Industry's collective voice heard in halls of Congress.

Washington conference attracts foundry executives; makes industry position on pending environmental legislation known in meetings with congressional delegations.

If anything has been gained as a result of the disorienting political winds sweeping the United States, it is the new willingness of the electorate to speak up to its federal legislators. There is the growing popular sentiment that a real America truly does live "outside the D.C. beltway," and that the people are more than willing--and certainly have the capacity--to share in the decisions that affect their welfare.

That sense of involvement pervaded the annual AFS Government Affairs Conference held March 22-24 in Washington, D.C. Its purpose was to have foundry executives meet face to face with lawmakers. The basic objective was simple: educate the uneducated--help legislators know the foundry industry and its impact on the nation's economic strength and position it as a positive economic resource.

It long has been the contention of AFS staff and foundry executives that laws adversely impacting the industry were made without sufficient knowledge of what a foundry is. For instance, it was revealed that few U.S. lawmakers or their staffs were aware of the size and scope of the industry, that it is the sixth largest business in the nation or that it is the country's largest recycler, converting unwanted metal scrap, otherwise destined for landfills, into engineered metal products. Some didn't even know what a casting is.

Laws have been promulgated and penalties assessed by congressional staffers who had no idea of actual foundry practice, were uninformed or used false, misleading or incomplete information. The cost to foundries in dollars and to their competitive position, vis a vis the emerging global marketplace, has been enormous.

The Strategy

AFS President R. Conner Warren put the conference in perspective in his opening remarks. He said the goal of the conference was, in essence, to affect proposed legislative measures that are punitive to the foundry industry before they become law. It is much easier to change proposed laws while at the first draft level rather than wait until they have progressed so far that the only offense remaining is to try to defeat them later on in the lawmaking process. This, he said, is difficult to do and history has proved that victory is not on the side of the latter.

His introductory remarks were seconded by Walter Kiplinger, AFS vice president-government affairs. He stated that the time was right (an election year) for foundrymen to define the role their operations play in congressional home districts. He observed that nothing gets a congressman's ear better than hearing from constituents, many of whom are already hostile to congressional actions.

As an example, he said it is important that every senator and representative know about sand and the vital part it plays in the well-being of the foundries in each congressman's district. Restrict the use of sand and it means lost jobs, and lost jobs mean lost votes. Lawmakers should know of the efforts made to reuse nontoxic sand as an inexpensive resource. They should hear firsthand from constituents about the detrimental impact on foundries of the language of the RCRA rewrite now making its way through the lawmaking process. Without a vigorous voice from home, congressmen tend to be victims of zealous staffers and various interest groups that run unopposed through the congressional cloakroom circuit.

Diana Waterman, Waterman & Assoc., the Washington legislative consulting firm working with the AFS Washington office, told the attendees that "this is the right time; we have the right message and the right messengers, and you, here today, are the muscle to do the job" of making a case for the foundry industry's position on the proposed laws, vital to thousands of large and small foundries.

She targeted the RCRA reauthorization bill, OSHA reform and the authorization bill for cast metal research funding as the essential topics of meetings between foundrymen and their congressmen.

Assembling the Message

While the principal activity of the conference was focused on congressional visitations, it also was designed to prepare the executives by providing information to strengthen their position in meetings with legislators. Several experts in trade, industry and government relations made presentations.

Jerry Jasinowski, president of the National Assn. of Manufacturers, stated that most congressmen and their staffs were unaware of America's strong foreign trade position. He cited a four-year NAM study (1987-1991) that showed the importance of the country's manufacturing sector to the overall economy. It confirmed that the manufacturing sector bought over 50% of the nation's total services and that U.S. exports doubled during the period. A $20 billion deficit to Europe became a surplus in an amazing turnaround and it can be continued, he said, if Congress ends its punitive attitude toward industry.

He credited Paul Tsongas, a recent presidential hopeful, for bringing to the attention of the American people the positive aspects of U.S. business and for advocating ways to encourage industrial growth. Manufacturing is the engine that drives the economy, he asserted, the primary source of export growth and the main sustainer of the country's service sector.

According to Jasinowski, there are several obstacles barring national industrial growth, areas the Congress and other regulators should understand and work to remedy and that industry should unite to change. They include:

* a poorly educated and untrained work force that has dogged the country for years and shows no sign of improvement;

* the huge federal deficit that must be reduced and the lack of savings and investment incentives. He decried the time spent on weak tax legislation when lawmakers should be focusing on ways to reward long-term investments that create jobs and economic growth;

* expanding overseas efforts to build markets for American goods and services;

* reducing the regulatory burdens on business and the need for product liability reform.

He also called for a maximum effort by the business and industrial sector to educate Congress as to what modern manufacturing is all about. He said that it is not a matter of all congressmen and their staffs being vindictive toward business; many are not, but they are too often unaware of how their actions affect the economy. It is up to the manufacturers to get legislators out of their offices and into the plants to see and learn at the grass roots level the importance of U.S. industry.

Jasinowski reported that the short-term economic forecast looks fairly strong. He based his reasons for recovery on the lowering of interest rates by the Federal Reserve Bank to their lowest level in over two decades and on the strong recovery of the housing market. He added that improving retail sales and low inventories also are contributing substantially along with consumer and business debt reductions. One of the often overlooked factors, Jasinowski said, is the country's gradual return to the idea that a strong manufacturing base is the key to a healthy national economy.

The OSHA Maze

Susan S. Nussbaum, executive director of the Workplace Health & Safety Council, gave a chilling example of the growing power of OSHA. She said that OSHA violation penalties on corporations in 1982 totaled $4.3 million. In the space of just nine years, that total had swollen to $91.7 million. She pointed out that the skyrocketing imposition of fines would continue under the Comprehensive OSHA Reform Act now under congressional study, and important congressional Democrats are pushing hard for its quick passage.

Under the guidance of Sen. Howard Metzenbaum (D-OH) and Rep. William Ford (D-MI), the stultifying rewrite of the OSHA law would, among other things, expand the agency's jurisdiction, mandate employer/employee safety and health committees for companies of 11 or more workers and increase criminal penalties for noncompliance.

New employer obligations under the OSHA rewrite would:

* require written safety and health programs describing employee training and education, detailing methods of identifying and correcting hazards and designating the management official responsible for health and safety;

* establish a safety and health committee for each worksite consisting of an equal number of employees and management representatives with the right to inspect any worksite, review employers' health and safety efforts and file advisory recommendations;

* make employers legally responsible for the safety of any employee on the worksite regardless of who their actual employer may be (subcontractor, pizza delivery, etc.).

* require a 24-hour reporting obligation of any accident.

Employees, under the OSHA rewrite, would have the right to:

* protest OSHA citations they deem unfair and participate in all hearings (including family members in the event of serious injury or death);

* refuse work they judge to be unsafe;

* afford "whistleblower" protection.

OSHA powers would be expanded to allow the agency new standard-setting authority letting it speed up the regulatory process, require stricter health and safety standards and permit it to close down facilities and/or equipment without a hearing in the event an employer does not immediately accede to OSHA's proposals.

OSHA also could broaden existing offenses from misdemeanors to felonies for what it considers "willful violations" and increase fines substantially. For instance, in the case of conviction for a "willful violation" resulting in a death, the present six months prison term would be extended to 10 years. In the case of the absence of a notice of inspection, the six-month prison term would go up to two years, the individual supervisor fine from $5000 up to $250,000 and the corporate fine of $10,000 would advance to $500,000.

RCRA Reauthorization

The Resource Conservation and Recovery Act is the federal mandate that regulates the treatment, storage and disposal of waste products. Proposed changes in the act would mandate municipal waste reduction, limit interstate transport of waste and reduce toxic chemicals in production processes.

Recycling of all waste products would place nonhazardous wastes, now within state jurisdiction, under federal control. Scrap metals would be classified as hazardous materials, forcing foundries to use only virgin materials. Many foundries, unable to meet the reduction requirements for the likes of iron, copper and aluminum, would effectively be put out of business.

Harvey Alter, U.S. Chamber of Commerce, reported that the administration has shied away from taking an active role in the reauthorization bill fearing that any substitute bill would be dead on arrival and serve only to provoke additional changes in RCRA. He claims that authors of the bill, who are pushing for regulation, have ignored or are ignorant of the facts of foundry operations. He warned that under present RCRA rewrite representations, spent molding sand would be regulated strictly, causing 100 million tons of sand a year to be disposed rather than reclaimed for reuse.

Administration's Views

Charles Kolb, deputy assistant to the president for domestic policy, detailed some of the gains that President Bush sees as critical forward indicators of the nation's continued recovery. He said the president is encouraged by the three consecutive quarters of economic growth and lower consumer debt, claiming that these factors will further encourage consumer spending. He said that retail sales were up in January and February, the first back-to-back monthly increases since 1985. More encouraging, the administration pointed to housing starts gaining nearly 10% in February and January's 55% rise over January '91.

Kolb said the 90-day regulatory moratorium declared by Bush was a periodic necessity just to give businessmen a break from smothering federal actions that disrupt economic recovery and the country's competitive position.

He declared the administration's intention to pressure long-term reform that would reduce the appalling number of lawsuits that cost the country some $80 billion in annual direct litigation costs and increased insurance premiums. Imposing a fairness rule in which the loser pays all court expenses and forcing both parties to share excessive discovery costs would eliminate many of the liability cases now clogging the courts nationwide.

Kolb also touched on the health care dilemma, saying that the administration strongly supports the preservation of the private systems as preferable to some government schemes being proposed. He indicated that education was high among the nation's most pressing problems because the present system isn't working well, even though we spend more per student than most industrialized countries. The president has said that money is not the sole answer to educational shortcomings and advocates an achievement-based alternative that involves innovation and hard work.

View from the Hill

Sen. Robert Kasten, Jr. (R-WI) was the featured speaker at the final luncheon. He is the ranking member of the Republican Small Business Committee and sits on three important congressional committees: Commerce, Budget and Appropriations. One of the few congressmen who understands the foundry industry well, he warned the conference attendees that they ignore pending legislation and the actions of Congress at their own peril. His message was that industries, and all citizens, must get involved with government in the same way the conference attendees were getting involved. He said it takes time and planning, but the alternative could cost America its future economic position.

"If we don't get a handle on the direction our government is going, we, all of us, will deserve the kind of government that only understands tax and spend, a government that is unresponsive and that will overwhelm the good sense of the people," Kasten said.

He stated that the key event that precipitated the current recession was the largest tax increase in our nation's history--the $165 billion bill handed to the country two years ago. That implemented a 12.5% gain in the government's long spending spree.

The president has conceded that he made a mistake when he agreed to the tax increases, but Kasten pointed out that the Congress, ignoring its blunder, is now trying to raise taxes again. This time it has targeted sole proprietorships (which many small foundries are), high-income earners and small businesses with fewer than 50 employees.

Congress, he said, needs to understand that businesses need incentives to work, save and invest, incentives that at least will retard the pace of taxation and regulation burdens already in place. The institution must be made to not merely maintain wealth, but find ways to stimulate its creation. Only by that route can the economy grow and the country prosper.