Small businesses fight for a voice in Washington
Small businesses are mounting a push to regain influence in Washington after what they say has been decades of neglect by policymakers.
The COVID-19 pandemic ravaged small businesses, shining a spotlight on the vulnerabilities owners face and forcing Congress to provide an unprecedented $800 billion in relief.
Now, small businesses that survived the economic downturn are playing a pivotal role in high-profile debates over antitrust and infrastructure in Washington.
Small Business Rising, a coalition representing more than 150,000 independent businesses launched in April, helped sway lawmakers to advance legislation to break up the largest tech companies through the House Judiciary Committee. The group says e-commerce giant Amazon is abusing its market power to block small firms from competing.
The coalition scored a policy win this month when President Biden signed an executive order that directs the Federal Trade Commission to bar “unfair methods of competition on internet marketplaces.”
The White House said tech companies’ huge platforms give them “unfair opportunities to get a leg up on the small businesses that rely on them to reach customers” in a fact sheet announcing the executive action.
“That’s a shift,” said Stacy Mitchell, co-director of the Institute for Local Self-Reliance, which helped form the coalition. “In the past, not only were both parties not concerned about concentrated economic power, but you didn’t see small business feature in the same way, either as a matter of policy or a matter of rhetoric.”
Members of Small Business Rising, which also includes National Grocers Association and the American Booksellers Association, closely communicated with Biden staffers as well as congressional committee staffers who drafted antitrust legislation.
But the coalition faces challenges against tech companies’ powerhouse lobbying teams.
Amazon spent $5 million to deploy 87 lobbyists in the first quarter of 2021. That’s significantly more than all of the coalition’s members spent on lobbying, combined.
“They lobbied like crazy,” Mitchell said. “You could hardly get anyone to see an email because there were flooding inboxes with emails and requests for meetings and calls. It was really remarkable to see.”
Amazon has pushed back on the coalition’s arguments, saying it has “empowered small and medium-sized businesses.”
The tech industry’s efforts to kill or stall the bills will only ramp up when the House considers the legislation later this year. And while politicians frequently show support for small businesses on the campaign trail, business owners say they haven’t followed through in Congress.
“We’ve consistently heard from small businesses across the country that they just didn’t feel like they had a voice in the process,” said Joe Wall, director of the Goldman Sachs 10,000 Small Businesses program.
In a survey conducted by the program, only 9 percent of small business owners felt they had a voice in the policymaking process. Only 7 percent said federal elected officials prioritize issues affecting small business over big business.
In the early days of the pandemic, the program launched an advocacy arm to get small business owners in front of members of Congress. The initiative held multiple virtual fly-ins that connected more than 2,000 small businesses with hundreds of lawmakers.
“Congress’ idea of small business is not necessarily what you see on main street,” said Jessica Johnson-Cope, president of New York-based firm Johnson Security Bureau and chair of the Goldman Sachs small business initiative. “We have to continue to advocate with congressional leaders so that they understand what is happening in the trenches.”
Business owners in the initiative are pushing congressional leaders to overhaul the federal procurement process in the infrastructure bill. They say the current system creates barriers to entry for small businesses, which are often intimidated by the complicated application and certification process.
A recent report from the program found that the number of small businesses contracting with the federal government shrank by 38 percent over the past decade, and the government has failed to meet procurement goals for women-owned small businesses and small businesses located in historically underused business zones.
“We’re trying to leverage the infrastructure bill, given that there’s going to be a tremendous amount of federal dollars going out the door and small businesses deserve a chance to get those contracts,” Wall said.
The initiative has also helped small business owners meet with Biden Cabinet officials, efforts that have already appeared to pay off. Biden’s executive order, signed Friday, directs federal agencies to “promote greater competition through their procurement and spending decisions” to give a boost to small businesses.