What's better than the Super Bowl? An award.

The highlight for most people this past weekend was the Super Bowl.  For me it was receiving the South Carolina Sierra Club’s Media Person of the Year award for my weekday talk-radio show. 

The Sierra Club has appreciated the opportunity to talk about conservation, the environment and alternative renewable energy on the air with me in a radio market not particularly friendly to its issues.  But for many years I and the SC Small Business Chamber of Commerce have recognized the importance of these issues to the state and our economy.  My radio show has been an extension of those positions.

No general business organization in the state has been more supportive of efforts to fight against climate change than the Small Business Chamber.  We recognize the negative effects will impact our small business tourism economy severely.  We also see the potential of alternative energy in controlling energy costs and creating new small businesses. 

So thank you Sierra Club for the recognition.  The plaque is already on my wall.

Poll: Small Business Owners Say Big Businesses, Millionaires Not Paying Fair Share of Taxes

90 percent of small business owners in nationwide poll say big corporations use loopholes to avoid taxes that small businesses have to pay; majority support increasing taxes on millionaires and letting high-end tax cuts expire

Washington, DC – Small business owners see corporate tax loopholes and accounting gimmicks used to shift U.S. profits offshore to avoid taxes as serious problems, according to an independent nationwide opinion poll released today. Small business owners think big corporations and the wealthy don’t pay their fair share of taxes, the poll shows. They support increasing taxes on millionaire incomes, letting high-end tax cuts expire, and closing the carried interest loophole that gives big tax breaks to hedge fund managers.

These are among the key findings summarized below of a scientific nationwide survey of small business owners released by the American Sustainable Business Council, Main Street Alliance and Small Business Majority. Click here to read the report.

“I’ve been in business 32 years, and I’m appalled at how big corporations and millionaires have shrunk their taxes,” said Lew Prince, managing partner of Vintage Vinyl, an independent music store in St. Louis, MO. “Ingrates like Amazon wouldn’t even exist without the Internet, which grew out of government research. The least that big corporations and their executives could do is pay their fair share for the roads, ports, education, research, public safety and everything else that tax dollars buy.”

“When big corporations like GE use loopholes and tax havens to avoid paying taxes, they’re starving our country of the revenues we need to invest in our communities and our future,” said Amanda Harrow, director of the Montana Small Business Alliance, a statewide network of small businesses. “Small business owners know that to build vibrant local economies we have to invest in education, infrastructure and building a healthy customer base. When big corporations that benefit from these essential investments don't do their part to support them, they’re jeopardizing our future. That’s unacceptable.”

“We need a Buffett Rule for wealthy individuals and a GE Rule for corporations,” said Scott Klinger, director of tax policy for Business for Shared Prosperity, a partner in the American Sustainable Business Council. “Warren Buffett spotlighted the madness of a tax code that lets him pay a lower rate than his secretary. Likewise, U.S. multinational corporations who shift U.S. profits offshore to avoid taxes shouldn’t be rewarded with a tax rate below Main Street employers.”

“Small businesses are the backbone of the economy, yet they feel the playing field is tilted in big businesses' favor and small firms are at a disadvantage when it comes to taxes and corporate loopholes,” said John Arensmeyer, founder and CEO of Small Business Majority. “Our economy needs to work for everyone. Policymakers need to listen to small businesses and level the economic playing field. If they do, we will all benefit from what small businesses can offer.”

Key findings from the survey include:

· Nine out of ten small business owners say big corporations use loopholes to avoid taxes that small businesses have to pay: 92 percent say big corporations’ use of such loopholes is a problem. Three-quarters of owners say their small business is harmed when loopholes allow big corporations to avoid taxes.

· Nine out of ten small business owners say that U.S. multinational corporations’ use of accounting loopholes to shift their U.S. profits to their offshore subsidiaries to avoid taxes is a problem: 91 percent agree it is a problem, with 55 percent saying it’s a very serious problem. When asked what would do the most to create jobs, small business owners chose eliminating incentives to move jobs overseas.

· Small business owners say big corporations are not paying their fair share of taxes: 67 percent believe big corporations pay less than their fair share. An even bigger majority, 73 percent, says multinational corporations pay less than their fair share.

· Small business owners say millionaires pay less than their fair share in taxes: 58 percent say households whose annual income exceeds $1 million pay less than their fair share.

· Small business owners support a higher tax rate for individuals earning more than $1 million: 57 percent agree that individuals earning more than $1 million a year should pay a higher tax rate on the income over $1 million.

· Small business owners want to eliminate the “carried interest” loophole that gives hedge fund managers a big break on their taxes: 81 percent favor hedge fund managers paying taxes at the ordinary income tax rate, which currently tops out at 35 percent, rather than the 15 percent capital gains rate they pay now.

· Small business owners support ending upper-income tax cuts: 51 percent say Congress should let tax cuts on taxable household income over $250,000 a year expire (only 40 percent believe they should be extended).

· Respondents in this scientific national survey were politically diverse, with a majority Republican or independent-leaning Republican: 50 percent identified as Republican (27 percent) or independent-leaning Republican (23 percent); 32 percent as Democrat (14 percent) or independent-leaning Democratic (18 percent); and 15 percent as independent.

For more information on these poll findings, visit:

http://www.asbcouncil.org/uploads/Taxes_Poll_Report_FINAL.pdf

http://mainstreetalliance.org/5535/poll-taxes/

http://www.smallbusinessmajority.org/small-business-research/downloads/020612_Taxes_Poll_Report.pdf

Poll results reported in this statement represent findings from a scientific national survey of 500 small business owners, commissioned by the American Sustainable Business Council, Main Street Alliance and Small Business Majority, and conducted by Lake Research Partners. The nationwide Internet survey was conducted between December 8, 2011, and January 4, 2012. It has a margin of error of +/- 4.4%.

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The American Sustainable Business Council is a powerful coalition of business networks representing over 100,000 companies and 200,000 business leaders. ASBC advocates for public policies that meet the realities of the 21st century global economy. www.asbcouncil.org

The Main Street Alliance is a national network of state-based small business coalitions. MSA creates opportunities for small business owners to speak for themselves on issues that impact their businesses and local economies. www.mainstreetalliance.org

Small Business Majority is a national nonpartisan small business advocacy organization, founded and run by small business owners, and focused on solving the biggest problems facing America’s 28 million small businesses. We conduct extensive opinion and economic research and work with small business owners, policy experts and elected officials nationwide to bring small business voices to the public policy table. www.smallbusinessmajority.org

More jobs, less unemployment…thank small businesses

243,000 more jobs in January.  Unemployment rate down to 8.3% from 8.5% last month. 

All good news from the Bureau of Labor Statistics.

The ADP National Employment Report had a different number, 170,000, for new jobs in January for nonfarm private employment.  But the ADP’s analysis of where those jobs came from was important.

Total new jobs:                                                                        170,000
Small Businesses   (1-49 employees)                                        95,000 (56%)
Medium Businesses   (50-499 employees)                                72,000 (42%)
Large Businesses  (500 and more employees)                           3,000  (less than 2%)

Small business continues to lead the way in growing the economy.  Now if Congress would only listen to our voices about our needs instead of listening to big business and multinationals pretending to be concerned with small business.

Small business polls reject anti-regulation rhetoric

The Hill's Congress Blog
February 1, 2012

By Frank Knapp, Jr.

With Congress back in session, the Senate will have several bills to consider that seek to make it nearly impossible for federal agencies to implement regulations. The REINS Act, the Regulatory Flexibility Improvements Act and the Regulatory Accountability Act have already passed in the House.

Advocates for these radical measures claim they are primarily needed because regulations are the top reason for small businesses not hiring. But a new nationwide poll of small business owners released today adds to numerous other surveys that refute this position.

The poll conducted by Lake Research for three national business organizations – American Sustainable Business Alliance, Main Street Alliance and Small Business Majority – found that the top problem for small business was weak customer demand, not regulations. In fact, reducing regulations came in fifth when small business owners were asked what needed to be done to create jobs. Eliminating incentives for employers to move jobs overseas came in first.

Contrary to anti-regulations rhetoric, 78 percent of small business owners see government standards as an important tool to level the playing field with big business and 86 percent view regulations as a necessary component of a modern economy: 93 percent agreed that their business could live with fair regulations and 78 percent agree that some standards are important to protect small businesses from unfair competition. Moreover, 76 percent said that regulations on the books should be enforced.

Small business owners express strong support for specific rules and standards:

•    84 percent support food safety standards
•    80 percent support product safety standards
•    80 percent support disclosure and regulation of toxic materials
•    79 percent support ensuring clean air and water
•    78 percent support rules to prevent health insurance companies from increasing rates     excessively
•    67 percent support rules to curtail financial speculation by Wall Street and banks.
•    61 percent support moving the country towards energy efficiency and clean energy.

There was much evidence of the same results to the “customer demand versus regulations” debate in 2011:

•    McClatchy News Service reported in September 2011 that they surveyed owners of small businesses, many of them mom-and-pop operations, to find out whether they thought they were being “choked by regulation.” Not one of the owners complained about regulation in their industries, “and most seemed to welcome it,” McClatchy reported.

•    In November 2011 the Hartford Financial Services Group reported that its survey of 2000 small businesses found that 75 percent of the respondents were struggling to succeed. The biggest barriers to their success were identified as lack of customer demand.

•    The National Federation of Independent Businesses survey of small business (conducted annually) reported that when asked what their most important problem is, almost 30 percent of small businesses reported "poor sales"; less than 14 percent reported regulation.

•    In May 2011, the U.S. Chamber of Commerce released a poll of small businesses, members and non-members. When asked what the top obstacle to hiring new employees was, only 8 percent said “too much regulation.”

Even an October Gallup poll being touted in the House Committee on Small Business hearing today as showing regulations as the top concern of small businesses actually, with more unbiased analysis, shows that the lack of customer demand is by far the number one issue of small business.

A recent big business survey shows similar results. The Business Roundtable reported last month that the main reasons for two-thirds of the biggest U.S. companies not planning on hiring in the next six months are this country’s “sluggish growth” and Europe’s economic problems. This result corresponds to the U.S. Bureau of Labor Statistics report that 30 percent of layoffs in the first half of 2011, according to the businesses themselves, were due to lack of business demand. Less than 1 percent of the layoffs were attributed to government regulations.

So if small businesses aren’t self-identifying regulations as their top impediment to growth and big businesses in general are not citing regulations for holding back hiring, who are the pushers of the anti-regulation bills really representing?

The answer is clear. Most of the complaints we hear in Washington are from only two industries -- those impacted by Wall Street reform (Dodd-Frank) and new Environmental Protection Agency regulations. K Street lobbyists regale Congress and the public about the dire economic consequences to small businesses of regulations that will prevent another Great Recession or protect the health and safety of our citizens. In reality, the financial giants who drove our economy off a cliff and the powerful oil/coal industries (and the surrogates of both) are driving the anti-regulation train in the name of small businesses.

The truth is that small business owners favor regulations to protect the air, water, food, financial system and themselves (from big business). Wall Street and the oil and coal lobbies should stop using small business as an excuse to run roughshod over regulations and take our nation backwards in time to the era before Theodore Roosevelt.

Knapp is the vice-chair of the American Sustainable Business Council and the president/CEO of the South Carolina Small Business Chamber of Commerce.

http://thehill.com/blogs/congress-blog/economy-a-budget/207957-small-business-polls-reject-anti-regulation-rhetoric

OPINION POLL: SMALL BUSINESSES SAY WEAK CUSTOMER DEMAND, NOT REGULATIONS, THEIR PROBLEM

National poll finds 78 percent of small businesses say regulations needed to protect small businesses from unfair competition, level playing field with big business; 86 percent see regulations as necessary part of a modern economy

Washington, DC – Small business owners say their main concern is weak customer demand, not regulations, according to independent opinion polling released today.  In fact, when asked what would do the most to create jobs, small business owners’ top response was eliminating incentives to move jobs overseas. Reducing regulation came in fifth place.

Small business owners see government standards as an important tool to level the playing field with big business. In addition to protecting small businesses the vast majority of owners view regulations as a necessary component of a modern economy.  Click here to read the report, based on a national survey of 500 small business owners, released today by the American Sustainable Business Council, Main Street Alliance and Small Business Majority.

“These survey results underscore what Main Street small business owners have been saying all along: we need more customers, more demand, not deregulation,” said Jim Houser, owner of Hawthorne Auto Clinic in Portland, Oregon, and a leader with the Main Street Alliance. “In fact, I’ve seen first-hand from over 35 years in the auto industry that smart standards help create jobs and promote innovation in the U.S. economy.”

“Despite the heated rhetoric, regulations simply aren’t small businesses’ top concern,” said John Arensmeyer, founder and CEO of Small Business Majority. “Small businesses can be the jobs engine we need to jumpstart the economy, but not if legislators are focusing on something that isn’t their top problem. Policymakers should listen to what real small businesses are saying and act accordingly.”

"With football at the top of everyone's mind, if we played the game with no rules the Super Bowl winner would come down to which team was bigger or willing to play dirtier," said Frank Knapp, Jr., Vice Chair of the American Sustainable Business Council and president and CEO of the South Carolina Small Business Chamber of Commerce.  "Well, regulations are the rules of the game we call private sector competition. An overwhelming percent of small business owners agree that without fair regulations creating a level playing field, small businesses won't be able to compete against big businesses. From our perspective, the effort to kill regulations is big businesses’ way of rigging the game in their favor."

Key findings from the survey include:

• Small business owners see their top problem as weak customer demand, not regulations: 34 percent cited weak customer demand as the most important problem for their business, while only 14 percent named government regulations.
• On the question of what would do the most to create jobs, cutting regulations came in low on the list: the top response was eliminating incentives to move jobs overseas at 24 percent; reducing regulation was fifth at 10 percent.
• Small business owners see an important role for standards and safeguards: 78 percent believe some standards are important to protect small businesses from unfair competition, and 76 percent believe regulations on the books should be enforced.
• Small business owners see regulations as necessary for a modern economy: 93 percent agree their business can live with some regulation if it is fair, manageable and reasonable.
• Small business owners express strong support for specific rules and standards: 78 percent support rules to prevent health insurance companies from increasing rates excessively, 84 percent support food safety standards, 80 percent support product safety standards and 80 percent support disclosure and regulation of toxic materials.
• Small business owners support clean energy policies: 79 percent support ensuring clean air and water, and 61 percent support moving the country towards energy efficiency and clean energy.
• Small businesses believe in streamlining government processes: 73 percent of respondents believe we should allow for one-stop electronic filing of government paperwork.

For more information on these poll findings, visit:            

http://www.asbcouncil.org/poll_regulations.html 

http://mainstreetalliance.org/5511/poll-regs-economy/

http://smallbusinessmajority.org/small-business-research/downloads/020112_Regulations_Poll_Report.pdf

Poll results reported in this statement represent findings from an Internet survey of 500 small business owners nationwide, commissioned by the American Sustainable Business Council, Main Street Alliance and Small Business Majority, and conducted by Lake Research Partners. The survey was conducted between December 8, 2011, and January 4, 2012. It has a margin of error of +/- 4.4%.

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The American Sustainable Business Council is a network of business organizations representing over 100,000 companies and 200,000 business leaders. ASBC advocates for public policies that meet the realities of the 21st century global economy including strategic investments in workforce and infrastructure; standards and safeguards that promote innovation, prevent abuse and protect critical resources; and a new sustainable economic model that fosters a growing, economically-secure middle class. http://www.asbcouncil.org/

The Main Street Alliance is a national network of state-based small business coalitions. MSA creates opportunities for small business owners to speak for themselves on issues that impact their businesses and local economies. http://www.mainstreetalliance.org/

Small Business Majority is a national nonpartisan small business advocacy organization, founded and run by small business owners, and focused on solving the biggest problems facing America’s 28 million small businesses. We conduct extensive opinion and economic research and work with small business owners, policy experts and elected officials nationwide to bring small business voices to the public policy table. http://www.smallbusinessmajority.org/

Gallup misleading Congress and public

Tomorrow the U.S. House Committee on Small Business holds a hearing featuring the results of a Gallup poll conducted in October last year.  The title of the hearing is The Path to Job Creation but the better title might be The Path to Deceiving Congress.   

The issue is the role government regulations play in small business job creation.  The GOP mantra this election season is that regulations are hindering job growth and must be eliminated or severely reduced.  Last year the House passed numerous bills to do just that.  Those bills are now in the Senate where the majority party has a different perspective on regulations and what really is holding back growth in small business—lack of cusumer demand.

The preponderance of polling results last year clearly indicate that the lack of customers is the main reason small businesses have not been able to more vigorously lead us out of the Great Recession as they have in other downturns.  But the anti-regulation crowd has been trying to use the recession both to eliminate regulations opposed by big business and as a partisan weapon in this year’s elections.

The hearing tomorrow looks like an effort to elevate the regulations issue for the media and public and force the Senate into taking action on the anti-regulation bills the House has sent it.

This is where the Gallup poll comes into play.  According to that poll, 22% of small business owners said that complying with government regulations was the most important problem facing small-business owners today.   Gallup’s analysis of this open-ended question (respondents were not given answers to choose from) showed that of all the responses, “regulations” was the number one answer.

I have a Master’s degree in Social Psychology.  But familiarity with opinion polling is not needed to bust Gallup on this poll result. 

First, using an open-ended question is troubling because the decision of how to categorize each response is subjective.  A response might contain mixed messages and thus must be interpreted giving the Gallup employee the final say on what the small business owner really meant in answering the question.  At this point the employee’s own biases (or the biases of the employer) come into play throwing the accuracy of the poll results into question.  It is interesting to note that this was the only open-ended question apparently used by Gallup in this poll.

Second, Gallup’s reporting of the answers to this question clearly shows an effort to obtain the results they wanted.  Here is how Gallup listed the results:

What do you think is the most important problem facing small-business
owners like you today? [OPEN-ENDED]

Complying with government regulations                           22%
Consumer confidence                                                      15%
Lack of consumer demand                                              12%
Lack of credit availability                                                 10%
Poor leadership/Government/President                             9%
Cash flow                                                                        7%
New healthcare policy                                                      5%
Competition from big business and overseas                     4%
Lack of jobs                                                                    4%

It is not hard to see that the responses of “consumer confidence” and “lack of jobs” are simply explanations for why there is a “lack of consumer demand”.   Combining those responses we find that 31% of small-business owners identified “lack of consumer demand” as their number one response far exceeding “complying with government regulations”.

We can even make the argument that “cash flow” is a problem because of “lack of consumer demand”.  That would show 38% of the responses being “lack of consumer demand”. 

Third, Gallup only gives us 88% of the responses to this question.  Were the remaining answers so nebulous or divergent that they weren’t of value?  Shouldn’t the number of these unreported responses alone have told Gallup that the open-ended question was a problem.

So now we know how Gallup was able to report the response to the question the way it did.  Now the question is why?

The answer is clear.  This was a Wells Fargo/Gallup poll.  Wells Fargo and the other big financial giants have been vigorous opponents of the regulations coming from the passage of Dodd/Frank that is designed to protect all of us, including small businesses, from another Great Recession.  Only the petroleum/coal industry has been trying harder to turn government regulations into the boogeyman responsible for all the country’s economic problems.

The PR tactic to bash regulations has been to convince Congress and the public that regulations are hurting small businesses.  But as previously noted much of the survey work last year on the issue didn’t come to that conclusion.  Tomorrow, results of another poll will be released by three national business organizations—American Sustainable Business Council, Main Street Alliance and Small Business Majority—again throwing water on the anti-regulation rhetoric.

It is obvious that Gallup was trying to deliver to its financing partner a response the anti-regulation folks could promote.  Hence the hearing tomorrow featuring Dr. Dennis Jacob, Chief Economist of Gallup, who will talk about the poll.

But to Gallup’s credit it did ask another question with structured responses that undermines the result produced for Wells Fargo. 

Thinking ahead to 2012, what would be a primary motivation or reason
for hiring and new employees?

When revenues or sales have increased                            27%
When the economy improves                                           20%
If you need to support growth or expansion plans             17%
If you need to replace an employee who left                     10%
Having tax credits for hiring unemployed workers             7%
Some other reason                                                           7%

That’s essentially 67% of small-business owners saying “increased consumer demand” will lead to job growth.  Maybe the “when regulations are reduced” answer is buried in the “some other reason” response.

Multinationals aren't here to help

“We don’t have an obligation to solve America’s problems.” 

Remember this quote from an Apple executive as reported by Charles Duhigg and Keith Bradsher.  It appeared in the first of a two part story that will surely win the two New York Times journalists deserved recognition for exposing Apple’s decidedly un-American manufacturing standards in China.

Remember this quote the next time you hear Apple, which is sitting on $98 billion in cash on hand, and other multinational corporations offer to help the American economy if we only lower their corporate taxes and let them bring home overseas profits with little taxation so they can hire workers. 

Remember that quote the next time Apple and their ilk lobby for more trade deals with other countries to create jobs here at home like we did with China in 2001 (we’ve lost 6 million manufacturing jobs since then). 

Remember that quote when you hear Apple and their big business elite or one of their organizations like the U.S. Chamber telling the American people that they know what is best for our country.

Remember that the real motive of Apple and other multinational corporations is not to solve America’s problems.  That’s because they are not American businesses any longer—they’re “citizens of the world” Thomas Friedman correctly points out in his column yesterday.

These multinationals have no allegiance to any country.  They have only one goal—to make as much profit for their executives and shareholders as possible by increasing production and lowering costs.  The slave-labor like conditions and slave-labor wages at Apple’s Chinese manufacturing plants are detailed in the New York Time’s stories.

Likewise, America should have no allegiance to these multinationals.  When Steven Jobs told President Obama last February that the iPhone jobs aren’t coming back to America, the President should have told him that we were going to start getting tough on trade enforcement.  No longer should we allow other countries to produce cheaper products due to little concern for their workers and environment.  “Meet our standards or pay tariffs” the President should have told Mr. Jobs. 

Almost a year after that meeting with Mr. Jobs, the President did call on tougher trade enforcement in his State of the Union.  Let’s hope he means it and give him our support.