The US Chamber's John Kirchner spoke to over 50 local business and community leaders at the Chamber's Eggs & Issues breakfast on Friday, May 17.
Kirchner spoke about a variety of issues, which represented a mixed bag of optimism and challenges. He talked about the strength of the economy, the positive impact of tax reform, along with challenges like the negative impact of tariffs and getting diverse parties in Washington to work together to get critical priorities accomplished like infrastructure and immigration reform.
Left: John Kirchner of the US Chamber speaks at the May 17 Eggs & Issues;
Right: Chamber members getting the federal update at Eau Claire's Holiday Inn South
To begin, Kirchner highlighted the stark partisan divide in Washington, emphasizing that, in 2013, only four members of Congress were considered moderate. (That number might be even lower now, he noted.) What are the reasons? Kirchner proposed two explanations. First, he said that gerrymandering could be a cause. When districts are drawn to favor only one party, those districts often elect the most extreme members of the favored party. Gerrymandering, however, can explain only the House’s division; the Senate is elected to represent states not districts. So he added that the abolition of earmarks could also be feeding the partisan conflict. Earmarks are amendments that individual legislators can append to bills in order to fulfill the interests of wavering legislators. Kirchner argued that their has been less motivation for bipartisanship since their abolition.
Even with that partisan conflict, Kirchner explained that Congress has passed a few important and beneficial bills. The 2017 tax bill is an example. Through lowering the top tax rate, he said, the administration has freed up a significant amount of corporate capital, much of which companies have invested into employee benefits and pay. This reform, having such noticeable effects in America, has spurred other nations to lower their corporate tax rates. Households have benefited too. For example, the bill has nearly doubled the average deduction for both single and joint filers. In addition, the child tax credit completely doubled, going from $1,000 to $2,000 on average.
Kirchner also emphasized the benefits of the Trump administration’s regulatory roll backs. Before President Trump was elected, Kirchner noted, many business owners viewed excessive regulation as the biggest barrier to success. “Since only 1976, executive agencies have issued over 180,000 new regulations,” his PowerPoint read (see also the graph below). In fiscal-year 2018 alone, the Administration repealed 176 regulations, which saved the nation around $23 billion. And since the start of the term, the Administration has withdrawn or delayed over 2,200 executive regulations. In addition, President Trump and Congress have invoked the Congressional Review Act 14 times, something done only once before.
Not all recent policies have improved the economy, however. For example, increasing tariffs has had an all-in-all negative effect on the economy, especially the agricultural industry. Since the beginning of his term, President Trump has imposed hundreds of billions of dollars in new tariffs. In return, many countries—including China, Mexico, and Canada—have retaliated. US industries and consumers now have to shoulder the burdens of roughly $150 billion in retaliatory tariffs. Those burdens, Kirchner added, function as taxes on Americans, which could actually harm the economy in the long run.
Mentioning Congress’s failure to pass health-care reform, Kirchner offered a solution to our current system of health care. He proposed an expansion of association health plans. These plans would primarily help small businesses because they will allow them to join up and enroll in low-rate group plans. The Congressional Budget Office estimates that, if implemented, this approach would increase the number of insured by about 400,000. Not long ago, however, a federal court held that key parts of the AHP policy plan are unconstitutional, so the future of that plan is uncertain.
For all the partisan loyalty observed earlier, Kirchner predicted that the parties might work together to pass an infrastructure package. Such a package would likely include a “modest increase in the federal fuel fee.” But that is something he expects both parties to support because it would benefit a large portion of the American population. Constructing the roads would also develop a trained workforce. Those are things everything can agree are beneficial. The primary struggle in passing such a bill lies in the fact that “infrastructure” means different things to different people. That is, infrastructure means the development of complex roadways to urban citizens, while it means the expansion of broadband to rural Americans.
Another area where both parties might work together is immigration. Although some aspects of this issue have caused fervor, it is possible that both parties could come together to reform green cards and the employment-verification system. Kirchner hit on another issue related to immigration--DACA. DACA has proven unpopular among many Republicans, but he stressed that these deferrals positively affect the workforce, something that desperately needs growth. With 10,000 baby boomers retiring every day, and with our low rate of population growth, DACA serves as a solution to the demands of our waning workforce.
U.S. Chamber of Commerce, Congressional and Public Affairs
Executive Director, Midwest Region
National chamber aims for the middle now (Leader-Telegram)
John Kirchner's PowerPoint Presentation (Eggs & Issues, May 17, 2019)
Posted by Nate Kane, Legislative Intern
Eau Claire Chamber
The Eau Claire Chamber of Commerce has more than 1,200 members.