INSIGHT: Chems eye new policies under Trump presidency

HOUSTON (ICIS)–The inauguration of Donald Trump as US president will give the country its first unified government since 2009-2011, opening up possibilities for new policies that could benefit the chemical industry.

Following the midterm elections in 2010, the US has had a divided government. Republicans controlled at least one of the US legislative chambers, and the Democrat Barack Obama controlled the presidency. The divide led to legislative gridlock.

Trump’s election marks the end of that gridlock, opening the possibility of various policies becoming law in the US.

One such opportunity already arose with the passage of the REINS Act, also known as the “Regulations from the Executive in Need of Scrutiny Act”, HR-21.

If it becomes law, the REINS Act would require Congress to approve major rules before they can take effect. Rules that would fall under the REINS Act would affect the economy by at least $100m/year.  

The act has been proposed in the past and has failed to become law.

The American Chemistry Council (ACC) welcomed the bill as well as another one, the “Midnight Rules Relief Act”, HR 21. This would allow Congress to reject blocks of regulations that were introduced near the end of a president’s term.

Right now, Congress can reject such regulations only one at a time.

The ACC described both acts as “important parts of a broader effort to modernise federal rulemaking, where greater transparency and accountability is sorely needed”.

Another bill getting a second visit is the “Regulatory Accountability Act”, HR-5.

For the National Association of Chemical Distributors (NACD), one of the biggest opportunities is regulatory reform, said Eric Byer, president of the group. Recently, there has been a disturbing trend in the US, in which the use of guidance documents has become almost regulatory in nature. This has come at the expense of proper rulemaking.

With the reform bills recently passed by Congress, Byer said, “there will be true legitimate regulatory reform, where guidance is kept at bay and the number of rulemaking is limited”.

Under the reforms, the main focus will be assessing whether proposed regulations meet business and safety needs, Byer said.

Stemming the pace of new regulations is important because the US already has many that are not being enforced, he said. “There’s no need to issue new rules at a rapid pace when you can enforce what is already on the books.”

Byer would like Congress to go a step further and propose bills that would start reviewing regulations that are already in existence and that are no longer applicable. Technology has made many of these regulations non-applicable, he said.

For the enforcement of existing regulations, Byer also expects the outlook will improve for NACD members.

“We have always maintained safety first,” he said. “But what we don’t want to see is agencies going out there on fishing expeditions, whether it is a revenue generating opportunity or something else.”

He added, “That’s not what the agency should be doing, but we’ve seen something like that going on for the last few years.”

Going forward, Byer expects government agencies to be more mindful about enforcing the intent of the nation’s safety regulations without burdening companies with excessive costs.

Similar thoughts were shared by Jennifer Abril, president of the Society of Chemical Manufacturers and Affiliates (SOCMA).

“We have found that regulatory burdens (both individual and cumulative) can have a disproportionate impact on small and medium-sized enterprises,” Abril said in a statement. Such businesses make up about 80% of SOCMA’s membership, so they are particularly sensitive about this.

“We are hopeful the regulatory climate under the Trump Administration will be favourable. SOCMA supports regulations that are sensible and don’t impede our members’ ability to be innovative,” Abril said.

Byer shares a similar sentiment for the infrastructure programme that Trump had stressed during his campaign.

Improved infrastructure would have a large, beneficial effect on NACD members, since they rely on trucks to move material. “We’d certainly love to see the roads improved, especially for safety purposes,” Byer said.

However, any infrastructure programme needs to improve the nation’s roads and bridges without imposing excessive costs on the country, Byer said.

Tariffs, another important topic for NACD members, are more uncertain, Byer said.

Trump had discussed tariffs during his campaign, but it is too difficult to see what he could actually accomplish on this front, Byer said. “To be honest with you, I don’t know what they are going to do.”

Those details could emerge as the year progresses, he said.

By Al Greenwood

INSET IMAGE: President-elect of the US Donald Trump and First Lady-elect arrive at the Make America Great Again Welcome Celebration concert at the Lincoln Memorial in Washington. (Chris Kleponis/SIPA/REX/Shutterstock)