Policy and Legal

To win the artificial intelligence race with China and better compete with Russia, the U.S. must reduce its project-approval times, the head of the largest American natural gas company has warned Congress (Financial Times, subscription).

What’s going on: “Congress [needs] to step up and act,” EQT President and CEO Toby Rice told the FT regarding the need for the government to streamline “America’s byzantine permitting process,” which has greatly increased infrastructure project costs and times.

• “The threat of not getting infrastructure built has only gotten larger,” he continued. “Not only from bad actors getting rich by selling energy that could be replaced with American energy—it’s also the threat of China winning the AI race.”
• The biggest concern, according to Rice: judicial review, which allows for up to six years of legal challenges of permit decisions.

We need it all: In recent years, the U.S. has been shuttering baseload power plants and making it harder for companies to build natural gas infrastructure, Rice continued, and as a result, prices have risen and the electrical grid is becoming unreliable.

• Since the start of his second term, however, President Trump has prioritized making the U.S. energy dominant, taking actions like lifting the previous administration’s ban on new LNG export permits.

The backdrop: “These actions come as the U.S. races to meet growing domestic and global power demand caused by the data centers used to build and develop AI.”

• Global electricity demand from data centers is expected to double by 2030, according to the International Energy Agency.

A positive step: This week, EQT “signed an agreement in principle to provide gas to a 4.4[-gigawatt] plant that will power the Homer City Energy Campus, a 3,200 acre data center in Pennsylvania.”

Europe, too: Europe has been trying to wean itself off Russian gas since Russia’s invasion of Ukraine in 2022.

• This week, ENI—one of Europe’s biggest energy firms—signed an agreement to purchase 2 million metric tonnes of LNG from U.S. company Venture Global.

The NAM’s view: “Mr. Rice is right that, as the NAM has long said, the U.S. permitting system is holding us back,” said NAM Vice President of Domestic Policy Chris Phalen.

• “The administration has made important strides in cutting needless red tape, but manufacturers need comprehensive permitting reform legislation from Congress that supports all energy sources and makes improvements to our transmission and distribution systems for the nation to reach its full potential.”

Researchers seeking new methods of generating thermal energy are now trying something new: the oil and gas industry (POLITICO’s E&E News).

What’s going on: “State research officials in North Dakota are examining two new options—pairing geothermal with active oil and gas sites and using captured carbon dioxide as a feedstock for geothermal power production.”

• The state gave the go-ahead in June for a $250,000 feasibility study looking at “whether those two new geothermal technologies could be used” there.

Why it’s happening now: President Trump signed an executive order in April, calling for the elimination of “all illegitimate impediments” to the development of geothermal projects.

• Geothermal power enjoys bipartisan support in Congress, and federal tax incentives for both geothermal and carbon capture and storage have “created an environment where companies and researchers can start to explore different methods of production,” Matt Villante, an earth scientist with the Pacific Northwest National Laboratory, told E&E News.
• In addition, the 45Q tax credit, which offers an incentive for carbon management undertakings that capture carbon dioxide, was preserved in the recent reconciliation bill.

How it works: Researchers are exploring several different methods for using captured carbon dioxide to produce geothermal energy, which is traditionally extracted “by drilling and pumping up brine from deep within the earth.”

• One method would involve injecting large amounts of carbon dioxide into the ground to push out the brine.
• “Another approach could be pushing CO2 underground to the heat source, and pumping back up the heated CO2 to power the turbines, then injected the cooled carbon dioxide back underground in a closed-loop system.”
• A third way would use hydraulic fracturing to break up “hot dry rock” using carbon dioxide.

Yes, but…Despite the support for geothermal, actual projects to harness it are thin on the ground.

• In 2023, only about 0.4% of U.S. power came from geothermal sources, according to the U.S. Energy Information Administration, as “investors … [wait] for the existing technology to become safer bets.”

The NAM says: “While geothermal represents a small portion of the energy mix now, the NAM supports efforts to invest in developing the technology so that the U.S. has more sources in its all-of-the-above energy portfolio,” said NAM Director of Energy and Resources Policy Michael Davin.

The Trump administration has released the text of a framework agreement with Indonesia yesterday, also announcing a deal with Japan that has not been made public yet.

Framework agreement with Indonesia: The document released yesterday is a framework for negotiating an “Agreement on Reciprocal Trade.” It includes some commitments but also lays the groundwork for more negotiations.

U.S. exports to Indonesia: Indonesia will “eliminate tariff barriers” on approximately 99% of U.S. industrial and agricultural exports.

• For context, U.S. manufacturing exports to Indonesia in 2024 were $6.5 billion of the $10.2 billion total. Manufacturing imports from Indonesia in 2024 were $25.4 billion of the $28 billion total.

U.S. imports from Indonesia: This agreement would reduce the U.S. tariff on imports from Indonesia to 19% from the 32% rate imposed by the Trump administration on April 2.

• Significantly, the agreement suggests the U.S. “may identify certain commodities not naturally available or domestically produced for further reduction in the reciprocal tariff rate.”
• This type of approach is exactly what the NAM has pushed for in its proposed U.S. Manufacturing Investment Accelerator Program, and it will continue advocating for such policies in subsequent trade agreements.

Critical minerals: Indonesia, which had previously banned exports of nickel, will also remove restrictions on exports to the U.S. of industrial commodities, including critical minerals.

Other key components: The agreement also achieves commitments by Indonesia on other key trade issues.

• Nontariff barriers: Indonesia will accept U.S. standards and certifications for vehicles, medical devices and pharmaceuticals, exempt certain U.S. products from local content requirements and also allow the import of U.S.-remanufactured goods.
• Digital trade: The country will also now support the World Trade Organization’s e-commerce moratorium on tariffs on electronic transmissions—something it had opposed previously and that is essential to manufacturers seeking to move information across borders.
• Steel: Indonesia pledged to join the Global Forum on Steel Excess Capacity, an approach the NAM supports to address unfair subsidization and excess production, particularly by China, that distort global markets.
• China: Indonesia will work with the U.S. to address the unfair practices of other countries and to cooperate on export controls, investment security and combatting duty evasion.
• Purchases: Indonesia has agreed to purchase U.S. aircraft, agricultural products and energy products.

More to come: President Trump has previewed agreements with the Philippines and Vietnam on social media, while Japanese officials have announced an agreement on tariffs at a press briefing. The NAM will report on the official details once they are available.

The bigger picture: Here are some other trade developments that the NAM is tracking:

• U.S. Treasury Secretary Scott Bessent will meet his Chinese counterpart in the coming days.
• President Trump will travel to Scotland for discussions on “finalizing” details in the U.K. deal.
• Talks with the EU, Canada and Mexico continue.
• And lastly, the president has signaled he may send letters setting a flat rate of 10–15% tariffs to some 150 countries.

“To put it simply, investments in infrastructure are investments in manufacturing,” Husco President and CEO and NAM Executive Committee member Austin Ramirez told the Senate this week.

What’s going on: “Modern, dependable transportation helps manufacturers make and move our products,” Ramirez, whose company makes hydraulic and electromechanical control systems, told the Senate Committee on Environment and Public Works at a Wednesday hearing on crafting the next highway bill.

• Infrastructure projects “generate productivity gains and induce demand for manufacturing goods—stimulating the economy and bolstering American competitiveness,” said Ramirez.

Funding in action: Husco has seen firsthand the benefits of robust infrastructure investments, Ramirez continued.

• “Our customers are in the automotive and construction industries. And Husco families drive over the roads and bridges improved by highway projects. Several are turning dirt this year in Waukesha County.”

Why it’s crucial: Failure to reauthorize key surface transportation programs would result in interruption of these critical investments in U.S. roads and bridges, hitting manufacturers hard, Ramirez told the committee.

• “We cannot go back to the fits and starts of highway bill extensions. Our industry needs certainty to invest, plan and hire in America.”

Permitting reform: Ramirez also explained how America’s “complex permitting laws impact investment decisions” and encouraged the committee to adopt comprehensive permitting reforms that expedite project approvals and put a stop to “endless litigation.”

What should be done: Policymakers should “seize the opportunity” to make “robust investments in our surface transportation infrastructure,” Ramirez said. This should include efforts to strengthen the Highway Trust Fund, expand highway capacity and connectivity, implement intermodal improvements to bolster the country’s freight network and enact much-needed permitting reform.

Other voices: Other manufacturers recently sat down with the NAM and United for Infrastructure, where the NAM serves as a steering committee member, to discuss how infrastructure impacts their businesses. Leaders from CRH, Nucor and Fluor—sponsors of the NAM’s and United for Infrastructure’s Infrastructure Week kickoff event—spoke about the importance of infrastructure investments and modernizing our infrastructure to keep products moving and manufacturers operating.

• “As we look at reauthorizing the [Infrastructure Investment and Jobs Act] a really important piece of that was the higher baseline for federal highway formula funding, which we know through our experience with state DOTs needs to continue to grow in order to meet the needs of growing states,” said Fluor Senior Director of Government Relations Nathan Robinson.
• “If we’re going to truly harness the power of what AI is going to bring us, what machine learning’s going to bring us, all the things that truly are the future [of the] economy, we’ve got to get the way we move people and goods around in much better shape,” said Nucor Executive Vice President of Business Services Ben Pickett.
• “Permitting reform has absolutely got to happen for us. We’d like to see … a less prescriptive bill and more money go to the states through [the] funding formula. … When states have funding security and certainty, then they’re able to go raise revenues,” said CRH Executive Vice President of Government Relations Ryan Lindsey.

The last word: “Our industry depends on a robust, modern, efficient transportation system—and you can promote domestic manufacturing by getting a highway bill done this Congress,” Ramirez concluded.

Endless litigation has delayed much-needed American infrastructure development for decades—and that has to stop, as the NAM and manufacturers have long argued. The Washington Post (subscription) editorial board makes the case that Congress must step up and fix the permitting process to unlock American investment and growth.

Recent developments: The recent Supreme Court ruling that limited the National Environmental Policy Act—in which the NAM filed an amicus brief—is a step in the right direction.

• In that case, “The court decided that the U.S. Surface Transportation Board could approve an 88-mile train track even if it might move crude oil from Utah to refineries on the Gulf Coast,” the Post noted. “The board didn’t have to assess the potential future impacts if the new track encouraged more oil drilling on one end and more oil refining on the other.”
• In other words, environmental review was limited to the environmental impact of the project itself—as intended by the statute—rather than a more expansive investigation into the potential uses of the finished project.

A long-standing problem: Gaming the permitting process to stop development is nothing new.

• “In the 1970s, a ‘new’ species of freshwater fish called the snail darter was discovered during NEPA research into the building of the Tellico Dam in Tennessee.”
• “For the project to be completed, Congress had to exempt it from the Endangered Species Act. It turned out that the fish was not endangered. It wasn’t a separate species. Opponents of the dam ‘discovered’ it to get the dam stopped.”

More at risk: Numerous infrastructure projects are still in limbo today due to this sort of maneuvering by groups seeking to delay needed investments.

• “A flower called Tiehm’s buckwheat might stand in the way of a Nevada lithium mine green-lit by the Biden administration,” for example.
• But, as the Post noted, “Maybe the idea of protecting every ecosystem at any cost should be reconsidered. The flower, which apparently grows only on 10 acres in the proposed mine’s footprint, is a close relative of other buckwheats. Is it a distinct species? Perhaps it could be grown elsewhere?”
• And another important question: “Perhaps the battle against climate change—which will require lithium to build lithium-ion batteries to power electric vehicles—should take precedence?”

Calling on Congress: “NEPA review had grown to require every government decision to survive endless judicial challenges, poorly serving the nation and the natural environment in which it sits. Congress should not leave it to courts to fix,” the Post concluded.

The NAM agrees: “Comprehensive permitting reform is essential to building a strong and more competitive manufacturing economy. As [the Post] notes, Congress should reevaluate environmental impact reviews in order to ease construction of critical infrastructure projects,” said NAM Managing Vice President of Policy Charles Crain on X.

The Food and Drug Administration is considering a scientifically flawed method for detection of asbestos in talc-containing cosmetics products—a move that could have far-reaching implications across the manufacturing sector.

What’s going on: In December, the FDA published a proposed rule for detecting and identifying asbestos, as required by the Modernization of Cosmetics Regulation Act of 2022. But the proposal is based on unsound science that could limit companies’ ability to utilize talc, a key manufacturing input.

• The overinclusive testing methodology prescribed in the rule is highly likely to misidentify non-asbestos minerals as asbestos. That means that a “positive” test could classify talc as contaminated with asbestos—even if no asbestos is present.
• In May, the FDA held a roundtable discussion on the safety of talc, at which participants discussed the merits of expanding this de facto talc ban beyond cosmetics and to most if not all products and manufacturing processes.

Why the NAM is concerned: Beyond cosmetics, talc is used in a wide variety of industries—including pharmaceuticals, food, plastics, paper, automotives, rubber, roofing, paint, coatings, pottery and ceramics. It is also commonly used on shop floors throughout the industry.

• For many companies, talc substitutions may be inferior or may not exist at all.
• In addition, an FDA-endorsed standard prone to false positives is highly likely to distort other agencies’ asbestos detection testing methods and exposure analysis.

The NAM says: The FDA should withdraw the proposed standard and publish a new rule that contains scientifically sound and accurate testing methods.

• “Manufacturers support the use of sound science,” said NAM Managing Vice President of Policy Charles Crain. “The FDA has the opportunity to repromulgate this flawed rule to provide for accurate, science-based testing that actually protects consumers—rather than a flawed standard that could have far-reaching and costly consequences throughout the manufacturing industry.”

There’s a lot for manufacturers in the U.S. to celebrate right now, starting with the historic passage of the One Big Beautiful Bill Act with pro-growth tax provisions—but they are still seeking more policy fixes to help them grow and compete, the NAM said last week at the 14th annual John Hazen White Manufacturing Forum at The Brookings Institution.

Starting with tax policy: “When we think about the president’s manufacturing strategy, his manufacturing policies, you really have to start with tax policy,” NAM Managing Vice President of Policy Charles Crain said about manufacturing under the Trump administration.

• “We know from the 2017 Tax Cuts and Jobs Act the impact that pro-growth tax policy [had] on manufacturing in 2018 and 2019. Coming out of the TCJA, we saw record capital investments in the manufacturing industry. We saw record job increases. We saw record wage increases.”
• The One Big Beautiful Bill Act, signed into law on the Fourth of July, “prevents … tax increases, and it really should support manufacturers’ efforts to drive manufacturing growth,” Crain continued, adding that the OBBBA included incentives for capital equipment purchases, research and development, factory building and more.
• The legislation is “a big win” for manufacturing and “a real credit to the president,” he said.

Reaching a shared goal: Even if the U.S. were “operating at full capacity,” manufacturing in the country would still require imports from other nations—making a commonsense trade policy a necessity, Crain said.

• In practice, manufacturing in the U.S. is only making about 67% of inputs required for finished goods, Crain said.
• “So we really need to solve for that 30-ish percent of outstanding inputs that we need to make things here. … Manufacturers need inputs to make things, and we need export markets to sell things. And so we think that a commonsense trade policy can allow for the president to achieve [the administration’s] trade policy goals without preventing manufacturers from investing here in America, which is a goal we all share.”

Giving manufacturers certainty: In the latest quarterly NAM Manufacturers’ Outlook Survey, just 55% of manufacturers—the lowest reading since the global pandemic in 2020—reported feeling positive about their companies’ outlook, Crain said. The top reason for the optimism drop? Trade uncertainty, something that a comprehensive U.S. trade policy can help remedy.

• Not knowing what to expect next when it comes to trade “makes it more difficult to make long-term investment decisions that we know drive manufacturing growth,” according to Crain.
• While tax uncertainty has now “been taken off the table” thanks to the passage of the OBBBA, “we’re still facing additional barriers to those long-term decisions that we need to create jobs here in America.”
• It’s also critical to manufacturing in the U.S. that the current corporate tax rate be maintained, Crain said. “[I]f we have a 35% corporate rate as opposed to the current 21[%], it’s going to be really difficult to onshore domestic manufacturing.”

Fewer regulations needed: Manufacturing in the U.S. also needs more balanced regulations—and fortunately, that’s something the administration began doing on day one.

• “[M]anufacturers, in our experience, have been very encouraged to see the administration taking a second look at some of the rules that were finalized in recent years … finding ways to maintain reliable rules of the road, but [also] to make those rules less costly.”

Open jobs in manufacturing: Manufacturers also remain committed to filling the 400,000 open manufacturing jobs in the U.S., Crain said, addressing an audience question.

• Manufacturers “are really focused on providing competitive benefits, having flexible work schedules, having onsite child care” as well as “partnering with local community colleges to implement training programs [and] partnering with the military to bring folks coming out of active duty into manufacturing shop floors.”

The takeaways: The OBBBA “delivers for manufacturers in America by making pro-growth tax provisions permanent,” Crain wrote on X following the event.

• But “[t]o ensure we can continue to grow manufacturing in America, policymakers must pursue a comprehensive manufacturing strategy that will provide manufacturers the tools, and the certainty, needed to make long-term investments,” he wrote in a second post.

President Trump issued more tariff letters late last week, warning major U.S. trading partners of the tariffs that will go into effect if negotiations do not lead to agreements by Aug. 1. Tariffs on Canadian imports will be assessed at 35%, while Mexican and European Union imports will see new tariffs of 30%.

Canada: The letter to Canada accuses the country of failing to stop the flow of fentanyl drugs into the U.S., while also citing tariff and nontariff trade barriers, including dairy policies.

• Canada is subject to an International Emergency Economic Powers Act fentanyl tariff rate of 25%. According to an April 2 executive order, if IEEPA fentanyl tariffs are withdrawn, a 12.5% IEEPA “reciprocal” tariff rate would replace them.
• USMCA-compliant goods are exempt from the existing Canada tariffs. The July 10 letter does not specify whether goods that qualify for an exception under the USMCA will continue to be exempt. It also does not say whether energy and energy resources from Canada will still be subject to the lower 10% tariff.
• The letter also warns that goods that are transshipped will be subject to an unspecified, higher tariff, and that an additional 35% tariff will be imposed should Canada retaliate.

Mexico: The letter to Mexico cites the country’s “failure to stop the Cartels,” while also mentioning trade barriers.

• Mexico is subject to the same arrangement as Canada under the April 2 executive order—IEEPA fentanyl tariffs of 25%, which if withdrawn would be replaced by a 12.5% “reciprocal” tariff.
• The letter to Mexico is likewise unclear about the USMCA exceptions and contains similar warnings about transshipment penalties and an additional 30% tariff in the case of retaliation.

EU: The European Commission also received a letter, which threatens the EU with a 30% tariff, a number “far less than what is needed to eliminate the trade deficit.” The letter also says that the U.S. expects “complete, open market access.”

• EU retaliatory tariffs were set to take effect this week but have been suspended pending negotiations.

The response: In a  post on X, Canadian Prime Minister Mark Carney said, “We are committed to continuing to work with the United States to save lives and protect communities in both our countries. … We are strengthening our trading partnerships throughout the world.”

• In a statement, EU Commissioner Ursula von der Leyen said the EU is “working towards an agreement by August 1,” adding that the EU “will take all necessary steps … including the adoption of proportionate countermeasures if required.”

Technology firms are urging the administration to create a federal artificial intelligence framework following Congress’ removal from the recently passed budget bill of a 10-year moratorium on state AI laws (The Wall Street Journal, subscription).

What’s going on: “Tech industry insiders are lobbying for nationwide regulations that pre-empt a jumble of state laws … in part to simplify compliance with a single set of requirements,” according to one tech leader.

• California, Texas, Colorado and Utah have passed AI legislation, and an additional 15 states are considering similar laws.
• Almost “every state has adopted privacy and data-security legislation that touches on AI in some way, lawyers say.”

Manufacturers’ take: Large companies have indicated their willingness to comply with AI laws, with manufacturers backing national regulation.

• AI regulations at the federal level would “establish consistent standards and promote the secure, fair development of AI,” an Amazon spokesperson told the Journal. “We will continue to work with legislators at both the federal and state level to ensure any regulation drives standards that support U.S. leadership on AI.”

The “patchwork” problem: The creation of 50 different, often-conflicting rules will limit manufacturers’ ability to operate and innovate, as they have told Congress repeatedly.

• The NAM, which advocated for a decade-long pause on state-level AI regulations, told the Senate last month that the moratorium would “support AI innovation and American AI leadership by protecting manufacturers from a [50]-state patchwork of conflicting, and potentially stifling, AI laws and regulations. … [M]anufacturers need a policy and regulatory framework that … streamlines compliance to enable rather than hinder manufacturers’ development and adoption of AI systems.”

More to comply with: Technology companies with global reach must now also comply with the stringent EU Artificial Intelligence Act, which took effect earlier this year and “aims to control runaway AI development.”

Ongoing advocacy: The NAM continues to advocate for “the importance of a light-touch regulatory framework to support the development and use of artificial intelligence” at the federal level, including eschewing AI-specific regulations to address challenges that are not AI-specific and instead rely on technology-neutral laws, as NAM Managing Vice President of Policy Charles Crain told the House in May.

President Trump signed more individual country letters this week, following his extension to Aug. 1 of the pause on “reciprocal” tariffs over 10%.

A quick recap: The president had delayed tariffs on individual countries, which had been announced on April 2, until July 9. He imposed a flat 10% tariff until then on all countries except Mexico, Canada and China.

• This week, he extended that pause until Aug. 1. If new trade deals are not reached by then, individual country rates will go into effect.

More letters: The president had issued letters on July 7, assigning tariff rates to imports from more than a dozen countries and followed those up with more letters to other countries on July 9. The second round included Libya, Iraq, Algeria, Moldova, Brunei and the Philippines.

• The letters also warned that if countries impose retaliatory tariffs, U.S. levies will rise as well. The increases cited in the letters range from 25% to 50%.
• You can find a full chart here of the countries that have received letters, as well as those that were included in the April 2 order but have not yet received letters.

Targeting Brazil: The U.S. ran a trade surplus with Brazil in 2024, which means it was not included in President Trump’s imposition of tariffs in April.

• Decrying the legal proceedings against former Brazilian president Jair Bolsonaro along with social media censorship policies (as well as trade barriers), President Trump announced that the U.S. is imposing a 50% additional tariff on Brazil, which will rise another 50% should Brazil retaliate.
• President Trump also ordered the United States Trade Representative to open a Section 301 investigation into Brazil’s “attacks on the digital trade activities of American companies” and other unfair trade practices, which could result in other tariffs.

Section 232: In a Truth Social post, the president mentioned plans for Section 232 tariffs on copper.

• The administration will have to issue a proclamation and provide documents defining the scope of the tariffs, including which products are subject to them, so details are yet to come.

The NAM is monitoring the administration’s actions on Section 232 closely and has been detailing manufacturers’ interests and concerns for the administration. You can read about its advocacy here.