Debt Deal: No Time for Manufacturers to Relax

With the debt-deal negotiations over and the crisis at least temporarily averted, PMA’s One Voice team has turned its attention to the next phase of the deficit-cutting process: the so-called “Super Committee,” consisting of 12 members of Congress.

Manufacturers and businesses have so far successfully opposed the imposition of new taxes and the removal of manufacturing tax credits/deductions. They also worked to help prevent the Bush tax cuts from expiring. While this is good news for our members, this is no time to rest on our laurels.

The 74-page Budget Control Act raises the debt ceiling by roughly $1 trillion through the calendar year, requiring $1 trillion in spending cuts during the next 10 years. If certain milestones are met by the end of 2011, the debt ceiling will increase enough to allow continued government borrowing through the 2012 Presidential elections. Entitlement programs have emerged relatively unscathed. Social Security and Medicaid will be exempted from spending cuts, and Medicare will only face cuts to providers and insurers, not to beneficiaries. The defense budget faces cuts of around $350 billion during the next 10 years.

The Super Committee created by the legislation consists of 12 members of Congress equally representing both parties and both houses of Congress. Senator Harry Reid, Senator Mitch McConnell, Representative John Boehner and Representative Nancy Pelosi will each appoint three members to the committee. The “Devine Dozen,” as some have coined them, will attempt to tackle the country’s biggest fiscal problems within 90 days. They are authorized to hold hearings, produce witnesses, take testimony and administer oaths. The Super Committee’s final legislative recommendations to cut at least $1.5 trillion more in spending are due by November 23, 2011, and Congress must act on them by December 23, 2011. If Congress fails to pass the recommendations, immediate across-the-board “sequestration” will occur with automatic budget cuts and withholding of payments.

As you can see, manufacturers are not yet out of the woods. The One Voice team will immediately begin work with the new Super Committee on our priorities, to continue efforts that began months ago with Congressional Committee Chairmen and political party leaders.

We will be calling on PMA members to work with our One Voice team in Washington, D.C., to ensure that the Committee does not take actions that will damage this country’s manufacturing sector. It is our sector that will continue to drive a recovering economy. As always, please do not hesitate to contact me or our One Voice team with questions.

Bill Gaskin, president of Precision Metalforming Association (PMA), represents the $113-billion metalforming industry of North America—the industry that uses stamping, fabricating, spinning, slide forming, roll forming technologies and other value-added processes. PMA’s Educational Foundation, MetalForming magazine and FABTECH’s METALFORM technology area are affiliates.