Author: John Kabateck

From time to time, small business owners must wonder about those whom they have elected to serve in the Capitol. Do our legislators understand the effect their actions have on small businesses around the state? Are they able to put themselves in the shoes of small business owners when voting on legislation that increases taxes, creates new regulations or adds mandates? Most small business owners would be honest and say that not enough legislators have those thoughts when voting.

On a regular basis, NFIB/California tracks the voting records of each member of the state
Assembly and Senate. The Voting Record provides a critically important evaluation of a
legislator’s attitude toward small business. The NFIB/California Voting Record is
developed by selecting key bills proposed by the legislature that affect small businesses.
The votes on those bills are then recorded and a percentage is determined for each
member of the Assembly and Senate.

One need not be a pollster or political scientist to conclude
that with each passing day, California voters have become increasingly wary and
frustrated with government’s (in)ability to get it right.  Once again, our state faces a
multibillion dollar deficit and the news will not get better for many years to
come.

How are taxpayers expected to have any faith that the very
politicians and bureaucrats that have mismanaged government agencies,
departments and budgets time after time would be any more competent assuming
and managing something as critically important as healthcare? 

The
sad but proven truth is that government-run healthcare will add more
bureaucracy and a hefty price tag to California taxpayers, small businesses and
jobs.  That is why the National
Federation of Independent Business (NFIB) so strongly opposed a recent
single-payer proposal in the form of Senate Bill 810 (Leno).

Our elected leaders have been back in session for just over
two weeks and once again it is clear that the majority of their time will be –
must be – dominated by the budget. Our recession still runs deep, scores of
Californians are still waiting in the unemployment line, and businesses –
mostly small businesses – from Del Norte to Del Mar are still shutting their
doors at a clip.  As we face
another crushing multibillion dollar state deficit, who can blame them?

Well, California voters can, and they’d be justified.

Voters actually have an opportunity to make a positive
change for the Golden State this November. We can make the bold decision to
remove those officials who continue to force us to bail them out for their
reckless partying, and instead we can support individuals who demonstrate that
they genuinely care about Main Street, jobs and the livelihood of our state.

Recently, the Commission on the 21st Century Economy held hearings around the state to determine the best way to reform California’s tax system, which many believe is outdated. There were hours of testimony from economic experts, tax groups and businesses of every size, including small business owners and representatives of the National Federation of Independent Business. We all agree – the system needs to be reformed in order to get us out of a feast-or-famine revenue stream.

The efforts of the Commission have brought to the forefront a major challenge to business growth in California and deserve a critical analysis by all parties including legislators and other state officials, the small business community, organized labor groups and taxpayer organizations. The fact that most of these groups have already expressed concern over some of the recommendations put forth by the Commission should be enough reason to pause before implementation of any of the recommendations. But certainly it does not shut down all discussion of ways in which the Governor and Legislature can reform our state tax structure to improve our economic and fiscal situation.

It felt a bit like Christmas yesterday afternoon when we finally received the long overdue study on the impact of regulations on small businesses in California. And while the news wasn’t good, it also wasn’t a surprise, like opening a gift that you picked out for yourself.

We hear from our members over and over that regulations in California are strangling them. One thing that this study proves is that what we’ve been saying is true – it accurately portrays the totality of the problems that small businesses face in our state when it comes to regulations. Don’t misunderstand – some regulation is needed to have a fair and balanced market, but there needs to be a reality check about how regulations will affect small businesses. Just like the saying that there is no free lunch it is equally true that compliance with regulations, particularly for small businesses, does cost money.

California finds it self in the midst or on the way out of the worst recession in decades, but in this dark time we can more clearly see that actions we have taken to hamstring our small businesses, the economy, and state revenues. More and more leaders, including the Governor and a number of legislators, are calling for action to right the ship and get our economy back on course.

In 1912, aiming for speed and ignoring iceberg warnings was a poor strategy for the Titanic. In 2009, aiming for universal health insurance and ignoring cost warnings is equally dangerous. The Congressional Budget Office has frigid warnings on some reform efforts: estimates of as much as $1.6 trillion in new costs over 10 years, perhaps without even covering everyone.

At $2.6 trillion per year and rising, healthcare spending is a threat to federal and state budgets, and big business. It’s already a nightmare for small business. We all want broader and better coverage, but reformers must ask: How can we first contain costs?

Members of Congress will come home to California in the next week or two. Your wallets and your health depend on what Congress does when they go back to Washington in September. Congress could take your money or leave more for you to spend. They can finance healthcare reform with taxes that crush small businesses, or they can adopt responsible reform that allows small businesses to survive and create new jobs. They can empower patients and providers to make life-and-death decisions themselves, or they can hand that power over to unelected bureaucrats.

California’s economy is in the tank and our state budget is wildly misaligned. The only way to get the state budget back in shape is to grow the economy, to put our record number of unemployed back to work and to get businesses opening and expanding instead of shrinking and closing.

Unfortunately some in the state Capitol are pushing even higher taxes which are a poison pill for economic growth. One public employees union has a list of 31 new and higher taxes totaling $40 billion.

That’s why the National Federation of Independent Business (NFIB) has joined with taxpayer organizations, large employers and other small business organizations to create Californians Against Higher Taxes. This coalition aims to use every arrow in our quiver to fight off economically devastating tax increases.

With California grappling with a major recession, record-high unemployment, and a massive state budget deficit, it is easy to understand how one can become greatly depressed about the future of the entrepreneurial spirit in our great state. However, when I witness sterling examples of great potential and perseverance of our youth despite the current recession, I am regularly reminded of the great hope and promise our future holds.

Earlier this month, NFIB/California was pleased to announce the 2009 winners of our Young Entrepreneur Awards (YEA). Six students from around the state were awarded scholarships designed to reward and encourage entrepreneurial talents among high school seniors. In addition to the traditional academic considerations, students were required to write an essay describing their entrepreneurial endeavors to date and future goals.

Many of the current and past recipients of these awards had already demonstrated their entrepreneurial spirit by starting, operating, and, in some cases, selling businesses before they have even donned their caps and gowns.

After the defeat of the recent ballot measures in May’s special election, many small businesses thought that perhaps they would be able to breathe a sigh of relief. The massive tax increases imposed as part of the February budget deal would expire in a few short, but bloody years. With all the stimulus talk and love for small business throughout the Capitol, some of California’s job creators began to think that a new dawn of realization was on the legislative horizon. They shouldn’t have been so optimistic.

The ink was barely dry on the ballots when the attacks on small business started with talk of eliminating their Proposition 13 protections. Proposition 13 limits property taxes to 1 percent of a property’s acquisition value, with increases limited to 2 percent a year. Prior to Proposition 13, Californians were burdened with higher taxes based on over inflated property values and a lack of consistency when assessing properties.