Did I mention an all-red Congress? “A Republican Congress and administration will bode well on energy policy as PHCC members confront bans and restrictions on natural gas connections and appliances across the country,” says Mark Valentini, Vice President of Legislative Affairs, PHCC-National Association. “This will also bode well for tax policy as certain provisions in the Tax Cuts and Jobs Act of 2017 are set to expire which have been beneficial for many contractors, especially when considering Congress revisiting the corporate tax rate and potentially lowering it to 15% down from 21%.”
Valentini’s cohort, Charles White, VP Regulatory Affairs, PHCC-National Association, says that we can expect to see legislation on tax reform and energy in the new Congress. “Tight margins particularly in the House will require all Republicans to be on board to pass anything,” says White. “It is possible that the new administration will review regulations that are currently in litigation, like the residential gas furnace rule, and perhaps decide to pull back those rules for revisions. This could also affect decisions on whether to appeal adverse court rulings such as the recent ruling against the US Department of Labor’s Overtime Rule.”
Tariffs and the Industry
There is a back-and-forth debate brewing whether instituting tariffs is beneficial to the American economy and the American worker. IAPMO’s Hansen says that economists have different views on the topic of tariffs, but the plumbing industry is well-positioned to support continued domestic production of what our country needs—and increase US exports to other countries.
“Any policy that strengthens our manufacturing muscle is good for the economy and increases job opportunities in the trades. Programs such as the Market Development Cooperator Program and Standards Alliance at USAID, along with the Department of Commerce’s Foreign Commercial Service, provide vital support to US exporters. We hope the administration will continue backing these programs to ensure US products remain competitive overseas. We continue to monitor the impact tariffs are having on our global industry as manufacturers move locations to avoid these costs,” says Hansen.
While IAPMO is cautiously optimistic and vigilant, PMI shares concern. “During his campaign, President Trump spoke about his desire to increase tariffs—as high as 60% on Chinese goods, 10% to 20% across the board on all foreign goods, including Europe, and 25% on imports from Mexico, unless they curb the number of immigrants coming across the border. If he’s successful, these tariffs will have an inflationary impact, increasing the costs of production and in turn the costs of products in the marketplace. That’s certainly one of the biggest concerns plumbing manufacturers have right now.
“Our stance on this issue all along is that tariffs are harmful to the economy because they increase costs for manufacturers and have an inflationary impact on customers wishing to purchase plumbing products. These increased costs lead manufacturers to provide fewer jobs and they have less money for compensation as well. From an economic standpoint, we see no benefits from tariffs. PMI has always been an advocate for free and fair trade among nations,” says Stackpole.
ABC’s Brubeck says that tariffs are a negotiating tool to renegotiate policies with other countries. “While having a hard time getting materials from overseas, resolving the domestic supply chain is a good thing,” says Brubeck.
Commitment to the Trades?
While President Trump’s first term had support from the trade’s rank and file, the Industry Recognized Apprenticeship Rule, for example, received more negative public comments than perhaps any other rule, suggests White. Those negative comments came overwhelmingly from those same rank and file workers. “Polling data throughout the election shows that the President-elect enjoyed substantial support from skilled blue-collar workers, but his future actions must support their jobs in the workforce,” says White.
Bellaman says that ABC looks forward to working with the Trump administration and Congress to advance policies that solve the issues that the construction industry faces, including the skilled labor shortage of more than half a million, widespread regulatory burdens and inflation and tax challenges. “We welcome the opportunity to work with a president who is willing to welcome all of the US construction industry to rebuild America.”
