Trump, the new Congress, and the auto industry: Whatês next?
Republicans have been dreaming for years of what a Republican Congress could achieve with a Republican president, and now their chance has come. We offer here the next in our series of articles discussing as many as anyone can in this uncertain year the likely priorities of the new Congress and president and how they could affect the auto industry.
Affordable Care Act: In the first few days of the 115th Congress, Republicans were eager to repeal at least parts of the Affordable Care Act. The catch: They have not offered a replacement and have not said when they will, indicating only that it could be weeks or months.
Congress could well vote to repeal the individual mandate that requires all Americans to have health insurance or pay a penalty. Itês not a broadly popular provision, but as the system stands now, the individual mandate is necessary for the financing to work. Insurance companies will be more likely to drop out of the market if only the very sick buy insurance. But there are still many unknowns.
Consumer Financial Protection Board: NADA has worked for some time to curtail the regulatory overreach of the CFPB. Some members of Congress would like to weaken or replace the chairman or even eliminate the board completely. An influential member interested in eliminating the CFPB is Senate Banking Committee Chairman Richard Shelby (R-AL). Watering down the role of the CFPB and other regulatory agencies could be an important part of Trumpês deregulation agenda.
Estate tax: As every WANADA member knows, NADA has been working for years to end the estate tax, a.k.a. the death tax. Now a new Congress and president-elect share that goal. On the campaign trail, Trump talked frequently about the need to lower business taxes. But he also wants to lower the deficit and has provided no details on his tax reform agenda.
Infrastructure: Infrastructure is notable for being an area of potential bipartisan cooperation until the details come out. As with tax reform, everyone agrees on the need for improved infrastructure. But paying for it directly with government funds would take a massive amount of money. Trumpês alternative: Offer tax credits to private investors who invest in infrastructure, at a cost of $1 trillion. Even a brief outline of the idea has brought controversy, and top Trump advisor Reince Priebus has said infrastructure wonêt be an immediate priority.
The Obama administration has been busy with new regulations and executive actions in its final weeks, and Trump has said he intends to overturn many of them. A big one for the auto industry is the final version of the CAFE rules approved by the Environmental Protection Agency in December. Rules created by a federal agency may not be easily overturned, though Congress could potentially pass a law that addresses the issue. But Congress and the new administration will have to choose their battles, with so many possible areas for action and only so much time.
Congress may be dominated by one party, but party consensus seems elusive. Once Trump takes office, Congressês time will initially be taken up by consideration of a new Supreme Court nominee and top Cabinet appointments. Neither Republicans nor Democrats in Congress nor Trump have shown much interest in bipartisan cooperation, and that too will contribute to gridlock.
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