Looking for Action from the Trump Administration
“You’d think steel would rule in D.C. these days,” Philip Bell told the MSCI Carbon Conference recently. “But now the rhetoric has to interface with reality.” Bell, president of the Steel Manufactures Association (SMA), and American Iron and Steel Institute (AISI) General Counsel Kevin Dempsey spoke together at the MSCI’s Carbon Conference, with both men offering hope, realism and caution.
After all, this is an administration that has pushed business executive confidence to all-time highs. “The President’s priorities are business confidence and economic growth,” Dempsey said. “This is a real change in perspective from Washington.” But now, both agreed, comes the hard part, forging workable programs particularly on tax reform and infrastructure spending. “This president has got to work with Congress,” Dempsey added, “but these programs are complex and they will take longer than he likes.”
More troublesome, they said, is that the President’s specific priorities are not easily pinned down and so many important agency appointments have not yet been filled. “It is too large a number,” said Bell. “Thousands in the Commerce Department alone.”
“No one has been named at OSHA either,” Dempsey said. “There are maybe 550 vacancies to be filled there.” Likewise at the EPA, “though we fully expect an eventual repeal and loosening of regulations, these kinds of delays cut into their potential impact,” he added.
This is background to an administration that has made it clear that health care and tax reform have moved to the top of its priority list, with infrastructure—critical to boosting employment and demand for the industrial metals supply chain—now pushed to third at best.
That drop in priority for infrastructure comes as the top two hardly seem headed for quick resolution. Health care is certainly in for a long and contentious fight. Tax reform will not be any easier.
“Tax reform is not for the faint of heart,” observed Bell. “Even though there is a lot of agreement on what needs to be done, lower rates on both corporate and pass-through income for instance. But we all know that tax reform is going to be a very heavy lift.”
With no obvious agreement on those two top issues, especially from Republicans in both houses of Congress, it seems that infrastructure may get stuck in that neglected third place. There is no indication yet that the administration is willing to spend the necessary public money on the nation’s roads, bridges, harbors and airports. Mostly the talk has been of public-private partnerships, which primarily applies to the building of toll roads, a disappointingly limited approach in a nation that just got a D+ for its infrastructure from the American Society of Civil Engineers.
“Infrastructure is extremely important,” Bell said. “Public-private investment is fine. But some projects that we’ve got to have are not revenue producers and just need to be funded publicly. It is going to take a lot of courage to spend that money.”
The caution from both men: Issues and programs that were once thought to be in line for quick D.C. action with Republicans in complete control, now appear to be bogged down. “What is most surprising to us is that compromise has now become some aspirational goal,” Bell said. “We just need a few statesmen to step up in order to make all this happen. If we can’t get these things done now, when will we?”