NGA: Letter to President-Elect Obama

Articles
December 23, 2008

NGA: Letter to President-Elect Obama

Dear President-elect Obama: On behalf of the nation’s independent community-based retail and wholesale grocers I congratulate you on your historic election as the forty-fourth President of the United States. The National Grocers Association (N.G.A.) is pleased to take this opportunity to begin a constructive dialogue with you and your administration as we look to the next four years of challenges and opportunities. The National Grocers Association’s retail grocers and wholesalers are the heart of their communities, neighbors serving neighbors, whether in the city, suburbs or rural America. N.G.A.’s retailers and wholesalers are privately owned or controlled family businesses who are the true entrepreneurs of the grocery industry that help drive our economy in every community and serve our nation’s consumers. These and other entrepreneurial businesses drive economic growth and provide over 50 percent of the jobs in the country. Entrepreneurs are not asking for any special considerations or bailouts, but only seek to compete on a level playing field. As the nation looks to the future, this entrepreneurial business sector shares your concerns about the economic challenges ahead and pledges to work constructively with you to develop sound solutions. N.G.A. supports your goal to provide additional appropriate stimulus to the economy and urges you in this historic time of economic uncertainty to provide the opportunity for entrepreneurial businesses to succeed. An economic stimulus can best be accomplished in this unstable time by decreasing, not increasing, corporate tax rates, or the taxes on individuals that operate their businesses as subchapter S corporations or other pass through entities. A comprehensive stimulus package should include among other items, extension of the current expensing and bonus accelerated depreciation. These tax incentives are used by retailers and wholesalers to invest in technology, energy saving equipment, and trucks for their businesses in order to better serve consumers, their communities, create jobs, and grow the economy. In the long run, meaningful relief from the federal estate tax must provide family owned businesses the incentive to pass the business on to the next generation, and not to have to recapitalize or sell the company in order to pay estate taxes.



President-elect Barack Obama
The Presidential Transition Team
Washington, D.C. 20270

Dear President-elect Obama:

On behalf of the nation’s independent community-based retail and wholesale grocers I congratulate you on your historic election as the forty-fourth President of the United States.  The National Grocers Association (N.G.A.) is pleased to take this opportunity to begin a constructive dialogue with you and your administration as we look to the next four years of challenges and opportunities. 

The National Grocers Association’s retail grocers and wholesalers are the heart of their communities, neighbors serving neighbors, whether in the city, suburbs or rural America.   N.G.A.’s retailers and wholesalers are privately owned or controlled family businesses who are the true entrepreneurs of the grocery industry that help drive our economy in every community and serve our nation’s consumers.   These and other entrepreneurial businesses drive economic growth and provide over 50 percent of the jobs in the country.  Entrepreneurs are not asking for any special considerations or bailouts, but only seek to compete on a level playing field.  

As the nation looks to the future, this entrepreneurial business sector shares your concerns about the economic challenges ahead and  pledges to work constructively with you to develop sound solutions.   N.G.A. supports your goal to provide additional appropriate stimulus to the economy and urges you in this historic time of economic uncertainty to provide the opportunity for entrepreneurial businesses to succeed.   An economic stimulus can best be accomplished in this unstable time by decreasing, not increasing, corporate tax rates, or the taxes on individuals that operate their businesses as subchapter S corporations or other pass through entities.   A comprehensive stimulus package should include among other items, extension of the current expensing and bonus accelerated depreciation.  These tax incentives are used by retailers and wholesalers to invest in technology, energy saving equipment, and trucks for their businesses in order to better serve consumers, their communities, create jobs, and grow the economy.  In the long run, meaningful relief from the federal estate tax must provide family owned businesses the incentive to pass the business on to the next generation, and not to have to recapitalize or sell the company in order to pay estate taxes. 

Our economic well-being also depends on fair employer and employee relationships. Sound public policy must not over regulate, and put the economy in further jeopardy by reducing the future of job stability and the growth of American business enterprise.  Targeted job tax credits have been shown to expand the availability of jobs and stabilize employment. The list of potential legislation affecting employees and employers is long, and is likely to have significant adverse economic consequences for community focused businesses and their employees.  Those that are of most concern to small businesses are mandates for paid sick leave, increased minimum wages, punitive civil penalties for employment law violations, and expansion employment discrimination laws.  Health care is in need of reform, but the imposition of greater costly mandates on employers could negatively impact employment and economic growth. With the economy in the midst of the severest economic recession since the Great Depression every penny counts in the very competitive grocery industry and compliance costs from greater regulation disproportionately affect small business. N.G.A. strongly urges you to reject the negative economic ramifications that more regulations will have by increasing the labor costs of doing business.  Increasing labor costs in a recessionary economy that is bordering on deflation could make our economic problems worse.

Importantly, recent debate and press reports covering the bailouts for American automobile companies have highlighted the volatile opinions and emotions that are being expressed between union and nonunion employees of the competing companies.   In this time of economic distress it would not be appropriate to further enflame the union and nonunion animosities by considering the Employee Free Choice Act.    N.G.A. is strongly opposed to the mislabeled Employee Free Choice Act, which would tilt the playing field for union organizing in favor of unions. The same democratic principles of a secret ballot that elected you President should apply for employees in union organizing campaigns.  Every employee should continue to have the right to vote in private under the National Labor Relations Board supervision when deciding whether or not to be represented by a union, and employers should not be forced into binding arbitration.  If this legislation were to be enacted, it will have unintended consequences.  Similar to when the Wagner Act was passed in 1935 during the Depression it will cause higher unemployment and lead to union and employer strife.

N.G.A. strongly shares your call for regulation to rein in the abusive practices by banks and credit card companies.  Consumers and merchants have long been subjected to the abusive, monopolistic market power by Visa, MasterCard, and their respective banks through the imposition of excessive fees and arbitrary rules.  Retail grocers, like all merchants, and ultimately consumers, have been subjected to hidden interchange fees on every credit and debit card transaction.  Senator Dick Durbin and Representative John Conyers are challenging these anticompetitive fees and rules on antitrust grounds.  N.G.A. urges you to have the Department of Justice aggressively investigate the anticompetitive activities of the monopolistic credit card companies and banks in fixing the price of interchange fees and setting arbitrary rules.

Your administration should support legislation that would level the playing field by giving the Federal Reserve Board authority to regulate credit card interchange fees and rules that will ultimately reduce and end discriminatory interchange fees, provide transparency, and eliminate anticompetitive rules.

Consistent and balanced enforcement of our nation’s antitrust laws, including the Robinson-Patman Act, is especially important to ensure a level competitive playing field for entrepreneurial businesses.  N.G.A. encourages you to appoint a Chairman of the Federal Trade Commission and Assistant Attorney General for Antitrust that will enforce the law in a consistent and balanced manner.   A level playing field provides the appropriate marketplace environment where diversity thrives and consumers are well served with an abundance of choices.

In conclusion, the nation’s independent community focused retailers and wholesalers fight to compete everyday in the marketplace.  They only ask that federal policy give them the opportunity to succeed on a level playing field and pledge to work with you in collaboration to avoid costly, burdensome, and excessive regulation and to implement programs that put us once again on the path to growth and prosperity.

Sincerely,
 
Thomas K. Zaucha
President and CEO  
National Grocers Association