This week, Promo Marketing is looking at the stories that helped define 2011. From Monday through Thursday we will recap the year’s major news in four different areas: industry news, politics, product safety and world events. Check PromoMarketing.com each day, and vote in our Friday poll for the most important story of the year.
2011 Year in Review: Politics
With an uncertain economy and unhappy population, it’s unsurprising that jobs were the topic most frequently discussed by politicians in 2011. The year is straddled by financial woes, with an unemployment rate at almost 10 percent in the beginning, and the Occupy Wall Street protests at the end. Many of the moves from the government were aimed at addressing these issues, such as repeals of onerous business laws and Federal Reserve moves to increase liquidity.
In the promotional products industry, the government’s actions were remarkable for different reasons. Statewide bans on state promotional products, cities banning plastic bags, and questionable buying the campaign trail all made headlines in 2011. Putting a point on the topic, the president dropped a bombshell on the promotional marketing industry at the end of the year, bring about a bigger question among suppliers and distributors, and in the media at large, about the place of promotional products in today’s market.
California Governor Bans State Promotional Products
Two time California Governor Jerry Brown fired the first shot across the bow at the industry when he banned the state government from purchasing any promotional products in February. “Not a cent of taxpayer money should be spent on flashlights, ashtrays or other unnecessary items, most of which likely end up in landfills,” the governor said at the time. In a PromoMarketing.com poll, 66 percent of respondents said they felt the ban would have negative repercussions for the industry. One month later, New Jersey Governor Chris Christie would veto $45,700 budgeted for state promotional products, calling the expenses “unnecessary.”
1099 Repeal for Tax Reporting is Passed
In April, the Senate passed “The Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayment Act,” which overturned an aspect of the 2010 health care reforms that expanded the requirements for businesses to file 1099 tax forms. Typically used for contractors and freelance workers, the 2010 changes would have required businesses to file a 1099 form for anyone paid more than $600 as a business expense, such as plumbers and electricians. Small businesses protested the law, saying it added unnecessary paperwork and costs. H.R. 4 was signed into law on April 14.
Plastic Bag Bans Spread Across West Coast
Los Angeles began enforcing on a controversial ban on disposable plastic bags, typically used at grocery stores and restaurants, on July 1. Business in the city were not allowed to give out plastic bags at all, and were required to charge $0.10 per paper bag given to customers. Retailers were encouraged to offer customers reusable tote bags as an alternative. At first limited to large retailers, the ban went into effect for all city businesses on January 1, 2012. Other California cities, including Long Beach, Santa Monica and San Jose, passed similar bans in 2011, and Seattle’s city council voted unanimously in favor of a similar ban in December.
Presidential Campaigns Caught Buying Foreign Promotional Products
An ABC News investigative report in August found that four presidential candidates were using products not made in America as part of their promotional campaigns. Newt Gingrich, Ron Paul, Rick Santorum and Herman Cain were all revealed to be using T-shirts manufactured overseas. Paul defended the choice as a free-market decision. The rest said they would have their people look into buying American-made T-shirts in the future.
USPS Suffers Continued Losses, Requests an End to Saturday Mail
The struggling United States Postal Service (USPS), which reported an $8.5 billion loss in 2010, requested from Congress the ability to restructure itself in September. Postmaster General Patrick Donahoe revealed a plan which would include raising rates, delaying payments on retirement packages, closing many USPS locations and ending Saturday delivery. President Obama’s proposal to reduce the debt included several of Donahoe’s requests, including ending Saturday mail service. In November, the USPS revealed it ended fiscal year 2011 with a $5.1 billion loss.
Obama Re-election Campaign Sues Promotional Products Company
Obama for America, the president’s re-election campaign, sued Washington Promotions & Printing for trademark infringement of the “Rising Sun” logo used in Barack Obama’s 2008 and 2012 campaigns. The campaign said it sent the company, which runs the website Demstore.com, a cease and desist letter in April and another in July before filing the lawsuit.
President Cuts Federal Promotional Products Spending by 20 Percent
In an executive order signed in November, President Obama directed federal agencies to cut spending on promotional products, referred to as “swag” and “unnecessary promotional items,” by 20 percent. “The Executive Order directs agencies to stop wasting taxpayer money on non-essential items used for promotional purposes, such as clothing, mugs, and non-work related gadgets,” the White House said in a statement. The budget cuts were heavily covered in the media, with outlets like Politico reporting that most federal agencies spend very little on promotional products, making any savings negligible.
