PHOTO COURTESY BILL YEARGINDear President Trump,
First, congratulations on your election to another term as President of the United States. The American people have entrusted you with another term, and we hope the next four years are good for the United States.
The company I lead as CEO is a 100-year-old organization that has multiple manufacturing plants across the United States, and exports to dozens of countries. As we embark on this four-year journey together, I appreciate the opportunity to share a few helpful thoughts.
Immigration
Immigration was an important part of your campaign, and many people appreciate your desire to secure our borders and keep criminals from entering our country. Keeping U.S. citizens safe is one of your most important responsibilities; securing borders helps with that responsibility.
However, we also know that immigration is the accelerant that has fueled the U.S. economy for more than 200 years. Many intelligent, reasonable people want to come to the United States to be producers, consumers and taxpayers. These folks will help us grow our economy and make us much better. We need to figure out a way to allow these people to be legal contributors to our society.
One of the biggest challenges facing U.S. companies is finding qualified people to fill open positions. Bringing more manufacturing back to the United States, which many business leaders support, can potentially hurt U.S. companies if there are not enough people to help fill the newly created jobs. Responsible immigration can help mitigate this potential problem.
We also need to solve the root problems of illegal immigration. We can do this by incentivizing U.S. companies to use their capitalistic tools to create industry in countries where people are trying to leave. We should also support efforts in these nations that strengthen the rule of law and affirm the protection of property rights that safeguard individual freedom and democratic institutions, and promote economic liberty. This could be a huge win-win for the country, the U.S. companies investing, the countries from which people are trying to leave, and for people who are suffering.
Trade
As noted, the company I lead as CEO, Correct Craft, has manufacturing plants across the United States and distributes into dozens of countries. Global trade — both buying and selling — is critical to our U.S.-based company. We want a level international playing field, but we have also seen the damage tariffs can do to our business and industry.
Though we do not directly buy much globally, many of our suppliers do. They pass global tariffs on to us, which increases our costs and makes us less competitive. These tariffs effectively become a significant new federal tax on us and other U.S. companies.
Tariffs can be even more problematic when selling U.S. products globally. Countries hit by these tariffs often impose retaliatory tariffs on U.S. companies, significantly impacting global exports. This is exactly what happened a few years ago when the European Union placed retaliatory tariffs on U.S.-built boats, negatively and significantly impacting our industry’s sales to Europe.
Enforcing fair trade is important, especially in relation to dumping. However, as your administration deliberates the use of tariffs, let’s be sure to focus on the potential unintended consequences to domestic businesses.
Taxes
Economist Arthur Laffer taught us decades ago that there is an optimum tax rate that generates the most tax revenue, and that tax rate often is lower than current rates. Many of us embrace this idea not just for its economic efficiency, but also because we enjoy lower taxes.
I personally like lower taxes, but not so much as to leave an economic time bomb for my granddaughter’s generation. While we want to find the optimum tax rates, we must also manage the government as a business and ensure that our federal revenues exceed disbursements.
Fiscal Responsibility
The United States can run significant deficits because our dollar functions as the global reserve currency, which lets us print money with little negative consequence. That works until it doesn’t. Our country’s ability to maintain the rarefied status of global banker is based on trust. However, our inability to manage our own fiscal affairs puts this trust at risk and will ultimately have a substantial negative impact on our country.
In the past few years, even pre-Covid, the federal deficit and debt have been exploding. As a country, we must begin demonstrating fiscal responsibility. I hope you will lead a national discussion regarding what services we expect from our government and how we will pay for them. Most federal expenditures go to defense, interest and the elderly. We need to decide what, if any, of these expenses we will cut. If we are unwilling to cut expenses for defense or seniors, we need to agree on how we will fund those disbursements. Leaving a mountain of debt should not be the solution.
As noted, lower taxes are wonderful. However, I encourage your administration to manage our fiscal affairs holistically to solidify the global trust in our currency for another generation or longer.
Regulations
Our business is dependent on clean water and air. Responsible regulation has proven to benefit not only society, but also those organizations that are being regulated. However, we can go too far. I appreciate and embrace your desire to roll back unnecessary regulation. Let’s be careful to ensure that we maintain those regulations that benefit us all.
U.S. Global Leadership
The United States has been the global leader since World War II, ensuring much of the world’s security and financial stability. That leadership is costly but provides significant, tangible and intangible benefits. Those who do not like our country want us to step back from our leadership roles, but I hope your administration will embrace those roles and use our global platform for good.
Social Security
We have just over a decade of Social Security viability remaining. I hope your administration will demonstrate leadership by making the difficult choices today to ensure Social Security is available to another generation of Americans.
President Trump, you have a big job, and the decisions you make in the next four years will impact our country for generations. However, you are not alone; there are many of us who stand ready to help however we can.
Bill Yeargin is president and CEO of Correct Craft, and the author of six books, including the best seller Education of a CEO.
