Congress should move quickly on issues critical to competitiveness - editorial

Nation's Business, Oct, 1991

As it enters the final phase of its 1991 session, Congress faces several matters of unfinished business vital to the future of U.S. companies and their competitiveness.

Among the measures awaiting major action are plans that will determine how the U.S. will:

* Meet its future transportation needs,

* Move toward less dependence on foreign energy sources,

* Restructure its banking system and laws, and

* Maintain its competitiveness in the global marketplace.

The ease and efficiency with which a nation is able to transport goods and services from one point to another have much to do with its competitiveness.

Clearly, our nation's roads and bridges are in disrepair to the point that our future transport capabilities are at stake. We need to being a major program of refurbishing our highway system immediately. The sooner Congress passes legislation acceptable to the president, the sooner the work can begin.

The bill has been delayed in the House because of controversy over a proposed 5-cents-per-gallon gasoline-tax hike. The House should resolve this sticking point.

Approximately $19.3 billion has accumulated in a federal trust fund for highway work. The government should release those funds, collected from federal gas taxes, so that they can be used for the rebuilding effort.

On energy, Congress has an opportunity, resulting from the recent Persian Gulf War, to get our nation back on track with a long-range energy strategy focusing on resource development, technology improvements, and conservation. The threat to energy supplies posed by the Iraqi invasion of Kuwait, a major oil producer, generated strong support in this country for policies to increase our energy self-reliance.

The Senate should approve its bill, and House panels should work diligently to complete their work before the Persian Gulf momentum fades.

Among the issues in the banking debate are interstate branching by banks and whether banks should be allowed to sell insurance and securities.

Such issues have pitted small banks against large banks, insurance companies against banks, and banks against securities firms.

If the broader issues are too difficult to resolve, Congress should focus more narrowly on deposit-insurance reform, where a consensus can likely be reached.

A reasonable and much-needed approach to deposit-insurance reform would be to establish a mechanism to provide for private-market pricing of insurance so that well-run and poorly run banks would pay different insurance premiums. Under the current system, they pay the same federally set premiums. Thus, the system fails to discourage poor management.

While highway, energy, and banking legislation all represent opportunities for Congress to improve U.S. competitiveness, it is equally important that lawmakers reject legislation that would harm the economy and competitiveness.

Among those measures are several bills backed by organized labor, including a civil-rights bill related to job discrimination, a bill to prohibit replacement of striking workers, and legislation to mandate that employers provide a specific amount of family and medical leave to employees.

The House passed a civil-rights bill that business opposed largely because of provisions it says would lead to hiring based on quotas. The Senate is expected to take up a somewhat different version of the legislation soon.

The mandated-leave legislation was approved by House and Senate committees in the spring. Either chamber could take up its leave bill at any time.

The bill to ban striker replacements was passed by the House and awaits a vote by the Senate.

The civil-rights, leave, and striker bills would all restrain business at a time when business and the economy need a boost.

One area of legislation that is in much earlier stages but which deserves and is likely to receive Congress' attention is health care--another area that significantly affects the cost of doing business.

The most sensible approach--and the one that offers the most promise for success in this Congress--is for Congress to begin with incremental reforms to make health care more affordable. Reforming the small-business insurance market so that more small businesses could provide insurance to their employees would be a good place to start.

All of this unfinished business could have profound, long-term effects on the cost of producing, selling, and distributing products and services in this country. Congress and its leaders should keep the economy and competitiveness in mind this fall as they decide when to act on legislation and which avenues to pursue.