2016 Elections: Entrepreneurship and Small Business Growth are Key to Resolving America’s Economic Stupor

By at 25 October, 2016, 11:30 am


By Karen Kerrigan-

There is still time for all candidates running for elected office to focus on the key issues that are driving the insecurity and worry of many Americans when it comes to the economy.  This means issues impacting small businesses and entrepreneurs must be front and center during the waning days of the campaign. After all, with Americans very concerned about their economic livelihood and future, stronger entrepreneurship and healthy small business growth are central to getting the economy back on a robust and sustainable growth track. 

The Presidential Candidates

The three presidential debates offered some insight into the candidates’ positions on economic issues. Still, the moderators did not fully explore and challenge these positions or the candidates’ plans for reigniting economic growth, quality job creation, investment and entrepreneurship. In fact, many important questions were never even asked. It seems we were getting there during the last debate with moderator Chris Wallace, but the two hours flew by quickly and the clock simply ran out.

Trump Re-Pivots

In addition to his proposals and agenda outlined on the campaign website, Donald Trump released a Contract with the American Voter on October 22 in Gettysburg, Pennsylvania. The Contract pulls together positions and plans outlined during the campaign, with a timeline for implementation. This first-100 day plan addresses several major areas that are priorities for small business owners, which focus on core business climate issues that have impacted business costs and uncertainty, investment, the rate of new business creation, and lack of vigor in the U.S. economy.  For example, action items include:

Legislative Initiatives: The introduction of ten bills including tax reform (lower rates, including the business tax rate to 15%), health care reform (repeal of Obamacare and expansion of HSAs and competitive measures like interstate purchasing of health plans), and re-building our nation’s infrastructure.

Executive Action: On regulatory relief and reform, Trump pledges to advance “a requirement that for every new federal regulation, two existing regulations must be eliminated.”

Energy development and production (small businesses and entrepreneurs dominate the energy industry and benefit from lower prices) – “I will lift the restrictions on the production of $50 trillion dollars’ worth of job-producing American energy reserves, including shale, oil, natural gas and clean coal. “ The plan will also “lift the Obama-Clinton roadblocks and allow vital energy infrastructure projects, like the Keystone Pipeline, to move forward.”

(Read the full document here.)

See our small business issue profiles on the candidates here:

HILLARY CLINTON                         DONALD TRUMP

Economy is the #1 Issue

According to Gallup’s most recent poll released on October 14, “the economy” is cited as the top problem facing the country, followed by “problems with government.” As entrepreneurs and small business owners are all-too-aware, the two issues are keenly interrelated. Government policies play a central role in whether startups and small businesses succeed, wither, or go under.

The sluggish economic recovery and the debilitating uncertainty that just won’t go away are not conducive to risk-taking. The vast growth in government regulation, for example, is especially hard on small businesses and is not helpful for fomenting an environment that encourages new business formation. Weak business creation has translated to pitiful economic growth, less opportunity, and fewer quality jobs for our economy. (See SBE Council’s report: Entrepreneurship in Decline: Millions of Missing Businesses.)

Issues to Focus On

When it comes to the state of our economy, the health of our nation’s small businesses and startup sector are extraordinarily important to the financial security and outlook of all Americans. Will our economy return to a dynamic condition that offers opportunity for the dreamers and the doers, or will it limp along in its current lackluster state where new business ideas die because of poor confidence, the lack of capital, and an aversion to risk-taking?

Out on the campaign trail, SBE Council and our members hope that the candidates will help us understand their positions by continually answering these key questions:

How will you boost entrepreneurship and new business creation?

New business creation remains poor, which means fewer jobs being created and less dynamism and innovation for our economy. Candidates need to outline how they will bring the entrepreneurial spirit and energy back to America. What are their specific plans to encourage more entrepreneurship and small business growth? This includes their specific policies relating to America’s complex and painful tax system, along with specific policies that will incentivize U.S. entrepreneurship.

How will you meaningful reform the regulatory system to encourage small business growth and new business creation?

Both candidates have talked about regulatory “relief,” but how will they specifically do that? How will they give small businesses a meaningful voice in the regulatory process where their input will be considered and acted upon (rather than ignored as currently)? What do they plan to do to review Obama Administration regulatory actions, and amend those that ignored small business impact and concern? Specifically, how will each of the candidates create more transparency and design a modern regulatory system that effectively and fairly engages the public, weighs cost-benefit to the community, considers the best available science, evaluates outcomes, and is flexible for entrepreneurs and small businesses?

How will you improve capital access and encourage private sector investment?

Many small businesses and entrepreneurs still lack adequate financing to compete and grow. At the same time trillions of dollars in capital sits on the sidelines because of economic and regulatory uncertainty. Dodd-Frank overreach has hurt small, community banks, which has affected their ability to lend to local small businesses. The Consumer Financial Protection Bureau is running amok (thankfully a recent court ruling has reined in the agency’s unconstitutional power structure), and the Security and Exchange Commission is ignoring sound reforms that would boost U.S. capital formation.

Thankfully, there are new and innovative means for entrepreneurs and small businesses to access capital. Online lending and crowdfunding platforms are filling a void, but even on that front the federal government views these emerging innovations as threats to small businesses rather than positive solutions. Entrepreneurs and American businesses need capital to fuel investment, quality job creation and their growth. Question: Specifically, how will your policy agenda boost capital formation, make the U.S. a haven for capital, and encourage private sector investment?

(See SBE Council’s report: A Lost Decade for Private Investment, which finds a real gross private domestic investment gap of at least $1.4 trillion – in 2009 dollars – in 2016.)

Questions from Small Business Owners and Entrepreneurs

SBE Council conducted a flash-poll of its members asking them specifics on what they want to continue to hear from the candidates.  An example of some of those responses, include:

My sales can’t keep up with costs. What will each candidate do to help the economy become strong again?

I am getting killed with higher health insurance costs. Where are my lower costs and more choices promised by Obamacare? What are you going to do to fix this mess?

I would like to hear specifics on matters relevant to small business (e.g., reduced taxes, reduced regulations, affordable health care). I don’t want to hear lip service, for example, “how important small business is to the U.S. economy.”

What is your program to eliminate and consolidate regulations that undermine the economy and harm people and small business, and those that hurt incentives to invest in small businesses? What about the consolidation of regulatory agencies?

How do you intend to make sure that entrepreneurs and small business owners have a REAL voice in your Administration?

Note to Media: Please Focus on the Issues

The media also needs to focus on issues and where the candidates plan to take the country on economic matters. The U.S. economy is at a critical juncture. Bold policies are needed to drive opportunity, growth and security for all Americans. Strengthening entrepreneurship, and encouraging more people to start businesses is so critical to a vibrant and growing economy. The final days of the election need to focus on what really matters.

Karen Kerrigan is president & CEO of the Small Business & Entrepreneurship Council.


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