Raf 'Build Back Better' vs. 'Keep America Great' - Exploring the Impact of the 2020 Elections on International Companies - Organization for ...
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‘Build Back Better’
raf America Great’
vs. ‘Keep
Exploring the Impact of the 2020
Elections on International Companies
*Current as of October 14, 2020
The presidential election is not a national election – it’s 50 state elections.
Popular Vote Winner in Each State Receives Electors’ Votes* 538 total electors, equal to the number of members of Congress in each state plus D.C.’s three electors, cast their votes for the president. 270 votes – over half of the electors – are needed to win. *Maine and Nebraska allocate electoral votes based on the popular vote winner at the congressional district level and the state level. Source: 270 to Win Accessed 10/5/20
Don’t wait up on election night.
Expect Delayed Election Results
in Battleground States
State Mail Ballot Deadline Ballot Processing and Counting
Michigan Ballots postmarked by the day before Mail ballots can be processed one
Effective Election Election Day and received within 14 days day before Election Day and
Date: Nov 17 after the election are eligible to be counted on Election Day
*Biden +7.2 counted
Pennsylvania Ballots postmarked by 8 p.m. on Election Mail ballots cannot be processed or
Effective Election Day and received through the Friday counted until Election Day
Date: Nov 6 after Election Day are eligible to be
*Biden +7.0 counted
Wisconsin Ballots postmarked by Election Day are Mail ballots cannot be processed or
Effective Election eligible to be counted counted until Election Day
Date: Nov 3
*Biden +6.3
North Carolina Ballots postmarked by Election Day and Mail ballots can be processed upon
Effective Election received by Nov. 12 are eligible to be receipt but not counted until
Date: Nov 12 counted Election Day
*Biden +3.2
* Real Clear Politics Average as of 10/14/20
References: Deadline MI : PA : WI : NC : Processing and Counting WP : WSJ
Expect Delayed Election Results in Battleground States State Mail Ballot Deadline Ballot Processing and Counting Florida Ballots received by 7 p.m. on Election Mail ballots can be processed and Effective Election Day are eligible to be counted counted 22 days before Election Date: Nov 3 Day *Biden +2.9 Minnesota Ballots postmarked by Election Day and Mail ballots can be processed upon Effective Election received by Nov. 10 are eligible to be receipt but not counted until after Date: Nov 10 counted polls close on Election Day *Biden +9.0 Arizona Ballots received by 7 p.m. on Election Mail ballots can be processed and Effective Election Day are eligible to be counted counted 14 days before Election Date: Nov 3 Day *Biden +2.7 Georgia Ballots received by 7 p.m. on Election Mail ballots can be processed upon Effective Election Day are eligible to be counted receipt but not counted until Date: Nov 3 Election Day *Trump +0.1 * Real Clear Politics Average as of 10/14/20 References: Deadline Time : WP : GA Processing and Counting FL : MN : AZ : AZ : GA
Election 2020 Timeline
Dec. 11: Jan. 6: U.S. Congress
Congressional meets in joint session to
appropriations expire count electoral votes
Oct. 15: Second Dec. 18: Final
Presidential Debate Nov. 3: Nov. 16: House scheduled
(Canceled on Oct. 9) Election Day returns congressional session
Oct. 7: First Vice Nov. 9: Senate Dec. 8: Electoral Dec. 23: Deadline
Presidential Debate returns college deadline for the receipt of
for resolving electors’ ballots
Oct. 22: Third election disputes Jan. 20:
Presidential Debate (3 U.S.C. § 5) Dec. 14: Electors Inauguration Day
from each state
meet and cast their
ballots for president
and vice president
Source: NCSL
Whichever party wins the White House will likely control the Senate.
Democrats Could Flip Senate
With Three Seats + White House*
Democrats: 47 seats Republicans: 53 seats
12 Democrat seats are up for election 23 Republican seats are up for election
10 seats are considered safe; 2 11 seats are considered safe; 12
seats are contested seats are contested
Of the 26 women in the Senate, 17 Of the 26 women in the Senate, 9 are
are Democrats Republicans
2 Democratic women are on the 6 Republican women are on the
ballot this year ballot this year
4 of these races are considered
competitive
*The Vice President serves as President of the Senate
Source: Cook Report accessed 10/14/20
and is responsible for the tie-breaking vote.
Presidential Outcomes
Influence Senate Races
Since 1992, incumbent senators have won…
97% 70%
(126/130) (37/53)
of races when the Presidential of races when the Presidential
candidate of their party won their state candidate of their party lost their state
Of the 12 most competitive Senate races, over half are in states that favor Trump
Likely+ Biden Lean Biden Toss Up Lean Trump Likely+ Trump
Colorado (Gardner) Maine (Collins) Arizona (McSally) Georgia (Loeffler) Alabama (Jones)
Michigan (Peters) Georgia (Perdue) Iowa (Ernst)
North Carolina (Tillis) Montana (Daines)
Alaska (Sullivan)
South Carolina
(Graham)
Democrat Republican
Source: Cook Report accessed 10/14/20 : UVA Center for Politics : H/T Mehlman CastagnettiHouse Unlikely to Flip
Democrats: 232 seats Republicans: 198 seats
1 Libertarian, 4 vacant seats
Democrats hold 30 districts that Republicans hold 7 districts that they
Trump won in 2016 held by 2% or less in 2018
Republicans would need a net
gain of 20 seats to win a majorityExpect familiar policy landscapes in 2021.
What a Potential Trump Administration Might Look Like
Trump’s Proposed Second Term Policies
“Keep America Great”
Jobs
• “Made in America” Tax Credits
• Tax penalties for outsourcing
Ending U.S. reliance on China
• Tax credits for companies “bringing back jobs” from China
• 100 percent expensing deductions for ‘essential’ industries bringing
manufacturing back to the U.S.
Corporate tax rate
• Focus on extending provisions of TCJA expiring in 2022 and 2025
References: Taxes : ChinaTrump’s Dealmaking Background
Trump views himself as a businessman, not a politician.
Trump is the only U.S. president to have never held elected office or served in the
military. Combined with his “Washington Outsider” political persona, President
Trump has demonstrated a willingness to question conventional norms.
2018: Trump’s pressure on NATO allies to “pay their fair share” leads to an increase in allied countries’
contributions to the alliance.
2020: After two years of negotiations, Trump and Chinese Vice Premier Liu sign the Phase One trade
agreement with China.
2020: Trump successfully negotiates the USMCA, a deal approved by bipartisan majorities in both
Chambers of Congress.
If past is prologue, President Trump will continue to use his bellicose
negotiation style to advance his “America First” economic policy agenda.
References: NATO : Phase One : USMCASecond Term Cabinet Turnover?
Average tenure of Cabinet positions Current Cabinet terms
In years, since 1993. In years
Commerce 2.5 3.6 Wilbur Ross
Treasury 3.0 3.7 Steven Mnuchin
Transportation 4.0 3.7 Elaine Chao
Energy 3.3 0.8 Dan Brouillette
Defense 2.9 1.2 Mark Esper
State 3.6 2.4 Mike Pompeo
Labor 4.2 1.0 Eugene Scalia
Attorney General 3.7 1.7 William Barr
0 1 2 3 4
YearsWhat a Potential Biden
Administration Might
Look Like
Photo: Phil Roeder in Des Moines, Iowa Jan 4, 2020 via Flickr
Accessed 9/28/2020Biden’s Proposed Policies
“Build Back Better”
“Buy America”
• “Made in America” $400 billion procurement investments
• Bring back critical supply chains to the U.S. via Defense Production Act and
other executive authorities
Taxes
• Increase the corporate income tax rate to 28 percent
• Establish a minimum tax on book income
Foreign influence in lobbying
• Add requirements for foreign businesses seeking to lobby in the U.S.
Source: Made in America : Supply Chains : Taxes : Foreign InfluenceBiden’s Dealmaking Background
Biden was Vice President for eight years, but he was a Senator for 36.
Biden’s success as a negotiator in the Obama Administration was built on his
reputation for working with colleagues across the aisle during his tenure in
the Senate.
2010: Biden and McConnell agree to extend Bush-era tax cuts for two more years.
2011: Biden and McConnell negotiate a compromise in the fight over the debt-ceiling
to avoid a government default.
2012: Biden and McConnell strike a deal to make Bush tax cuts permanent and end
the “fiscal cliff” crisis.
If past is prologue, expect a President Biden to utilize his relationships
with congressional leaders to advance
his agenda in a bipartisan manner.
Source: 2010 : 2011 : 2012Known Key Players
Long-Time Political Advisors Prominent Black and Hispanic
• Anita Dunn Leaders
• Steve Ricchetti • Rep. Jim Clyburn
• Ron Klain • Rep. Cedric Richmond
• Ted Kaufman • Rep. Karen Bass
• Valerie Biden Owens • Rep. Filemon Vela
Former Staff • Rep. Tony Cárdenas
• Evan Ryan • Rep. Anthony Brown
• Yohannes Abraham State and local elected officials
• Jeff Zients • LA Mayor Eric Garcetti
• Bruce Reed • Michigan Gov. Gretchen Whitmer
Young Progressives • California Gov. Gavin Newsom
• Symone Sanders • Atlanta Mayor Keisha Lance
Bottoms
• Gautam Raghavan
Source: Ogilvy Government RelationsPotential Chief of Staff
Ron Klain Steve Ricchetti
• Former senior White House aide to President • Chairman of Joe Biden’s 2020 election
Obama responsible for implementing the campaign
Recovery Act • Chief of Staff to VP Joe Biden (2013-2017)
• Served as Chief of Staff to VP Joe Biden • WH Deputy Chief of Staff for Operations
(2009-2011) and VP Al Gore (1995-1999) (1998-2001)
• Associate Counsel to President Clinton in
charge of judicial selection, won
confirmation of Supreme Court Justice Ruth
Bader Ginsburg
• Chief Council to the U.S. Senate Committee
on the Judiciary (1989-1992)
Source: Brownstein Hyatt Farber Schreck : HarvardPotential U.S. Trade Representative
Pete Buttigieg Tom Nides Robert Lighthizer
• Mayer of South Bend, • Managing Director and Vice • Current U.S. Trade
Indiana (2012- 2020) Chairman at Morgan Stanley Representative (2017 –
• Former 2020 Presidential • Former Deputy Secretary of State, present)
candidate appointed by President Obama • Former partner at Skadden
• U.S. Navy Reserve (2009- (2011-2013) law firm
2017) • Served as Chief of Staff to U.S. Trade • Served as Deputy USTR for
Representative Mickey Kantor President Ronald Reagan
• Fred Hochberg, Former U.S. Export-Import Bank chairman
• Rhonda Schmidtlein, Member of U.S. International Trade Commission
• Robert Holleyman, Former Deputy U.S. Trade Representative in the Obama administration
• Rep. Jimmy Gomez (D-CA), Helped negotiate stronger labor provisions in USMCA
• Beth Baltzan, Fellow at Open Markets Institute, Associate General Counsel at USTR (2003 - 2009)
• Katherine Tai, Current trade counsel for House Ways & Means Democrats
Source: CNBC : Axios : FT : Brownstein Hyatt Farber Schreck : ReutersPotential Secretary of the Treasury
Elizabeth Warren Jamie Dimon Richard Cordray Lael Brainard
• U.S. Senator from MA • Chairman and • Democratic nominee
CEO of for Governor of Ohio in 2018 • Member of the U.S.
(2013 - present)
JPMorgan Chase Federal
• Former Presidential • Served as the Director of the Reserve's Board of
candidate • Previously on the Consumer Financial Governors
• Assistant to the President board of Protection Bureau (2012-2017)
directors of the • Served as the U.S.
& Special Advisor to the • Attorney General of Ohio Under Secretary of the
Secretary of the Treasury Federal Reserve (2009-2011)
Bank of NY Treasury for
on the Consumer • Treasurer of Ohio (2007-2009) International Affairs &
Financial Protection • Former Chair of • Treasurer of Franklin County, as Counselor to the
Bureau (2010-2011) the Business Ohio (2002-2007) Secretary of the
• Law professor for over 30 Roundtable Treasury (2009 -2013)
• Solicitor General of Ohio
years before her political (1993-1995)
career
Source: Brownstein Hyatt Farber Schreck : CNBC : Axios : BloombergPotential Secretary of Commerce
Rohit Chopra Susan Helper
• Commissioner on the Federal Trade • Professor of economics at Case Western
Commission (2018 – present) Reserve University
• Previously joined the Department of the • Chief Economist of the U.S. Department of
Treasury to launch the Consumer Commerce (2013-2015)
Financial Protection Bureau (CFPB) as • Senior Economist at the White House Council of
Assistant Director Economic Advisers in the Obama
• Appointed as the first Student Loan Administration (2012-2013)
Ombudsman • Committee member of the National Academy
of Sciences Panel on Manufacturing
Source: Brownstein Hyatt Farber SchreckPotential Economic Advisors
Council of Economic Advisors
• Jared Bernstein, Senior Fellow at the Center on Budget and Policy Priorities
• Heather Boushey, President and CEO of the Washington Center for
Equitable Growth
• Jason Furman, American economist and professor at Harvard University;
served as chair of the Council of Economic Advisers (2013-2017)
National Economic Council
• Lael Brainard, member of the U.S. Federal Reserve’s Board of Governors
• Sarah Bloom Raskin, American attorney; formerly a member of the Board of
Governors of the Federal Reserve System and a former United States
Deputy Secretary of the Treasury
• Larry Summers, American economist; former director of the National
Economic Council for President Obama
Source: Brownstein Hyatt Farber Schreck : CNBCTrade Policy Outlook
Trump Biden
Buy Buy American Buy American
American • Tax credits for reshoring jobs from China and expensing • $400 billion procurement investments for “Made in America”
deductions for reshoring manufacturing jobs including pharmaceuticals, products in telecom and AI
• Will not issue federal contracts to companies industries, clean energy products and building materials
outsourcing jobs to China • Update international trade rules on government procurement
• Tax benefit claw-back provision for companies outsourcing jobs
China Further decoupling with China Preference for multilateralism in countering China
• Continue to maintain status quo on Phase One deal, • "Hands may be tied" on removing tariffs
but unlikely to pursue Phase Two deal
Trade Completion of a U.S.-U.K. trade deal Free Trade Agreements will take a “backseat”
Agreements • Seek TPA renewal • TPA renewal is not a priority
• Open to pursuing trade agreement with the EU • U.S.-U.K. trade deal negotiations may be paused
• Trade agreements: Kenya, potentially Taiwan • Will end U.S.-EU trade war
• Mini-deals with India, Brazil; Phase Two deal with Japan
DST Retaliation on Digital Services Taxes Restart OECD negotiations on Digital Services Taxes
Retaliation • Completion of Section 301 investigations • Completion of Section 301 investigations
WTO Continued pressure for WTO reform Potential WTO reform
Additional Potentially politicized M&A reviews Take a “tougher tone” and “meaningful punishments” in foreign
Policies policy
Source: Linked above : H/T Akin GumpThe struggle for party control is also underway in state governments.
Key Governor and State
Legislative Elections
11 states are holding gubernatorial races this year.
Montana is the only state considered a toss-up.
Here are the states where legislative control of a chamber may flip:
State Senate Chambers to Watch State House Chambers to Watch
Arizona Arizona Michigan
Colorado Alaska* North Carolina
Minnesota Florida Pennsylvania
North Carolina Iowa Texas
Currently Democratic Currently Republican
*A bipartisan coalition currently
controls the Alaska House
Source: MultiStateImplications
What GA Teams Can Do to Prepare
Communicate the Likelihood of Delayed Election Results NOW
• Those less familiar with the U.S. political system may mistakenly view delayed results as system failure.
Recounts should only reinforce confidence in the system. The U.S. election process is well established, and
Internally
every action will be highly scrutinized.
• Use the increased attention to showcase the importance of your GA mission by providing regular
company-wide perspective throughout the various stages of the election process.
Don’t Go Silent During the “Chaos”
• Look for opportunities in the must-do congressional “Lame Duck” action items (e.g. Appropriations, COVID
Externally relief, tax extenders, etc.).
• Communicate the importance of global connections with policymakers.
• Reinforce your company’s activity in combating the pandemic and propelling economic recovery.
Prepare for Next Year’s Known Policy Agenda
• Prepare your company for the issues likely to dominate the policy agenda in Q1-Q2 of 2021 (e.g. COVID,
economic recovery, China decoupling, etc.)
Prep for 2021 • State governments will be aggressively seeking revenue next year so remain plugged in to GBA’s state
working groups.
• Ensure your GA team is well-resourced for next year’s challenging policy environment, which will likely be
challenging regardless of the election outcomes.Additional Resources
Resources
Electoral College Battleground States Election Outlook Races to Watch State Elections
USA.gov: Presidential POLITICO: State of Mehlman Bloomberg MultiState: 2020
Election Process the Race Castagnetti: What Government: State Elections
to Expect in the 2020 2020 Election Coverage
Elections Outlook
This resource POLITICO provides a This analysis, This presentation MultiState breaks
provides more deep dive into the produced by dives into the down state
information on the political divides Mehlman balance of power governor and
mechanics of the within each of this Castagnetti, outlook in the House legislature races in
electoral college year’s eight provides a data- and Senate and key this pre-election
and the presidential battleground states. driven look at races to watch in briefing deck.
election process. historical trends, top this election.
issues and the
foreseeable failures
ahead in the 2020
election.About GBA As the premier voice of international companies in the United States, the Global Business Alliance (GBA) actively promotes and defends an open economy that welcomes international companies to invest in America. Our members are American companies with global heritage and an indispensable part of our nation’s economic success. When America is open for business, we all benefit.
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