President Obama met with a group of small business owners and advocacy groups to discuss the prospect of expiring tax cuts and the so-called fiscal cliff.
Colorado entrepreneur Lisa Goodbee joined the President and 14 other small business owners from across the country on Tuesday to talk about the fiscal situation being created by a host of tax increases and billions of dollars in automatic spending cuts that will take effect on Jan. 1 if Congress and the president can’t agree on a plan to reduce the deficit by year’s end—known as the fiscal cliff. If not avoided, this situation will have a dire effect on entrepreneurs and the middle class, small firms’ core customer base.
“Business is picking up as the economy recovers, but my clients could take a big hit if we fall off the so-called fiscal cliff, and that could be devastating for my business,” said Goodbee, president of Goodbee & Associates, Inc., an engineering firm in Centennial, Colo., in a statement. “It’s really important for my clients and my own business for Congress to take a balanced approach to this problem, and find a sensible solution that both generates revenue and cuts expenses.”
Obama has pushed for a number of small business tax breaks to stimulate the economy. The tax breaks would refund 10 percent of the cost of new payroll—in the form of new hiring or new wages—up to a total of $500,000 next year.
Four other participants in the White House meeting were affiliated with the American Sustainable Business Council and Business for Shared Prosperity: Mandy Cabot, CEO of Dansko Inc, a footwear company headquartered in West Grove, Penn.; Lew Prince, managing partner of Vintage Vinyl in St. Louis, the largest independent music store in the Midwest; and David Bolotsky, CEO of UnCommonGoods in Brooklyn N.Y.; Nikhil Arora, co-founder of Back to the Roots, an urban mushroom farm in Oakland, Calif.
Cabot, Prince, Bolotsky and Arora are among more than 600 business owners and executives who signed a letter sent by the advocacy groups American Sustainable Business Council and Business for Shared Prosperity calling on Congress to end costly Bush tax cuts for the top 2 percent and reinvest in America.
“We’re not here asking for anything for ourselves,” said Prince. “We’re here because we want the best for our country. I’ve run a small business for more than 30 years. Expecting high-income tax cuts to trickle down as job creation is like pouring gas on your hood and expecting it to fuel your engine. It’s time to stop giving tax breaks to wealthy households and big corporations, and reinvest in America.” Prince is a leader in Business for Shared Prosperity.
In their letter to Congress, the business leaders said, “In the last decade, we have been cutting taxes on the wealthiest Americans and underfunding vital programs to pay for them. Large and growing budget cuts have had a severe impact on business, particularly micro and small business and job creation—reducing funding for infrastructure improvements, community economic development programs, housing, job training and much more. America’s failing infrastructure is starved of funds and falling further behind our global competitors. … The high-end tax cuts are hurting our economy. It’s time to end them, not extend them. This would be an important step in rebuilding an economy that grows our small businesses and middle class.”
An opinion poll released earlier this month by the advocacy group Small Business Majority found that nearly eight in 10 small business owners are aware of the fiscal cliff. The poll also revealed that entrepreneurs don’t want a solution to interfere with job creation opportunities. A majority of them believe it’s more important for Congress to focus on creating jobs than reducing the deficit. However, small business owners see eliminating tax cuts that only benefit the wealthiest as one part of a potential solution.
By nearly a two-to-one ratio, small business owners believe spending cuts for education, health care and infrastructure would hurt the economy more than a tax increase on the top 2 percent. A majority also believe that allowing tax cuts for high-income earners to expire is the right thing to do given the current economic situation.