We, the undersigned business owners, executives and investors, call on the President and Congress to end tax dodging and support a level playing field for business by enacting strong legislation to stop tax haven abuses. Offshore tax havens reward tax evaders, rob public coffers of needed revenue and offload taxes to responsible businesses and households.
The Main Street Alliance submitted a letter from small business leaders in its network opposing a mandatory expansion of the E-Verify system for the record of a June 15 hearing on the topic. House Judiciary Committee Chairman Lamar Smith filed a mandatory E-Verify proposal on June 14.
May 27: VA Court Decision on Corporate Campaign Contributions Tilts Playing Field Against Small Businesses
Small business owners urge reconsideration and reversal of Friday’s ruling wiping out remaining protections against flood of corporate money in elections.
WASHINGTON, DC – Today, a federal district court judge in Virginia overturned a century-old precedent in ruling that corporations should be permitted to make direct political contributions to candidates for office. The Main Street Alliance released the following statements from national spokespeople in response:
Jim Houser, owner of Hawthorne Auto Clinic in Portland, OR and MSA steering committee member:
This decision is not only bad for democracy, it's bad for free and fair competition and especially bad for small businesses. Success in business should be determined by who can offer the best products and services, the best value, the best customer service - not by who can spend more to buy influence with elected officials and then use that influence to game the system.
Overturning a century of precedent to allow corporations to contribute directly to political campaigns is going to take a deck that's already stacked in favor of big corporate players – against small businesses – and stack it even more. If this decision is allowed to stand, our Congress and state legislatures will become wholly-owned subsidiaries of large, multi-national corporations that have no allegiance to this country, or any other, but only to their own short-term financial interests.
Small business owners like me, we know we have to compete against the big corporate players to offer the best value and service to our customers. We welcome that challenge. But give us a level playing field, not a system that's rigged so the big corporate spenders win every time.
David Borris, owner of Hel's Kitchen Catering in Northbrook, IL and MSA executive committee member:
This decision tilts the playing field even further in favor of large corporations at the expense of America’s small businesses. Small businesses are already at risk of getting swamped by price-gouging in health insurance. We're already getting soaked as big companies like GE dodge their taxes and leave us to hold the bag. As if all that wasn't bad enough, along comes a judge in Virginia who blows up the last levees protecting us from getting drowned in a flood of corporate money in politics.
Unless this decision is reconsidered and reversed, it's going to be a serious problem, and not only for today's small businesses. It will threaten to choke off new start-up opportunities as large corporations will write the rules of the game and then act as their own umpire. This decision goes against the very idea of America as the 'land of opportunity.'
Small business owners demand to know if insurers are bankrolling new campaign to undermine health law
WASHINGTON, DC – Today, the U.S. Chamber of Commerce and allies announced their latest campaign to undermine the nation’s new health law by attacking one of the law's funding sources: a fee on health insurance companies. The Main Street Alliance released the following statement from David Borris, owner of Hel's Kitchen Catering in Northbrook, IL and a member of the Main Street Alliance executive committee, in response:
Health insurance companies are reporting the biggest profits in their industry's history, beating analysts' expectations by an average of 30 percent in the first quarter of 2011.(1) So let me get this straight: the U.S. Chamber and its allies are arguing to let insurance companies off the hook from paying their fair share to bring the small business benefits of the health law – things like rate review and a value for premiums requirement – to market? And they’re making that argument in our name, in the name of America's small businesses?
This looks like another case of small business identity theft – hiding behind small business arguments to defend big insurance profits, just like when health insurers secretly funneled $86 million to the U.S. Chamber in 2009 to fund attacks on health reform in the name of the business community. We'd like to know, are the insurance companies bankrolling this latest campaign, too?
(1) Reed Abelson, "Health Insurers Making Record Profits as Many Postpone Care," The New York Times, May 13, 2011, http://www.nytimes.com/2011/05/14/business/14health.html?emc=tnt&tntemail0=y
Don't Let Big Banks Obstruct Swipe Fee Reform
Debit swipe fees now cost American businesses over $16 billion a year, and exorbitant fees on debit transactions have a disproportionate impact on small businesses. Last year, Congress passed an amendment in the financial overhaul to rein in excessive swipe fees, but the rules set to go into effect in July are facing an all-out assault from big banks and card companies.
The country observed National Small Business Week in May (see the Presidential Proclamation). The Main Street Alliance marked the occasion by releasing its “State of the Small Business Nation – 2011.” This white paper includes a “Small Business Top Ten List” of concrete policy opportunities to level the playing field for small businesses and help them create jobs.
While pundits and politicians like to label policies “pro-business” or “anti-business,” as if there were one unified business interest, the reality is that policies that make winners out of some businesses make losers out of others. As Bruce Josten, the chief lobbyist of the U.S. Chamber of Commerce, put it, “You’re never going to have one hundred percent unanimity. Never. There is inherent tension… I laugh every day when someone calls and asks what does the business community think.” (1)
While Mr. Josten pointed to tensions between oil and gas companies, wholesalers and retailers, investment banks and retail banks – all big corporate players – his point applies even more so to the dynamics between big business and small business. While pundits and politicians like to lump all business interests together, the truth is that policies that benefit large corporate players very often tilt the playing field against small businesses.
In a cover letter to President Obama, senior administration officials, and congressional leaders on May 18, Main Street Alliance business leaders wrote:
Our members come from states across the country and a wide range of sectors, but we are united by a common set of values – small business values. We believe in what we do, we stand by our products and services, and we want people in government and corporate leadership who do the same. We stand for fair play and a level playing field. We stand for having each other’s backs. We believe America’s future prosperity depends on everyone contributing their fair share.
These small business values are what guide our business decisions and our commitment to advancing policies that fulfill the promise of an economy that works for all of us – small businesses, our employees, and the communities that sustain us.
(1) James Verini, “Show Him the Money,” Washington Monthly, July/August 2010, http://www.washingtonmonthly.com/features/2010/1007.verini.html
On May 19, Main Street Alliance members from Louisiana and Maine were joined by Senator Dick Durbin on a conference call highlighting the disproportionate impact of debit card swipe fees on small businesses. Rules limiting swipe fees, passed last year and set to go into effect this summer, are now under attack from the banking lobby, with an amendment under consideration to delay the rules from taking effect for up to 24 months.
Here are a sampling of quotes from speakers on the call:
Mary Noel Black, owner of The UPS Store at Citiplace in Baton Rouge, LA:
“This system is broken and small businesses are paying the price in constantly increasing debit swipe fees. Small businesses have the least leverage, the least ability to negotiate with the big banks and the card companies, so we end up with the worst contracts.
“Those who say they want to delay and study this issue, are really only paving the way for these much-needed swipe fee limits to die a quiet death. Every month of delay on the new swipe fee rules is another $1.3 billion bailout to the banks – delaying 15 months translates into another $15-20 billion gift to the banks, paid for off the backs of small business owners like me.”
Rita Moran, owner of Apple Valley Books in Winthrop, ME:
“Swipe fees are uneven, unfair and it’s absurd! This issue pits one business against another and the customers are caught in the middle. Every day I have customers come in, hand me their debit card and say they want to use it as a credit card because the banks told them to. This is divisive. Beyond the dollars and cents issue, this is a community issue.”
Senator Dick Durbin, Assistant Senate Majority Leader:
“The swipe fee issue is a very important issue for small businesses across America. These are tough times. I’ve heard so many speeches on the floor of the Senate – by both political parties – about how we need to stand behind small businesses because they are the job creators of America. Moving the new swipe fee rules forward is a key opportunity to do that.
“Last year, we got a bipartisan vote of 47 Democrats and 17 Republicans to set the Federal Reserve on the path to establishing reasonable interchange fees. Swipe fees account for $1.3 billion each month, the lion’s share of that going to the biggest banks on Wall Street. We want to end the price fixing by the card companies, end this rip-off of consumers and small businesses by making sure these fees are reasonable.
“The next two weeks are a critical moment for this issue as we wait for the Federal Reserve to announce the rule in the first part of June. We’ll get to look at the rule, dispel rumors about what the rule will do, and then we can move forward from there to implement the rule by the July 21st deadline and ensure fair treatment for all of our small businesses.
“I encourage small business owners in every state to be in touch with your Members of Congress and let them know that this is a critical issue for the growth and expansion of small businesses across America.”
MSA and the Maine Small Business Coalition co-hosted a press call on May 17 with small business owners from Maine, Oregon, Montana, and Illinois about health care. The business owners discussed the status of health care implementation in their states and recounted the role of health insurance companies in blocking and undermining new benefits for small businesses.
“Since the insurance industry lost the battle on health care reform at the national level, they’ve been turning their attention to states. They put their lobbyists to work here in Maine and almost overnight they’ve gutted key consumer protections in our insurance laws,” said John Costin, owner of Veneer Services Unlimited in Kennebunk, Maine and a leader with the Maine Small Business Coalition.
“Anthem and the other insurance companies have taken the money small business owners like me pay in premiums and used it to completely subvert our state’s consumer protections in insurance law,” Costin said. Maine Bureau of Insurance Superintendent Mila Kofman resigned yesterday due to fundamental philosophical differences with Maine Governor Paul LePage over LD1333, the state legislation passed last week that guts consumer protections and imposes a new tax on policy-holders.
“There are clear winners and losers in the law just passed here in Maine,” said Nate Libby, director of the Maine Small Business Coalition. “The winners are insurance giants like Anthem and WellPoint. The losers are small business owners and their employees, especially people with health conditions, people aging up beyond 48, and rural Mainers. Given this turn of events with LD1333 ramrodded through our legislature with the backing of the insurance companies, small business owners in our network want to know how many of our premium dollars Anthem and WellPoint are using to lobby against our best interests.”
Jim Houser, owner of Hawthorne Auto Clinic in Portland, Oregon and co-chair of MSA-Oregon, has served on Oregon’s Consumer Advisory Group for development of the health insurance exchange. “We came up with strong recommendations for our insurance exchange, including giving it the ability to negotiate for rates and services, and protecting its governance from conflicts of interest,” said Houser. “During the meetings we had to develop our proposal, no one from the insurance industry came before us to voice any concerns or ask for modifications.”
“Then, when our proposal was delivered to the legislature, the insurance lobbyists swarmed key legislators to water down the bill,” Houser continued. “They got what they wanted – the bill that passed our State Senate prohibits the exchange from negotiating on our behalf, and it gives insurance executives two seats on the exchange board. Putting the exchange in a straitjacket and subjecting it to a clear conflict of interest in governance is not good for small businesses.”
Brianne Harrington is the owner of The Painted Pot, a small business in Helena, Montana and a leader with the Montana Small Business Alliance. “I just got a call from my insurance company. Despite the fact that we have a high-deductible plan – $5,000 per person and $10,000 for our family – and despite the fact that it pays only half of costs beyond that, we’re still getting hit with an increase of more than 50 percent. That’s why we were holding out to get rate review passed in the Montana legislature. But our big insurers didn’t want that and they got the bill killed, so now there are no protections whatsoever on how much my insurance company can raise my rates.”
Harrington added, “Speaking of the secret money tunnel between the insurance industry and the U.S. Chamber of Commerce, we actually dropped our membership in the Montana State Chamber a couple years ago because we saw that our dues were being funneled to lobby for big business interests, not small businesses. The insurance companies don’t have the best interests of small business owners like me at heart. They just want to take my money and lobby against me.”
Commentary: Why Do Small Businesses Support E.O. on Contractor Political Spending? Because "Deniability" is Not a Small Business Value
That’s why it’s encouraging to hear news of a potential executive order from the Obama Administration that would require government contractors to disclose their political spending if they surpass a $5,000 threshold. It’s a small step, to be sure, compared to the big problems of covert political spending and a broken campaign finance system. But it’s a step in the right direction (see this May 4 post from OMB Watch for more background on the potential order).
Not everyone in the business community seems to feel this way, though. In an interview for an April 26 New York Times story, R. Bruce Josten, top lobbyist for the U.S. Chamber of Commerce, said the Chamber “is not going to tolerate” the proposed transparency order.
Transparency is a Main Street value. Small business owners take pride in being straight-shooting, “what you see is what you get” business people. So why is the U.S. Chamber out guns blazing against this proposal?
You don’t have to dig far to find out. It turns out over 50 of the companies represented on the U.S. Chamber’s board of directors are government contractors, and to the tune of a whopping $44 billion in 2010, according to an analysis compiled by U.S. Chamber Watch.
So, that means almost half of the companies represented on the U.S. Chamber's board – including the likes of Lockheed Martin, Pfizer, Verizon, WellPoint, JPMorgan Chase, and even the U.S. Chamber itself – would have to disclose both their direct and indirect political spending. The indirect part is key, because it means contributions given by companies to the U.S. Chamber for political purposes – like the health insurance industry’s $86.2 million bankrolling of the Chamber’s anti-health reform activities in 2009 – would be part of required disclosures.
To understand why this is just so “intolerable” an idea to the Chamber, it helps to understand the organization’s business model. James Verini wrote about this in the Washington Monthly’s July/August 2010 issue, quoting an interview with U.S. Chamber CEO Tom Donohue:
“I asked Donohue what, exactly, the Chamber does. ‘Two fundamental things,’ he replied. ‘We’re advocates. Sure we do studies, sure we do events, sure we do meetings, sure we have all kinds of stuff, but we’re advocates.’ And then he surprised me again with his candor. ‘The second thing we do is really more interesting,’ he said. ‘We’re the reinsurance industry for individual industry associations and state chambers of commerce and people of that nature.’”What did Donohue mean by “reinsurance?” Verini elaborates later in his article:
“In other words, a large part of what the Chamber sells is political cover. For multibillion-dollar insurers, drug makers, and medical device manufacturers who are too smart and image conscious to make public attacks of their own, the Chamber of Commerce is a friend who will do the dirty work. ‘I want to give them all the deniability they need,’ says Donohue.”“All the deniability they need.” That’s why the Chamber is so up in arms about the proposed executive order – because it will take away that “deniability” by laying bare which corporations are laundering their political contributions through third parties, undermining one of the core benefits the Chamber offers to its high-roller members.
Deniability is not a small business value. In fact, it’s the polar opposite of one - the value of doing what you say and saying what you do. Small business owners take responsibility for their actions. Big corporations should, too, including their political spending, and that’s why the Obama Administration should forge ahead with this executive order. It would be a victory for transparency and for a more level playing field for America’s small businesses.
On April 20, the Montana Small Business Alliance hosted a business roundtable on clean energy and clean air issues with U.S. Senator Jon Tester. Small business owners from Billings and Eastern Montana communities got face to face and shared their perspectives on clean air and energy issues with Senator Tester, who serves on both the Energy & Water Development and Interior, Environment, & Related Agencies subcommittees of the Senate Appropriations Committee.
The business owners who joined the roundtable represented a true cross-section of Montana. They included a farmer/rancher, an architect, a restaurant owner, and a carpenter. Though they come from many different sectors, these business leaders were united by their interest in protecting Montana’s quality of life to support healthy communities and vibrant local economies.
Montana has seen many battles waged on the premise that economic growth can only come at the expense of the state’s natural beauty and environment. The business owners at the MSBA roundtable turned this premise on its head, making a compelling case that long-term economic growth goes hand in hand with preserving the state’s natural splendor.
Senator Tester and the roundtable participants discussed the potential for an expansion of jobs related to clean air, clean water and energy efficiency. The business leaders cited examples of maximizing energy efficiency at their businesses as a money-saving mechanism. The conversation also touched on the health care costs related to pollution.
"Nationally, we are spending tens of billions of dollars on health care related costs of using carbon based fuels," said Ben Reed, owner of Winpower West. "We want our children and grandchildren to enjoy the fruits of our labor, not have to pay the costs for them."
“Hearing from small business owners who are strengthening Montana’s economy and creating jobs is one of the most important things I do," Tester said. "Today’s roundtable was full of good ideas about working together to move our economy forward while making responsible decisions about Montana’s land, air and water.”