Disclosure: I have not made up my mind which of the two presidential candidates I am going to support. I am not particularly excited about either one of them, and my vote will likely be one for the one who “the least objectionable to me.” As an additional note, this November’s presidential election will be 8th I have voted in.
One of my fellow Allbusiness advisors, Miranda Marquit is currently doing a series on her analysis of what the presumptive republican and democratic presidential candidates positions are on a variety of topics related to personal finance. I decided that it would be good to look at areas affecting small business owners, since the Small Business Administration reports that small businesses pay out over 45% of the US private payroll and they generated 60 – 80% of new net jobs over the past 10 years.
During my research, something I discovered is that neither Barack Obama nor John McCain has published many positions relating to small businesses. Those that are published tend to be vague, with no significant substance. It has been very hard to find “their words” related to the three topics I believe are currently most critical to small business owners, which are health insurance, access to capital, and taxes. I have scanned speeches and their websites to find the material I am using.
Today I am going to represent the best I can what the candidate’s stated position is related to small business access to capital.
McCain’s official website doesn’t have much dedicated information about small business access to capital:
The positions below were taken from a speech given to the National Federation of Business (NFIB) on June 10, 2008.They are Mr. McCain’s words directly. I wish I could have found more about access to capital. If readers know of other official material that would supplement this, I will be happy to post it.
Currently, there are the 21.6 million sole proprietorships filing under the individual income tax. When Senator Obama talks about raising income tax rates on those making over 250,000 dollars — that includes these businesses as well. He also proposes increases in dividend and capital gains taxes. Under Senator Obama’s tax plan, Americans of every background would see their taxes rise — seniors, parents, small business owners, and just about everyone who has even a modest investment in the market. He proposes to eliminate the Social Security earnings cap, and thereby to increase the tax on employers. He proposes to eliminate the secret ballot for union votes, and to raise the minimum wage and then index it, which is a sure way to add to your costs and to slow the creation of new jobs. You work hard in small businesses to grow and to create new jobs and opportunities for others — and the federal government shouldn’t make your work any harder.
As president, I intend to act quickly and decisively to promote growth and opportunity. I intend to keep the current low income and investment tax rates. And I will pursue tax reform that supports the wage-earners and job creators who make this economy run, and help them to succeed in a global economy. Serious reform is needed to help American companies compete in international markets. I have proposed a reduction in the corporate tax rate from the second highest in the world to one on par with our trading partners; to keep businesses and jobs in this country.
I want to break down foreign trade barriers, so that America’s small businesses can compete abroad. When new trading partners can sell in our market, and American companies can sell in theirs, the gains are great and lasting. The strength of the American economy offers a better life to every society we trade with, and the good comes back to us in many ways — in better jobs, higher wages, and lower prices. Free trade can also give once troubled and impoverished nations a stake in the world economy, and in their relations with America.
Here are Obama’s positions as stated on his official website:
(my comments are in italics)
Expand Loan Programs for Small Businesses: Access to capital is a top concern among small business owners. Barack Obama cosponsored the bipartisan Small Business Lending Reauthorization and Improvements Act. This bill expands the Small Business Administration’s loan and micro-loan programs which provide startup and long-term financing that small firms cannot receive through normal channels. Obama will work to help more entrepreneurs get loans, expand the network of lenders, and simplify the loan approval process. (In this author’s opinion, the SBA does need additional funding for more programs, especially related to small business education programs.)
Invest in Women-Owned Small Businesses: Women are majority owners of more than 28 percent of U.S. businesses, but lead less than 4 percent of venture capital-backed firms. Women business owners are more likely than white male business owners to have their loan applications denied. Barack Obama encourages investment in women-owned businesses, providing more support to women business owners and reducing discrimination in lending. To create greater opportunities for women business owners who would like to do business with the federal government, Obama will implement the Women Owned Business contracting program that was signed into law by President Bill Clinton, but has yet to be implemented by the Bush Administration.
Increasing Minority Access to Capital: Access to venture capital is critically important to the development of minority-owned businesses. Yet there has been a growing gap between the amounts of venture capital available to minority-owned small businesses compared to other small businesses. Less than 1 percent of the $250 billion in venture capital dollars invested annually nationwide has been directed to the country’s 4.4 million minority business owners. And in recent years, there has been a significant decline in the share of Small Business Investment Company financings that have gone to minority-owned and women-owned businesses. In order to increase their size, capacity, and ability to do business with the federal government, and to compete in the open market, minority firms need greater access to venture capital investment, as well as greater access to business loans. Barack Obama will strengthen Small Business Administration programs that provide capital to minority owned businesses, support outreach programs that help minority business owners apply for loans, and work to encourage the growth and capacity of minority firms.
It should always be remembered that our President can encourage and support legislation, but he or she doesn’t pass it. Both Houses of Congress would have to pass most of the initiatives proposed or supported by any president in their campaign rhetoric.