CHEMICAL & ENGINEERING
NEWS VOLUME 39, NUMBER
48
The Chemical World This Week
TAX SESSION. Changes in depreciation allowances would encourage capital investment, Rep. Hale Boggs (D.-La.) told MCA members at a panel session on taxation and depreciation in New York last week. Other panel members included
NOVEMBER 27, 1961
(left to right): Edwin Putzell, Jr., Monsanto; William Home, Jr., Olin Mathieson; H. A. Rockwell, Merck; and J. E. Carter, B. F. Goodrich. The chemical industry's concern over government relations was a major theme at the MCA meeting
Executives Should Up Interest in Government Chemical executives are urged to take a more active part in Government, receive some tips on how to do it Practically all chemical executives agree that it's important to maintain good relations between industry and Government. Yet many do not know how to go about improving those relations with Congress and the agencies and departments of Government. Others simply are unable to explain their side of an issue to government officials or to the public. Still others are insensitive, occasionally even indifferent, to politics. "The time when businessmen could say 'To hell with public opinion!' is long past. Likewise, the time has passed when businessmen could say, 'That's for politicians and the government workers to take care of. I'm busy producing a product for sale',"
Gen. John Hull, president of the Manufacturing Chemists' Association, reminded 1050 chemical industry executives attending MCA's one-day meeting in New York last week. The executives were urged to take a more active role in Government. They also heard plenty of reasons why they should be concerned with industrygovernment relations and learned what they should do about improving their relations with the Government. Laws Cost Money. One reason why management should be concerned with government relations is because the Government is exerting more and more influence in the chemical industry, Gen. Hull says. This influence is an increasing cost factor in chemical
production. New laws cost money. The cost factor is one that accountants don't have a column for in their ledgers or in the memory tapes of computers, but that such a cost item exists can hardly be disputed, Gen. Hull told the executives. The recent ruling by the Food and Drug Administration clearing polyethylene as a packaging material for foods is one example of the high cost of a new governmental ruling. According to Gen. Hull, it cost $1 million to assemble and present to FDA the scientific data upon which the ruling could be made. In other cases, chemical companies may find it necessary to establish new positions within their company in orNOV. 27, 1961 C&EN
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William G. Whyte Joining associations isn't enough
Gen. John Hull New laws cost money
Robert Kelly Get to know Congressmen's staff
der to have the manpower needed to cope with new laws. At least one chemical company, Gen. Hull says, now has a technical man devoting full time to its relationships with one government agency concerning its products. Although the man is not required by law or by the agency involved, the company felt the new position was necessary to enable it to understand the law and to make certain that communication between the company and the Government is effective, Gen. Hull explained. Many businessmen may not like the Government's growing influence in the business economy, but they have got to do more than sit in a corner and sulk about it, Gen. Hull maintains. "Whenever industry fails to meet a problem charged with public interest, it is inevitable that Government is going to take a hand/' he says. "When this happens," he goes on, "we find ourselves appearing before Congressional committees objecting to some proposed measure—we are often forced to take a defensive attitude." Gen. Hull feels the solution to this problem is to take a more active part in government, on the municipal, state, and national level. What to Do. Panel discussions on industry-government relations, taxation and depreciation, and the federal labeling act and regulations, underscored the chemical industry's growing concern over government relations. William G. Whyte, assistant vice president, U.S. Steel, feels that motivation and instruction are two key words in getting businessmen interested in politics. Businessmen have
got to realize the importance of taking an interest in legislation that affects their company. And, then, they've got to be told what sort of action to take, he told MCA. Some executives feel they have done their part by joining a national association, such as the U.S. Chamber of Commerce, the National Association of Manufacturers, or MCA. Although these associations do a fine job, Mr. Whyte says, businessmen cannot slough all the responsibility off to an association. The businessman himself should write or call his Congressman or testify before Congressional committees on legislation affecting his company. Robert Kelly, manager of legislative services for Du Pont, gave chemical executives some hints on how to get along on Capitol Hill. Mr. Kelly urges chemical executives to get acquainted with their Congressmeneven though they may not agree with the Congressmen's political views. Businessmen should also get to know their Congressmen's staff. They should know the names of their administrative assistants, legislative assistants, or personal secretaries, he told MCA members. Unlike some Senators and Representatives, Mr. Kelly explains, many of these staff people remain on Capitol Hill for years, shifting from office to office and committee to committee. Because of their knowledge, experience, and understanding of how to get things done, they are valuable people for businessmen to know. "Chances are," Mr. Kelly says, "that the Congressman won't be in his office the
first time you call and it's helpful to know who is next in command." But most important of all is maintaining continuing liaison with Capitol Hill. A businessman shouldn't expect his Congressmen to remember him, if he makes his Capitol Hill visit a oncea-year event, Mr. Kelly feels. Taxes. The differences of opinion between government officials and industry involving proposed tax reforms on depreciation is one specific government-industry problem that is likely to receive increased attention in coming months. The chemical industry now spends about 1 1 % of all manufacturing costs for plant and equipment, yet depreciation rules for industry have remained substantially unchanged for almost 20 years, Edwin J. Putzell, Jr., secretary of Monsanto Chemical, told MCA members. Last July, the House Ways and Means Committee approved a draft bill that allows a credit against taxes of S7c of the amount invested in equipment with a useful life of six years or more (C&EN, July 24, page 2 1 ) . However, many chemical officials feel the plan is inadequate. Industry favors a more liberal plan. Rep. Hale Boggs (D.-La.) assured MCA members that the Government "must give inducement to our American business, whether it be the chemical business or others, to reinvest in modern machinery and plants. It may very well be that a combination of these two depreciation plans [the House committee's plan and industry's plan] on an industry-by-industry basis will be the best solution to the problem," he says.
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C&EN
NOV. 27, 1961
