RNC Dispatch One — Trade and Immigration/Labor Policy Matter

I spent the better part of last week at the Republican National Convention in Minneapolis and St. Paul, Minnesota. Before departure, I promised myself that I'd work to not overly mix politics and procurement, but on two issues, trade and immigration are just inseparable. Fact is, regardless of whether you consider yourself a Democrat or Republican -- or whether you're a global onlooker curious about the US election -- both issues are tantamount when it comes to fostering a business climate that favors optimal Spend Management strategies. And in both of these areas, I strongly believe that Senator McCain, if elected President, would drive a better overall trade and immigration/labor environment that will help companies reduce costs (versus increasing them) in the procurement arena. Granted, no one should vote on just these issues alone, but from a Spend Management perspective, I believe they're probably the most important issues on a business level.

Consider, for a moment, the implications of creating new barriers to trade through raising tariffs and erecting trade barriers designed to protect special interests in the US (a favorite tactic of companies that can't compete on the basis of price, product or customer service in a free market environment). By placing a shield around the margins of these organizations, everyone pays a higher price. This is precisely what happened when, under the Bush administration, we saw new trade barriers across a range of commodities from steel to mattress inner springs. Based on what I heard this week and the policy research I've done, McCain is no George Bush or Barack Obama when it comes to pandering to down-on-their-luck companies and industries by encouraging or directly enacting protectionist policies. Because of this, any company worried about increased commodity costs attributable to protectionist policies -- especially in the areas favored by protectionist mongers like metals -- should strongly consider supporting candidates, PACs and other lobbying organizations that go against the Bush/Obama wishy-washy free-trade planks.

Immigration is another issue that should be on the mind of all procurement and supply chain executives today. Here, both the Democrats and Republicans have had a wretched track record in recent years of not supporting immigration policies that favor increasing the skilled workforce in the United States. McCain has gone against the xenophobia in much of his party by supporting pro-immigration policies. Why does this matter for companies and sourcing strategies? For one, in the war for talent, hiring top-notch operational professionals should never just be a local matter. Companies should be able to consider potentially lower-cost and higher qualified employees from companies such as India in the procurement area. But even more importantly, a pro-immigration stance matters in the Spend Management world because it directly impacts the competiveness of local suppliers. I firmly believe that a Barack Obama presidency would increase the power of unions in this country, escalating the cost of labor for many domestic suppliers and increasing supply risk. Combine this with the double whammy of restrictive trade policies and we'll all be looking at increased costs coming down the road.

There is no easy choice in this election. Both McCain and Obama are both gentlemen who bring experience and smarts to the table (in one case street smarts, in the other academic smarts). But after this week, I'm personally convinced that McCain is the candidate who will make it easier for all of us to save our companies money through helping to make our suppliers more competitive by encouraging free trade, pro-immigration and competitive labor policies.

- Jason Busch

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