The manufacturers association is an association that is put together to represent the members if there is any dispute, or to ensure that their welfare is well taken care of. The association represents indiscriminately the small and large scale manufacturers, and as well as represents individuals who may in one way or the other associated to manufacture or manufacturing goods (referred to as importers of manufactured goods in this report). The association represents all the manufacturers and importers in 50 states, and in addition has a considerably large workforce. The contributions that the manufacturers make to the financial industry is wide, and therefore the grievances that the members of the association make are substantiated and is something that, if ignored, would have an adverse effect on both the economy and individuals of the nation. The manufacturers union is the largest driver to the economic growth and the key player in the private sector. Amongst the manufactures, the role that is played by the union is great, and that is why they uphold every idea that is put forward. This is also the reason why the union is referred to as being a representative of the manufacturers. The policy agendas are discussed in depth by the union to ensure that the rights of the players under its umbrella are not violated. The other important part that the association plays is ensuring that the barriers to importation are not felt by their members, especially if they are nothing but oppressive. The paper discusses the introduction of penalty duties of 30% on manufactured imports by the government, as well as cases when the importer fails to prove that he or she reduces carbon emissions by at least 3% per annum, including ensuing effects.
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The following is the part of the report that is intended for a press-release. The members of the manufacturers association are opposed to the introduction of penalty duties of 30% on manufactured imports by the government. This also involves cases when the importer fails to prove that he or she reduces carbon emissions by at least 3% per annum. As stated below, this will have negative implications for the consumer, manufacturer, manufacturing industry and government because they are all financially related. Should the policy be implemented, the costs involved will be felt across the board and result in them being unbearable for the aforementioned players. It is a well-known fact that the main interest of the government is to ensure that the citizens are satisfied with the kind of work that they involved in and furthermore, that they are satisfied with the services and are not exploited. Consequently, it means that the government should come out with ways and means of ensuring that the proposed bill is either dropped or changed to suit the needs of the manufacturers association and that would help in an overly manner to ensure that the society as a whole benefits from this service. This report is exemplary since it gives out the exact details of the way the proposed bill could affect the society.
This report is presented by the manufacturers association and concerns the proposed policy on the introduction of penalty duties of 30% on manufactured imports by the government, as well as cases when the importer fails to prove that he or she reduces carbon emissions by at least 3% per annum. This policy has its advantages and disadvantages, since it will help the environmentalists who are a part of concern of the manufacturers association. At the same time, it will deter the manufacturers from importing goods into the country resulting in failure to meet the government target in some areas and leading to gains in others (Blakemore, 2008). In order to ascertain the effects of the aforementioned issue, it would be expedient to study the effects. Firstly, the increase that would be levied on the products would push the the product prices up in the market, thus affecting the consumer who the government is supposed to protect. In addition, the increase would help to increase the profits of the manufacturers due to the increase in prices. This would mean that the market game would not be fair for both the consumer and the producer. The 30 % increase would help to bar the manufacturers from adhering to the policies, thus helping the environment as a whole. The following are the recommendations that the manufactures union would like to put forth concerning this issue (Birkland, 2010).
- The 30% increase should be reduced to 20% to ensure that the manufacturers are not affected
- The increase should be abolished to protect the welfare of the citizens
- The increase can additionally be maintained if the environment is more important than the citizens, and this would involve the manufacturers, importers, and consumers
It is also important to note that the Manufacturers association is the largest industrial trade association that represents both small- and large-scale manufacturers, such as importers of manufactured goods, who help fill in the gap that the local manufacturers cannot service (Chemerinsky, 2011). Therefore, the union represents all the 50 states in the US, and the voices that they air in this matter should be considered in depth. The manufacturers employ well beyond 12 million US citizens, and their nearly $2 trillion annual contribution to the economy is an additional source of revenue for the government.
The Intent of the Policy
The policy was written with various intentions, but the main intention was to petition the government to lessen or get rid of the proposed policy, since it may affect the daily operations of the manufacturers in the country. This intention is not biased and is very much inclined to helping the society as a whole and indirectly protecting the interests of the government (World Trade Organization, 2005). The aforementioned policy intends to encourage members of the import association who fall under the manufacturers association by virtue that they are importing manufactured goods to start championing ways and means of stopping carbon emissions by 3% annually. This is an excellent initiative but it has some flaws. First, this is not the right channel of ensuring that the importers adhere to the rule, since they will be oppressed, and this would lead to an overall failure by them to take up the initiative. If they adhere to the initiative, they will be inclined to come up with ways and means of ensuring that the fine that is imposed on them is compensated. This would eventually affect the citizens, and it is not the intent of the manufacturers union that the consumers are oppressed (Kletzer, 2002). Therefore, this policy has a wide range of effects that may take time to be felt by the consumers and government. The intention of this policy is to protect the environment by imposing financial charges on the key players in the financial market. This is a good move but it did not get an approval from the union which is affected by it.
Policy Effets on the Industry
The effects of this policy have been mentioned above, though not extensively. It is imperative to focus on the overall effects of the policy, if it is to be amended. The policy that intends to increase the penalty duties by 30% on manufactured imports by the government and in cases when the importer fails to prove that he or she is reduces carbon emissions by at least 3% per annum. This would mean that if the importer fails to prove that they reduce carbon emissions, they are definitely going to incur losses (Svedberg, 1979). These losses are quite extensive in terms of charges, and it means that the importer will have to pay again in addition to what he or she has already paid to import the product. It is known that the costs of importing in the United States are quite high, and it takes a lot of capital to bring something into the country. Therefore, it is quite easy to see that the 30% increase would mean that the importer would not only be financially oppressed but overly oppressed. This would have two implications, such as: a) the imports to the United States would be reduced b) the imports would be stopped altogether. The implications of the two actions for the economy would be devastating. The next phase of the foregoing problem would be the citizen (Facchini, 2007). If the government imposes this policy and the importers do not implement any of the abovementioned plans, they would continue with the imports but would have to increase the prices of the goods. Now, this move also has two possible outcomes, such as: a) the consumers would be oppressed and incur the 30% fine b) the consumers would come up with strategies through the consumers union to battle with the manufacturers union or the government, or both. This in return would have several effects. The first effect is that the government would have a disgruntled citizenry, and the increase that they impose would haunt them. The next possible outcome would be the battle of the two unions, such as the one referred to in this report and the consumers union. This too would have an effect on both parties and the government (Ehrenhaft, 1997). This shows the profound effect the policy would have on the industry. In particular, it would include an increase in prices of goods and services, which would lead to the reduction of imports, since the consumers would be forced to refrain from buying the goods. The next phase would be the one that has already been mentioned above.
Cost benefit analysis is used by the government or individuals to calculate and evaluate the desirability of a given policy. In this case, the analysis is carried out on the 30% increase and the resultant effects to the industry (Nayyar, 2007). The analysis would be carried out in the following manner:
- Listing and alternative programs
- Listing of the stakeholders affected by the policy
- Selecting and measuring all costs and benefits policy
- Predicting the costs of relevant period of time
- Converting the costs to a common currency
- Adopting a recommended choice
Analyzing the cost benefits of the policy, if implemented, would mean that if the aforementioned factors are considered, the industry would be considerably affected. The alternative program still remains as mentioned above, which is the reduction or the abolition of the penalty duties. This would have a serious positive effect, since it would mean that the market remains unaffected (Rai, 2007). The stakeholder affected by this policy would be the manufacturing industry, which aims to protect the importers, in case unfavorable policies, such as the aforementioned one, are implemented. It is likely that the effects of cost-benefit would be felt even before the broader effects, since the lack of finances would lead to the stages that have already been described in the essay (Kurthen, 1998).
Policy Effects on Companies
Once a policy is enacted, there are always two types of effects, and only one of them may be present. The effect that this policy has on the companies would be unintended. These are also referred to as side effects. The environment that the policy seeks to undermine already has a complex adaptive system, which is made up of a series of importers. Therefore, it is logical to deduce that the policy can have counter-intuitive results. Even though this policy would increase the overall revenue of the government, the margin that it has set as a penalty is too high and may lead to capital flight. The citizens would be adversely affected by the increased tax, since they will have to come up with ways and means of countering the flaw, and the only voice that they have is that of the government. If the imports are reduced, the effects that the nation or the citizenry have would be clearly noted, and this is why the abovementioned policy may not be the best one to tackle the situation (Bussemaker, 1999).
If implemented, the policy would be very challenging and have numerous effects on the society, but mostly on the companies that are involved in import and export activities. The companies in the industry are known to be the ones that would be involved in the sharing of the costs. This means that the policy would not affect a single company but all of the companies in the industry, since they are the ones that are being targeted by the policy. What follows below is some ways and means that the policy would affect the companies in the industry (Edwards, 2001).
Regulatory burden refers to a burden that would be felt by the government. The aforementioned policy would greatly affect both the consumer and the government, since it would lead to numerous financial and ethical issues. The manufacturing union recognizes the need of implementing the aforementioned policy, but this does not mean that it fully discredits or supports it. The abovementioned policy would lead to numerous losses in the financial market, since the consumers would be affected when they try to come up with ways and means of ensuring that they meet the costs that have been laid down by the government. The question that the government would have to ask itself is whether the policy that is mentioned below would be effective or essential to the public. The interests that it holds should then be a guiding factor to the overall decision-making process. Another question that the government should ask itself is whether the implementation of the aforementioned policy would really help it. The policy has its advantages, but the disadvantages far outweigh them. If implemented, it would mean that the government would be gaining more income from the above penalty (Andersen, 2002). However, what is paramount is to decide whether the policy includes standard guidelines and codes. If not, then the entire policy is deemed untimely or such that has been given inadequate consideration. In addition, the policy is oppressive, since it already has a force of law due to the fine imposed. This means that the burden of introducing an oppressive law would be transferred to the government. It is not in the intterests of the government to enact legislation that does not help its citizens. For the purpose of evaluating the policy, it is also important to examine the effects that the regulations would have on a firm-level perspective. Even if passed, the regulation would be carried out most efficiently and involve little costs, since the burden would be transferred to the consumer. This policy seems to overlap, and it is, therefore, safe to say that the importers would attempt to rationalize the requirements, and this would mean cost-sharing.
The cost of carrying out the new policy is inherent. This means that if it is reduced, the public will benefit, since they will receive a better bargain in terms of funds. The companies are deeply affected by the policy in a series of ways. The economic costs to the importing firms is something that cannot be overlooked, since it has to do with the issue under discussion. The companies will have to face steeper challenges, and some of them will have to go out of business due to the aforementioned policy, while the manufacturing association represents both the large-scale and small-scale players. In order to assess its costs to the firms, it is paramount that the costs of implementing the policy are analyzed first. The benefits that are expected to be accrued form this policy are numerous, and it means that the government may not be interested in discarding it. The assessment that should be carried out to analyze the costs includes (Taylor-Gooby, 2004):
Financial: the costs of implementing the new policy can be felt financially as the first basis. The cost of implementation in the firms would be great, since it would mean that they would have to come up with ways and means of creating new resources that would be environmentally friendly (National City Bank of New York, 2009). The new resources would mean that there is a need to increase the capital, and this would mean that workforce capacity has to be increased to manage the new changes. This in return would mean a higher cost margin to the companies. The next thing to do would be to include cultural changes, and this would change the organizational focus (Andersen, 2002). The double running would make the operations in the company hard.
Timescale: the timescale to be realized in the form of the companies would have to include a change in the schedule to take account of the needs of the new policy. This is a negative effect, since the operating costs of the companies would increase, thus leading to the overall failure of small-scale companies to exist in the market and their eventual demise (Blakemore, 2008).
Risk: the implementation of a new policy involves risks, and it means that if something goes wrong, the whole process will be flawed, and that is something that the company cannot do without (Kurthen, 1998). Therefore, the burden that the company would feel is obvious from this juncture.
Opportunity costs: the company would have to come up with new ways and means of calculating a better need, since it would have to implement the policy if it were to avoid the costs. This goes to show that if the policy is changed in the near future, the companies that implemented the requirements would suffer from it severely (Facchini, 2007).
Overall Effects on the Companies
If a policy is brought forth and the business environment is forced to come up with ways and means of implementing it, there are bound to be some costs and changes in the business, if it does not want to pay the fine imposed due to the policy. The aforementioned policy does not necessarily help the companies, even though it may prove to be helpful to the environment. Therefore, there are numerous financial risks involved in participating in this kind of business, since it means that the rights of the importers can be altered in a way that the policymakers feel befits them (Thomas, 1991). The policy that has been analyzed has no basis, and it would be unfair to impose it on the importers, and not on the entire industry. Equality is a key subject matter in this issue, since it is the right of the individuals of a country to feel appreciated, if they participate in one kind of work or another. Since the abovementioned policy is not clearly laid down, it means that the companies involved in export business would have to commit themselves differently, and this divide is not suitable for the financial market (Campbell, 2011). When pursuing the policies, the companies will have to face short-term problems, which might lead to many of them being closed down. This, therefore, means that the policy should be given a timeframe, while the players in the import industry be given adequate time to come up with the right means and ways of funding the changes. The new policy may seem to be simple, but in the real sense it has a lot of hidden costs, as discussed earlier in the paper. Therefore, the policymakers should always come up with ideas that favor their citizens, which would encourage them to be hardworking and committed to their jobs.
Suggested Modifications or Alternatives
The report can be modified in a number of ways to suit the needs of the government, environment, society and stakeholders. One of the ways of improvising the policy is to give the stakeholders adequate time to come up with the best ways of funding the changes that will be brought about by the policy (Wesson, 1984). The other way is to come up with another clearly laid down policy that would incorporate contributions from all the key players in the affected areas to ensure satisfaction with the rules to be laid down. Another way would be to abolish and create a new policy, or have an agreement that would be ratified by importers and environmentalists (General Agreement on Tariffs and Trade, 2000).
In conclusion, the policy that has been laid forth is not overly bad. This report has further attested to the fact that it may be helpful to the environment. However, the main concern that has been raised is the way the importers who fall under the manufacturing association would be affected. It is evident that the new policy would not go down well with the importers, since it is biased and does not forewarn all the players in the carbon-emitting industry.
Recommendations to Government
The government has come up with a clear and relevant document. On the other hand, it should follow some of the recommendations listed below in order to ensure that no part of the market feels discriminated against.
- To come up with a clearer policy
- To ensure that all the key players in the industry are involved in the formulation of the policy
- To give the importers time to come up with the necessary finances to implement the changes that would suit the government needs.