Washington Watch
May 2008
CALL TO ACTION – ASK U. S. SENATORS TO OPPOSE S. 2191
The United States Senate is expected to debate S. 2191, America’s Climate Security Act of 2007, the first week in June. The Executive Committee of the Arkansas State Chamber/AIA has adopted a position to oppose this bill. We ask you to join our opposition by contacting Senators Blanche Lincoln and Mark Pryor and urging them to oppose S. 2191.
We oppose this bill because of the harmful economic impact it would have both nationally and in Arkansas on energy costs, economic growth and employment. The National Association of Manufacturers and the American Council for Capital Formation (ACCF) recently unveiled a jointly commissioned study that assessed the economic impacts resulting from this proposed climate change legislation sponsored by U.S. Senators Joseph Lieberman (I-CT) and John Warner(R-VA).
The study found that the Lieberman-Warner climate change bill would reduce U.S. gross domestic product by up to $210 billion per year by 2020 including employment losses of up to 1.8 million jobs in 2020 nationwide. If S. 2191 becomes law, the study found that it would increase energy costs that would result in Arkansas losing 10,985 to 16,524 jobs in 2020 and 29,736 to 39,583 in 2030. Arkansans’ disposable household income would be reduced by $733 to $2,378 per year by 2020 and $3,088 to $5,631 by 2030.
In addition to strong negative impacts on economic growth in Arkansas, industrial output and harm to low-income families, the state’s schools, universities and hospitals would likely experience a 28 percent to 35 percent increase in expenditures by 2020 and a 91 percent to 123 percent increase by 2030.
We fear the Lieberman-Warner Climate Security Act could drive businesses overseas to nations with less stringent emissions requirements and the newly relocated companies’ emissions will then float back over to the United States, making it even harder for domestic businesses to compete.
The Arkansas State Chamber/AIA opposes the Lieberman-Warner climate bill because it does little to impact global greenhouse gas emissions levels, it harms the American economy through lost jobs, declining GDP and increased electricity prices, and it does not adequately promote the technologies needed to ensure a reliable energy supply in a carbon-constrained world. This bill is the wrong method for addressing greenhouse gas emissions.
Please ask Senator Lincoln and Senator Pryor to vote NO on S. 2191.
You may contact our Senators by phone or fax as follows:
Senator Lincoln—phone 202-224-4843, fax 202-228-1371
Senator Pryor—phone 202-224-2353, fax 202-228-0908
State Chamber/AIA Opposes Union Card Check Legislation
During the recent Arkansas State Chamber/AIA Washington Fly-In and Congressional Dinner, State Chamber/AIA President & CEO Paul Harvel and Executive Vice President Kenny Hall visited with the chiefs of staff for Senators Lincoln and Pryor to emphasize our organizations’ opposition to union card check legislation. In these meetings, we confirmed that Senator Lincoln remains uncommitted while Senator Pryor supports the bill.
The State Chamber/AIA established its position to oppose card check last year. We then communicated in person, by mail, by newsletter and through a grass roots campaign against card check when it was previously considered by the U.S. Congress. Our opposition to card check was re-established at the inaugural meeting of the Arkansas State Chamber/AIA National Issues Committee in January 2008 and was then adopted by the State Chamber/AIA board of directors.
Card check would take away a worker’s ability to choose — in the privacy of the voting booth — whether or not to join a union. Instead, union organizers would be allowed to demand that workers publicly sign a card indicating their choice, exposing any worker who said “no” to harassment, intimidation and coercion. This would make union organizing far cheaper and easier than under current law, affecting every employer in Arkansas.
Our greatest concern is that Arkansas’s small businesses, which haven’t been a lucrative target for unions, would find themselves facing aggressive union organizing. We fear the unionization of Arkansas’s small businesses would do dramatic harm to Arkansas’s economy.
In addition to the in-person meetings at this year’s Fly-In, the State Chamber/AIA provided a fact sheet to Fly-In attendees to aid in their conversations with members of the Arkansas Congressional Delegation. Also, members of the State Chamber/AIA Executive Committee personally delivered copies of a letter to all members of the Arkansas Congressional Delegation at the Congressional Dinner while State Chamber Chairman Hugh McDonald summarized the letter during his opening remarks. This letter outlined nine national issues the State Chamber/AIA is interested in and informed our delegation that our top three priority issues were healthcare, education and the defeat of union card check/employee free choice legislation.
The State Chamber/AIA will continue to provide information about card check legislation to its members and continue asking our Congressional Delegation to oppose card check whenever it is considered. It is vitally important that businesses all over Arkansas stay in contact with our Congressional Delegation and seek opposition to card check.
Farm Bill Update
After months of negotiations, the 2008 Farm Bill conference report has won solid approval in both houses of Congress. The measure passed the House Wednesday with a vote of 318 – 106 and the Senate on Thursday morning with an 81 – 15 margin. All six members of the Arkansas delegation voted in support of the bill.
The bill would spend $296 billion on nutrition, conservation, energy and farm subsidy programs over the next five years. Despite being widely known as the farm bill, approximately two-thirds of the measure would go toward domestic nutrition programs such as food stamps and emergency food aid. According to the Congressional Budget Office, agricultural commodity programs comprise about $35 billion of the legislation’s total cost.
After the House vote on Wednesday U.S. Secretary of Agriculture Ed Schafer confirmed President Bush’s intent to veto the legislation. Both chambers have more than the necessary two-thirds majority that is required to override a veto, but members will have to vote again to do so. Congress has overridden only one veto during Bush’s two terms. The current farm bill will likely be extended to May 23 to allow Congress the necessary time to override the President's veto.
In a previous statement regarding the announcement of the farm bill conference report, Secretary Schafer outlined some of the administration’s concerns with the bill. "At a time of record farm income, Congress decided to further increase farm subsidy rates, qualify more people for taxpayer support, and move programs toward more government control…In addition, Congress decided to include a new permanent disaster program. This program represents a return to outdated farm policy and questions the government's investment in crop insurance which was designed to protect farmers against low commodity prices and crop failures. This action will discredit farm programs and jeopardize public support for future farm bills.” The administration is also unsatisfied with a list of extraneous provisions and earmarks that are not related to farm programs.
The farm bill conference report is available on the House Agriculture Committee website at http://agriculture.house.gov/inside/FarmBill.html.
Senate Proposal Would Tax Windfall Oil Profits
On May 8, the New York Times and the Associated Press reported that Senate Democrats “called for a temporary special tax on oil companies' profits and a rollback of $17 billion in oil industry tax breaks as part of an energy package." The proposal would also create "federal penalties on energy price gouging and a suspension of oil deliveries into the government's emergency reserve." The AP explains that, under the plan, a "25 percent profits tax would apply just to oil company earnings above what would be considered 'reasonable' and only if those profits are not reinvested in expanding refinery capacity or renewable energy sources." While that tax would expire after two years, the provisions "are widely viewed as unlikely to be enacted and would almost certainly prompt a veto by President Bush."
The Washington Post adds that the legislation, called the Consumers First Energy Act, "could 'have unintended consequences' for U.S. companies doing business in Saudi Arabia and other OPEC countries," according to U.S. Chamber of Commerce vice president William Kovacs. Meanwhile, Tony Cudmore, spokesman for ExxonMobil, warned that "in the past, windfall profit taxes have undermined capital investments in the U.S. oil and gas industry and reduced domestic energy supplies."
According to Congressional Quarterly, Democrats are to bring the energy package to the Senate floor "where it will compete with a Republican proposal focused on increasing supply." Though each plan "resurrects partisan provisions that have failed in previous Congresses," they "remain in agreement on one aspect of energy policy," in that each includes "plans to halt crude oil deliveries to the Strategic Petroleum Reserve in an effort to increase supplies on the market." Among the features of the Democrats’ bill is an "anti-price-gouging" provision that "would give the president the authority to declare an energy emergency should there be a shortage or disruption in the oil market." In that case, "retailers selling oil or gasoline at a price deemed 'unconscionably excessive' would be subject to penalties. A similar measure has passed the House but stalled in the Senate."
The Republicans' bill, Reuters reports, "calls for new U.S. oil production in offshore areas as well as Alaska's Arctic National Wildlife Refuge."
South Korean Market Reopens to All U.S. Beef
Farm Bureau reports that the South Korean government has agreed to open its market to all U.S. beef products from cattle of all ages.
United States Trade Representative (USTR) officials reached agreement with their South Korean counterparts on an import protocol for U.S. beef products that is “fully consistent with World Animal Health Organization (OIE) guidelines and other international standards.”
South Korea closed its market to U.S. beef and beef products after a case of bovine spongiform encephalopathy (BSE) was discovered in a Canadian-born cow in the U.S. in December 2003. Prior to that, South Korea was the third-largest export market for U.S. beef and beef products. The U. S. exported $815 million worth of beef and beef products in 2003, according to USTR.
South Korea partially reopened its market to deboned U.S. beef from cattle less than 30 months of age in January 2006, but the reopening was subject to several interruptions and the market has been effectively closed since October 2007. The new protocol, which will take effect in mid-May, allows shipment of all U.S. beef products that have appropriate specified risk materials, as defined by the OIE, removed.
