, more than the rest of the world combined.

While foreign countries are expanding their use of export credit, the United States has been essentially sitting on the sidelines since 2015, undermining U.S. manufacturing companies big and small and manufacturing workers across the nation. According to the National Association of Manufacturer’s estimates, manufacturers lost at least $119 billion in manufacturing output, translating into 80,000 fewer manufacturing jobs in 2016 and 2017 as a result of an inactive Bank.

This week, the NAM urgently called on the Senate leadership to come together in a bipartisan manner and vote to confirm well-qualified Ex-Im Board of Directors nominees that the Senate Banking Committee approved last week on a broad, bipartisan basis. That’s a positive step forward—and a sign that senators from both parties are ready to work together to get the Ex-Im Bank back up and running.  Now the full Senate must commit to the businesses and workers that rely on the Bank by confirming these nominees as soon as possible. The cost of inaction is already too great.

Congress Must Act Now To Stop Burdensome Health Care Taxes From Taking Effect

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Rising health care costs continue to burden manufacturing workers and American families. Unfortunately, three health care taxes are set to add even more costs to health care budgets across the country.

In 10 months, the medical device tax and the health insurance tax will go into effect. The Cadillac Tax, a 40 percent tax on “high-quality” employer-sponsored health plans, will come into full force in 2022. Regrettably, more and more employer-sponsored plans will be considered “high-quality” and taxed at the 40 percent rate because of the design of the tax, which will increase the financial burden on American families and manufacturing workers.

But it doesn’t have to be this way. Congress can act now to prevent these taxes from increasing health care costs—and manufacturers are urging it do so.

Companies are already facing hard decisions between setting aside funds to pay for the looming medical device tax bill or hiring potential new employees, investing in research and development or expanding operations. We already know the impact of the 2.3 percent excise tax on medical technologies because it went into effect for the two-year period of 2013 and 2014. During this time, tens of millions of dollars were diverted—either canceled or delayed—from innovative new research and almost 29,000 jobs were lost, according the U.S. Department of Commerce. Congress cannot allow this to happen again.

With the clock ticking on health care taxes, companies have already started preparing, and Congress must unite to address these health care taxes in advance of the looming deadlines. Today, a bipartisan group of 20 senators worked together to advance efforts to achieve full repeal of the medical device tax by introducing the Protect Medical Innovation Act of 2019. The National Association of Manufacturers key-voted similar legislation in the 115th Congress, which passed the U.S. House of Representatives with an overwhelming bipartisan vote of 283-132.

Manufacturers urge the House to introduce companion legislation and for Republicans and Democrats to expeditiously advance legislation to address the health care taxes that are fast approaching.

 

President Trump Just Held a White House Meeting About the Manufacturing Workforce Crisis…

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Job creation in the modern manufacturing industry is surging, but employers are struggling to find enough workers with the right set of skills. This workforce crisis has caused nearly half a million open manufacturing jobs to remain unfilled, and the Manufacturing Institute’s 2018 Skills Gap Study found that number is expected to swell to 2.4 million within the next decade.

Manufacturers aren’t sitting on the sidelines, and neither is the White House. 

Yesterday, President Trump, Ivanka Trump, and Secretary of Commerce Wilbur Ross sat down with business leaders, educators, and policy makers on the American Workforce Policy Advisory Board to discuss the depth of the workforce crisis, how it is negatively impacting economic growth, and pro-active solutions to up-skill America’s workforce:

Last month, the Bureau of Labor Statistics said U.S. job openings reached a record high in December at 7.3 million. The White House says the job openings present “a mismatch between the skills needed and those being taught, requiring immediate attention to help more Americans enter the workforce.”

The advisory board members will work “to develop and implement a strategy to revamp the American workforce to better meet the challenges of the 21st century,” the White House said.

NAM President and CEO Jay Timmons, as a member of the board, participated in the White House meeting, and shared a few words with President Trump about manufacturing’s historic optimism and growth, and how the workforce crisis is acutely threatening the industry. 

 

Timmons cited the results of our latest Manufacturers’ Outlook Survey, which showed optimism in the industry at historic highs for the ninth consecutive quarter: 

JAY TIMMONS: I had the great fortune yesterday of being able to announce the results of our first quarter 2019 Survey of Manufacturers with the Vice President present at our Board of Directors meeting. And as you know, that survey has been going on for 20 years. I was able to announce that we have had nine consecutive quarters of record optimism — 

PRESIDENT TRUMP: Great. 

JAY TIMMONS: — for manufacturers. 91.8 percent. And that’s no accident. That is because of the tools we’ve been given to invest, to hire, to raise wages on benefits through tax reform, through regulatory certainty. And that’s created a bit of a challenge for us because now we have 428,000 jobs open in manufacturing. Our Manufacturing Institute predicts that that number will increase to 2.4 million in the next 10 years. So this Board, this Advisory Board, it’s perfect timing. 

THE PRESIDENT:  Thank you, Jay.  And if you remember from past years, others said that manufacturing was not going to happen; those jobs were never coming back.  And they are coming back.  We have 600,000 —

MR. TIMMONS:  Well, they’re coming roaring back.

“Thank you for taking this on,” Timmons said. “It really is going to matter for America’s future. It’s going to matter for our success in the global economy.”

It will take collaboration from manufacturing leaders, policy makers, educators, and communities to tackle the workforce crisis and guarantee further growth in the modern manufacturing industry. Yesterday’s meeting was an encouraging sign that we’re headed in the right direction. 

Time For A Bipartisan Approach to Overcome Biggest Infrastructure Bill Challenge: How To Fund It

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Lawmakers from both political parties can agree that we need better infrastructure. To achieve that goal, however, Congress must take a bipartisan approach to overcome the biggest challenge of passing an infrastructure bill—how to fund it.

Yesterday’s U.S. House of Representatives Ways and Means Committee Hearing “Our Nation’s Crumbling Infrastructure and the Need for Immediate Action” was a step toward that end that asked the hard questions about funding. Witnesses representing both business and organized labor agreed that the time is now to modernize the user fees that fund our infrastructure. The National Association of Manufacturers believes that this funding mechanism will be a key component to an infrastructure package, and the NAM-led Infrastructure Working Group brought 150 diverse trade association together with the same message in February.

How Congress proceeds with an infrastructure package will have broad economic implications. According to the NAM Outlook Survey released earlier this week, manufacturers have recorded nine consecutive quarters of record optimism, thanks in part to pro-growth policies—and tax reform in particular. Tax reform has already helped manufacturers invest more, hire more and pay workers more. Yet, as this quarter’s survey also showed, rolling back tax reform—as some have previously suggested to pay for infrastructure—would have the opposite impact. No one wants that. To keep the momentum for manufacturing and our economy going, we need to keep moving forward on all fronts. That means doing infrastructure the right way, and last week the NAM released manufacturers’ blueprint for how to get there.

Our “Building to Win” plan envisions robust investments to repair and reinvigorate the infrastructure that makes the American Dream possible. Our plan calls for and outlines potential solutions to recurring funding shortages, such as indexing or increasing the federal fuel tax as well as introducing a vehicle mile traveled fees. “Building to Win” is based off a principle that forms the bedrock of our infrastructure system—namely that transportation networks should be funded through user fees paid by the companies and individuals who typically use and benefit from them.

Tuesday, while speaking at the NAM Spring 2019 Board of Directors Meeting, Vice President Mike Pence said “This president and our administration are absolutely committed to rebuilding the infrastructure of America. It is time for a major bill from the Congress to rebuild the roads and bridges and ports and highways of America.” And yesterday, Ways and Means Committee Chairman Richard Neal (D-MA), agreed, saying, “We have a real opportunity to do something really big.” Manufacturers agree—in fact, the NAM Outlook Survey showed a large majority of manufacturers saying that passage of a major infrastructure bill would positively impact their company’s business plans and outlook. Now what’s needed is for both parties in Washington to come together to get infrastructure done in a smart, bipartisan way that keeps manufacturing’s optimism strong and our country’s economy moving forward. We’ll continue working with members of both parties to get that done.

Florida’s Proposed Prescription Drug Solution is Not an Actionable Solution

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As some states continue to consider various ways to address rising health care costs, Florida is the latest state to seek authorization from its legislature to import prescription drugs from Canada. As is the case with similar proposals in other states, this unproven drug importation proposal would risk eroding the public health standards U.S. prescription drugs are held to—and could expose Americans to lower quality drugs to the detriment of their health. To elected leaders, such a proposal may seem like a simple solution, but—however well intentioned—this opinion comes without a full understanding of the value of innovation led by pharmaceutical manufacturers in America and the required federal role in this proposal.

Florida’s HB 19 carries a false promise to lower drug prices by allowing the importation of prescription drugs from Canada. There is no question that skyrocketing health care costs are disrupting families and businesses around the country. However, allowing imported drugs from Canada is not a solution. Canada does not have the same standards or long-established mechanisms in place to protect patients as we do here in the United States. Furthermore, elected leaders should not ignore the bill’s need for federal approval and its needless risk to public health. To date, no Secretary of the U.S. Department of Health and Human Services has been willing to make a certification to permit drug importation from foreign countries due to concerns about public health—and rightly so.

Manufacturers support efforts to increase access to affordable medicine, but it cannot be at the expense of safety or quality. Canada does not make product safety guarantees to the U.S., so importation and re-importation could expose consumers to counterfeit and adulterated therapies. High prescription drug costs should be addressed—but not at the expense of eroding the reputation of quality drugs approved by the Food and Drug Administration for marketing in the United States.  Adequate drug consistency and quality cannot be assured with imported medicine—nor can the health and wellness of people seeking treatment through foreign prescription medicine that may be counterfeit or adulterated. The National Association of Manufacturers has long opposed the importation of prescription drugs, and we will continue advocating for patient safety to remain the driving factor in determining prescription drug laws. Americans count on national safeguards guaranteeing the quality of prescription drugs for their health and wellbeing. There cannot be doubt or uncertainty.

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