Small Businesses Are The Backbone Of Our Economy
November 20, 2005
Small businesses are the backbone of the American economy. They create two of every three new jobs; produce 39 percent of the gross national product and invent more than half the nation's technological innovation. Over 20 million small businesses provided dynamic opportunity for all Americans. It is the vibrancy of small bossiness which sparks the engine of economic growth.
Today however, when consumer spending is at all-time high, small business owners and the self-employed face extraordinarily demanding challenges to make ends meet. Increased costs of doing business, government red tape, and increased bureaucratic regulations, make it tougher than ever for small businesses to compete and succeed. In short, the backbone of our business economy has been twisted out of shape by numerous mandated regulations.
In the business world, there are no certain guarantees. Beginning or maintaining a small business presents creative opportunities while at the same time unique challenges. According to the U.S. Small Business Administration, over 50 percent fail in the first year and 95 percent fail within the first five years. And yet, never before have the innovation and ingenuity of American small business owners and their employees been so critically significant to the nation's economy.
Congressman Steve Chabot from Ohio and senior member of the House Small Business Committee reports that "small businesses have witnesses a solid 18 straight months of job growth. Over 2 million new jobs were created in 2004 and gaining month by month. Small businesses, representing over 99 percent of all U.S. employers, account for three-quarters of all new net jobs." Further, Rep. Chabot stated, "I am committed to creating an environment in which small business owners and their employees can thrive." We applaud the efforts of Rep. Chabot and men and women like him who possess the same creative determination and drive
As we see it, small businesses face increasingly restrictive federal and state regulations which hamper productivity and stifle job creation. Complying with unreasonable amounts of paperwork, bureaucratic red tape and outdated rules is not the way to help America's small employers compete in the world marketplace.
Congress must work to make recent tax relief provisions permanent. While cutting taxes across -the- board will allow small business owners to invest more in their companies, there must be a way to eliminate the business-destroying death tax.
Still anther priority is limiting abusive lawsuits that are draining resources from small businesses-- resources that could be used to invest in jobs, salaries and benefits. Nearly every small business owner, with whom we have spoken, cites the risk of frivolous lawsuits, massive legal expense and liability insurance costs. And if that isn't enough, health insurance premiums have increased by double digits for the fourth-straight year, putting a sever strain on small business owners and their employees. According to the National Federation of Independent Business (NFIB), 25 million small business owners, employees and their families are without health insurance. To address this problem, Congress should expand the availability of Association Health Plans. These plans allow small business groups to pool their health care resources together through trade associations to lower costs and offer a wider array of health care options.
And then there is the talk about the values of the State sponsored Empire Zone property tax credit. Big deal! As reported by Brian Ackely, WIN columnist, "One Rochester-reviewed company created one job, that with a salary of $10,000, in return for $137,000 in Empire Zone property tax credit. And a Syracuse firm also created one job, but got more than $263,000 in tax reduction and credit. Empire Zones "are like a narcotic that ease the pain, but don't get at the root cause," noted the Business Council of New York. This should tell us something. When we need a program to be competitive this should indicate how bad our policies are, and how much damage they inflict on industry which creates the jobs.
It is our hope that the State Legislatures, the Congress, and the American people, will address these issues and soon. The future of many small business establishments and independent entrepreneurs are running dangerously close to the financial edge. Next time you have a chance, look over your nearby community. Observe the hardware and grocery store, the local plumber, the farmer, the auto and small engine repair shop, and the electrician. Notice the small manufacturer, the furniture dealer, the local pharmacy or the local radio station and newspaper. You will see small business owners and their employees working tirelessly, to achieve what all of us hope to achieve... the American dream. That is how we see it FROM OUR PERSPECTIVE.