The CEO who chairs the National Association of Manufacturers sent a strong warning shot across the bow of the Trump administration and Congress at appearances in Washington, D.C., this week: Don’t you dare not cut taxes.
In fact, warned David Farr, CEO of Emerson Electric as well as chairman of the NAM, many of the lobbying group’s members already have made corporate investment decisions on the assumption that the tax reform promised by President Trump and the Republican-led Congress is indeed coming.
“We are investing in anticipation of Congress passing a tax-reform bill,” Farr said at a Daily Caller National Foundation event. “I think the key issue Congress has to understand is that we think something is going to get done, and if it doesn’t get done, the U.S. economy will be hurt.”
Farr’s comments echoed the consensus of the 20 CEOs interviewed by Chief Executive about their 2018 outlook, for the November-December issue of the magazine and for related stories online. The high economic hopes of most of the highly diverse group of CEOs for next year were pinned more on their assumptions of U.S. tax reform than on any other single factor.
The Emerson Electric chief also used Wednesday to meet with key senators ahead of a budget-resolution vote in the Senate that is meant to take a first major step toward tax reform.
He told the Daily Caller meeting that St. Louis-based Emerson is raising its capital spending this year by a little over 10 percent compared with 2016, and that the maker of items ranging from home garbage disposals to monitoring systems for liquefied natural-gas production platforms plans to raise that by another 15 percent in 2018.
“Manufacturing is doing this now because we are thinking about higher growth in 2019 and 2020,” Farr said. But Farr cautioned that Emerson and other manufacturers can pull “it all right back out” if Washington doesn’t come through on tax reform.
He said that many small- and medium-sized American companies don’t have the financial wherewithal to move production abroad. Many larger manufacturers save on labor costs and also pocket savings from lower foreign tax rates by moving production abroad.
And, Farr added, foreign-owned companies will join U.S.-based companies in pulling back on capital investment in America “if they see a failure from Congress.”
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
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2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
