WASHINGTON -- President Bush's second-term agenda is likely to focus on boosting free trade, more tax cuts and tackling rising health care costs, supermarket industry lobbyists said last week, on the heels of Bush's re-election when Republicans also solidified their power base in Congress.
Industry association officials are generally enthusiastic about the GOP reclaiming the White House, and increasing its majority in the House and Senate. In the last four years, Republicans have championed several issues affecting food retailers' business, such as repealing the Clinton administration's ergonomic rules and rewriting overtime-pay regulations.
During Bush's first term, food retailers also backed his almost $3 trillion in tax cuts, including a 10-year phaseout of the inheritance tax, a change long backed by supermarkets. The industry was also a financial backer of Bush's re-election bid against Democratic Sen. John Kerry, who will return to the Senate representing Massachusetts.
In his second term, the president, in concert with GOP Capitol Hill lawmakers, is expected to press to make $1.9 million of his tax cuts permanent, including elimination of the inheritance tax. Moreover, there will be a push to reform the federal tax code, the details of which haven't been unveiled.
Gary Phillips, president and chief executive officer, Associated Wholesale Grocers, Kansas City, Kan., who also serves as chairman of the National Grocers Association, Arlington, Va., said the re-election of Bush and Republican gains in Congress will foster an atmosphere that will allow independent grocers to succeed. Phillips told SN he is eyeing policy gains including a permanent repeal of the estate tax and tort reform, as well as an improving economy and a business atmosphere less encumbered by mandatory regulatory programs.
"As a whole, we're really pleased with the results of the election," Phillips said. "As independents, we're excited to continue to be working with this administration and this Congress to address issues that are terribly important. We're looking at more voluntary programs as opposed to times in the past where there was too much regulatory red tape, fines and burdensome rules that ultimately wind up costing the consumer. We will continue to push permanent repeal of the death tax. Right now, we've got it through 2010 -- but family business people shouldn't have to plan their deaths before 2010. That isn't a pleasant process.
"We're also encouraged about the administration's comments on tort reform. We believe our legal system is out of control and needs to be drawn in, with everything from obesity lawsuits to medical liability."
Emboldened by earning 51% of the popular vote to Kerry's 48%, and having more Republicans in Congress, Bush told reporters Wednesday he's ready to aggressively pursue his agenda.
"I earned [political] capital in the campaign, and now I intend to spend it," Bush said. "And I'm going to spend it for what I told the people I would spend it on."
Plans to streamline the tax code are being closely watched by retailers who fear a national sales tax -- which the president has talked about informally -- might figure prominently.
Bush also will have to tackle soaring health care costs. He plans to ask Congress to create tax-free health care savings accounts that would be used to pick up health expenses not covered by insurance.
Jill Cashen, a spokeswoman at the United Food and Commercial Workers International Union, said health care reform is organized labor's top legislative priority. However, she called Bush's health care savings account unworkable and too costly for lower-wage retail employees. The union would like to see Kerry's health care plan implemented, which called for allowing lower-income individuals to use affordable health care policies covering federal workers. The Kerry plan would also have created an independent, federally backed entity to offer lower-cost catastrophic health care re-insurance premiums, which would lower employer-based policy costs, Cashen said.
Operating with a business-friendly administration could pose challenges for organized labor, but Cashen said the UFCW has been through this before and hopes to wield some influence among Republicans, as well as Democrats.
"We survived throughout the 1980s, and we held steady membership numbers and influence," she said. "We are prepared to work with folks on both sides of the aisle."
Also for organized labor, Bush's second term means another uphill battle over increasing the $5.15 hourly federal minimum wage, ensuring strong labor and environmental provisions in free-trade agreements, and immigration reform.
In California, voters narrowly rejected Proposition 72, a measure that would implement a law requiring employers with 50 or more workers to pay for at least 80% of the cost of health insurance for workers who exceed 100 hours a month, and require companies with at least 200 employees to also cover dependents. Supported by labor, senior citizens groups and some health organizations, the measure was strongly opposed by retailers including Wal-Mart Stores, Bentonville, Ark., which reportedly pledged $600,000 to efforts to defeat it.
"We're very pleased with the outcome," Bob McAdam, vice president of corporate affairs for Wal-Mart, told SN. "I think the voters clearly saw some things they were uncomfortable with about the government-directed health care plan that was part of Proposition 72."