Business, labor leader: Regulatory reform means jobs - let's get it done

Ask a skilled craftsman or small manufacturer what’s wrong with the economy, and you’ll probably get a similar answer – a government that is simultaneously too overbearing and too unresponsive.

Our country’s ever-growing tangle of state and federal rules are constricting job growth and stifling business investments like a noose around the broader economy. Regulations have proliferated so swiftly that it would be impossible to unravel this knot one rule at a time. To complicate matters, our regulatory regime was designed for the 1940s and 50s—not for the 2020s and 30s—and is not designed to grapple with our rapidly changing economy.  Without a fundamental redesign, it will continue to stifle American innovation and hinder our ability to deliver new, life-changing products. That is why policymakers must act to modernize the entire system.

As the heads of the North America’s Building Trades Unions, representing more than 3 million craftsmen and women, and the National Association of Manufacturers, the leading association for manufacturers, many people wouldn’t expect us to agree on such a high-profile political issue. But we do – for the same reason: jobs. We won’t generate the kind of wage gains or employment growth that Americans deserve unless we fix a regulatory system that is too inefficient, too complex and too exposed to shifts in the political wind.

Today, there are dozens of privately financed infrastructure projects that would create tens of thousands of good-paying new jobs. But they remain stuck in a regulatory snarl that could easily be reduced with a smarter rule-making process that limits inexplicable delays and unnecessary turf battles.

To fix this problem, Congress needs to establish basic parameters to modernize federal rule-making. In our view, there are three pillars of effective, bipartisan regulatory reform: transparency, scientific integrity and accountability. In other words, the rulemaking process should be conducted out in the open and backed up by objective, unimpeachable science, while being overseen by officials who are held accountable to the voters.

Take infrastructure. President Donald Trump has promised to invest roughly $1 trillion for much-needed infrastructure projects. But getting that money to actual projects is harder than it looks because of outdated, complicated state and federal rules. The president has done what he can to improve this process, but Congress must take additional steps to adopt permanent reforms that gives both businesses and regulators more certainty.

Today, there are dozens of privately financed infrastructure projects that would create tens of thousands of good-paying new jobs. These projects would improve water access in California, develop wind energy in Wyoming and power homes in the Northeast. But they remain stuck in a regulatory snarl that could easily be reduced with a smarter rule-making process that limits inexplicable delays and unnecessary turf battles.

Case in point, the approval process to build an export terminal for liquefied natural gas in Oregon has stretched more than a decade, with no clear end in sight. The Department of Energy initially authorized the $7 billion Jordan Cove project back in 2014, but the Federal Energy Regulatory Commission stepped in last year, effectively stalling construction of the terminal, as well as a related pipeline. The project is once again up for review, but these drawn-out deliberations have delayed the creation of hundreds of shovel-ready jobs and deprived the local economy a welcome boost. This could have been avoided with a modernized approval process.

The problem is just as pronounced at the state level. Consider, for example, the six-year regulatory saga of the Grain Belt Express, a renewable energy transmission line stretching from Kansas to Indiana and projected to create over 5,000 jobs but denied—twice—at the state level. Or the Constitution Pipeline, which would create over 1,300 construction jobs and bring inexpensive natural gas produced in Pennsylvania to consumers in New York. After spending years securing all of its federal permits, the project was still thwarted when it was denied a water permit by the state of New York. 

Adopting the basic principles of accountability, transparency, and scientific integrity will make the rulemaking process more predictable and establish safeguards against regulators acting on a political agenda. Businesses are more likely to hire when they know what they can expect from government regulators, and these basic principles should strengthen the degree of certainty in the marketplace.

These principles also help ensure that an administration of either party does not abuse its regulatory authority by introducing too many new rules or gutting necessary protections. This should be welcome news to Republicans and Democrats alike who fear that regulations will be drastically altered each time a new party wins the White House. Bipartisan regulatory reform should appeal to both parties by creating a more objective, efficient, transparent and fair administrative process.

Our two organizations have joined together to help form the Coalition for Regulatory Innovation because we believe reform is best achieved with a united bipartisan front. Thankfully, Republicans and Democrats in Washington have responded to this issue by offering practical solutions to improve the entire rulemaking process. Our commitment is to bring together people from the business and labor communities to get Congress to move forward on reform that is long overdue.

Real reforms to our regulatory system will bring solutions that lift everyone up and leave no one behind by helping to create high-paying construction and manufacturing jobs. So, in the days ahead, we will work with any lawmaker ready to do the right thing for American workers—and for the future of the most dynamic, innovative economy in the world. 

Jay Timmons is president and CEO of the National Association of Manufacturers (NAM).

Sean McGarvey is the President of the North America's Building Trades Unions.