Advocate!

Advocacy is the pursuit of influencing outcomes, including public policy and resource allocation decisions, within political, economic and social systems and institutions that directly affect people's current lives.

GAWDA's mission is to promote the safe operation and economic vitality of distributors of industrial gases and related welding equipment and supplies. We further define one of our primary purposes as “to anticipate and proactively influence federal government activities and issues of interest to the industry, provide analysis on current issues and disseminate relevant information to the membership.”

As an association, we do not directly lobby Congress or federal agencies. We do, however, partner with the Compressed Gas Association (CGA) and the National Association of Wholesaler-Distributors (NAW) in sending letters, educating our members on the issues and supporting grassroots lobbying campaigns. There are two issues pending in Congress that could have a disadvantageous impact on the welding and gases industry—Card Check and LIFO.

Card Check: Employee Free Choice Act (EFCA)
Under current law, if a union conducting an organizing campaign obtains signed cards from 30 percent of the workers supporting union representation, the union can request that the National Labor Relations Board (NLRB) conduct a certification election. If the union obtains signatures from 50 percent plus one of the employees, the union can present those cards to the employer and ask to be recognized. The employer can then insist on a NLRB supervised election in which workers vote—by secret ballot—on whether they want union representation.

If EFCA becomes law and the union obtains the signatures of 50 percent plus one employee, that union automatically becomes the bargaining agent without any secret ballot and can demand that the employer negotiate a contract. If an agreement is not reached within 120 days, the union can demand that the negotiations be referred to binding arbitration, and the decision of the arbitrator would be binding for two years. Enactment of EFCA would make it easier and much more economical for unions to target small and mid-size businesses, like many of GAWDA's member companies, and increase their likelihood of success. You can read more about Card Check on page 60 in an interview with Jade West, senior vice president of government relations at NAW.

LIFO Repeal
LIFO is an accounting method used to determine both book income and tax liability. LIFO is an abbreviation for “last-in-first-out.” This is opposed to the other common inventory accounting method, which is “first-in-first-out,” or FIFO. LIFO is considered a more accurate accounting method when inventory costs are rising, because it takes into account the greater costs of replacing inventory. This gives a better measure of both the financial condition of the business and the economic income that should be subject to tax. If inventory costs are rising, use of the LIFO method means less tax liability in a given year than under FIFO.

LIFO repeal would “reverse LIFO reserves” so that the amount of the reserve would become income for the year repeal was effective. However, companies would have no economic income from such an accounting adjustment, meaning taxation without receipt of dollars. For small businesses, the LIFO reserve could exceed retained earnings, in which case the business probably would liquidate and might still owe tax. After repeal, companies with rising supply and materials costs would pay greater tax liability in each year because of the loss of LIFO.

Call to Action
GAWDA will continue to keep you informed about developments on these two issues through articles in GAWDA Connection and by providing links to NAW and its system for contacting representatives in Congress. Let your voice be heard, or it will be drowned out by the opposition.