Washington Watch

Washington Watch

June 2009

EFCA Bill Still at Forefront on Capitol Hill

 

As we have been reporting, Sen. Tom Harkin (D-IA), who is managing the Employee Free Choice Act (EFCA) debate in the Senate, is floating EFCA “alternatives” on Capitol Hill, reportedly meeting with moderate Democrats and with organized labor in hopes of securing the support of at least 60 senators – the number needed to overcome a filibuster.

Our efforts to stop EFCA have been well received to date, but we continue to have a strong fight on our hands and we need your help in defending the opposition’s latest attack. Recently, you may have received a phone solicitation from a group called “Change to Win”. This group is backed by seven major union organizations and informs the listener that they will be receiving a mailer on information asking Senator Lincoln to join Vice President Biden and President Obama in supporting working families in Arkansas by pushing for the Employee Free Choice Act (EFCA). 

You can help defend this latest attack by calling or writing your senators and letting them know of your opposition to EFCA and how it would be harmful to all Arkansans. Tell them any compromise that eliminates the secret ballot, imposes mandatory binding arbitration or jeopardizes the prosperity of Arkansas businesses is not acceptable. 

Even if you have already written either or both senators, please do so again. We are asking all State Chamber/AIA members to get involved and help us to defeat EFCA. We need your help now more than ever.

For additional information or to become part of the Coalition against EFCA, contact Coalition Coordinator Sarah Beth Turner at (501) 975-8344 or e-mail her at info@yoursecretballot.com. 

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 Business Groups React Warily to First Draft of Health Care Bill

 

USA Today reported, "Business groups reacted warily Sunday to the Senate's first stab at overhauling the nation's health care system, a rift that could complicate President Obama's goal of achieving bipartisan support for his top domestic priority." After weeks of "behind-the-scenes negotiations and friendly exchanges, debate over health care appeared to fall into familiar territory after a draft proposal by the Senate Health, Education, Labor and Pensions Committee began circulating late last week." Among the "potential stumbling blocks: Most employers would be required to provide health insurance to workers or pay a penalty." Hank Cox, a spokesman for the NAM , said, "We're trying to get that out of there." In addition, "The cost of expanding health coverage, which could be more than $1 trillion, has become a key issue. The draft does not address how changes would be paid for."

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 Speaker Sets Short Timeline for Consideration of Climate Change Bill

 

House Speaker Nancy Pelosi (D-CA) last week told eight Committee Chairmen that they must finish work on H.R. 2454, the American Clean Energy Act, by June 19 or forfeit their jurisdiction over the bill. H.R. 2454, perhaps better known as the Waxman/Markey cap-and-trade bill, cleared the Energy and Commerce Committee on May 21 by a vote of 33-25. The vote was largely split along party lines. In an article written just after the committee hearing, the New York Times called the bill, "the most ambitious energy and global warming legislation ever debated in Congress." According to the Times, “In the Senate, leaders say they lack the votes to pass the bill as it is now written." The bill "has critics and supporters on the left and right." Both "the National Association of Manufacturers and the United States Chamber of Commerce opposed it," arguing "that it was a burdensome tax on business that would drive companies and jobs overseas while doing little to address climate change."

 

The Speaker's short timeframe for considering the legislation could prompt some Committee Chairs – especially those with other pressing priorities – to waive their panel's jurisdiction over the bill. Meanwhile, last week the Senate Energy Committee was set to mark up legislation establishing a federal renewable electricity standard.

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 Oppose EPA Decision to Regulate Greenhouse Gases Under Clean Air Act

 

The National Association of Manufacturers (NAM) is urging companies to contact the Environmental Protection Agency (EPA) and oppose its April 17 announcement that six greenhouse gases (GHGs) may endanger public health. In a key 2007 decision, the U.S. Supreme Court acknowledged that EPA had broad discretion to determine whether or not GHG emissions "endanger public health.” Meanwhile, recent documents from the Office of Management and Budget show that federal policymakers realize that the proposal will further burden the economy. EPA is receiving public comments on its “endangerment finding” through June 23. The NAM has created a Web site, www.nam.org/epa , that provides additional information on EPA's action and includes an online petition and sample letter that can be e-mailed to EPA and included as part of the record.

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Senator Lincoln Named Chairman of Subcommittee

Sen. Blanche Lincoln took on additional leadership responsibilities in the U.S. Senate last week. Lincoln was named chairman of the of the Senate Agriculture Committee’s Subcommittee on Rural Revitalization, Conservation, Forestry and Credit. The subcommittee oversees rural economic revitalization, rural job and business growth, rural electrification with telecommunications and utilities as well as conservation of natural resources. Lincoln has served on the Agriculture Committee since entering the Senate in 1999 and heads the Senate Finance Committee’s Subcommittee on Social Security, Pensions and Family Policy. 

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Some U.S. Economists Believe Recession May Be Over

 

The Financial Times reported, "Is the U.S. recession over? A handful of bullish economists are starting to claim that it is, or that it very soon will be." But the "National Bureau of Economic Research business cycle dating committee, which decides when recessions begin and end, has not even begun discussing the end date and will probably not reach a verdict for 18 months or more." The "'recession is over' camp highlights new claims for unemployment benefits and new orders for manufacturing goods." The ISM manufacturing survey for May "rose to 42.8 -- consistent with past recession troughs. The new orders index rose above 50 to 51.1 for the first time since December 2007, when this recession began." Most forecasters think the economy will "only start growing in the second half of the year."

 

In similar news, the Washington Post reported, "Factory orders inched upward in April after posting a decline the previous month, according to new economic data, offering further evidence that the U.S. manufacturing sector is no longer shrinking as rapidly as it was in the fall." Analysts have been "watching factory orders and other indicators for signs that manufacturers and their customers, having slashed inventories, will soon have to start replenishing their supplies." The new data, released by the Commerce Department, are "encouraging -- factory orders rose 0.7 percent. But many economists fear that demand for factory goods could still be weighed down by the slump in the auto industry and construction, as well as in consumer spending."

 

The AP reported, "The Commerce Department's report [last] Wednesday was below analysts' expectations of a 0.9 percent increase. The department also sharply marked down the March figure to a 1.9 percent drop, compared with the 0.9 percent decline previously reported." Orders for "big-ticket durable goods, such as industrial machinery and appliances, rose 1.7 percent, down slightly from the government's initial estimate last week of a 1.9 percent rise."

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 Construction Spending Unexpectedly Rises

 

Bloomberg News reported, "Spending on construction in the U.S. unexpectedly rose in April as the housing slump eased and more commercial projects got under way." According to the data by the Commerce Department, "the 0.8 percent gain was the biggest since August and followed a revised 0.4 percent increase the prior month. ... Residential construction climbed 0.6 percent and work on power plants and factories propelled commercial construction up." There is hope that "federal and local government spending will ramp up as funding from the $787 billion fiscal stimulus package filters through to worksites."

 

The AP noted that the rise defied "economists' forecasts for a decline," and "the unexpected gain -- the most since August -- marked the second straight month that builders boosted spending on construction projects around the country. ... Economists were bracing for a 1.2 percent drop in construction spending for April." In an encouraging note, the AP pointed out, "private builders increased spending on housing projects by 0.7 percent, contributing to the overall improvement in April." Meanwhile, "private spending on all other construction projects other than residential ones went up a strong 1.8 percent in April, following a 2.6 percent gain in March. Builders increased spending in April on projects including hotels and motels, factories, power plants and health care facilities."

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Job Data Furthers Hope That Recession Is Ending 

The Wall Street Journal reported, "The slowing pace of U.S. job losses last month added to hopes that the recession is drawing to a close." Yet, "in a sign that the downturn continues to inflict damage, the jobless rate reached its highest level in 26 years." The Labor Department said that "nonfarm payrolls fell by 345,000 in May...less than April's 504,000 drop and the smallest decline since September. Still, more jobs were lost in May than in any month of the prior three recessions, and the economy has now lost six million jobs since the recession began in December 2007. The unemployment rate rose a half point to 9.4 percent, its highest level since February 1983."

 

Similarly, the Los Angeles Times reported, "The nation's breathtaking pace of job loss slowed significantly in May, bolstering hopes that the worst of the recession is over. But millions of Americans and their families face continued economic pain with the unemployment rate jumping to 9.4 percent." The contrasting trends highlights "a painful economic reality: Even as the recession winds down, hundreds of thousands of workers may continue to lose their jobs -- and the unemployed may be among the last to reap the benefits of recovery."

 

USA Today noted, "Investors cheered far fewer job losses last month than the 520,000 expected by analysts and many fewer than the monthly average of 643,000 the past six months. Also, the government said 82,000 fewer jobs were lost in March and April than it originally estimated." A survey last week indicated "the pace of contraction in manufacturing slowing markedly while the housing market shows signs of bottoming. A record 14.5 million people were out of work last month and 6 million jobs have been lost since the economic downturn began in December 2007."

 

According to the Financial Times, "men have suffered more than women, and their unemployment rate last month reached 10.5 per cent - a full 2.5 percentage points higher than the rate for women. This is largely because men dominated the industries such as manufacturing and finance that have contracted most." Furthermore, "manufacturers are still laying off vast numbers, in contrast to the service sector. The number of factory jobs fell by 156,000, with car-making, machinery and metal products accounting for half of that drop. Many analysts warn that the bankruptcy and radical restructuring plans for General Motors and Chrysler will accelerate the job losses over the summer."

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Government to Play "Unprecedented" Role in Auto Industry

 

The Washington Post pointed out that, "for the foreseeable future, the U.S. government will play an unprecedented role in the nation's auto industry by virtue of its multibillion-dollar investments in General Motors and Chrysler. But exactly how this critical public-private partnership will work is still being developed, even as leadership of the automakers is overhauled." Consequently, "the new alliance between the government and the automakers will be defined by a group of people who are either new to their jobs or new to the industry." The Post also notes that "the government said it will weigh in on 'core governance' issues but refrain from day-to-day decisions," a promise that "is already being tested -- environmentalists are pressing for cars with lower emissions, unions are calling for more domestic jobs and elected representatives are protesting plant closings."

 

Additionally, The Hill reported, "Consumer groups and trial lawyers are crying foul over the Obama administration's bankruptcy plans for General Motors and Chrysler," as "those plans would extinguish all ongoing auto accident claims that blame a death or serious injury on a defective GM or Chrysler vehicle."

 

Meanwhile, the New York Times recalled on its front page that GM "has been hemorrhaging customers for decades. For the last 30 years, it has been losing almost one percentage point of market share every year. It sold 45 percent of the new vehicles in this country in 1980, 35 percent in 1990, 28 percent in 2000 and 19 percent so far this year." The Times notes that all the steps taken so far "should help the company focus on building cars that enough people want to buy. But GM still hasn't explained how, at long last, it will manage to do so. And optimism doesn't qualify as a strategy." Furthermore, the research firm IHS Global Insight forecasts "GM's market share would drop to 17 percent in 2014."

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Mexican Truckers File Suit Against U.S. Over Trucking Ban

 

The AP reports, "Mexican truckers have filed a lawsuit against the United States seeking $6 billion in compensation for losses they claim to have suffered since Washington banned them from crossing the border in violation of a trade pact, an attorney said [last] Tuesday." Mexico 's National Cargo Transportation Association, or Canacar, "filed the lawsuit representing 4,500 trucking companies, said Pedro Ojeda, the group's lawyer." The Teamsters, consumer groups and independent insurers have "warned that Mexican trucks are unsafe and lobbied Congress to keep them out." Obama has "asked the office of the US Trade Representative to work with the Department of Transportation, the State Department and Congress to create a new program."

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