I run what many consider to be the ultimate small business – a company that takes great new product ideas and brings those products to market on an international scale. Like all small business owners, I have been paying a lot of attention lately to our nation’s economic problems and the desire by our most prominent politicians to create jobs.
Unemployment is currently about 6 percent in Virginia, but it is higher nationwide – nearly 1 in 10 working people are out of a job, with many more who are underemployed or have simply given up.
For all the back and forth that we’ve seen in Congress this year over how to get the economy moving, our elected officials should start by focusing on one fact: Small businesses are the job creators for our nation.
Here’s what Washington needs to understand: Businesses and business people are the source of all of our nation’s prosperity and the source of income for most Americans.
The vast majority of small business owners are honest people who believe that they can build a better future for themselves and those around them. They believe that their willingness to accept risk, their ingenuity and their efforts should drive their success. It’s called the American Dream.
* * * * *
What’s currently coming out of Washington is more regulation that drives more costs and more uncertainty for businesses like mine.
These regulations often claim lofty goals or aspirations but are ungrounded in their structure and fundamentally flawed in their implementation – the costs to businesses are ignored, and the “unintended consequences” are sometimes worse than the problems the regulations were intended to address.
In addition, the cost of adhering to these regulations is disproportionate, with small businesses paying 30 percent to 40 percent more than their big-business counterparts. This directly impacts many businesses such as mine by decreasing our ability to compete and grow our businesses through investment and increased hiring.
There are several major impacts that are already being felt by many businesses. This is occurring with the implications of Dodd-Frank and the increased scrutiny that federal regulators have applied to banks.
My bank, one of the largest in the nation, introduced a series of “new processes” for small businesses in response to regulatory concerns. Despite my impeccable credit history, my bank made it abundantly clear that its goal was to avoid this regulatory scrutiny and that saying “no” to loans was never the wrong answer. While I was fortunate to secure funding elsewhere, I know that many are not getting the much-needed capital to start or grow their business.
* * * * *
I’m a small business owner who works long days (and often long nights) running and building my business. I understand there are more than 4,200 new regulations in the pipeline today, with nearly a thousand of those impacting small businesses.
Like most small business owners, I don’t employ full-time lawyers and accountants. So for me, the scariest thing is that I don’t know what I don’t know. The concern I share with many business owners is that something I’m not even tracking will significantly and meaningfully impact my business.
A huge proportion of those regulations are coming from the U.S. Environmental Protection Agency. These regulations would impact everything from farms and construction to carbon dioxide emissions from schools and hospitals.
These may be driven by lofty ideals. Who can argue with cleaner air? But a proposal to dramatically tighten ozone thresholds (that were tightened just three years ago) could throw 90 percent of the nation into noncompliance and jeopardize 7.3 million jobs.
The implementation of these and other new regulations will hamper or eliminate business’s ability to create jobs in the United States, leaving businesses with the option of creating jobs in other countries or not competing at all. This tells me that Washington has something else in mind entirely – not job creation, and certainly not job creation by small businesses.
I’m not against regulations and agree that many are justified. However, the current situation in Washington puts the agencies proposing burdensome rules in charge of assessing the costs and benefits of those very regulations. Those assessments often omit or understate the full impacts of new regulations.
A responsible approach would require independent assessments of the full impacts of new regulations. Since small businesses are the backbone of our economy, any assessment should include direct and indirect impacts on small businesses.
* * * * *
If Washington is truly interested in creating jobs and stimulating our economy, it would make much more sense for it to stop hindering small businesses by forcing them to wade through a code of federal regulations that currently comes in at 150,000 pages – and is growing every day.
Perhaps Washington should go so far as understanding and repealing existing regulations that are outdated or didn’t have the intended outcomes and are hampering businesses today. This approach would help business and likely streamline government agencies.
I’m waiting and hoping to see that kind of signal from Washington, so I can continue to thrive and create jobs here in Virginia.