Board Chair Gregg Sherrill’s Remarks at the Commercial Vehicle Outlook Conference (Dallas, TX)

Thank you for that warm introduction. It’s good to be with you this evening.

Since I was born in Texas, it’s a homecoming of sorts for me. Although having been raised southwest of Houston, I grew up thinking of Dallas as a northern city. But now I’m older and much more sophisticated, and I can report the folks here in Dallas are just as friendly and hospitable as Texans south of I-10.

Tenneco is an $8.4 billion company, one of the world’s leading designers, manufacturers and distributors of clean air and ride performance products for the automotive, commercial truck and off-highway markets and the aftermarket. We employ nearly 29,000 people worldwide, with more than 90 manufacturing facilities on six continents and 15 engineering centers. In the most basic way, our success as a global company depends on our people.

Like many U.S. manufacturers, we have an inherent advantage due to our deep experience in dealing with global diversity. We operate in a mosaic of cultures, and realize that all business is local. But our corporate DNA blends with the cultural DNA, and around the globe we subscribe to a single, clear and simple strategy aligned with clear corporate values.  

In all respects, we’re a global company – but a global company with its roots sunk deep in this democratic experiment of ours – a nation like no other in the history of the world, always in the process of becoming, and always striving to become better.

Just consider what we have going for us. At no time in history has a country enjoyed such comparative advantage and quality of life as the United States in the 21st century.

We have an abundance of arable land, clean air and water, energy and natural resources. We live in an unquestioned democracy within an ingenious federal system and governed by the rule of law. Our free enterprise system and our financial system with its deep liquid markets is the envy of the world, as is our university system.

Thanks to the wisdom and vision of our country’s early leaders, many of them largely unsung, we are a three-ocean nation – the Atlantic, Pacific, and Arctic. Much of our future will be written in Alaska and the yet-to-be explored lands and waters of our far north, while at the same time continuing to safeguard our heritage of protected wilderness.

Yet with all that, and a $17 trillion economy going for us, how do we find ourselves facing a $13 trillion debt – 75 percent of GDP, the highest since World War II? Under current law, that debt will reach 78 percent of GDP by 2025 – twice the historic average – and it will exceed the size of the economy by the mid-2030s.

In large part, the blame lies with many of the people we send to Washington to represent us. But it also lies with all of us for not making it clear what we expect of them and holding them to it.

In large part, the blame lies with many of the people we send to Washington to represent us. But it also lies with all of us for not making it clear what we expect of them and holding them to it.

True, policymakers have made some progress in reducing deficits, but it’s all short term – higher taxes, discretional spending cuts and sequestration, not the long-term drivers.  If nothing changes, by 2030, just 15 years from now, every dollar of revenue will go to mandatory spending – Medicare, Medicaid, Social Security and interest on the debt.

In fact, by just 2025, interest on the debt will reach around $800 billion, more than the current combined federal spending on defense, education, transportation and medical research. And, add to this a tax system that ‘spends’ $1.6 trillion in foregone revenue on special provisions and hidden subsidies.

These are matters of real and intense concern to all of us, our businesses, our country, our children and our grandchildren. And this is where it’s deeply personal for me.  I have four grown daughters, nine grandchildren, and a four year old son. You might say I bring a multi-generational point of view to this critical issue.

At present, in addition to my duties at Tenneco, I serve as Chairman of the National Association of Manufacturers, representing some 14,000 manufacturing companies. I’m also a member of the Business Roundtable and a founding member of the Fix the Debt Coalition CEO Council. As such, I’m keenly aware of the business/government relationship, and have been especially so since the financial crisis of 2008 and 2009.

At the root of that crisis was enormous private sector leverage with well-disguised risk, which was essentially alleviated by larger public service debt. Sovereign debt and deficit issues are now widespread throughout the world, and it has been suggested that if we let the debt continue to bubble up until it bursts – well let’s just say I don’t think we should go there to find out what happens.

It’s essential that our national leadership move this impending crisis to the top of the national agenda. Today no business in the world exists in isolation from government.

As we were profoundly reminded in 2008, the well-being of our economy depends to a great extent on confidence. Government has a major role to play in encouraging and maintaining that confidence, setting sensible pro-growth programs and policies that play to our unique strengths as a nation.

But increasingly, our government has been failing us in this area. As Eugene Steuerle points out in his recent book with the wonderful title, Dead Men Ruling, this situation has steadily worsened as both parties attempt to control the future by imposing their agendas on future generations. In the process, mandatory programs and tax policies are locked in and continue to grow year over year without any governmental action and regardless of changing demographics.

Thus, our priorities today and those of our children and grandchildren are being fought over within an ever-shrinking discretionary budget that reaches zero by 2030. The negative economic consequences will be profound – rising and unsustainable debt; diminishing ability to fight recessions and deal with national emergencies; and a broken government as reflected in an antiquated tax and social welfare system.

And most unconscionable of all, are budgets that invest ever less in our children and our future – a moral crime and blueprint for a declining nation.

That can’t continue. This impending crisis has to be moved to the top of the national agenda. In fact, it’s so central that we should demand that presidential candidates focus on how to deal with this fiscal trajectory – important enough I believe to devote one of next year’s Presidential debates to just this topic.

Let each candidate explain to voters his or her plans for working with both parties and Congress to reduce the debt. Let’s see an agenda that includes reforms that strengthen our economy long-term and put our finances in order. This is no time for adhering to pro- or anti-tax gimmickry or other ideological bickering.

As Eugene Steuerle points out, one party focuses on raising taxes but never reforming social spending or entitlements, while the other focuses on cutting social programs and entitlements but never raising taxes. The result is a political logjam, caused in no small part by fear of losing the next election.

So let’s take a look at a current example of how something everyone agrees is a clear national priority is being affected by the ever shrinking funding available for discretionary spending. I’m referring to our national infrastructure and the Highway Trust Fund.

The Senate has vowed to craft a long-term bill, but in the meantime agreed with the House to settle for another three-month temporary patch for the Highway Trust Fund. That allowed our legislators to leave Washington for the entire month of August for their summer vacations, plus an additional week off in September for the Labor Day break.

Thus, with a break around Thanksgiving, and the last week in December usually written off, legislators will have a little less than three months to produce a comprehensive Highway Bill, while facing deep ideological differences – and significant differences between the House and Senate and within the respective parties themselves – over how a bill would be funded.

Many of us, no matter what our political affiliations, have pointed out that the federal fuel tax, really a user tax, hasn’t been raised since 1993. A significant part of the funding problem would be solved if that tax were raised by roughly 15-cents, and indexed to inflation to ensure it remains a sustainable source of revenue. And what better time to do it than now with gasoline prices down on average 85-cents per gallon versus last year. 

That was the type of thing Simpson-Bowles recommended – a reasonable, non-political approach, with both spending reductions and some revenue increases. But in Washington’s overheated ideological atmosphere, and especially on the eve of a presidential election, with several active legislators running and using Congress as a forum for their campaigns, rational and reasoned approaches are as likely as snow here tonight. 

Moreover, the legislative plate, which our representatives decided not to touch in July, will be uncomfortably full when they return after Labor Day. In short, Congress has put off for tomorrow what they could have done yesterday, and the result may be an impasse on all fronts, resurrecting all that semi-hysterical talk of fiscal cliffs and shutting down government.

Consider just a few items on the menu – government funding runs out on October 1; there’ll be a requirement to increase the debt ceiling; an increasingly bitter debate over the Iranian nuclear agreement; and debate about reauthorizing the Export-Import Bank, a move favored by pro-business legislators in both parties.

It had been hoped that the Bank would be authorized as part of extending the Highway Trust Fund before Congress left town. And let’s not forget such major issues as TPP, immigration reform and tax reform.

In the meantime, while the automotive and commercial truck industries continue to innovate and embrace the latest technological advances, the potholes deepen and widen, the bridges continue to crumble, and our whole transportation infrastructure becomes increasingly difficult – and in places dangerous – to navigate.

As I know we all agree, this neglect is extraordinarily short-sighted. Our national transportation system, in which we’re all invested, has helped produce the best housed, best clothed, best fed and best educated citizens in the world.

In fact, it’s no exaggeration to say that our national transportation system is a primary guarantor of our way of life. We’re responsible to a great cross section of Americans – consumers, companies, government at all levels – and as we meet those responsibilities, we adapt to changing times.

That means continued improvement in the quality of our products and increasing reliance on technology, with innovation the key. And it means rigorous maintenance and constant improvement of our country’s transportation infrastructure.

It also means continuing to nurture long term and mutually beneficial relationships, with other businesses and with government. Whether we’re engaged in providing our fighting forces with the best technology and equipment available, or helping in the effort to bring cleaner air and water to our towns and cities, we’ve worked together, to the benefit of all our citizens.

Our central role may seem obvious. But in uncertain times our contributions sometimes become blurred, in part the result of the conflicting economic, ideological and political arguments raging in Washington.

At such times, it’s easy to sour on politicians – and with good reason. But politicians have always been politicians, and partisanship has always been part of the political equation.


And although it can at times be irritating and counter-productive, I sincerely believe it can also be an expression of deeply-held principle, a sign of democratic good health, as it has since the days of Hamilton and Jefferson when differences over the role of government make today’s debate almost look trivial.   

But when a moment for decisive action finally arrives, crucial to our nation’s well-being, when all the bickering finally fades out, I believe our history shows that we can expect the best from our people, our politicians, and our government.

But when a moment for decisive action finally arrives, crucial to our nation’s well-being, when all the bickering finally fades out, I believe our history shows that we can expect the best from our people, our politicians, and our government.

That’s what we’ve done since the earliest days of our republic, when the partisanship was if anything much more intense than it is today.  

During another hot summer in 1787, in a stifling State House in Philadelphia, delegates to our Constitutional Convention from every region and every political and economic faction in our new country hammered out the terms on which the republic would be governed.

Every view was aired, every dissenting voice was heard. Factionalism was intense, with the whole idea of bipartisanship laughable. But they fought it out, and finally came together to form a national government.

George Washington said it was “little short of a miracle” that the differences among delegates – far greater differences than there are today – were able to be reconciled. And at the end, virtually all the signing delegates left apologizing for an imperfect document.

There’s no doubt that it required significant compromise from everyone there.  But with 228 years of hindsight, no one can argue that had any one side prevailed, it would have been a better document and that today, along with its 27 amendments, it’s still a beacon of hope for the world.

Ratification of the Constitution, as the historian Joseph Ellis put it, “was the most comprehensive and consequential political debate in American history.”

That’s not to say that ratification blew away all traces of partisanship. In fact, as Edward Larson writes in his splendid book The Magnificent Catastrophe, a history of the election of 1800 which involved the first presidential campaign, the partisanship in that campaign appalled George Washington.

Among the players, John Adams and Thomas Jefferson were feuding. Neither liked Aaron Burr, and Burr returned the sentiment.  Alexander Hamilton didn’t like Jefferson or Burr. Jefferson was called a Deist infidel and a friend of France, at a time when the French Revolution was underway. Adams was called an elitist friend of England, and Burr an unprincipled opportunist who’d start a war to win an election.

As the campaign heated up, partisan ranks solidified, debate gave way to mudslinging, and George Washington’s dream of the selfless public servant appeared to go up in smoke.

Yet despite the birth of partisan politics – and maybe because of it – our nation survived and flourished, in no small part because of the freedom of our system and the human ingenuity it nurtures and encourages.

And when we’ve undergone periods of great crisis – the Revolution, Civil War, two World Wars, Depression, assassinations, civil strife – our system has always produced leaders equal to the occasion.

Washington, Lincoln and FDR come immediately to mind, as does Ronald Reagan. But at critical moments in our history, less celebrated leaders have also stepped forward to play a leading role in shaping our national destiny.

James K. Polk, the 11th president of the U.S., was by his own choice a one-term president, believing that the politics involved in running for a second term would interfere with carrying out his agenda.

Polk, a political protégé of Andrew Jackson (“Old Hickory’) whose nickname was “Young Hickory,” has been called our “least known consequential president.” But he certainly was consequential here, responsible for the annexation of Texas, and signing the legislation in 1845 that made Texas the 28th state.

Perhaps more than any other president, Polk was responsible for our nation’s westward expansion. In three short years he oversaw the greatest territorial expansion in our history, winning control of Texas, California, Nevada, New Mexico, Arizona, Utah, Washington, Oregon, and partial control of the territories that would become Oklahoma, Colorado, Kansas, Wyoming and Montana. I would call that an investment in the future!

During Polk’s term, the problems unresolved at Ratification gave rise to the fierce partisanship that would erupt in Civil War, and he served out his term under extreme political pressure. But his determination to serve just one term would help render him immune to partisan attacks and allow him to complete his agenda, to the ultimate benefit of Texas and the American West.

So why do I bring up these historical examples? Well I simply believe that great perspective can be derived from history. 

We have faced much greater consequential issues in the past and in environments of even greater partisanship, and have ultimately found solutions through principled compromise and it’s what gives me an optimistic view and confidence in our future.

We have faced much greater consequential issues in the past and in environments of even greater partisanship, and have ultimately found solutions through principled compromise and it’s what gives me an optimistic view and confidence in our future.

Two centuries later in Washington, where government seems to have no coherent agenda, another hot and partisan summer is coming to an end.

The vacations will soon be over, at least for several months, and our legislators will be returning to take up our work. This year the already over-loaded legislative schedule will be complicated by the efforts of a lame-duck administration to add to President Obama’s legacy, and resistance from those who want to replace him.

We may be approaching something like a perpetual campaign, with candidates off and running and raising money year-round. But perhaps it’s time for us to step back and take a good look at whom we’re supporting, and for what. Perhaps it’s time to hold our would-be office holders accountable.

During the upcoming presidential debates, the candidates should be pressed to address basic economic questions including fiscal responsibility, expanded trade, a comprehensive energy policy, a realistic regulatory approach, immigration reform and a consistent tax policy – it’s in these and related areas that our government can ensure that we maintain our preeminent position in the world.

By putting these matters at the center of economic policy-making, our government would ensure that American business is playing at the top of its game.

At its best, government is the facilitator and guarantor of our freedom to create, to lead, to innovate. That’s what American business has always done best. And that’s what our government should encourage business to continue to do.

Next year we’ll elect a new president and a new administration, and perhaps have a new broom. Whether it sweeps clean or just pushes it all under the same old rug is in part up to all of us as voters. But it’s also up to all of us as spokesmen and women for our free-enterprise system.

All of us here tonight have a great stake in our nation’s success. For two centuries now, we’ve been the hope and envy of the world, a beacon of freedom seen in every land. And our free-enterprise system, hard wired into our DNA, has created more wealth and lifted more people out of poverty than any system yet devised by man.

We can all take great pride in that system, and we can take great pride in the role all the segments of our industry have played since the earliest days in building this great industrial society.

At Tenneco today, as with so many of your companies, we are working in an area where business, economics, science, ideology, politics and government intersect, and at times the problems posed to our industry have seemed nearly insurmountable.

But we’ve always come through. We’ve always believed that given any problem, we can meet it and solve it. Give us a dream and we can make it reality. And that’s just what we’ve done.

In the end, that’s the defining characteristic of our free enterprise system, our gift to the world. We’ve helped give people everywhere an unprecedented measure of mobility, and by so doing have helped give people around the world an unprecedented measure of human freedom.

“Life, liberty and the pursuit of happiness” – a simple but elegant statement that describes the ultimate purpose of our economic system; namely, to allow all of us to  rise just as high and far as our talents and abilities can carry us, and to achieve life’s ultimate satisfaction in the pursuit of our dreams. 

The most important thing to remember is that when the chips are down, right thinking and patriotic Americans – Americans like the men and women in this room tonight – have always come forward together to solve our problems and move our country forward.

In one of the greatest speeches in American history, President Lincoln in his Gettysburg Address essentially raises a question that is relevant for every generation of Americans.  Knowing that the very foundation of our government was unique in all of human history; that governments derived their power from the consent of those governed, he stated that we are engaged in a great test as to whether that nation, or any nation, so conceived and so dedicated, can long endure.

Well, we met this test under severe circumstances during Lincoln’s time and have many times prior to and since then, and always when the outcome was not so certain.

We’ve entered one of those periods in our history when it’s essential that all of us be heard, loud and clear, in defense of our system of government that was designed to serve us and protect basic tenets such as our free enterprise system.

It’s time to help shape the dialogue on economic matters to which you bring a real-world business understanding – matters much too important to be left to the career politicians.  In fact, the common theme in overcoming every major crisis this country has faced was the emergence of leadership that was willing to sacrifice themselves for the future and not sacrifice the future for themselves.  As citizens, I believe this is the main criteria we should be looking for as we consider who deserves the privilege of leading this great nation.

I know many of you here tonight are not only tirelessly working to ensure the sustainability of your business and providing outstanding opportunities for countless families but you’re also working hard on policies to enhance our country’s success.  For all of this, I congratulate and thank you for your efforts.