Government Affairs Roundup
“Your Timely Roundup of Local, State, and Federal Updates”

Chamber members:

President Biden says the $1.75 trillion social spending package that is languishing in the House is the key to slowing down the inflation train. However, there is one inevitable question surrounding that discussion: When? Many researchers agree with Biden in part, but believe the way the mammoth proposal is structured could add to the problem next year before prices have time to cool.

That possibility, fueled by the news this week that annual inflation jumped to 6.2 percent last month, has given Republicans another tool in the chest to deploy over the next year’s midterm elections in their bid to retake both chambers of Congress. More on the record inflation jump below along with other news in today’s roundup.

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U.S. Inflation Hit 31-Year High in October as Consumer Prices Jump 6.2%
U.S. inflation hit a three-decade high in October, delivering widespread and sizable price increases to households for everything from groceries to cars due to persistent supply shortages and strong consumer demand.

The Labor Department said the consumer-price index—which measures what consumers pay for goods and services—increased in October by 6.2% from a year ago. That was the fastest 12-month pace since 1990 and the fifth straight month of inflation above 5%.

The core price index, which excludes the often-volatile categories of food and energy, climbed 4.6% in October from a year earlier, higher than September’s 4% rise and the largest increase since 1991. On a monthly basis, the CPI increased a seasonally adjusted 0.9% in October from the prior month, a sharp acceleration from September’s 0.4% rise and the same as June’s 0.9% pace.

Price increases were broad-based, with higher costs for new and used autos, gasoline and other energy costs, furniture, rent and medical care, the Labor Department said. Food prices for both groceries and dining out rose by the most in decades. Prices fell for airline fares and alcohol.

Persistently higher inflation—triggered by a faster-than-anticipated but uneven economic recovery, trillions of dollars in pandemic-related government stimulus and other factors—is hitting consumers’ wallets. At the same time, a rebounding economy and healthy household balance sheets are both stoking demand and cushioning price increases.

The inflation surge is complicating the Federal Reserve’s strategy for unwinding easy-money policies the central bank imposed early in the pandemic. It has also emerged as a political factor affecting the Biden administration’s economic agenda.

The reading renewed GOP criticism of Democrats’ roughly $2 trillion social spending and climate plan as wasteful and likely to fuel inflation. The plan includes funding for expanded childcare, free prekindergarten, an enhanced child tax credit and other items, along with provisions to bring down prescription drug prices.

Prices climbed the fastest in the South, a part of the country that reopened earlier in the pandemic but was hit relatively harder by the Delta variant of Covid-19. Prices were also up more in the Midwest than in the Northeast and West.

Fed officials are watching inflation measures closely to gauge whether the recent jump in prices will be temporary or longer lasting. One such factor is consumer expectations of future inflation, which can prove self-fulfilling as households are more likely to demand higher wages and accept higher prices in anticipation of further price hikes.

Consumers’ median inflation expectation for three years from now stayed at 4.2% in October, the same as in September, according to a survey by the New York Fed—the highest level since the survey began in 2013.

Gasoline prices last month shot up nearly 50% from the same month a year ago, putting them at levels last seen in 2014. Grocery prices climbed 5.4%, with pork prices up 14.1% from a year ago, the biggest increase since 1990.

Prices for new vehicles jumped 9.8% in October, the largest rise since 1975, while prices for furniture and bedding leapt by the most since 1951. Prices for tires and sports equipment rose by the most since the early 1980s.

A 5.3% surge in restaurant prices last month marked the sharpest increase since 1982. The steady rise in restaurant prices over the past few months is a sign of this pass-through from wages into higher prices, economists say. That dynamic is increasingly showing up in other sectors.

Consumer spending increased at an annual rate of 1.6% in the third quarter, a sharp slowdown from a 12% increase in the prior quarter. However, much of that deceleration was due to scarcity of new cars and other durable goods. Consumer spending on services last quarter climbed at the brisk annual rate of 7.9%. Spending on services has bounced back further in recent weeks as coronavirus infections fell, which could increase pressure on prices.

Businesses are also passing on higher costs to consumers. Sixty percent of small-business owners said they had raised prices in the previous 90 days, according to a November survey of more than 560 small businesses for The Wall Street Journal by Vistage Worldwide Inc., a business-coaching and peer-advisory firm.

Eighty percent of the companies surveyed reported higher labor costs, while 72% said vendors had increased prices and more than half experienced higher costs for raw materials and other inputs.

Companies are struggling to get materials and are delaying orders, adding to demand pressures. The most prominent example is a shortage of semiconductors that has hamstrung auto production and driven up prices for both new and used vehicles.

A separate shortage of available workers is also affecting inflation and the overall economy, said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics. “The bigger picture is we’re likely to see inflation climb higher,” she said. “Things are going to get worse before they get better.”

The dearth of workers needed to meet consumer demand is also putting upward pressure on wages, adding to companies’ motivations for raising prices to offset higher labor costs. Higher food and energy prices—driven up by pandemic-related production snags, weather and geopolitical factors—are also spurring inflation, said Richard F. Moody, chief economist at Regions Financial Corp. “All these things are being rolled into prices we pay at the grocery store,” he said.

Some companies are racing to keep up with continuous, rapid price increases across the economy. Tom McTaggart, a pricing consultant and the founder of, said he began sensing a sustained rise in supply-chain-driven inflation during the summer. His billable hours had surpassed those for all of 2020, itself a record-breaking year for his business. Demand for his services has surged as his clients have struggled to preserve their margins.

“It’s a never-ending loop—by the time you’ve implemented one price increase, you’re already ready to implement a new one,” said Mr. McTaggart, who is based in Philadelphia. “It’s like trying to hit a moving target while you’re standing on a moving platform.”

Infrastructure Passed, Build Back Better is Being Negotiated Still, So What’s Next
Supply chain bottlenecks spurred by increased demand threaten to hold up Christmas gifts.

Businesses are facing labor shortages, which are likely to lead to inconveniences for Americans traveling during the holiday season.

Rising gas prices will add to those headaches, and now administration officials are warning that heating homes also will cost more this year.

And as it gets colder, inside gatherings could lead to more coronavirus cases, which have started to flatline after weeks in which they have fallen.

It all adds up to a difficult winter and potentially troublesome holiday season for President Biden, who has already seen his approval numbers drop amid a challenging few months for his administration. Fears that Biden’s party could lose the House and Senate in next year’s midterms are also up after a disappointing showing in last week’s elections in Virginia and New Jersey.

President Biden closed last week with some good news. A positive jobs report started the day out well on Friday, and the House finally approved a $1 trillion infrastructure bill by the end of the day that is a key part of the president’s agenda. But the White House and Democrats have struggled to sell their accomplishments, stirring worries within the party.

Recent polling suggests that a majority of Americans believe the country is on the wrong track.

A USA Today/Suffolk University poll taken last week before the infrastructure bill’s passage found that only 38 percent of registered voters approve of Biden’s job as president and 46 percent believe he has performed worse as president than they expected. In some good news for Biden, the same survey did find that over 60 percent approve of the infrastructure bill.

White House chief of staff Ron Klain acknowledged when asked Sunday on NBC’s “Meet the Press” about Biden’s low poll numbers that it has been a “rough and tough year” and that Americans have been frustrated with the pace of the recovery from the pandemic.

At the same time, he noted that job creation has picked up substantially under Biden when compared to the Trump administration, and that coronavirus deaths have fallen sharply.

Roads, Transit, Internet: What’s in the infrastructure bill
The $1 trillion infrastructure plan that now goes to President Joe Biden to sign into law has money for roads, bridges, ports, rail transit, safe water, the power grid, broadband internet and more.

The new law promises to reach almost every corner of the country. It’s a historic investment that the president has compared to the building of the transcontinental railroad and Interstate Highway System. The White House is projecting that the investments will add, on average, about 2 million jobs per year over the coming decade.

Here’s a breakdown of the bill:


The bill would provide $110 billion to repair the nation’s aging highways, bridges and roads. According to the White House, 173,000 total miles or nearly 280,000 kilometers of America’s highways and major roads and 45,000 bridges are in poor condition. And the almost $40 billion for bridges is the single largest dedicated bridge investment since the construction of the national highway system, according to the Biden administration.


The $39 billion for public transit in the legislation would expand transportation systems, improve accessibility for people with disabilities and provide dollars to state and local governments to buy zero-emission and low-emission buses. The Transportation Department estimates that the current repair backlog is more than 24,000 buses, 5,000 rail cars, 200 stations and thousands of miles of track and power systems.


To reduce Amtrak’s maintenance backlog, which has worsened since Superstorm Sandy nine years ago, the bill would provide $66 billion to improve the rail service’s Northeast Corridor (457 miles, 735 km), as well as other routes. It’s less than the $80 billion Biden — who famously rode Amtrak from Delaware to Washington during his time in the Senate — originally asked for, but it would be the largest federal investment in passenger rail service since Amtrak was founded 50 years ago.


The bill would spend $7.5 billion for electric vehicle charging stations, which the administration says are critical to accelerating the use of electric vehicles to curb climate change. It would also provide $5 billion for the purchase of electric school buses and hybrids, reducing reliance on school buses that run on diesel fuel.


The legislation’s $65 billion for broadband access would aim to improve internet services for rural areas, low-income families and tribal communities. Most of the money would be made available through grants to states.


To protect against the power outages that have become more frequent in recent years, the bill would spend $65 billion to improve the reliability and resiliency of the power grid. It would also boost carbon capture technologies and more environmentally friendly electricity sources like clean hydrogen.


The bill would spend $25 billion to improve runways, gates and taxiways at airports and to improve terminals. It would also improve aging air traffic control towers.


The legislation would spend $55 billion on water and wastewater infrastructure. It has $15 billion to replace lead pipes and $10 billion to address water contamination from polyfluoroalkyl substances — chemicals that were used in the production of Teflon and have also been used in firefighting foam, water-repellent clothing and many other items.


The five-year spending package would be paid for by tapping $210 billion in unspent COVID-19 relief aid and $53 billion in unemployment insurance aid some states have halted, along with an array of smaller pots of money, like petroleum reserve sales and spectrum auctions for 5G services.

Federal court could rule on Illinois legislative maps next month
With about two months until politicians file to run for statehouse seats, the new legislative maps for Illinois House and Senate districts are in the hands of the courts. A ruling could come early next month. Plaintiffs challenging the Illinois Democrat’s enacted statehouse maps are set to propose their ideas.

The legislative maps passed in May Gov. J.B. Pritzker enacted in June was deemed by a federal panel of judges to violate the 14th Amendment. Three sets of plaintiffs, Republican legislative leaders, the Mexican American Legal Defense and Education Fund and the NAACP have had their challenges consolidated.

State Rep. Tim Butler, R-Springfield, said the court has now asked plaintiffs how maps enacted in September should be amended. “And these all revolve around what are called Section 2 claims for minority voting rights, so for Latino voting rights and African American voting rights,” Butler told WMAY. “And so I think by Wednesday you’re going to see the attorneys file probably some response on maybe how districts can be different especially”

Butler expects the courts to make a decision sometime next month after a hearing in the case. “We’re at a point today where the court has basically said ‘look, we’re taking charge of this, Democrats you’ve had your opportunity, the rest of the plaintiffs, give us your ideas on this,’” Butler said. “And so I think the court is going to make a decision on this probably in early December or so.”

It’s important the issue is resolved, Butler said, because the filing period for the June Primary election is coming up in about two months. “Jan. 13, so we need to have this finalized soon so folks can go out and circulate petitions to get on the ballot and the courts understand that they need to respect that timeline,” Butler said.

Meanwhile, the state’s new maps for congressional boundaries where Illinois loses a seat, have yet to be acted upon by Gov. J.B. Pritzker. They were sent to him a week ago.

New Maps Shared
The Illinois Republican Party, the NAACP and MALDEF (Mexican American Legal Defense and Educational Fund) have submitted proposed legislative maps they say do a better job of representing underrepresented communities in Illinois than the ones Democrats approved in September.

The maps were submitted to a panel of judges who will discuss all three proposals at a hearing tentatively set for the week of Dec. 6, according to Capitol News’ Peter Hancock.

“This map fixes the problems created by Gov. J.B. Pritzker and the Democrats,” Republican Sen. Jason Barickman said. The GOP map creates 11 Latino-majority districts in the state House and five in the Senate, primarily in Cook County, Aurora, and Metro East areas. The Democrats’ map that was signed by the governor creates four Latino-majority House districts and two Senate districts. “The map proves that the Democrats’ primary purpose was in fulfilling a partisan goal at the expense of Illinois voters,” according to Barickman.

The NAACP’s map creates an additional Black seat in the Metro East area as well. “The NAACP says if the court decides to stick with the Democrats’ map, Black voters won’t have the power to elect a Black representative, as they have since 1975,” according to Belleville News-Democrat’s Kelsey Landis.

The three groups name as defendants: House Speaker Emanuel “Chris” Welch, Senate President Don Harmon, and the Illinois State Board of Elections. The lawsuits challenge Democrats’ legislative map on grounds that it violates the Voting Rights Act. The judicial panel asked for the plaintiffs to offer up their own map, so that’s what we’re seeing now.

Covid-19 Rekindles Debate Over License Requirements for Many Jobs
The coronavirus pandemic has heated up the long simmering debate on whether a swath of workers should need a license for jobs such as hair braiding, nursing and fitness training.

More than 1,100 occupations are licensed in at least one state, according to the National Conference of State Legislatures. Last year, 29 million workers, nearly a quarter of those employed full time, held a license, the Labor Department said. In the 1950s, about 5% of workers had licenses, according to researchers.

President Biden and some congressional Republicans say the need to hold a license to work in many different roles blocks Americans from taking well-paying jobs. Those concerns have been raised as job openings rose to a record 10.1 million at the end of June, but 3.4 million fewer workers were in the labor force that month versus February 2020, before the pandemic took hold in the U.S.

Advocates of the requirements say licenses and regulations around occupations such as barbers and insurance agents help keep the public healthy and protected, something that came into sharper focus during the pandemic.

Mr. Biden signed an executive order calling for the streamlining of occupational licensing requirements, which are set by states, as part of a broader effort intended to increase competition. The order asked the Federal Trade Commission to ban unnecessary occupational licensing restrictions that impede economic mobility.

A White House representative said that in certain occupations, such as skilled construction trades, licensing protects public safety and increases wages for workers who acquire in-demand skills. But in other occupations those rules make it difficult to enter the field without countervailing benefits. Which specific occupations will be addressed is up to the FTC, the representative said. An FTC spokeswoman declined to comment.

Both the Trump and Obama administrations also sought to ease licensing rules. In May, the Republican Study Committee’s alternative budget called “to reduce the burden of occupational licensing requirements, which often have more to do with intentional barriers to entry than safety.” Reps. Darrell Issa (R., Calif.), Diana Harshbarger (R., Tenn.) and Jim Banks (R., Ind.) have introduced legislation to lessen such regulations.

Licensing rules are set by state bodies and cover occupations such as plumbers, auctioneers and massage therapists. The patchwork of state rules makes it difficult for Washington lawmakers to impose changes.

State legislatures often put in place licensing requirements to respond to health and safety concerns. Once in place those rules are difficult to roll back, in part because license holders advocate to keep them.

Occupational licenses create a barrier for potential competing workers to enter the field, said Morris Kleiner, a professor at the University of Minnesota who studies licensing. That means license holders can charge more for their services, which raises consumer prices, while earning more and having better job security, he said.

Some states are making changes. In 2019, Arizona became the first to recognize all out-of-state licenses and in 2020 Florida reduced or eliminated licensing requirements for more than 30 occupations. Colorado, New Jersey and New Mexico have removed citizenship requirements for licenses, said Iris Hentze, a policy specialist at the National Conference of State Legislatures.

At the beginning of the pandemic, several states implemented temporary and emergency policies that waived or loosened requirements around licenses to beef up the medical workforce.

Ms. Hentze said some state lawmakers are considering making those changes permanent and discussed multistate compacts to recognize licenses from elsewhere in fields such as audiology, occupational therapy and psychology. There is already a multistate agreement for nurses. She said that Wyoming, South Dakota and Oklahoma have passed laws recognizing out-of-state licenses this year for all occupations.

Still, many businesses say that they can’t find enough licensed workers as the economy recovers from the pandemic downturn. “I can’t hire someone to shampoo hair unless they first attend a for-profit school for 8 months” to earn a license, said Frank Zona, an owner of salons in eastern Massachusetts.

The Professional Beauty Association, an organization for cosmetologists, said consumers want the accountability that comes with a license. The group supports recognizing out-of-state licenses. “Consumers have a reasonable expectation that the person applying a chemical or coming at them with a sharp object is trained,” said Myra Irizarry Reddy, the association’s government affairs director. “You wouldn’t spend $200 to go into a salon to get services from someone who just decided one day that it looks fun.”

All Anti-Sexual Harassment Training MUST be completed by December 31, 2021
Illinois has enacted changes in legislation to fight sexual harassment in the workplace. In addition to the Workplace Transparency Act, amendments to the Illinois Human Rights Act and the Victims’ Economic Security and Safety Act, the Sexual Harassment Victim Representation Act and the Hotel and Casino Employee Safety Act have all been signed. These new regulations mean huge changes for all employers, varying from who is an employer in Illinois to disallowing nondisclosure agreements for claims of harassment or discrimination.

Beginning on January 1, 2020, all Illinois employers were required to provide sexual harassment training to all employees on an annual basis. Stay tuned for more information on how you can obtain this necessary training through the chamber. We should have more information out in the next week or two.

Stay well,

Mike Paone
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
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815.727.5373 direct