NECA TransmissionsNotes from the front lines of the electrical contracting industry
  • The Sound of a Stagnant Economy

    Posted on Jun 13, 2013 by John M Grau

    Thud! The national jobs report has landed and it’s not an encouraging sound. Instead of gaining ground on job growth and lowering the unemployment rate, we’re moving backwards. The rounds of self-analysis and blame have begun.

    The timing was good for the Jobs for America Summit which I attended earlier this week. It made national news because Jeff Immelt, General Electric CEO and chairman of the Council on Jobs and Competitiveness, addressed the group. The highlight for me, however, was the release of a new small business outlook survey conducted by Harris Interactive.

    The survey of small business owners (annual company income of $25 million or less) tracks their attitudes about the impact of the political environment on the business environment and also includes their forecasts for upcoming business and hiring. Most NECA members fit this profile, so I assume it is at least partially reflective of their thoughts and forecasts.

    Economists claim that small businesses are the engine for job creation and growth. So what are the hiring forecasts? Nearly 65% said they have no plans to add employees this year and about 15% are reducing their workforce. That means 80% are not hiring and only 20% are creating new jobs.

    Why aren’t they hiring? Well, lack of work/orders/sales is the primary reason, but what’s behind the stagnation? The number one reason cited by small business owners is economic uncertainty. And the causes of economic uncertainty are the federal debt and deficit, regulations coming out of Washington, tax rates and tax code changes, and the requirements of the healthcare bill.

    While small business owners are by nature an optimistic group, only 39% said that their own business’s best days are ahead of them. And an even more sobering number is that only 20% believe that the country’s best days are ahead.

    While the debt and deficit are now the top agenda items for Congress and the White House, it doesn’t seem that our government leaders are doing much to confront the other causes of economic uncertainty. And until the uncertainty is resolved, it doesn’t look like small businesses will grow and create new jobs. Expect another thud next month.

  • The "Super Committee”

    Posted on Oct 04, 2011 by Lake Coulson

    NECA Transmissions features posts from CEO John Grau and other NECA staff and leaders about industry projects or issues they are following. Today’s post comes from Lake Coulson.

    Just before you were leaving town on your August vacation and much-needed family quality time, Congress passed legislation that would prevent the United States from defaulting on its credit obligations and created a 12-person House-Senate Super Committee (“Committee”) to consider additional deficit reductions.  The Committee has to submit a report of its recommendations by November 23 and Congress will be limited to vote up-or-down on the plan by December 23.  If Congress fails to act on the Committee’s recommendations, automatic spending cuts of $1.2 trillion will occur in domestic spending and defense.

    Many believe the odds are stacked against the Super Committee agreeing on a package of spending cuts, let alone Congress concurring, without amending, the Super Committee’s recommendations.

    However, if the naysayers are incorrect, and the Super Committee is effective at producing deficit reductions, it could very well change the way Washington does business and the way legislation is enacted.  By design, the Super Committee possesses enormous power as it supersedes the process by which legislation normally becomes law.  Legislation receives a hearing and markup in the committee of jurisdiction; however, a decent argument offers that tax and revenue legislation that has long fallen under the scope of the Ways and Means Committee now falls under the jurisdiction of the Super Committee.

    While the relevant committees cannot be ignored, and thankfully, there are several tax-writers on the Super Committee, NECA, for the immediate future, must focus its advocacy on the Super Committee’s members.  Legislation to repeal the 3% withholding tax, incentives for electric vehicles and associated infrastructure and energy efficient investments for building owners could all be in play before the Super Committee.  NECA will need to respond with strategies to be fast, focused, and flexible, as it is now forced to advocate for beneficial provisions before a Committee with some of whom have, little, if any direct tax-writing experience or direct knowledge of the benefits created by those tax incentives.

    Those arguing for greater transparency in the political process will undoubtedly lose out in this closed environment as the details of the reduction package will be restricted to the Committee’s members and House/Senate leadership.  However, those seeking action in Washington may benefit from potential streamlined decision-making as the Committee’s recommendations cannot be amended or modified; members will be limited to an up-or-down vote on the recommendations.

    In conclusion, one can argue that drastic times call for drastic measures.  It is conceivable that if this process is successful in producing a bipartisan solution at reducing the deficit, it may well serve as a model for future budget deliberations.  If this sounds like a cop out, and it probably is, it’s too soon tell whether this political model will work, but keep your calendar clear on November 23, the date when the Super Committee’s recommendations are due to Congress.

  • Obamanomics and Democratic Leadership 101

    Posted on Dec 12, 2009 by John M Grau

    I spent last weekend in Miami at the newly renovated Fontainebleu Hotel, which re-opened only three weeks ago. I was there for a meeting of the Associations Committee of 100, representing the CEOs of the most influential national associations in the country. The meeting was actually an educational event — an introductory course, of sorts — as various speakers prepared us for issues and legislation expected at the start of the Obama administration and the incoming 111th Congress.

    The two biggest agenda items are likely to be first out of the box in January — a stimulus package and health care reform. Both will be important to our industry, so it’s a good idea for industry leaders to learn about them. I took a copy of an 89-page paper on health reform by Senate Finance Committee Chair Max Baucus with me for airplane reading.

    I also used my networking time during coffee breaks to form a coalition of construction associations interested in promoting building issues for the stimulus package. The existing infrastructure coalitions are more focused on highways and bridges. We think some of the stimulus should be spent on building construction as well.

    One interesting observation noted during our discussions is that the Obama economic team is mainly composed of individuals with PhDs in economics. That’s considered a positive sign for business groups because economists, whether conservative or liberal, believe in markets and market solutions. We were told that our arguments on domestic issues will have their best chance of being accepted if they are supported by economic data and principles.

    A special treat during our meeting was a briefing by General James Jones, nominated to become President-Elect Obama’s National Security Advisor. General Jones is currently CEO of the Institute for 21st Century Energy and a member of our group of 100.

    We first crossed paths three years ago when I was one of a dozen association executives invited to Brussels for a briefing by our United States missions to the European Union and NATO. After our visit to NATO headquarters, General Jones invited us to SHAPE headquarters in Mons, Belguim, where he then served as SACEUR (Supreme Allied Commander Europe — a post also previously held by Dwight Eisenhower and Wesley Clark). We were briefed on NATO’s changed military mission around the world.

    For the past year, General Jones has headed up a coalition to develop and promote energy policy recommendations for the United States. NECA fully supports the coalition’s recommendations. It was good to hear General Jones say that he truly believes in the policy positions they helped develop and will be an advocate for them within the White House.

    Just being at the meeting in Miami confirmed that NECA is recognized as a highly influential organization. Now, as a result of the education I received there, I feel better prepared to help lead NECA in influencing the major legislative initiatives we’ll face in the next few months.

     

  • Response from IBEW President Ed Hill

    Posted on Jan 17, 2009 by John M Grau

    One reason I blog at NECA Transmissions is because I want to hear directly what people on our industry's frontline are thinking. I don't expect everyone to always agree with me, and I appreciate the people who take the time to write comments to my posts. While most NECA members agreed with my position on the Employee Free Choice Act, IBEW International President Ed Hill had another view.


    John:

    I am somewhat surprised that your editorial regarding the Employee Free Choice Act hits as something that has little to do with our working relationship, but is more of a personal attack on the rights of working men and women.  I understand your concern regarding the favored nations issue; however it is our opinion that this is not a real issue, but one that some of you are using to mask your disdain for the rights of workers.  I believe that in the past when your organization wanted something legislatively that we did not necessarily agree with, there was a gentlemen’s agreement that we would not get involved, but would sit it out.  I believe for the most part this has happened and for the most part when there was something that was good for the industry we were there to work with our partners.

    Your buy-in of the position of the anti-union forces does surprise me, and like the rest of them you have got it all wrong.  The present situation lends itself to the control of management when it is they who decide whether to have a card check for representation or not.  As you know if there are 95% of the people want a union, and the company refuses to accept the wishes of the employees and recognize the union as their bargaining representative, then the employer can demand an election. It is then that they grind the process to a halt until they can intimidate enough people against the union that they will permit the process to continue. Well, since it has been that way and anti-union management types seem to like it, we would like to be able to have something to say about the process as well, and if there enough cards to determine that the majority want a union then they should be permitted to have one instead of being brow-beat with the threat of loss of their employment and in many cases the actual loss of their job, until there is an election held.

    However, there may be a bright side to this issue. Your position of concern for the voting rights of working men and women, however narrowly applied to a single issue, may be something to smile about.

    Ed


    I appreciate Ed's willingness to share his response here. Feel free to use the link below to send me any additional comments on this topic.

  • An Open Letter to Our New Leaders

    Posted on Nov 07, 2008 by John M Grau

    Congratulations President-elect Barack Obama and Members of the Newly Elected 111th Congress.

    ECPAC didn’t support all of you in your election races.  Regardless, we do celebrate our democracy, and the fact that we freely and openly choose our leaders.

    Whether we supported you or not, you can expect to hear from us. We are the voice of the nation's electrical contracting industry. We are a significant segment of the construction industry, which is one of the largest employers of American citizens and represents a major portion of our nation's gross domestic product.

    We will offer you our thoughts, ideas, support when we can - and criticism when necessary. We look forward to a productive working relationship.

    We know you will have your hands full with a number of important issues. Here are a few things we would like Congress and the new Administration to place on your agenda.

    We need some help with our pension plans. It won't cost you anything, unlike the Wall Street bailout. Just give us some extra time to fund our obligations. We suspect that, in contrast to the last Administration, you won't have a bias against union multi-employer plans.

    We also suspect that we won't have to fight very hard to keep Davis-Bacon provisions intact. You're with us on that one. But please don't go so far with your promotion of union issues that you trample on the rights of small employers. We'll be watching you closely on that.

    We're encouraged that you will promote investment in infrastructure, energy conservation measures, and alternative sources of energy. That's right up our alley, and our members can help you rebuild, renew, and re-energize America.

    We most likely will part ways with you on some tax issues. Remember that, by and large, we are small, family-owned businesses. You claim that we are the engine for job growth in our country. Please don't stifle our ability to grow our businesses.

    Estate taxes, corporate tax rates, and marginal income tax rates do matter. As a matter of good faith, why not repeal the 3% withholding tax that Congress sneaked into some legislation a couple years ago? We all know it was a bad idea, so let's get rid of it.

    There's also the matter of regulation. We see the fallout from lax regulation in the financial markets. Don't use that as an excuse to swing the pendulum too far the other way. We see the need for regulations, and we will work with you to make any new regulations sensible and workable. We have a very productive coalition with OSHA that is advancing safety efforts in the line construction industry. Please don't destroy that.

    We know you will be busy setting up your offices, hiring your staff, and preparing to govern our country. So we won't bother you any more right now. We just wanted to introduce ourselves and let you know that you'll be seeing us down the road.

    Once again, congratulations, and good luck!

  • Why don't they like me?

    Posted on Sep 16, 2008 by John M Grau

    Maybe I’m taking this too personally, but I don’t think either presidential campaign likes me very much. The media is against me, too. It may be self-centered to think so, but I keep imagining that they have a picture of me posted somewhere with the words “bad guy” underneath it.

    Why am I all of a sudden so undesirable to political campaigns and media pundits? Well, I’m the product of a small town (population: 500). The high school I attended was part of a consolidated school district, and my graduating class had less than 200 students. I went to church every Sunday (still do), and I owned shotguns (still do), hunted, and knew how to field dress small game (might have forgotten how to do that).

    My dad was a small businessman. He ran his own neighborhood grocery store and later opened up a one-man real estate brokerage. In addition, he served on the County Board of Supervisors. We received calls at home from his constituents whenever they had a problem with county services.

    Once he received an irate call from a lady who ended up being unhappy with his answer. She suggested that he was overpaid. My dad said he figured out that he cost her four and one-half cents per year in taxes. He said he would mail her back a nickel, and she could keep the change.

    At any rate, listening to condescending comments about small town ways and values – “clinging to guns and religion” – hits home to me. I can relate to Sarah Palin. The media thinks those of us who grew up in rural areas are naïve and amusing.

    On the other hand, it seems that Palin doesn’t like me that much either. Both campaigns have railed against special interest lobbyists and Washington insiders. Despite my small town roots, I now live in the Washington, D.C. area, and I work for a special interest group with a well-funded PAC. I feel like I need to sneak down back streets with sunglasses on, and my baseball cap pulled down low over my face. (For my views on special interests please see my April 30 posting on this blog).

    The interesting fact is that whoever gets elected will be looking to associations and association PACs like NECA for information and money. They can’t operate without us, and they shouldn’t. We have as much right to participate in our government as anyone, as well as a professional responsibility to our industry and public safety.

    I was concerned how NECA’s status as having one of the 50 largest PACs in the country might reflect on our members. One of our political consultants, Robert Raben, told me not to worry. Electrical contractors are small business people, and small business can do no wrong. Small business owners are your neighborhood grocers or real estate agents, like my dad. Both political parties recognize small businesses as the biggest source of economic and job growth, and they want to be associated with them.

    So it seems that in this election NECA contractors are golden. I, on the other hand, am left to bitterly cling to my guns, religion, and Gucci loafers.

  • More Inside Baseball

    Posted on May 19, 2008 by John M Grau

    Both the baseball and political seasons are in full swing. From time to time, I have reported on insights I’ve gathered from meetings with some of the political movers and shakers in Washington, D.C. It’s time for an update.

    I recently joined seven other association CEOs for a breakfast meeting with the Director and Asst. Director of the White House Office of Public Liaison. These are the people who promote the President’s position on legislative matters before Congress. 

    They told us that the White House is primarily focused on two legislative issues: trade and the economy. The trade issue is the Colombia Free Trade Agreement being held up by the House leadership. The economy issue revolves around various stimulus measures being debated by Congress. 

    Apparently the White House is still promoting a broad range of issues, but quite frankly, it was evident to me that there’s not much going on there. With a lame-duck President who’s lost almost all political leverage, I believe the White House staff are simply biding their time until they’re out of office. Not that it’s an unusual situation – just the reality of politics and government.

    More interesting was a closed door session with Senator John Ensign of Nevada. Sen. Ensign also heads up the National Republican Senatorial Committee, the group that raises money and promotes Republican candidates for U.S. Senate races. Both parties have such committees on both the House and Senate side. NECA contributes to all these committees for both parties including the overall national committees, and that gives us entrée to sessions like this.

    Ensign was very frank about the Republican Senate prospects for this fall’s election. He admitted that he expects to lose seats. His goal is to hold on to 45 seats, and in his wildest dreams, he can paint a scenario for 47 Republican seats. He gave a candid race-by-race analysis. He noted that fundraising has been a problem for the Republican Party. He said that last year he spent most of his time apologizing for the performance of his party. This year the prospects have improved.

    Ensign did offer a glimpse of the issue Republicans will use to motivate donors – union card check legislation. It was defeated last year, but with increased Democratic strength in both the House and Senate next year, along with the prospects of a Democratic President, he expects card check legislation to be front and center on the legislative agenda. His argument is that Republicans need to maintain enough seats in the Senate to be able to filibuster the bill if necessary.

    So that’s the Republican Senate battle plan for this fall’s election. My inside baseball group is extending an invitation to the Obama campaign staff to provide someone to meet with us. More insights to come.

     

  • Hold Up a Mirror to See the Special Interests

    Posted on Apr 30, 2008 by John M Grau

    Right now I’m attending the NECA Legislative Conference in Washington, D.C. This is a busy week for me, with meetings of the Government Affairs Committee, the Workforce Development Committee and the National Joint Apprenticeship and Training Committee. Just to round things out, the Marketing Committee gathered last week.

    In my opening remarks at the conference this morning, I warned the NECA members and staff present to be on the look out for special interest groups. All the presidential candidates and many legislators say that special interests are taking over our government and unduly influencing our elected officials. These special interests are like a 17-year-old boy with only one thing on his mind – in this case, it’s to convince legislators to support their issue or cause.

    Then I asked the conference participants to look around at the other people in the room. They now had come face-to-face with the dreaded special interests. We are one of those special interest groups.

    Anyone who gets together with a group to petition their government leaders is a special interest. But it seems that depending on your political bias, groups like the trial lawyers, unions, and the Sierra Club are not special interest groups. Apparently. it’s okay for them to invite legislators to their meetings and help finance political campaigns. If you listen to the mainstream media, the real special interests are business groups. They have unflattering labels like “Big Oil” or “Big Pharma.” 

    In truth, it’s a patriotic act for a special interest of any kind to legitimately try to convince their legislators of the merit of their point of view. Like voting, it’s our duty.

    Our political leaders should not work in isolation. They need to be confronted with issues and understand the problems facing their constituents. But it is difficult for any one voice to be heard. For one thing, it’s not feasible for every citizen of this country to have a personal meeting with every legislator voting on a matter of interest to that citizen. It’s also not very efficient.

    That’s where trade associations, professional societies and other groups come into play. It makes perfect sense for people or companies with common interests to band together to jointly present their point of view to our political leaders. And the bigger, the more organized and well-financed the group, the better. Such things clearly demonstrate the importance that the group places on their issues.

    So we shouldn’t be knocking special interest groups. We should be lauding them. Totalitarian governments control their populations by suppressing organized groups. In contrast, democracies promote a free society by guaranteeing the right of people to organize into groups and to openly petition their government.

    So this week, the patriots of our industry are in Washington, D.C., working to influence the federal government. Watch out Congress – Big Electrical is in town. We are a special interest group, and we’re proud to be here!

  • On Capitol Hill

    Posted on Sep 20, 2007 by John M Grau

    Last year at this time members of the NECA Political Leadership Council (PLC) met with U.S. Secretary of Labor Elaine Chao. Ms. Chao dropped by the PLC meeting being held at the Mandarin Oriental hotel in downtown Washington, D.C.   Among other subjects, she asked if we would like to hear about her department’s enforcement efforts against unions. She told us how the department was cracking down on reporting requirements under the 1959 labor-management act and forcing union bosses to detail all their expenses and any benefits received from management.

    Of course, we were already familiar with the new DOL initiative. While we are all for honest and ethical behavior in the labor-management arena, our experience has been that these particular regulations were excessive.  They mostly amounted to a paperwork nightmare and a potential liability trap for union employers and union leaders alike. 

    The members of the PLC were very forthright in telling this to Secretary Chao. They pointed out that the new enforcement efforts made it a potential criminal offense to fail to report inviting the local union business agent to a chapter dinner meeting or picking up the tab after a labor-management negotiating session – items that would be routine for any other businesses. When it became clear to Ms. Chao that our group wasn’t in a union-bashing mood, she politely thanked us for inviting her, turned on her heels, and marched out the door.

    The PLC is meeting again this week in Washington, and as far as I know, Secretary Chao hasn’t been invited to drop by for another chat. Instead, the PLC members may hear about one of the budget battles brewing in Congress. The White House has requested an increase in the Dept. of Labor’s enforcement budget to about $57 million, a 20 percent increase over last year. The Democratic-controlled House has scaled that amount back to $46 million. Meanwhile, President Bush is threatening to veto the broader spending bill that contains the labor budget in part because it doesn’t include the full requested amount for the union oversight office.

    The fight seems to be less over dollars and enforcement and more about payback for or protection of unions, depending on your party’s perspective. (To my mind, the Department should focus on true criminal behavior, not counting how many cups of coffee were purchased during a meeting with the local business manager.) But whatever the outcome, we’ll be watching to make sure that NECA contractors don’t get caught in the crossfire.

    I’m grateful for the commitment our PLC members have shown by participating in the Summit. It’s their faces and their stories as constituents that make the difference in how a representative may vote on an issue. The PLC and ECPAC have given NECA a pretty loud megaphone on Capitol Hill. Secretary Chao may not have wanted to hear what we told her, but that didn’t stop us from speaking up.

  • Multi-tasking meetings

    Posted on May 16, 2007 by John M Grau

    The first week of May kicked off with a busy round of NECA meetings in Washington, D.C. Things got started with the Government Affairs Committee meeting and ended with the Future Leaders Conference. In between, there was the annual legislative conference and a meeting of our Labor Relations Task Force with the top IBEW leaders.

    All the meetings were very productive. NECA is a force on Capitol Hill, and our members proved it by showing up in strength to meet with their Congressmen and Senators on repealing the 3% withholding tax. (Meeting details and pictures from the event on posted on NECA’s government affairs web page.) Over 125 NECA contractors and chapter staff attended the conference, the most participants from any of the Campaign for Quality Construction coalition member groups.

    The Future Leaders group drew 70 young contractors to a two-day forum on the topics that will shape their future in electrical contracting – topics not that different from the interests facing the current NECA leadership.  Discussions of labor relations issues were everywhere. IBEW President Ed Hill spent nearly two hours in a broad ranging discussion with the group. NECA’s Future Leaders are also extremely focused on working with Congressional leaders.

    In fact, that’s probably what I noticed most about this group: their willingness to pursue multiple courses to improve their businesses.  The next generation is exploring new market partnerships in Mexico and shoring up Congressional support to repeal punitive business legislation. Their enthusiasm for multi-tasking was contagious.

    The fruits of our Labor Relations Task Force meeting with the IBEW leaders will become evident in the weeks ahead. The task force has discussed a broad range of issues from market share to productivity, flexibility, and the Code of Excellence. Workforce training and development are also at the top of the agenda. We’re serious about our efforts to reform our industry, and I’m convinced that the IBEW national leadership is as well. 

About NECA Transmissions

NECA Transmissions is a collaborative effort from CEO John Grau and NECA staff to provide insight and feedback on key issues from the front lines of the electrical contracting industry.

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