It's not the FTC's place to rule on noncompetes, says U.S. Chamber of Commerce CEO

Number of Fed officials on the record today, Richmond’s Tom Barkin saying the full impact of higher rates is still to come. New York Fed President John Williams saying, quote, consumers are continuing to spend and businesses are continuing to invest, but he’s forecasting slower economic growth this year. But joining us exclusively with her view on the business climate is Suzanne Clark, president and CEO of US Chamber of Commerce. Suzanne, it’s great to have you back on the show. Welcome. Thanks, Morgan. I am going to start right there because we have started to see some softer data, economic data, but we have also seen signs that inflation is really sticky here at these levels. You look out into a year where there’s geopolitical uncertainty, there’s an election and then of course higher interest rates or interest rates potentially staying higher for longer. You have your hand in so many and speak to so many different companies across so many different sizes across so many different industries. What are you seeing? What are you hearing? I appreciate the question. Thank you. Look, we welcomed the remarks today. They kind of jive with what we’ve been thinking, which is that the Fed is data-driven. They’ve been pretty clear what they’re looking for. We still expect them to hit or get close enough to the targets that we see at least a small rate cut before the end of the year. And I think you’re right. Some of that is that the job market is still so strong. You know when you have 2.7 million open jobs, there’s a job for everyone who wants it and that does underpin consumer spending even when they’re feeling pain in the grocery store, right, or pain at the at the gas pump. And so we do agree that that growth may not be robust, but you know, we had a better Q1 than people were expecting and we’re glad to see other Fed commentary about sticking with the guidance that they’ve put out. How does regulatory dynamics factor into all of this and into the CEO confidence that you’re gleaning right now? And I asked that knowing that the Chamber has been involved in a number of suits challenging different regulatory agencies within the government about overreach, most recently of course this FTC ban on non competes. Oh my gosh, it’s such a big topic. I’m going to have to take the next two segments. Morgan kidding. But just saying quickly, I think you’re making the right connection, which is between this regulatory overreach and CEO uncertainty and family uncertainty in the first term of the Biden administration, we’re talking about a trillion dollar impact on regulatory cost. Who pays that? Consumers, small businesses, businesses. And there are direct costs, but there’s also, to your point, the cost of uncertainty. And So what does this mean? How do you make a business plan? What are the new rules going to be? How many will be? We’re seeing more rules, We’re seeing more economically significant rules, and they’re really coming at a furious pace. And if I could just tag on one thought, our concern is that we also have really unelected bureaucrats tend to micromanage business at a really complicated time already to run a business. And that’s part of what we believe is happening at the FTC. OK Suzanne I’m going to ask another one on the non compete. So you know at least two questions if not two segments. So putting aside the regulatory piece of it, one way to kill uncertainty on that issue would just be to agree, right. I, I’d spent a lot of time in Silicon Valley, non competes are illegal in California. It’s a pretty big economy and Silicon Valley certainly still work. So why not just take the uncertainty off the table and say, sure, no more non competes for small business. Different question, right. The question we have in our lawsuit is did the FTC have the authority to make this rule right? I know, but I’m asking the other question, not the one in your lawsuit. I’m sorry, you’re asking the other question, not the one in your lawsuit, not about the authority but about why not just go along with it. What’s so bad about non competes? I think what’s so bad about non competes when they’re narrow and when they’re time enforced, what the problem with not having non competes is? How do you protect trade secrets? How do you take AC suite executive or a sales executive out of the market and directly to a competitor? How do you innovate and have technology if your chief scientists can walk down the road? I think in a narrow way a lot of non competes have held up in court because they’re seen as important to innovation and breakthroughs and and again I’m just not sure that it’s the FTC’s place to be making these rules. You were in China earlier this year. We’ve been hearing this a lot from companies both on and off the records, the DE risking the gaming out of how their operations in China play out over the long term. What are you seeing, what are you hearing especially as we are in election year and we do know the rhetoric around China is ramping. You are seeing increased tariffs or proposed increased tariffs on certain products that are being imported into this country and of course this ongoing decoupling around tech. Now again, I feel like these are really complex issues that don’t fit sound bites particularly well. But to give you an example, I was glad to go to China. I’m glad we’re getting back in the habit of communication, both military to military cooperation and communication, but also commercial conversation and commercial diplomacy. I think it’s important that the two biggest economies in the world are talking. That said, a lot of what we’re talking about is how to preserve our national security, how to de risk, how to take things we only supply from China and find other sources. Important parts of the conversation, as are these big green areas, whether it’s burgers or ball caps, where we should have free trade between two countries that helps Americans at the at the grocery store, helps Americans when they’re when they’re out doing their retail shopping. So how do you have a sophisticated answer where you’re protecting our national security, not single sourcing supply chains and yet trading with the world’s second largest economy?