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Small business left out of presidential remarks

Raymond Keating

So, what happened to small business?

In his State of the Union address, President Barack Obama offered no direct, substantive remarks about small business. That, of course, is a striking omission given the central role entrepreneurial firms play in terms of innovation, economic growth and job creation.

However, the president did touch on some issues that affect the entrepreneurial sector of our economy. Potential positives exist when the president spoke about comprehensive immigration reform as well as protecting U.S. intellectual property in the international marketplace. But the details on such policymaking are critical. For example, placing further burdens on entrepreneurs and businesses in terms of policing immigration is unwarranted and unwise.

In addition, the president noted recent trade agreements approved by Congress. Those were positive steps. They were originally negotiated in the Bush administration, though, and President Obama has done nothing else to advance free trade and international opportunity for U.S. businesses and workers.

After these few items, the State of the Union speech simply came back to the anti-growth, anti-business policies that have been the unfortunate hallmark of the Obama years.

Most glaring, of course, was the president’s renewed call for higher taxes on upper-income earners. That simply means fewer resources in the hands of private-sector investors, entrepreneurs, businesses and consumers and more resources to be wasted by government. That can only be a negative for the economy.

And Obama’s talk on taxing corporations was anything but friendly towards international businesses. Dressed up in populist rhetoric, the president’s declarations on outsourcing amounted to a clear signal international firms should set up their headquarters in another nation.

In addition, the president showed no inclination to reduce the size of government. Instead, there were calls for more subsidies for and spending on noneconomic energy ventures, politically driven infrastructure projects and still more federal meddling and handouts on mortgages. Of course, his mortgage plan would come with more taxes on banks, which would mean fewer resources, again, available for the private sector.

This State of the Union address was stunning in its lack of vision and substance on how the U.S. economy might get back on a track of robust growth. That was due in part to grossly misguided economic thinking and to a view of small business that is at best ambivalent and at worst hostile.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. Reach him through the Web site at www.sbecouncil.org.
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Posted by on Feb 8 2012. Filed under Opinion. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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