Lawmakers gave entrepreneurs two lousy gifts for Small Business Week
This post originally appeared on Huffington Post and was authored by John Arensmeyer Founder & CEO of Small Business Majority
Entrepreneurs in the United States have a long wishlist of things they would like to see lawmakers do that would help improve their businesses. From tax reform to healthcare changes, there are plenty of ways politicians could make life better for America’s job creators. During this year’s National Small Business Week, however, Congress decided to ignore that list and ended up giving two really lousy gifts to small businesses: the first step toward repeal of the Affordable Care Act (ACA), and the revocation of a rule that makes it easier for states to establish retirement savings plans that benefit small businesses.
After weeks of begging, browbeating and backroom dealing, Republicans managed to force their replacement plan for the ACA, known as the American Health Care Act (AHCA), through the U.S. House of Representatives on May 4. Regardless of whether or not the AHCA ever becomes law, it absolutely does not have the support of small business owners. In fact, Small Business Majority’s scientific opinion polling found that small businesses favor the ACA over the AHCA by a 2:1 ratio. What’s more, after learning about specific provisions of the ACA 58 percent of small business owners said they support it.
Small firms value the ACA because it has removed a significant barrier to entrepreneurship. With healthcare coverage no longer tied to working for someone else, entrepreneurs can now pursue their own dreams knowing that they will have access to quality, affordable healthcare coverage. Unfortunately some lawmakers seem to think that allocating a mere $8 billion for high-risk pools will be enough to ensure that anyone with pre-existing conditions will be able to afford the skyrocketing premiums they will face under the AHCA. We already know, however, that states resisted instituting high-risk pools at least once before, and there is no reason to think anything has changed or that $8 billion would be anywhere near to help cover people with very high premiums. As a result, the AHCA would stifle entrepreneurship by keeping insurance out of reach for those hoping to start their own business and may force many solo entrepreneurs out onto the job market.
As if the healthcare blow from the House were not enough, the U.S. Senate also harmed small employers during Small Business Week by revoking a rule created by the U.S. Department of Labor during the Obama administration that permits states to create a public/private partnership that allows private-sector employees to contribute to an individual retirement savings account through modest payroll deductions. This is essential for small businesses that frequently lack the resources to offer these retirement savings options on their own.
Small business owners want to offer retirement plans because they help make for a satisfied staff, which in turn can increase productivity and profits. Programs like these also help level the playing field between small businesses that want to offer retirement benefits but can’t, and their larger corporate counterparts that can. This helps small businesses compete for top talent, and gives employers peace of mind that they are doing what’s best for their workers.
States like California, Illinois, Oregon that are already in the processing of setting up these programs have indicated they are going to do what it takes to move forward. Unfortunately, many other states considering setting up these programs may be discouraged from doing so, which is a setback for entrepreneurs that want state retirement programs.
Many, many lawmakers say they care about America’s entrepreneurs. I don’t doubt it. Their words, however, often do not match their actions. It is shameful that so many lawmakers voted against the interests of small employers during National Small Business Week, so we clearly need to encourage our politicians to do some good for our nation’s job creators. There is certainly no shortage of helpful ideas. It’s just a matter of having the will to make difficult political choices in order to solve the problems faced by the vast majority of small firms.