PHILADELPHIA The United States must avoid a plunge off the fiscal cliff, embrace a strong energy policy, invest in infrastructure and create a business-friendly regulatory environment if it is going to fully recover and prosper, according to Schnitzer Steel Industries Inc.s the top executive.
The threat of the fiscal cliff is creating uncertainty in the business sector, president and chief executive officer Tamara Lundgren said Monday at AMMs 6th Annual Steel Scrap Conference in Philadelphia.
"This is madness," she said. "The only reason we are perched out on the ledge is our legislators walked us out there themselves."
If the country goes over the cliff, it will permanently lose 6 million jobs by 2014, according to projections from the National Association of Manufacturers. "If we lose more jobs, we will have a permanently unemployed part of our work force, and that will cost us much more," Lundgren said.
Whats more, the countrys lackluster energy policy has prevented new factories and businesses from emerging, Lundgren said. "You cant grow a business without a reliable affordable energy supply," she said.
Elected officials need to be allies and not adversaries of business, as every two manufacturing jobs create one spin-off job, Lundgren said, adding that business leaders should insist on an energy program.
During the presidential election, both candidates spoke of the need to invest in infrastructure, Lundgren noted. China invests 9 percent each year in infrastructure, while Europe invests 5 percent and the United States invests just 2 percent.
"Neglect takes a toll," she said. If the country were to invest in infrastructure, it would create jobs and increase steel demand while improving aging roads and water systems, she said.
Lundgren also said that regulatory issues have proven costly and confusing to businesses. "Creating a predictable and reasonable regulatory environment might sound like an oxymoron like jumbo shrimp, but it is our only choice. Uncertainty makes it impossible to plan ahead," she told the roomful of executives.
The cost of compliance for business is increasing at a staggering 7.6 percent each year, Lundgren said. "The burden for business is not merely one (of) regulation but the sheer volume," she said, adding that the United States ranks 76 globally in terms of the ease of the regulatory environment.
"I am not arguing business should be free from regulations, but more can clearly be done to promote adherence to enforce ones we already have. We need a sensible, predictable regulatory environment," she said.
Lundgren encouraged people in the industry to become proactive and to contact their legislators to voice their concerns. "If you wrote one word down before you leave this conference it would be to engage. This is our moment to recharge," she said.