National Small Business Week should be a good time
for the National Federation of Independent Business (NFIB) which claims to
represent the country’s real job creators.
Unfortunately for the NFIB, exactly who is pulling its strings now has the attention of the national media. As John Stoehr writes for Reuters (see
below), “A close look at its record suggests that the NFIB uses the politically
valuable mantle of small business to pursue an agenda that may take its cues
from elsewhere.”
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Reuters
May 22, 2012
May 22, 2012
Who truly speaks for
small businesses?
By John Stoehr
Everyone knows that small businesses hate
President Obama’s historic healthcare reform law, right? At least that’s what
the nation’s leading small-business advocacy group would have you believe.
Joining 26 states, the National Federation of
Independent Business challenged the law all the way to the U.S. Supreme Court
in March. It claimed the “individual mandate” is unconstitutional and would
bankrupt small businesses with unnecessary costs.
Yet while the NFIB claims its
multimillion-dollar lawsuit is on behalf of job creators and small businesses
everywhere, it’s unclear whether small businesses genuinely support the NFIB
position. A close look at its record suggests that the NFIB uses the
politically valuable mantle of small business to pursue an agenda that may take
its cues from elsewhere.
For one thing, many of its 340,000 members, most
of whom employ 20 or fewer workers,
have already benefited from the law. According to a March report in the Wall Street
Journal, members have seen costs go down thanks to tax credits
that were built into the law. Small firms in industries like advertising have
also been able to compete with large national companies for talented employees.
As one member told the WSJ: “[The NFIB is] doing a very big disservice
to their members” by opposing the healthcare law.
For another, the NFIB has a record of lobbying
for issues that benefit big businesses, not necessarily small ones. Consider a widespread state tax loophole
that lets big-box retailers like Wal-Mart and Home Depot transfer income to
out-of-state subsidiaries. This loophole often allows the chain retailers to
pay no state income tax, while small businesses do. Yet the NFIB has fought
against closing such loopholes.
Moreover, small businesses generally favor some kind of regulation, because such
standards often make them more competitive with big companies. The NFIB is
opposed to regulation on principle, but it also claims, as many Republicans do,
that the threat of regulation on entrepreneurs and job creators – they have a habit
of calling it “regulatory uncertainty”
– has kept businesses from hiring and thus from stimulating the economy. But
observers across the political spectrum
say this is a canard. Regulation isn’t preventing businesses from hiring. Poor sales are.
Perhaps it is no surprise that the NFIB fights for issues
that the Republican Party as well as big corporations also fight for:
deregulation, lower taxes and tort reform. According to the Center for
Responsive Politics, the NFIB’s political action committee has raised over $20
million since 1998. In 2010, nearly 94 percent of
contributions went to Republicans. This year it’s 98 percent. It spent
$9.5 million lobbying against the healthcare reform bill in 2010. And last
year, the NFIB received $3.7 million from Crossroads GPS, according to Bloomberg.
Crossroads GPS is a non-profit with close ties to Karl Rove, the political
adviser of George W. Bush.
Given the partisan affiliations and positions,
it’s unsurprising that other groups who claim to speak for small business, such
as Family Values at Work,
cast a gimlet-eye at the NFIB. So do small-business owners and small-business
advocacy groups. Frank Knapp, president of the South Carolina Small Business
Chamber of Commerce, called the NFIB a “small-business pretender”
and “lapdog” of the U.S. Chamber of Commerce. In April, J. Kelly Conklin, a New
Jersey cabinetmaker, wrote in the Hill: “Whether we’re talking about
health care or taxes (or both at the same time), NFIB always seems to side with
the big fellas – big insurance, big banking, big business – not little guys
like me. Why? I don’t know.”
Perhaps few do.
What’s more certain is that calling yourself a
small-business group while serving the interests of big business has political
advantages.
A Gallup poll showed most
Americans trust small business to create jobs, more than they do large
corporations or the U.S. Congress. That kind of public opinion explains why the
major parties can’t agree on anything unless it has something to do with small
business.
And it explains why the NFIB, in speaking for
small business, hopes to be seen as speaking for the American people – even
though, if the Supreme Court overturns the healthcare law, it’s the American
people and their trusted small business who may suffer most.+(124x76).jpg)
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