Oxford Analytica expects the climate for US-based businesses to improve in 2013, no matter who occupies the White House.
President Barack Obama has proposed consolidating agencies in the federal government to produce a more focused economic and business-friendly policy environment and to cut budgetary outlays — and concurrently to establish a dedicated ‘Trade Enforcement Unit’.
Using Reagan-era language, the president is asking Congress to give him authority to ’shrink’ the size of the federal government measured in number of employees and number of regulations, saving 3 billion dollars over ten years. His proposal is the first major executive initiative to seek a return of this power since a special presidential authority to reorganise government lapsed in 1984.
If authorised, it could reduce the cost of doing business for US-based multinational firms.
A streamlined, single ‘USA Business’ agency emulates a model established by several Asian economies, facilitating exports.
However, the proposed Trade Enforcement Unit is obviously directed at China, and would add to trade tensions with Beijing.
The reorganisation would be most effective at promoting US business and exports if accompanied by corporate tax reform, a Romney priority.
While obviously an election-year ploy to embarrass the president’s Republican opponents — who will reject it, even though it conforms to several of their priorities — the president’s latest business-friendly regulatory simplification proposals likely point to significant post-election reform.
This is a positive sign for US businesses; an administration led by either Obama or Mitt Romney would likely make reducing business costs and facilitating exports a priority in 2013.
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