WASHINGTON -- With the White House up for grabs in the Nov. 2 general election, food retailers would be better off if the current occupant, President Bush, keeps his job, according to industry associations.
The assessment is largely based on four Bush administration policies the president's presumptive Democratic opponent, Massachusetts Sen. John Kerry, opposes.
The make-or-break list of supermarket industry-supported issues championed by the Bush administration consists of: elimination of the estate tax; repeal of country-of-origin rules for produce and meat; revamping of a Depression-era law deciding who gets overtime pay; and continued replacement of mandatory workplace repetitive injury regulations with voluntary guidelines.
"We feel the regulatory climate is better [under Bush]," said John Motley, senior vice president of government and public affairs, Food Marketing Institute, based here.
Bush backs corporate and individual tax cuts to spur economic growth, and shrugs off critics' concerns that another round of tax cuts would only exacerbate the $500 billion federal deficit, threatening higher interest rates. The president argues the economy's recovery from the March 2001 recession can be pegged to the $1.7 trillion in tax cuts and record workplace productivity during his first term.
Bush also casts aside criticism that the recovery has been uneven and his tax cuts haven't spurred businesses to hire more workers. At the current pace, Bush will preside over the first administration with a net loss of jobs since 1929 and President Hoover's early Depression tenure, a political thorn Kerry readily pokes at the president.
Bush still wants more tax cuts, and is again using the estate tax as a rallying issue for the cause. Although Congress voted to phase out the estate tax through 2010, a second congressional vote is needed before then to permanently repeal it, before it is scheduled to return in 2011.
Bush favors permanent repeal as an economic boost for independent businesses, while Kerry -- who proposes increasing taxes for the wealthiest Americans while reducing middle-class taxes -- rejects the idea as being fiscally unsound and largely benefiting the rich.
Yet a Bush re-election doesn't guarantee permanent repeal of the estate tax, even if the GOP-controlled House and Senate remain in place. While Republicans are able to handily approve permanent repeal in the House, a handful of Senate GOP members who are fiscal conservatives worried about further increasing the federal debt have impeded passage in their chamber.
Conversely, if Kerry were elected president, any move to erode the estate tax phase-out would likely die in a GOP-led House, leaving the issue to be settled by the victor in the 2008 presidential contest and to test the supermarket industry's patience.
"The ultimate goal is repeal before the law expires [in 2010]," said Tom Wenning, vice president and general counsel of the National Grocers Association, Arlington, Va. Wenning is enthused by the Bush administration's proposed incremental change before Congress that would force a permanent repeal vote one year earlier, by 2009.
A move to reinstate workplace repetitive injury regulations would be considered likely under a Kerry administration, but if Congress remains in Republican hands, as expected, ergonomics legislation wouldn't likely move.
Repeal of the Clinton administration's ergonomic rules was one of President Bush's first acts, to the delight of supermarket officials. The industry viewed the regulations as overly prescriptive, and it supports the Bush administration's voluntary guidelines instead.
"The Labor Department under Kerry would aggressively pursue an ergonomics regulation," said David French, senior vice president of government relations with the International Food Distributors Association, Falls Church, Va.
Likewise, the supermarket industry supports Bush's overhaul of federal rules governing which workers are eligible for overtime pay. The Labor Department recently released the new regulations. However, Kerry would shelve the Bush administration changes, arguing millions of workers would be stripped of overtime pay, something supporters dispute.
Whether supermarkets should have to slap labels with the country of origin on fresh or frozen meat, produce, fish and peanuts -- an enormously contentious issue between retail opponents and their suppliers -- is another issue caught up in the presidential election year.
Although Bush signed a country-of-origin labeling law, or COOL, he now favors repeal and retooling of the measure. However, tinkering with COOL on Capitol Hill has proved difficult, with some Republicans from farm and cattle states joining Democrats like Kerry to block COOL changes.
Bush views a mandatory COOL system as costly and otherwise burdensome to businesses and something the food industry could undertake voluntarily. Kerry considers labeling a way to promote U.S.-raised food from small farmers and businesses.
Other supermarket issues are also in the presidential election-year mix, including the importation of lower-priced prescription drugs from Canada. Supermarkets with pharmacies have found a friend in Bush, who opposes drug importation. Kerry supports buying Canadian drugs as a way to help senior citizens and spark competition in the U.S. retail drug market.
One of the things both Kerry and Bush support is an increase of the $5.15-an-hour federal minimum wage, which retailers oppose as artificially forcing increases in all workplace wages. However, Bush said he supports a wage hike only if it's coupled with tax breaks for businesses to offset the price tag of higher wages. Kerry, the top Democrat on the Senate Small Business and Entrepreneurship Committee, supports offsetting the wage increase, but with tax cuts for small businesses.
In this particularly divisive election-year environment, supermarket officials might be interested to know that Kerry, on the hot industry topic of slotting fees, has a sympathetic view toward retailers. (The Bush administration hasn't weighed in on the issue, but is generally seen as supportive of the practice of grocery stores charging vendors for shelf space.)
In the late 1990s, Kerry and Kit Bond, R-Mo., then chairman of the Small Business Committee, held hearings to delve into whether pricey slotting fees unfairly keep small food suppliers from selling at supermarkets. No legislation was spawned from the hearings, where Bond remained skeptical about the slotting fee practice, long upheld as not violating antitrust regulations.
Regarding Kerry, "I found him better to deal with than Sen. Bond" on the issue, remembered FMI's Motley, who recalled a discussion with the presidential candidate on why a retailer would "take a chance by putting an unproven product [on a shelf] unless the manufacturer was willing to stand behind it" by paying slotting fees or cooperative advertising.
On food safety and nutrition labeling -- two regulatory issues tackled by presidents -- Kerry has yet to weigh in, with the exception of mad cow disease.
Kerry sides with consumer advocates in supporting a mandatory system to trace cattle from the farm to slaughter houses in cases when a cow tests positively for the brain-wasting bovine spongiform encephalopathy. The Bush administration has supported voluntary tracing, and has stressed testing to weed out infected cattle.
The Bush administration has taken a mixed approach on food safety and nutrition labeling.
At first, the president signed a bill relaxing strict Clinton administration-era standards dictating when foods can be called organic. However, under pressure from small -business farm interests and consumers, Congress and the president reversed the change.
However, the Bush administration, to the applause of processed food producers, has loosened rules governing when health claims can be made about food.
In addition, to address increased obesity in the United States, the Bush administration asked food manufacturers to change nutrition labels to better reflect the number of calories someone is likely to consume of a food in one sitting. Such changes would be voluntary, and thus supported by food manufacturers and opposed by consumer groups.
"Relying on junk-food marketers' self-policing is naive and one of the things that helped Americans waddle into the obesity epidemic in the first place," complained Michael Jacobson, executive director of Center for Science in the Public Interest, Washington, in a statement.
Bush Vs. Kerry On Key Issues:
Issue: Bush's Position; Kerry's Position
Estate tax: Favors permanent repeal; Favors retention
Country-of-origin labeling: Supports voluntary guidelines; Supports COOL
Overtime pay: Wants pro-business changes; Opposes Bush's changes
Workplace injury regulations: Sees voluntary guidelines as sufficient; Likely to try to reinstate Clinton's rules
