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July 07, 2016 02:00 AM

Processors must prepare for election aftermath

Don Loepp
Editor
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    Rich Williams

    A month ago, could most North American plastics processors imagine that their business may be impacted by the Brexit vote?

    Show of hands — how many really understood what Brexit was, and what the impact of a “leave” vote would be?

    The June headlines about the United Kingdom's exit from the European Union, and the subsequent gyrations in stock prices, interest rates, currency valuations and some commodity products, were a major reminder that we're all in a global economy now.

    OK, I admit, that's a no brainer. But what does it mean to North American processors?

    First, should you have a Brexit strategy? With uncertainty in Europe, possibly for a few years, processors in North America could have some competitive advantages. Many are already anticipating benefits from plentiful low-cost shale gas, which is fueling big investment in the chemical sector, including resin manufacturing. And while the North American economies haven't exactly been booming, slow growth may start to feel pretty good if other markets around the world start to slump.

    But consider this — the two presumptive major party candidates for U.S. president appear to have vastly different policies on global trade. The outcome of the November election could have a huge impact on the global economy.

    Are processors prepared for the new trade and economic policies that either Hillary Clinton or Donald Trump would bring to the White House?

    A year ago, I thought that the ballot issue that global plastics industry would be watching most closely in November would be the vote in California on whether to ban single-use plastic bags statewide. And I'd argue that's still got the potential to have a huge impact. The result could either accelerate or slow down the spread of bag bans around the United States, and around the world. And, if successful, it may embolden efforts to ban other plastic products.

    But as we get closer to Election Day, I've gradually become less entertained by this year's Presidential contest, and more concerned about the impact of the potential results.

    It's going to be an interesting next five months. Processors should be prepared for any outcome — and remember, the smartest strategy may not be to just sit, watch and react later.

    Highlighting plastics: A winning strategy?

    The other election race I'm keeping a close eye on this year is Republican Sen. Ron Johnson's bid for reelection in Wisconsin.

    You'll recall that Johnson was the CEO of Pacur LLC, an Oshkosh, Wis.-based sheet extruder, before he decided to run against three-term incumbent Democrat Sen. Russ Feingold back in 2010. And in a wave of anti-incumbent, Tea Party, mid-year election mayhem, Johnson pulled off a pretty big upset.

    Now, six years later, Feingold wants his old seat back, so they're facing off again. But this time Johnson is the incumbent.

    Senate races tend to be close in Wisconsin, which qualifies as a swing state — Johnson won just under 52 percent of the vote in 2010.

    So is Johnson a comfortable incumbent now, running on his record in Washington? Not exactly. I've been amused by his first couple of television campaign advertisements. Instead of showing him walking the Capitol steps or chairing the Homeland Security and Governmental Affairs Committee, Johnson is seen back in the Pacur plant, standing next to an extruder, and rolls of plastic sheet.

    In one, he holds up a photo from the 1970s, leaning against an extruder, and says: “Not only did I help install this machine, I also operated it, working 12-hour shifts at night.”

    In the other ad, he asserts: “Career politicians manufacture hogwash. I manufacture plastic,” adding “Some companies export jobs. We export our products.”

    It's refreshing to see a plastics company owner/executive emphasizing his manufacturing background so prominently. Johnson isn't running away from his plastics ties, he's actually highlighting them!

    I'm eager to see if dairy state voters will send Johnson back to Washington this fall, or back to the plastics factory in Oshkosh.

    Loepp is editor of Plastics News and author of “The Plastics Blog.” Follow him on Twitter @donloepp.

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