Candidates John Kerry and George Bush actually agree on one thing: the importance of small business owners and their employees in the American economy. Small businesses represent 99.7% of all employers, and 50% of the private work force is employed by small business.
While the presidential hopefuls agree on encouraging small business owners, they have polar views on the current state of the economy. John Kerry thinks it's a mess. The Bush Administration claims it is improving all the time. In fact, George Bush and Dick Cheney have indicated the economy would be robust, except for the war on terror. Yet, the Kerry-Edwards camp insists the country can't endure four more years of the same economic policies.
John Kerry's proposals for small businesses are based on an economy in trouble. He sees middle class Americans and small businesses as suffering the most. Trickle down economics under Bush benefit the wealthiest corporations with generous tax cuts. But that doesn't benefit the other 98% of Americans. John Kerry has outlined policies to invigorate small businesses that wrest away the wealthy's tax bonanza for financing:
Kerry-Edwards plan of federal support for small businesses:
- Create a "Small Business Opportunity Fund" of $170 million.
- Help "micro-enterprises." This means expanding loans and equity for operations with five or fewer employees and revenues under $500,000.
- Increase venture capital investments from the federal government.
- Expand loan programs to get small businesses off the ground.
- Fair play in federal contracting. Provide small businesses more opportunities for contract work with federal agencies. Increase awards of federal contracts to small business to 30%.
- Reduce contract bundling. This practice combines small contracts into large ones, which effectively guarantees large corporations will win contracts. A report this October showed a 10-year high in the number and size of bundled contracts, which means small businesses are shut out more than ever.
- Tax Simplification. Allow the IRS and state agencies to combine state and federal employment tax returns on one form.
- Tax credit to reduce energy cost. Provide a 20 percent tax credit for purchasing equipment that meets energy-efficient standards.
- Strengthen small manufacturers. Increase loan and investment limits, develop a manufacturing skills training program for current workers and students, increase funding for the Manufacturing Extension Partnership Program, and create an Office of Manufacturing within the Small Business Administration.
- Small business representation. Small business will be given a Kerry cabinet level position and a voice at the World Trade Organization. This way small business interests will be heard and federal regulations will be fair to small business.
- Cut health care costs by two-thirds. Propose refundable tax credits for up to 50 percent of the cost of coverage. Give small business access to the Congressional Health Plan and save them about 15% in health care costs on top of the tax credit.
- Eliminate capital gain taxes for long-term investments in small business. To attract capital into small business, exempt investments held for five or more years in small businesses.
- New jobs tax credit. The credit will cover an employer's share of payroll expenses for net new jobs created by small businesses in 2005 and 2006.
- Enact a small business retirement initiative. Use tax credits to help offset the start up costs of pension plans for small businesses.
- Tax credit for called-up reservists employed by small businesses.
- Reduce medical malpractice premiums. Prevent and punish frivolous lawsuits. This proposal includes requiring a specialist to certify if a medical malpractice case has merit before proceeding. Ensure states have non-binding mediation available before trial. Lawyers will be under a "three strikes" sanction that would prevent them filing another suit for ten years if they file three frivolous cases. The plan opposes punitive damages unless intentional misconduct, gross negligence, or reckless indifference is established.
Funding Kerry's Proposals:
Kerry proposes to pay for his programs and tax incentives, in addition to reducing our national deficit, by ending "Corporate Welfare." This is to be accomplished by axing tax cuts given to the wealthiest Americans. Kerry proposes to roll back Bush's tax cut for those with incomes over $200,000. Kerry's tax cuts will benefit 98% of all Americans and 99% of tax paying corporations.
John Kerry's specific plan for America's small business comes from his dissatisfaction with America's economic environment and direction. Even as September's Employment Report was released, the Bush website reported the news as good. The Kerry website described the report in terms of loss and disappointment. Kerry states: "He (President Bush) believes this is the best America can do. I believe America can and will do better." Kerry's aggressive strategy to help small businesses may just sway votes for those still undecided.