Local orthopedic leaders and 2nd District U.S. Congressman Rudy Yakym discussed a number of issues at an orthopedic roundtable Thursday at OrthoWorx.
Bob Vitoux, OrthoWorx chief executive officer, explained, “Congressman Yakym wanted to come in and hear what’s going on in their world, and at the same time, part some views into what’s going on in his world.”
OrthoWorx aspires to have roundtable discussions more frequently to make sure that “our orthopedic leadership has a floor or a platform to be heard,” he said, adding that Yakym has been great at staying in touch with them.
“This is something that we’ve done on some different occasions. Often, we do it more singular. This was an opportunity to get a cross-section of the entire industry together,” he said.
In the first hour of the two-hour roundtable, Vitoux said they did introductions and he reminded everyone of the really great things the orthopedic industry is doing. Yakym gave his own introduction and then there was some back-and-forth questions and answers.
“We talked about different things as it relates to, moving from hospitals to surgery centers and what the implications are of some of that on the industry, as well as what D.C. sees. We talked about air travel, having so many global companies, and what’s going on in the transportation area. Congressman Yakym is part of the transportation committee. And then most recently we talked about taxes and how do we continue to see this deficit being paid down over time and how that will come. And then we talked about R & D (research and development) tax credits,” Vitoux said in summarizing the first hour.
Noncompete Clauses
After lunch, the second half of the roundtable began with discussion on the Federal Trade Commission’s rule to ban noncompete clauses nationwide.
Yakym was told by a roundtable participant that companies sink a lot of money into their people and give them a lot of proprietary information so there’s a concern with the FTC banning noncompetes. While there could be some reasonable limitations to not enforcing the noncompetes, for the FTC to come out and just broadly ban them across the board is “troubling.”
In response to that concern, Yakym said, “In a broad general sense, businesses know how to run their companies, and one of the things from the federal government’s perspective, I believe that we need to allow businesses to run their companies and not continue to step in the way. What we find is that the more government gets in the way, the worse things are, particularly the federal government.”
Typically, most noncompete language as it relates to labor law information is regulated at the state level, as it should be, he said. “I’m a fan of leaving a lot of those decisions to the states, as opposed to having the government come in and having one big ruling that impacts all 335 million or so Americans,” Yakym said.
Business interests sued the Federal Trade Commission in federal court Wednesday over the agency's new rule banning noncompete clauses, according to USA Today. The suit, led by the U.S. Chamber of Commerce and filed in Texas, argues that the FTC does not have the authority to regulate noncompete clauses.
Early Childhood Care
Kosciusko County has a very competitive labor market. One of the challenges the local industry has faced over the last 20 or so years is finding people to operate CNC machines and to work. A hurdle to that is access to early childhood care. Yakym was asked if there was anything that could be done at the state or federal level to improve that access.
“Child care is a huge issue. ... People want to go to work,” Yakym said. “I do think that there are some things that we need to rethink in terms of child care. There are parents who want to say it’s not our responsibility, it’s somebody else’s responsibility. You have companies that want to say it’s the government’s responsibility, and government doesn’t want anything to do with it. I think there are opportunities for people to say, ‘How do you rethink this a little bit?’ Even from the tax code perspective.”
As an example, he said today if an employer wants to pay for child care for an employee to come into work, the check goes from the employer to the childcare provider. That ends up being taxable income to the parent, though the worker doesn’t receive any cash from the employer for the childcare. The childcare provider, who is getting income from it, also is paying taxes on it.
“So in some ways, it’s almost like a double taxation,” Yakym said.
Immigration
Immigration issues were another area of focus with the roundtable discussion. Yakym was told a story about a business that hired a number of Venezuelans over a year ago, and those employees were very loyal and hardworking. They had documentation, but the company didn’t know part of them hadn’t been in the country for a year before they could actually work.
“How can we fix that? How can we fix this immigration issue because we’ve got people who want to come here and work, and they’re trainable. Obviously, there’s a language barrier, we’re working through that, but how do we fix ‘OK, we’ll let you stay, but you can’t work and make an income’? So who’s taking care of them?” the participant asked.
Yakym said there are two glaring issues, one of which is that the southern border under President Joe Biden is wide open.
“Every community right now is a border community. Even my team recently put together some numbers that show illegal crossings on the southern border, for the first 38 months of this president and compared it to the first 38 months of the last five presidents before this. The prior five four-year terms had a pretty narrow band down at the bottom (of the graph). Under this president, it’s going straight up and nothing but straight up. One out of every 100 people in the country today came across the southern border illegally in the last 12 months. It’s 3.5 million people. It’s 1% of our population in the last 12 months alone,” Yakym said.
The number one priority is to secure the southern border, he said.
The second issue, Yakym said, is how to fix the overall legal immigration system, which “is a very, very different issue. People want to lump them together, but they are wildly different issues.”
He said we need to think a little bit differently about immigration than we historically have in this country.
“... The reality is, I believe we need to think about immigration for what it is economically, which is a supply of labor into the marketplace. And if you come into a scenario where unemployment in a community is at 8, 9, 10, 12, 14%, let’s say, you ought to turn the spicket off and no one should come in to go to work because you have plenty of people locally that have the ability to do it. But if you can’t find someone who can do the job, if you’re trying to hire at any price, we ought to have the ability to have someone come here and take that job,” Yakym said.
The immigration system today is not simple, but overly complex, difficult to navigate and no one knows how to navigate it without a lawyer, he said. It needs to be simplified, but it starts with securing the southern border.
A roundtable participant talked about how the immigrants he’s known are incredible workers.
Another participant said they’re just trying to get workers in the door who will stay and be dedicated. He said there are immigrants in Kosciusko County that want to be those workers.
“The border issue is a huge issue, but there’s got to be a path to citizenship or different things to be able to work because - and I’ll just say it - there’s a lot of jobs that Americans just aren’t willing to do, and these people are more than willing to do it. I’ve seen it firsthand, and they’ll stay loyal to you,” a participant added.
Political Gridlock
With the election coming up, Yakym was asked if there was any optimism about Washington, D.C., changing and the ending of gridlock, regardless of who the president is. Nothing seems to get done in the Capitol.
“I think one of the things that needs to change is that more people need to show up and vote in primaries. There are a lot of people who get to the November election and they look at the Republican and the Democrat on the ballot and they look at both of them and go, ‘Well, I don’t like either one of these choices,’” Yakym responded. “But then they forget that they delegated their authority to have a say in that choice to everyone else because they didn’t vote.”
He said the primary turnout in this country is around 20% on a national average. “So you have 1 in 5 registered voters making the decision of who’s going to be on the ballot in the fall and they make the decision for everyone else,” he said, encouraging everyone to show up and vote in the primaries.
He also encourages people to run for office and get involved.
Yakym also talked about how America’s Founding Fathers set up the Constitution so it wouldn’t be easy to get something done in Washington. “It’s almost intentionally difficult,” he said.
Interest Rate
The last question posed to Yakym was where did he see interest rates going in the next 12 to 18 months.
Yakym said he had breakfast with Federal Reserve Chair Jerome Powell last week.
“They do not want to start to lower interest rates until they are very confident that inflation is under control,” he said. “We’ve had - for the last five years in Washington - a very, very serious overspending problem in Washington. They’re adding two or north of $2 trillion of debt every year right now. We have spent, again, the better part of the last five years, for a lack of better term, flying airplanes across the country, dropping bags of cash out of the back. Everyone walks out into their yard, picks up a bag of cash and thinks they’re rich. No, the reality is your dollar just depreciated. And inflation in our economy is still real.”
Last month CPI (consumer price index) came in hotter than expected, while at the same time Thursday morning the first quarter GDP (gross domestic product) report is coming in lower than expected, he stated.
“That’s a real problem. I believe the Fed would have liked to have started lowering the interest rate by now, but they don’t have a choice at this juncture because inflation is still running higher than it needs to be. I think they’re going to hold for now and maybe later this year we get a rate cut, but inflation is not showing a sign of slowing down. Oh, by the way, the employment market is still really strong. So at this time they don’t have a basis for cutting rates,” Yakym said.
Washington needs to curb federal spending.