Across-the-Board Income Tax Rate Cuts
We support. The U.S. Economy has been growing steadily the past 8 years. Now, with almost half the global economy in recession, we need an across-the-board tax rate cut as an insurance policy for continued U.S. economic growth. An across the board rate cut is fairer and simpler than targeted tax cuts that help only a few. The total federal tax take is at record levels. Rates should be lowered for all. The budget surplus has room for a tax cut. The estimated surplus of $2.4 trillion over the next 10 years would allow for a tax cut of $600 billion and still leave $1.8 trillion for fixing Social Security and other expenditures.
Economic Condition of the American Worker
Much media rhetoric has focused on the state of the American worker and perceptions of "working more for less." The blame for this is misplaced: assigned to imagined "corporate greed." In reality, it is the excesses of government – and the high taxes needed to pay for them – that hold families back. Even so, the facts paint a much brighter picture of the American worker in terms of employment, compensation and empowerment. Unfortunately, the burden of higher taxes on the average worker has created a very real sensation of "working more for less" in spite of their relative prosperity. Since 1949, the FICA tax rate alone has increased 520 percent.
Education and Workforce Development
American workers are the most productive workers in the world. They demonstrate initiative, creativity and energy that has helped make American companies competitive again. Unfortunately, too many workers have inadequate education and skills. To remain competitive in the global economy, America needs to do more, publicly and privately, to educate and train the workforce of today and tomorrow. There is a growing skills gap. Eighty-eight percent of manufacturers report difficulties in finding qualified candidates in at least one job function. Sixty percent of manufacturers typically reject half of all applicants as unqualified. Solutions need to come from business, government, and from American workers. The federal government needs to adopt national and international standards to measure student performance in reading, mathematics, science and social studies. In addition, tax incentives should be enacted to support education and training investments. Business should do its part by working more closely with community schools to shape appropriate curriculum and to develop a voluntary system of skill standards.
EPA's Air Quality Regulations
We oppose. In 1997, the EPA issued new National Ambient Air Quality Standards (NAAQS) governing ozone and fine particulate matter. In 1999, the D.C. Circuit Court deemed those rules unconstitutional and sent them back to the EPA for further consideration. The EPA is appealing. Air quality has improved dramatically over the past 30. But these new regulations would have the effect of putting hundreds of communities back to non-compliance. The new standards would be impossible to meet without jeopardizing the economy. We oppose these new standards. Justified by EPA in terms of children’s health, the tighter rules are not scientifically supported. In 1999, with the support from this and other employers' organizations, Congress acted to ensure that there would be enough time for considering new scientific studies before the regulations are implemented.
Estate Taxes (the Death Tax)
Estate tax rates as high as 55% can force small manufacturing families to sell the business on the death of the owner. Yielding a tax burden exceeding the liquid assets of most manufacturing families, many manufacturing families develop estate planning strategies to head off loss of the family business but these are costly, cumbersome and time consuming. We support repeal or reduction of the death tax. Estate taxes generate less than 2% of federal tax revenue. They aren’t worth it. Only a third of family-owned businesses survive into the next generation. For many of the two-thirds that don’t, death taxes are a prime reason.
Family and Medical Leave Act
Legislation has been introduced to expand the FMLA to include 24 additional hours of leave or lowering the threshold to employers with over 25 employees. We oppose. The FMLA requires companies with 50 or more employees to provide up to 12 weeks of unpaid leave to employees with a newborn or newly adopted child, serious personal illness or seriously ill family member. While on leave, the employee’s job and health insurance are protected. This 13-page law has become 300 pages of regulations, and hundreds of pages of interpretive "guidance". Congress should not expand the FMLA, especially not until the problems with the current FMLA are addressed.
FMLA - Unemployment Compensation
The Labor Department proposed a regulation in November 1999 to allow states to use unemployment insurance (UI) funds to pay workers on FMLA leave. Breaking 65 years of common sense and program history, this politically motivated scheme will jeopardize the financial security of those who lose jobs during the next economic slowdown. The Labor Dept. in June finalized the regulation. We believe unemployment insurance is for people who don’t have jobs. The Labor Dept. itself acknowledges that half of the states’ unemployment trust funds are less-than-adequately-funded. We urge our state to ignore this ill-advised guidance.
Managed care reform has been a top issue in Congress. The Dingell-Norwood bill contains a dangerous mix of (1) liability for employers who offer health coverage and (2) expensive health insurance mandates. American businesses provide health care voluntarily to their employees. 129 million Americans get their health care this way. Anti-managed care bills like Dingell-Norwood "Consensus Managed Care Improvement Act" or the the Kennedy-Dingell "Patient’s Bill of Rights Act" would destroy that system. These bills would allow injured employees to sue their employers for injuries suffered as a consequence of benefits delivered or denied under the employer's health plan. That means skyrocketing legal costs for employers, less money for employee benefits.
The federal minimum wage is currently $5.15 an hour. The Administration and big Labor have made raising the minimum wage a top priority. We oppose. Supporters argue that raising the minimum wage reduces poverty. It does not. Most who are poor either don’t work at all or work only sporadically. Raising the minimum wage does diminish the supply of entry-level jobs. It reduces opportunities for young people and others with low-skills who want to add to family earnings. Few, if any, Association members pay minimum wage. We oppose increasing the minimum wage even though it wouldn’t directly affect our members’ labor costs. We take this position in the belief that increasing the minimum wage is bad economic and social policy.
OSHA Ergonomics Regulation
The Labor Department has published proposed OSHA standards for workplace ergonomics. At the same time, the National Academy of Sciences is conducting a study of the existing body of scientific and medical knowledge about ergonomics, pursuant to legislation passed in late 1998. We believe the Labor Department should wait for that study's findings, expected in early 2001, before promulgating ergonomics standards or guidelines.
OSHA does not possess adequate scientific evidence for promulgating ergonomics standards. At the least, it needs to wait to be informed by the results of the ongoing National Academy of Sciences study. While OSHA estimates the standards would cost U.S. employers some $4 billion, an SBA study puts compliance costs for small businesses alone at a minimum of $12 billion to as much as $40 billion.
OSHA’s proposed regulation focuses on process rather than actual solutions. An employer following the proper procedures could still see no reduction in the injury rate. There is a lack of sufficient scientific and medical evidence on the causes of musculoskeletal disorders (MSDs): a recent government study found no direct relationship between work and MSDs, nor the extent to which non-work factors are responsible for these injuries. As a federal agency charged with regulating all American businesses, we believe OSHA should wait for objective data before attempting to promulgate new ergonomics regulations.
Permanent Normal Trade Relations (PNTR) with China
We support (H. R. 4444). We oppose the unilateral China sanction bill, S. 2645.
The US legal system must be reformed to inhibit the threat of lawsuits for frivolous or dubious liability claims. This association supports a uniform federal law that would promote U.S. business growth by (1) mandating that liability be established through "clear and convincing" evidence before awarding punitive damages; (2) limiting the amount of punitive damages; assigning "fair-share" liability in direct proportion to the fault of a defendant; (3) allowing for a defense to be raised when an injury results from misuse, alteration or action under the influence of alcohol or illicit drugs; and (4) limiting the liability for old and outdated capital equipment.
R&D Tax Credit
The R&D Tax Credit gives firms a credit for certain research expenses. Since its creation in 1981, it has expired and been extended many times. Lapses in the R&D credit create uncertainty and complicate long-term investment plans. We support a permanent extension of the R&D tax credit. Manufacturers conduct nearly 60% of all R&D in the US. Most other industrialized countries provide permanent (and larger) R&D incentives to their firms. U.S. companies are at a competitive disadvantage without it. The R&D credit is an important pro-growth provision in an income tax code that is otherwise anti-growth. It should be made permanent.
(1) American highways carry $4.4 trillion of goods yearly. But nearly 60 percent of U.S. roads and 33 percent of bridges require repair. Manufacturers rely on a sound infrastructure to help with just-in-time delivery and speeding products to market. We support programs designed to maintain and improve the nation's vital highway system. (2) Archaic shipping laws harm U.S. exporters and benefit foreign competitors. Manufacturers support reform of the ocean shipping industry - the only transportation sector still heavily regulated. Reforms would eliminate burdensome tariff filing with the Federal Maritime Commission, provide confidentiality for service contracts, allow shippers and carriers to privately agree on many commercial issues, and protect shippers from retribution for undercharges.