May 10, 2017

Rothenberg: Don't Look to D.C. for Big Changes

The first 100 days of the Trump administration have seen a considerable easing of the regulatory burdens service centers and other businesses have operated under since the start of the Obama administration. Through a series of executive orders, the 45th president has put a freeze on new regulations, while taking significant steps toward rolling back others.

However, three of the other political footballs—health care, tax reform and infrastructure spending—are going to be much tougher for President Trump and the Republican Congress to move, said Stuart Rothenberg, long-time political analyst and senior editor for Inside Elections. Rothenberg was one of the speakers at this week’s Metals Service Center Institute Annual Meeting in Miami.

Though Trump and the House GOP celebrated the narrow passage of a modified version of the American Health Care Act earlier this month, D.C. observers don’t expect that bill to survive its run through the Senate gauntlet. Given the different makeup of the Senate, plus the general uncertainty around the effects of the AHCA without a Congressional Budget Office score, the version that comes out of the Senate is expected to be markedly different. “I’m skeptical they can reconcile the differences,” Rothenberg said of the process that must take place between the two versions of the health care bill before it’s sent on to the president.

Rothenberg is similarly pessimistic that comprehensive tax reform will be successfully negotiated. That isn’t a problem just for this Congress and administration, but in general. Tax reform is achingly complex and difficult. Invariably, any change that is embraced by one element of the business community or public is rebuffed by another. Ultimately, nothing significant gets done. Smaller changes on the tax front are much more likely to occur, he said.

Finally, there’s infrastructure, one of the few policy concerns voiced by the Trump administration that can get some traction with the opposition party. “This has the best opportunity for cooperation,” Rothenberg said. Republicans view infrastructure as a key business driver, while Democrats tend to see it in the context of jobs, creating that rare opportunity for bipartisanship. In fact, it might be more challenging to move the Tea Party wing of the Republican party than to win Democratic support for a major infrastructure spend, he said.

Ultimately, he suspects, due to the delay in movement on the bill and the potential issues with the extreme right wing of the House, the infrastructure plan that emerges will be far short of the $1 trillion figure Trump touted earlier this year. “They’ll do something because it’s in both parties’ best interests, but it’s not going to be as big as promised,” Rothenberg said.

For more on MSCI’s Annual Meeting, see the June issue of Metal Center News.


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Friday, October 20, 2017