Policy and Legal

Manufacturers need smart laws and effective policies. That’s why the NAM is standing up for manufacturers everywhere – from the halls of power where we advance important legislation, to the courts where we fight to defend our rights.

Press Releases

New Study | Stricter Interest Expense Limits Costs Half Million Jobs

Failing to Address EBIT-Based Limitation Harms Manufacturers’ Competitiveness

Washington, D.C. – Following the release of an analysis on the economic impact of failing to reverse a stricter limitation on deductions for interest on business loans that took effect earlier this year, National Association of Manufacturers Managing Vice President of Tax and Domestic Economic Policy Chris Netram released the following statement.

Key Findings:

The stricter EBIT-based 163(j) interest expense limitation before market adjustments would cost:

  • 467,000 jobs;
  • $23.4 billion of employee compensation; and
  • $43.8 billion in GDP.

“Manufacturers are already facing incredible economic headwinds due to increased input costs, rising interest rates, labor shortages and snarled supply chains. This analysis shows that failing to reverse the damaging change to the tax treatment of interest on business loans disproportionately harms manufacturers at a perilous time—costing hundreds of thousands of jobs and billions of dollars in economic growth.

“America is an international outlier in imposing such a strict interest expense limitation. With nearly half a million American jobs at stake, Congress must act by year’s end to reverse the stricter EBIT-based limitation and allow manufacturers to continue to invest for growth.”

EY’s Quantitative Economics and Statistics group prepared the analysis.

Background:

Prior to 2022, the interest expense limitation was calculated based on a company’s earnings before interest, tax, depreciation and amortization (EBITDA). This year, a stricter limitation based on a company’s earnings before interest and tax (EBIT) took effect. By excluding depreciation and amortization from the calculation, the stricter limitation increases the tax burden on manufacturers that make investments in long-lived capital equipment.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.8 million men and women, contributes $2.77 trillion to the U.S. economy annually and accounts for 58% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Policy and Legal

Kigali Ratification a Win for Manufacturers

Get the Latest News

Get involved

The Senate voted yesterday to ratify the Kigali Amendment—an international greenhouse gas–reduction accord that is more meaningful than any the U.S. had agreed to before. Long advocated by the NAM, this ratification is a major step forward for manufacturers and their ability to compete effectively and sustainably.

A climate-action model: In a strong bipartisan 69–27 vote, the Senate approved the amendment, a change to the 1987 Montreal Protocol that phases down the use of hydrofluorocarbons (commonly used refrigerants) in favor of more efficient next-generation alternatives.

  • The measure, which the NAM called for in its climate change roadmap, “The Promise Ahead,” “could help avoid a half-degree Celsius of global temperature increases by the end of this century,” according to POLITICO Pro’s E&E News (subscription).
  • The ratification builds on a move for which manufacturers also pushed, the 2020 legislation requiring the Environmental Protection Agency to issue rules to phase down nonessential HFCs by 85% by 2036.

Manufacturers approve: Many manufacturers were delighted by this move. “Trane Technologies applauds senators on both sides of the aisle for voting to ratify the Kigali Amendment,” Trane Technologies Chair and CEO Dave Regnery told Input.

  • “In addition to creating 33,000 U.S. jobs, stimulating $12.5 billion in new investment in the U.S. economy and boosting U.S. exports by 25%, ratifying Kigali aligns with our bold commitments to reduce emissions through sustainable innovation.”

Accountability for China, India: Critically, the legislation fortifies “our global leadership and put[s] the U.S. in a position to hold countries like China and India accountable,” NAM Vice President of Energy and Resources Policy Rachel Jones said in a communique to Congress—which was quoted by Environment & Public Works Committee Chairman Sen. Tom Carper (D-DE) on the Senate floor Tuesday.

  • The amendment will also “protect American workers, grow the economy and improve our trade balance all while encouraging further innovation to strengthen America’s technology leadership,” Jones wrote.

Inside the NAM’s advocacy: “We were able to leverage our longstanding policy experience, strategic partnerships and our depth of relationships in the Senate to adeptly navigate the ever-changing and challenging politics,” said NAM Senior Vice President of Policy & Government Relations Aric Newhouse.

  • “Ultimately, the NAM’s support and long-term engagement was able to shepherd this crucial priority for manufacturers across the finish line in a bipartisan way that doesn’t force a false choice between environmental protection and economic growth.”

The last word: “This action proves that if we work together—if we rise above politics and partisanship and focus on solving problems—we can make our vision of a brighter tomorrow into reality,” Jones said in a statement.

Press Releases

Manufacturers: Kigali Ratification a Blueprint for Bipartisan Climate Action

Washington, D.C. – Following the Senate’s 69–27 vote to ratify the Kigali Amendment to the Montreal Protocol, National Association of Manufacturers Vice President of Energy and Resources Policy Rachel Jones released the following statement:

“The Senate’s vote to ratify the Kigali Amendment is a blueprint for the type of bipartisan climate action that meets science-based targets while strengthening manufacturing competitiveness. It will reduce emissions by the equivalent of 80 billion metric tons of CO2 by 2050, with the potential to create up to 150,000 more U.S. jobs by 2027. This action proves that if we work together—if we rise above politics and partisanship and focus on solving problems—we can make our vision of a brighter tomorrow into reality.

“Manufacturers have supported the ratification of the Kigali Amendment for years. This treaty will be a boon for manufacturing, for global trade and for products that protect health, safety, comfort and productivity worldwide. Ratification further strengthens our global leadership on the phasedown of hydrofluorocarbons and will help the U.S. hold countries like China and India accountable on emissions. This shows that we can tackle climate change while strengthening our global competitiveness as we deploy next-generation technologies.”

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.8 million men and women, contributes $2.77 trillion to the U.S. economy annually and accounts for 58% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Policy and Legal

What Manufacturers Need from Regulatory Reform

Get the Latest News

Get involved

While smart regulations can enhance manufacturers’ competitiveness, there are far too many cases of unwieldy or unnecessary rules getting in their way. That’s why the NAM is standing up for regulatory reform and providing policymakers with a list of solutions to pursue today.

The challenge: The annual regulatory cost burden for an average U.S. firm represents 21% of its payroll, forcing manufacturers to divert resources away from important investments. For smaller manufacturers, the burden can be disproportionately painful, creating barriers to growth and development.

Our work: At the NAM, we’re advocating for a predictable regulatory agenda that is based on science and facts and that offers flexibility for innovation.

  • The NAM’s agenda, contained in its policy blueprint Competing to Win, seeks to combat the fundamental problems in our outdated regulatory system.
  • That includes ensuring that regulations focus on outcomes and rely on data; improving regulatory analysis; minimizing unnecessary burdens; strengthening industry outreach; preserving the ability of companies to grow; and reducing the abuse of our legal system.

What we’re saying: “Manufacturers in the United States should be able to grow, compete and win without being stymied by outdated and unnecessary regulations,” said NAM Director of Regulatory, Tax and Domestic Economic Policy Alex Monié.

  • “We are proud of the work that the NAM has done to reduce the burden on businesses while also protecting the men and women who make things in America.”
  • “We are committed to pressing forward so that every manufacturer can support their workforce, participate in market innovation, contribute to their communities, promote competitiveness and advance U.S. leadership.”

Learn more: Check out the NAM’s full regulatory reform agenda in Competing to Win—a strategic blueprint for the policies that manufacturers in America need to compete with the rest of the world.

Policy and Legal

NAM Competes to Win on Taxes

Get the Latest News

Get involved

The NAM is leading the way forward on a range of policies to help boost innovation, opportunity and competitiveness for manufacturers in the United States—and that includes tax policies that ensure manufacturers can continue to compete and win.

The record: During tax reform, the NAM achieved its key priorities—a lower corporate income tax rate, a reduced tax burden on pass-through business income, the adoption of a modern territorial tax system, the retention of the R&D tax credit and the adoption of incentives for capital equipment purchases.

  • Thanks to a more competitive tax code, manufacturers across America have been investing in jobs, facilities and their communities.

The road ahead: Of course, the NAM isn’t taking its eye off the ball. We are committed to protecting our gains and furthering progress—and that means ensuring the tax code continues to incentivize manufacturers’ ability to invest in innovation and growth. We’re focusing on three important tax priorities in the months ahead.

Research and development: On Jan. 1 of this year, a harmful tax change went into effect that makes R&D more expensive in the United States by requiring businesses to deduct their R&D expenses over a period of years.

  • The NAM has been leading the charge to ensure the tax code continues to support innovation by allowing businesses to fully deduct their R&D expenses in the year in which they are incurred. Check out these company stories on the importance of tax policies that support R&D.

Interest deductibility: When manufacturers borrow funds to buy capital equipment, the interest they pay on those loans is tax deductible up to a certain limit. But a recent change in the tax law modified how that limit is calculated—shrinking the deduction, making debt financing more expensive and leaving less capital for job creation and investment.

  • The U.S. is the only OECD country with such a strict interest limitation, so the NAM is working with members of both parties in Congress to reverse the new limit calculation and enhance manufacturers’ ability to compete. Read more about the NAM’s work on this provision here.

Full expensing: Under present law, manufacturers can deduct 100% of their investments in assets with long useful lives, supporting their ability to acquire vital equipment and strengthening their competitiveness. However, the ability to deduct 100% of these costs begins to phase down at the beginning of 2023 and is set to completely expire in 2027.

  • The NAM is leading the business community in advocating for full expensing permanency, joining with members of Congress to support legislation that would create certainty for manufacturers. See how full expensing has benefited small manufacturers in the United States here.

The last word: “The NAM is fighting to protect manufacturers across the country,” said NAM Senior Director of Tax Policy David Eiselsberg. “Protecting R&D, interest deductibility and full expensing will provide the tax certainty necessary for manufacturers to continue to invest in jobs and growth.”

Learn more: Check out the NAM’s full tax agenda in “Competing to Win.”

Press Releases

Manufacturers Call for Quick Resolution to Rail Negotiations

Timmons: Delays in concluding the rail negotiations will exacerbate the pain of inflation and supply chain disruptions, and failing to reach an agreem

Washington, D.C. – Following news that White House aides and Cabinet officials spent Tuesday reviewing contingency plans for a work stoppage, including outreach to shippers, truckers and air-freight lines to keep goods moving, National Association of Manufacturers President and CEO Jay Timmons released the following statement on the ongoing negotiations between Class I railroads and labor unions representing the freight rail workforce:

“For years now, America’s manufacturing workers have endured the effects of rapidly rising material costs and severe supply chain disruptions, and our member surveys have shown quarter after quarter that these are among the top challenges affecting manufacturing growth in America. Further delays in concluding the rail negotiations will exacerbate the pain of inflation and supply chain disruptions, and failing to reach an agreement before Friday’s deadline would devastate the movement of manufactured products that families depend on,” said Timmons. “The Presidential Emergency Board has announced reasonable recommendations that nearly all parties have accepted, so now is the time to resolve remaining issues. We appreciate the administration’s proactive approach, and Congress should be ready to act as a last resort. But manufacturers still believe that the parties have it within their power to resolve these talks before they inflict severe economic damage.”

Currently, the American freight rail network accounts for nearly 40% of total freight volume, and a strike or delay in finalizing a long-term contract would have devastating impacts across surface supply chain networks and economic output. The Association of American Railroads recently released a report that found a nationwide freight rail interruption could cost more than $2 billion per day in lost economic activity.

Background: On Monday, Sept. 12, the NAM sent a letter to congressional leaders reiterating support for the work of the Presidential Emergency Board, which has aided in the talks. The NAM also urged Congress to use its statutory authority to institute the PEB’s recommendations should it become necessary to intervene. The NAM supported President Biden’s selection of an independent and objective PEB and believes that the recommendations announced on Aug. 16 have provided an appropriate framework to avoid disruption to freight rail operations.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.8 million men and women, contributes $2.77 trillion to the U.S. economy annually and accounts for 58% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Press Releases

Manufacturers Unveil Competitiveness Agenda Ahead of Midterm Elections

“Competing to Win” offers a path for bringing the country together around policies, shared values and a unified purpose

Washington, D.C. – Ahead of the midterm elections, the National Association of Manufacturers released its policy roadmap, “Competing to Win,” a comprehensive blueprint featuring immediate solutions for bolstering manufacturers’ competitiveness. It is also a roadmap for policymakers on the laws and regulations needed to strengthen the manufacturing industry in the months and years ahead.

With the country facing rising prices, snarled supply chains and geopolitical turmoil, manufacturers are outlining an actionable competitiveness agenda that Americans across the political spectrum can support. “Competing to Win” includes the policies manufacturers in America will need in place to continue driving the country forward.

“‘Competing to Win’ offers a path for bringing our country together around policies, shared values and a unified purpose,” said NAM President and CEO Jay Timmons. “The NAM is putting forward a plan filled with ideas that policymakers could pursue immediately, including solutions to urgent problems, such as energy security, immigration reform, supply chain disruptions, the ongoing workforce shortage and more. Manufacturers have shown incredible resilience through difficult times, employing more workers now than before the pandemic, but continued resilience is not guaranteed without the policies that are critical to the state of manufacturing in America.”

The NAM and its members will leverage “Competing to Win” to shape policy debates ahead of the midterm elections, in the remainder of the 117th Congress and at the start of the 118th Congress—including in direct engagement with lawmakers, for grassroots activity, across traditional and digital media and through events in key states and districts as we did following the initial rollout of the roadmap in 2016.

The document focuses on 12 areas of action, and all policies are rooted in the values that have made America exceptional and keep manufacturing strong: free enterprise, competitiveness, individual liberty and equal opportunity.

Learn more about how manufacturers are leading and about the industry’s competitiveness agenda at nam.org/competing-to-win.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.8 million men and women, contributes $2.77 trillion to the U.S. economy annually and accounts for 58% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org

Policy and Legal

Congress Leans into Electoral Count Reform

Get the Latest News

Get involved

Following the events of January 2021, the processes for counting electoral votes has received renewed attention—and some members of Congress are working together to fix it.

The background: The law that governs the counting of electoral votes following a presidential election, called the Electoral Count Act, was written in 1887.

  • Over the course of more than a century, the law has remained the same, even as ambiguities have caused conflicts and upheavals—most notably after the 2020 election.
  • In the past two years, a bipartisan group of U.S. senators, led by Sens. Joe Manchin (D-WV) and Susan Collins (R-ME), have come together to develop the Electoral Count Reform Act, which is intended to remove ambiguities around the counting of electoral votes.

The proposal: While the ECRA is still being drafted, a few key provisions have been discussed. For example:

  • The ECRA would clarify that the vice president’s role in vote counting is ceremonial, and that he or she is not empowered to throw out or change any state’s electoral votes.
  • The bill raises the threshold for members of Congress to object to a state’s slate of electoral votes.
  • Certain versions of the bill contain provisions that would increase election security, including by increasing penalties against individuals who threaten election officials.
  • The bill would make clear that state legislatures cannot override the popular vote in their states or throw a state’s electors to someone other than the candidate chosen by their voters.
  • The bill would also clear up ambiguities about presidential transition funds, ensuring that these funds can be disbursed to both candidates in the event of a disputed election in order to prevent delays.

Where we are: The current proposal has 17 cosponsors and is bipartisan. It has been through a hearing in the Rules Committee in the Senate, and it seems likely that some form of the ECRA will be considered this fall.

Our take: “The National Association of Manufacturers supports a clear, secure democratic process that doesn’t confer any partisan advantage and reduces opportunities to exploit ambiguities in the law,” said NAM Chief Legal Officer Linda Kelly. “A stable democracy is good for manufacturers and good for the world. That’s something we can all agree upon.”

Policy and Legal

NAM Files Lawsuit Against SEC Over Proxy Rule Rescission

Get the Latest News

Get involved

The U.S. Securities and Exchange Commission has rescinded critical components of a landmark 2020 rule regulating so-called “proxy advisory firms”—and the NAM is fighting back in court.

The long road here: In 2020, after years of NAM advocacy, the SEC finalized a major rule designed to combat proxy firms’ errors and conflicts of interest.

  • Proxy firms influence publicly traded companies by recommending how institutional asset managers should vote in corporate proxy contests, often without any accountability.
  • The 2020 rule required proxy firms to engage with public companies and their investors, and it subjected the firms to the SEC’s anti-fraud standards.

The about-face: Beginning last year, however, the SEC’s new leadership has worked to undermine the rule, including by refusing to enforce it—an unlawful decision the NAM opposed in court. Last week, the SEC officially rescinded many of the rule’s critical reforms.

The response: The NAM has filed a lawsuit against the SEC to preserve the 2020 rule. Our complaint argues that the SEC’s actions are “arbitrary and capricious”—and that the 2022 rescission should be overturned.

The issue: Federal agencies are required to articulate a reasoned explanation for making a new policy decision—especially when that decision is based on the same facts but reaches a different outcome than a recent rule.

  • In this case, the SEC finalized a compromise rule in 2020 based on a decade of bipartisan research, analysis and discussion—and no new evidence has emerged since 2020 given that the SEC prevented the rule from taking effect. So, the agency’s about-face “epitomizes ‘arbitrary and capricious’ rulemaking.”

What we’re saying: “Manufacturers depend on federal agencies to provide reliable rules of the road, and the SEC’s arbitrary actions to rescind this commonsense regulation clearly violate its obligations under the Administrative Procedure Act,” said NAM Chief Legal Officer Linda Kelly. “The NAM Legal Center is filing suit to preserve the 2020 rule in full and protect manufacturers from proxy advisory firms’ outsized influence.”

Press Releases

Every Manufacturer in America Will Benefit from the CHIPS and Science Act

Timmons: Manufacturers thank congressional leaders from both parties who got this bill across the finish line and President Biden and Secretary Raimon

Washington, D.C. – Following President Biden’s signing of the CHIPS and Science Act of 2022, National Association of Manufacturers President and CEO Jay Timmons released the following statement:

“Every manufacturer in America will benefit from the CHIPS and Science Act, whether they make chips, make products that require chips or are part of a supply chain disrupted by the semiconductor shortage.

“Manufacturers thank congressional leaders from both parties who got this bill across the finish line and President Biden and Secretary Raimondo for their leadership. The industry will also benefit from the new law’s funding for programs to support the STEM workforce, advanced technology development, excavation of critical minerals, clean energy and more.

“Without a doubt, this legislation boosts manufacturers’ competitiveness. But there’s work to be done. Congress must continue its work on China competition legislation and move forward on policies from the U.S. Innovation and Competition Act and the America COMPETES Act that were left out, such as anti-counterfeiting measures, important trade provisions and further investments in supply chain resilience and workforce development.

“Our economic future and America’s leadership in the world depend on a competitive manufacturing industry. Congress has acted wisely with the CHIPS and Science Act. Now we need Congress to continue standing with manufacturers and focus on policies that will help us compete with China and other countries, not make it more expensive to make things in America.”

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.8 million men and women, contributes $2.77 trillion to the U.S. economy annually and accounts for 58% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

View More