PETERSBURG, WV – Today, at the first hearing of the Ways and Means Committee under a new Republican majority, Chairman Jason Smith (MO-08) spoke about how policymakers must put the interests of American workers first by hearing directly from them about their struggles and their ideas to improve the lives and livelihoods of their families and communities after two years of crisis under one-party Democrat rule.
The testimony came as part of the Committee’s first hearing in the new Republican majority, held at Allegheny Wood Products, a hardwood lumber manufacturer, in Petersburg, West Virginia.
Witnesses included a 25-year employee of Allegheny Wood Products, a mom of three and local restaurant owner, a veteran and co-owner of a local distillery, and a West Virginia native who has worked in the coal industry for 30 years.
Click here to watch Chairman Smith’s opening statement.
Chairman Smith shared how the Ways and Committee, under Republican leadership, is prioritizing the voices and views of the American people. The Committee is going into communities to hear directly from Americans about their struggles and their ideas to improve their lives and livelihoods so that Congress can better put the interests of American workers front and center:
“We must prioritize the voices in rooms like this one, and not those of the Washington political class. We will hear today about the state of the American economy. And it is in danger…If we want to put our nation on sounder footing, we need to prioritize our most valuable resource: the American worker. And the first step is listening to Americans on the front lines of our economy, hearing their stories and their ideas for improving life for their families, their neighbors, and our country.”
Ahead of President Biden’s State of the Union speech in Washington tomorrow, Chairman Smith pushed back on the President’s inevitable attempt to spin the past two years of crisis under his Administration as some sort of success. Smith laid out the facts about Biden’s inflation crisis and declining real wages, the President’s attack on American energy, his Administration’s failure to address the supply chain crisis, and its fueling of the chronic worker shortage:
“The truth is that inflation has risen 13.9 percent across the country since Joe Biden took the oath of office. Skyrocketing costs are even worse in rural communities, where inflation is 130 percent higher than urban areas and real wage growth is 25 percent lower…[T]his Administration is shutting down fossil fuel production, while throwing billions at green energy projects run by the Democrat donor class…Small businesses waiting for parts and equipment on backorder know that our supply chain issues haven’t been solved. The struggle means lost revenue for businesses, smaller paychecks for workers, and higher prices for families. Instead of negotiating trade deals to bring supply chains home and sell more American goods abroad, the Biden Administration is out to lunch.
“His speech will likely not mention the worker shortage, even though his party’s war on work helped create the problem. The result has been ‘Help Wanted’ signs everywhere and the lowest labor force participation rate since Jimmy Carter. We need to reconnect more Americans to work; that’s how you help lift families out of poverty.”
Tom Plaugher, vice president of operations at Allegheny Wood Products and a 25-year employee, testified about how rising fuel prices, supply chain issues, the worker shortage, rising interest rates, and overregulation, have put a squeeze on his business:
“The supply chain crisis hit us hard from two directions. It became difficult to obtain the parts and equipment that we needed to run. Lead times went from a few days to several weeks or even months…The supply chain crisis caused access to containers and vessel space to export our cargo timely to become scarce. Shipping rates from Asia soared and steamship lines opted to send containers back empty rather than load cargo here in the U.S.
“AWP and our entire industry attempted to ramp up production, but most companies were unable to do so due to a lack of labor. Some of our contractors closed their doors or dramatically scaled back their business as they were unable to find employees to fill the available jobs.
“Rising interest rates put a damper on housing in the latter half of 2022 and the outlook for 2023 is not good.
“I have heard it said many times that higher costs don’t really affect businesses and that they simply pass that additional cost along to their customer. It does not work that way in our industry…If the price for our lumber becomes too high, customers will simply look for a cheaper alternative or a replacement product.”
Ashley Bachman, mom of three and local restaurant owner, testified that her business is suffering as inflation squeezes her customers while her employees are asking to work more to cover ever-rising costs:
“Unfortunately, after COVID we have been hit with another crisis. The crisis of rising costs of everything. This has proven to be a much tougher task than what we dealt with during the COVID regulations.
“We have had to change our menu prices countless times just to make sure that we don’t go out of business. We still are not charging enough for our menu items because we are afraid that we will price ourselves out of business…We have taken a hit in business so far, these past two quarters, having less customers coming in.
“Our kitchen cooking equipment runs off propane…During some months, the cost of propane has more than doubled the price that it was in the corresponding months of 2020. The rise in price in all other energy costs has caused our lease payment to be increased from $2000 to $4500 a month in only 5 years’ time. Our little restaurant has been bleeding money due to all the increased costs and I don’t know how much longer we’ll be able to continue with the prices the way they are…
“Around the same time that stimulus checks were going out and the added unemployment benefit money is when the worker shortage started to happen.”
Wylie McDade, a Navy veteran and co-owner of a local distillery that opened in 2021, talked about the difficulty of starting and running in a business in Biden’s economy:
“Much has changed in the past two years. Due to factory closures, glass shortages have been and continue to be a scourge on the industry. Input costs on grain have risen sharply…Lead times are up at least by a factor of two to ten. Ordering minimums have doubled and tripled…supply chain logistics remain painful to say the least.
“Despite input cost increases, we are reluctant to raise prices and have not done so…However, it comes at great cost – growth. Our workforce should consist of seven to ten in order to work the distillery…yet we do so with five.
“Our community outlook is positive, but this is West Virginia and Mountaineers inherently know how to do more with less.
“We need lower and more consistent fuel prices…we need more choice in energy…We need to strengthen national manufacturing…”
Jamie Ward, West Virginia native, a 30-year coal industry worker, and currently a plant manager, testified about how overregulation from Washington has helped shut down coal plants, lay off coal workers, and destroy communities that rely on coal mining:
“I saw the coal industry decline further to the point where I was forced to leave West Virginia to find work in the industry in Alabama for a time. I watched the small towns of my home state fall on incredibly hard times all because of anti-coal policies that were being pushed in Washington, D.C. by people who had never even been to the place where I grew up.
“I remember a time when someone could not drive more than three or four miles without seeing a coal mine, where you’d be able to find work. Now, I have employees coming from many miles away just to keep a job.”