Success in global markets isn’t just about money. It depends on how you do business. For proof, look no further than the S&P 500. More and more companies listed in that economic index tout the way they’ve reduced greenhouse gases, reduce waste, operate safely and respect human rights. Recently the Wall Street Journal reported that U.S. companies listed on European exchanges are more likely to spread the word about their corporate citizenship since the European Parliament passed a directive in April requiring large businesses to provide such details.
Similarly, international trade agreements are built on such squishy things as trust. Unfortunately, there’s little of that inside the chambers where U.S. policy is made. Political polarization between Democrats and Republicans has paralyzed the passage of trade policy that would make it easier for American companies to grow their businesses around the world. And as we implied up front, trade barriers aren’t all financial. They can relate to safety standards surrounding equipment. That’s an issue U.S. business people have the power to address, both among themselves through their trade associations and in-person with their local and national representatives in government.
That was the thinking that inspired the Industrial Truck Association (ITA) to promote the first National Forklift Safety Day on Tuesday, June 10, 2014. This is a day on which occupational safety is spotlighted for all users of industrial trucks—both through the media and face-to-face networking. But just as importantly, ITA is using this day as a conversation starter between its OEM members and their elected representatives.
On June 9th, ITA-member forklift OEMs flew into Washington, DC to strategize with each other on how to approach their congressmen and senators on matters of corporate citizenship and business growth. They were each scheduled to meet with their representatives on Capitol Hill the next day, so they wanted to make best use of June 9th to prepare. Forklift safety provided a good entry-point for that discussion.
A Moral Obligation
“We are a small industry and have to work harder to get their attention,” Brian Butler told MH&L before the meeting’s start. Butler is ITA chairman and president and CEO of Linde Material Handling North America.
“This is something OEMs can do in their own state, as well. The world is getting smaller so when you can talk about safety [to your politicians] it becomes an agenda item all over the world. You have an obligation to keep your people safe, so it’s not just politics. We have not always been forthright in political and economic discussions, so this week we are hoping to change some of that.”
Safety was also intended to provide a bridge that would lead the conversation on Capitol Hill to matters of business sustainability. Chief among those issues is international trade.
Elimination of Tariffs
ITA President Brian Feehan explained further the strategy behind this gathering.
“This day was created to serve as a rallying point for our manufacturers and suppliers to educate the user base, policy makers as well as the administration on the need for continued powered industrial truck operator training, he said. As for trade issues surrounding the global sale and support of those trucks, that also requires education about what it will take to accomplish these things. “Two primary objectives,” Feehan added, “are the elimination of all tariffs and the harmonization of non-tariff issues through a transparent process.”
Linda Dempsey, vice president of international economic affairs for the National Association of Manufacturers (NAM), continued this civics strategy session by suggesting how citizens like ITA’s members can change the barriers to trade that keep cropping up.
“It must happen through trade agreements,” she said. “Nearly half of all manufactured exports over the last several years have gone to just 20 countries representing less than 10% of world GDP and 6% of the world population. Those are our current 20 free trade agreement partners. The U.S. does better in markets where barriers have been eliminated, where we have a level playing field and where we have high standards. You’ll hear a lot on Capitol Hill that we have a huge trade deficit but we actually have a trade surplus with those 20 trade agreement partners. Two of the best point to make when talking to your representatives about trade is that those 20 purchase nearly half of our exports. Think how much more we could sell if we had other good trade agreements.”
But to do that, Congress must pass executive-level trade promotion authority, she stated. That means giving the president the authority to finalize trade agreements without letting them fall into the meat grinder of polarized American politics.
“This is critical if we’re to get the kind of trade agreements we want,” she added. “Japan is asking, ‘If we do this agreement which is politically difficult, how will we know if the U.S. Congress will give it an up or down vote? We’re not sure we’ll put our best offer on the table until we see trade promotion authority.’”
Unfortunately, she believes there won’t be any major legislation on this issue until November—unless businesses can convince their representatives of its importance to them—the voters. She suggested a way to start this dialog with them:
“It is always important to share, ‘I’m in the market today trying to make sales in these overseas markets. Why are we behind China and Europe in negotiating new trade agreements? The U.S. needs to lead if we’re to grow our manufacturing competitiveness.’”
The Voter's Power
Scott Klug, public affairs director at the national law firm of Foley & Lardner, and former Republican member of the United States House of Representatives representing Wisconsin's 2nd congressional district, appealed to the salesman in each of the ITA members at this gathering as they prepare their pitch to the politicians.
“This will be one of the easier sales calls you ever made,” he said. “You vote and the people who work for you vote. You’re arriving at a time when congress’s ratings are in the single digits. There are 37 voting days in congress to pass all those bills they’re considering. The things you care about most are probably the easiest to address such as environment and safety. Find out what committees your representatives are on. These are the issues they care most about. For those of you who talk to folks on ways and means and finance committees, they’ll know trade issues well. Those on workforce development will understand OSHA issues. Some meetings will be friendly and some won’t. Some are not friends of trade agreements. Be prepared to respectfully disagree.”
Overcoming a Competitive Disadvantage
Several ITA members gave MH&L a preview of what these representatives were about to hear from them. James Radous, executive vice president Americas for UniCarriers, and his colleague Mark Manninen, senior director of business and channel development, explained that trade barriers discourage business growth and put American companies at a competitive disadvantage with rivals in other countries.
“If countries like Chile make their agreements easier to accomplish, we become the outsiders,” Radous said. “Take shipping to Brazil, for example. We are at a disadvantage because we don’t manufacture in Brazil. The developing markets can help boost your business and if you’re going to be number one in your industry you need to play in the biggest market outside the U.S. and that’s Brazil. Right now it’s very costly to do business there. By not having tariffs in Brazil we can keep manufacturing in the U.S. and figure a less expensive way to get products into Brazil. Columbia and Peru are also strong markets and we are learning how to do business there. We’re moving ahead to get our name out globally.”
Safety as a Trade Barrier
Jeff Rufener, president of Toyota Material Handling, U.S.A., pointed out that there are also non-tariff barriers to trade that must be addressed, and that includes safety standards.
“Most world markets can have different standards, some developed for operator safety and some developed for the wrong reason, and those are the ones that can be barriers to trade,” he said. “You have to jump through hoops to meet the regulations of some countries. Is that being done for safety or to limit trade?”
Rufener believes this issue can resonate with most of the representatives he and his fellow ITA members were preparing to meet with.
“Government in general is having trouble demonstrating its value,” he noted. “What are people getting for their taxes? The politicians are sensitive to that so they should be very interested in the safety issue.”
Everett Eissenstat, chief international trade counsel to Orrin Hatch, ranking member of the Senate Committee on Finance, was sympathetic with the kinds of concerns Rufener expressed to MH&L.
“There’s a real effort for harmonization of standards so if you have safety requirements on a forklift you make here in the states there should be recognition for those in the European Union so you don’t have to go through an additional testing process,” he said. “This can save a lot of money and time and make you more competitive. But it is difficult to do with bureaucracies that have been doing things the same way for a long time. This may take three to five years or even longer. But the best time to get your issues known is at the outset of negotiation. It’s like an investment of capital to get you a payout at the end.”
But Rufener added that he is also interested in the issue of granting the president trade authority.
“I’m really disappointed that congress hasn’t yet authorized the president via T-TIP [Transatlantic Trade and Investment Partnership],” he said. “The president has to be allowed to conduct negotiations and close deals on our behalf. Politics in this country has become so partisan and has become detrimental to commerce. We have to me more efficient working across borders. That’s how we’ll get the economy back on track.”
Help OSHA Help You
Finally, Doug Kalinowski, with the OSHA directorate of cooperative and state programs, outlined ways ITA and other industry associations can more effectively work with government to establish safer and more productive working environments.
“Many employers don’t want to talk to OSHA,” he acknowledged. “But associations like yours open the door. We get input from you about the kind of safety and health information that’s important to you. We’re looking for ways to strengthen and tailor it. Congress gives Federal OSHA about $500 million a year and the state plans $100 million a year to develop programs and offer compliance assistance. We try to focus programs on things that make a difference. We just filled the position of director of operator services and alliances to measure the impact of these alliances.”
If their meetings with representatives on Capitol Hill have the intended effect, perhaps ITA members will have an incentive to introduce themselves to OSHA’s new hire.