At a time when small businesses should be at the heart of our nation’s economic recovery, America’s best job creators deserve leaders that create an environment where businesses can thrive. President Obama, in his State of the Union address, gave yet another lecture on how critical small businesses are to this country; however, when you dig into it, the facts show this administration is drowning Main Street in regulations at a record pace and increasing costs and uncertainty at every turn, while doing little to help promote growth.
The importance of small business to our economy is indisputable. They make up 54 percent of the private sector economy, and create about 70 percent of all new jobs. In January 2012, President Obama elevated the Small Business Administration (SBA) to a cabinet-level agency. This move was heralded as an example of how small businesses were at the forefront of the president’s agenda. However, the administration’s neglect of the SBA has proven otherwise.
Earlier this month, the Senate Small Business and Entrepreneurship Committee finally held a nomination hearing for an SBA administrator. The time it took to nominate Maria Contreras-Sweet as SBA head – 11 months after the previous administrator’s resignation announcement – is indicative of the administration’s cavalier view of small business.
The previous administrator, Karen Mills, announced her resignation on February 11, 2013, and since then, the administration has issued 3,854 regulations costing businesses $112 billion. This record pace has been extremely harmful for small businesses, considering their cost to comply with regulations is 36% higher than for larger firms. Yet, this administration continues to pile it on.
The SBA remains the singular federal agency with the sole responsibility for overseeing issues that affect the United States’ 29 million small businesses. As a resource for loans, contracts, business development, and counseling, taxpayers expect the agency to assist small businesses when they need it most. Instead, businesses have found extensive delays at the SBA to process the most basic applications. To cite an example, in the wake of Superstorm Sandy, small businesses were unable to promptly get a loan to recover and rebuild because the agency is repeatedly losing applications and documentation. When these businesses approach the SBA for help, they report to our respective Committees a pattern of broken promises, missed deadlines, and a government that is closed to small business.
Small companies have seen their health care insurance plans cancelled due to Obamacare and the promise of keeping their current coverage broken. Now that President Obama has delayed online enrollment for the Small Business Health Options Program (SHOPs) exchanges for an additional year, and limited choice within the federal exchanges to just one plan, these same small businesses find they are victims of more government ineptitude and higher costs for plans that don’t fit their needs. Larry Katz, CEO of Dot’s Diner in Louisiana, recently testified before the Senate Small Business Committee that he wants to expand his business, but Obamacare is forcing him to close two diners to fall below the 50 employee mandate threshold. As these businesses downsize and struggle to survive, SBA leadership has been nowhere to be found.
As leaders representing small businesses and advocating for their success, we say ‘enough is enough.’ The New Year marks a new opportunity for President Obama to fulfill years of unmet promises to this country’s entrepreneurs. Unfortunately, the rhetoric from the president’s State of the Union address does not heal the wounds inflicted on small businesses during his first five years in office. It is time for this administration to put small businesses at the forefront and allow America’s job creators to unleash a robust economic recovery.
Risch is the junior senator from Idaho, serving since 2009. He is ranking member of the Small Business and Entrepreneurship Committee, and also sits on the Energy and Natural Resources and the Foreign Relations committees. Graves has represented Missouri's 6th Congressional District since 2001. He is chairman of the Small Business Committee, and also sits on the transportation and Infrastructure Committee.