We hear time and time again, that small businesses are the job generators and a key component to the U.S. economy. There are nearly 27.2 million small businesses and they create between 60-80 percent of the country's new jobs.
But across the country, small business owners complain they cannot get loans, are buried in regulatory red-tape and struggling under the new health care rules being put in place.
This week is official “small business week” which is sort of like handing a “get well soon” card to someone lying in the gutter after being run over by a car. American businessmen and women I speak with tell me they're tired of this charade of "caring.” They want action.
I decided to ask House Small Business Committee Chairman Sam Graves (R-MO) what he is hearing from his small business constituents and if he thinks Congress has the political will to restore America's economic vitality.
LL: Small businesses create between 60-80 percent of the new jobs in the country and there are many headwinds facing them right now. What is their number one concern right now?
Rep. Sam Graves: The number one concern facing America’s small businesses is uncertainty. During this National Small Business Week, our Committee Members have heard from small business owners that they lack the confidence in our economy, our tax policies and our regulatory system to expand their businesses and start hiring again.
LL: Some of my contacts which are small businessmen who supported the President in the first election say they are not happy with the declaring of war on business and are no longer supporting him. Do you think it's all smoke and mirrors when it comes to the White House's commissions and summits on supporting the small business?
Rep. Sam Graves: Absolutely, as we have all seen throughout his campaign and his presidency, President Obama talks the talk, but he has yet to walk the walk. We have heard him talk a great deal about the importance of small business and his intention to help small business and it all sounds great; but we have yet to see any action.
In fact, if anything, most of the policy he has put forth over the last two years has actually hurt small businesses. Businesses haven’t been sitting on revenues because they want to, it’s because they are nervous about the uncertainty that this Administration has created.
This is the most anti-business Administration ever.
LL: I am hearing from my banking contacts that small businesses are still considered "a risk" and the lending spigot is not really open.
Are you hearing this from your constituents and what's needed to grease the credit wheel again?
Rep. Sam Graves: Unfortunately, access to capital continues to be an obstacle for many small businesses. Because of the economic crisis, and a stricter regulatory environment, banks remain very cautious about lending to small business because of lower credit scores and lack of adequate collateral, including lower real estate value. In order to get things back on track, we need the government to step aside and allow free market capitalism to work. Doing so will unleash the power of the most dynamic elements of our economy– small businesses and entrepreneurs.
LL: How do we grow America's small businesses?
Rep. Sam Graves: In order to grow America’s small business we must create a stable economic climate that allows them to prosper. We must restore their faith in the American economy by improving access to capital, simplifying the tax code and reducing excessive, burdensome regulations. Small business owners don’t need billions of dollars in stimulus funds to expand and to start hiring again, they simply need to feel confident in both the government and the economy.
LL: Consumers are vital to this economic recovery, but with inflation, the real unemployment rate in double digits they are not as vibrant in terms of spending. This is another one two punch to the small businessman.
Rep. Sam Graves: It is a vicious cycle to some degree, but it all goes back to reducing uncertainty and creating a stable economy. Consumers will spend if they feel confident in a strong economy that allows for private sector growth and job creation. Similarly, businesses will hire if they feel confident in a strong economy where consumers are spending and markets are strong. In order to break the cycle, we need government to take a step back, get spending under control and eliminate unnecessary, burdensome regulations.
LL: What policies out there do you think are hurting the US small businessman?
Rep. Sam Graves: President Obama’s health care reform law has been tremendously problematic for our small businesses. Several small business owners have testified before my Committee about their struggle to both understand and comply with Obamacare’s provisions.
Many are grappling with the increased costs and taxes associated with provisions like the employer mandate—which stands to directly impact 220,000 small firms employing more than 26 million workers.
LL: Will Congress find the political will to get their financial house in order and send a message to small business they are serious in restoring America's debt ridden balance sheet?
Rep. Sam Graves: I think we are already showing the will and making real progress. My colleagues and I are committed to reigning in our spending and reducing our national debt. It is important that we restore a sense of fiscal discipline and get our finances back on track. Every reduction that we make will spur important growth in the private sector and further stabilize our economy. I hope that the Senate and the President will join us in working toward this important goal.
A Senior Talent Producer at CNBC, and author of "Thriving in the New Economy:Lessons from Today's Top Business Minds."
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