On Bloomberg, Portman Discusses How Tax Reform is Strengthening the Economy, GM’s Decision to Close Lordstown Plant
In an interview with Bloomberg this morning, Senator Portman highlighted the current economic growth in the United States due in part to tax reform. He also stressed the need for balanced trade and providing a level playing field for all countries. Senator Portman, who was the U.S. Trade Representative during the George W. Bush administration, has been a leading voice in the Senate on U.S. trade policy and serves on the Senate Finance Committee, which has jurisdiction over trade issues.
Portman also discussed General Motors’ decision to shut down its plant in Lordstown, Ohio in March of 2019. Portman is scheduled to meet with GM CEO Mary Barra today to urge her to recommit to Lordstown and bring new production to the plant.
Excerpts of his interview can be found below and a video can be found here:
PORTMAN ON THE GROWING ECONOMY:
“I think the tax reform is responsible in part for this incredible economic growth we’ve seen over the past several months. You were having discussions earlier about Europe and that 1.2, 1.3 [percent] economic growth seems like it is okay for Europe. That was the new normal here too for a while. 1.5 to two percent really and now we are looking at over three percent growth this year and we are seeing not just that but actually more revenues have come in to the federal coffers this year from our income taxes than they did last year. Not a lot, but there is more taxes coming in, more revenue coming in because of the economic growth. That is part of the solution here you saw in the late 1990s. How do you get this economy not just to be the three percent or four percent as it’s been this year for a short period time, but for a sustained period of time? And then, how do you deal with the spending, which is unsustainable in its current form? I think that combination is still something that Congress and the administration should be dealing with.”
PORTMAN ON NEED FOR BALANCED TRADE:
“It is hard to argue it hasn’t been because American has become not just the world’s strongest economy, but you see the kind of economic growth that we have had, which is the envy of the world. But, having said that, we need to have balanced trade. In other words, we need to make sure our exports have a fighting chance, leveling the playing field, reciprocity, all those are really important. We need to be sure there is trade but that the trade is one that benefits both sides. Second, we need to be sure that imports are fairly traded in our country and are not dumped, so below their cost or subsidized. As you know, we’ve won some big cases against China recently with regard to that issue. Yes, trade is really important, but we have to be sure that all countries in the world are playing by the same rules.”
PORTMAN ON GM GEO MARY BARRA DECISION TO CLOSE LORDSTOWN PLANT:
“She is making decisions to deal with her overcapacity. I think she’s said publically that they are about 25 percent overcapacity in their system. She also has a car that’s being made in Ohio that she says is not selling. What we are saying to her and what I have said to her on many occasions over the last several months, not just recently, is that we want a new product in Ohio. And if General Motors is indeed going to make 20 new electric car models in the next five years, we want one built in Lordstown. And it makes sense because this is a plant that has done very well by General Motors. It just won a JD Power Award this year, it has been competitive. It’s one where the UAW has made concessions. So workers have stood by GM and it is time for GM to stand by them and make a commitment to the plant.
“In terms of the trade issues, we also have to talk about the tax issues, because, as you know, the tax reform effort that was just completed makes it much more competitive to stay in the United States. As an example, people are talking about the difference between Mexico and the United States. Well, Mexico’s corporate rate is 30 percent. Ours went from 35, which was higher, down to 21 percent, which is a lot lower. But we also have immediate expensing, so investment in the Lordstown plant can be written off immediately, which is a huge advantage. My hope is the tax policy in addition to the trade policy and in addition to regulatory policies, makes it advantageous for GM to make this further commitment to Ohio and our country.”