I want to thank you for inviting me to discuss some of
the issues critical to small businesses. This is the second
time I have spoken to you. The first was at former member
Mike McKevitt. I don't have to tell you how much I enjoyed
working with Mike. He had a very straight forward manner,
and you always knew where he stood on an issue. He was
a great advocate for this nation's small businesses, and
he will be sorely missed.
Earlier this year when President Bush was sworn in as
our 43rd President, one of his first goals was to bring
a new approach to Washington. He said that he wanted to
unite people to work for the common good -- and I applaud
him for that. But bringing people together to work for
a shared belief is nothing new to members of the small
business committee.
Long ago, our members realized that helping small businesses
is not a democratic or a republican issue, neither party
has a corner on that market --- we must work together.
This cooperative agreement has allowed our committee to
be one of the most productive in recent congresses. During
the 106th Congress, the committee passed twenty-seven
bills, twenty of which were signed into law by the President.
We were able to accomplish this because liberal and conservative
--- rural and urban legislators checked our ideologies
at the door, and kept one goal in mind --- "How can
we help small businesses, the engine of this economy keep
running." While this success was unprecedented, we
can not rest on our laurels because small business has
a big agenda, which means we have a big agenda.
One of the most pressing issues affecting this nation's
small businesses is the need for access to affordable
health care for both themselves and employees. While almost
80 percent of all corporate America employees have access
to health care, less than 50 percent of all small businesses
have access to the same level. If you are self-employed,
the landscape is even more difficult, with 60 percent
of our nation's uninsured children living in a self-employed
household. This has got to change! Finding a solution
for this national crisis has not and will not be easy.
One alternative is to allow small businesses to band together
and use the "scale of economy" through their
numbers to purchase health care. This is how big business
is able to provide health insurance and if it is good
enough for IBM, it should be good enough for small business.
The other major front in affordable health care is through
tax deductions. Several years ago, we were able to win
the passage of 100 percent deductibility of health insurance
for the self-employed. The battle over the past several
years has been accelerating the deduction, which is scheduled
to fully kick in by 2003. Our job is to bring this to
bare sooner. These are important steps, which I believe
will go a long way in helping this nation's small businesses
close the health insurance gap.
One of the other major topics we have spent the first
five months of the new Congress focusing on is tax reform.
It is estimated that Congress will send a tax relief bill
to the President for his signature before memorial day.
During the President's first address to Congress, he said
"Tax relief for small business's means jobs for
all Americans." I couldn't agree more with him, but
you can imagine my surprise the next day when the President
released his budget and there were no direct tax breaks
for small businesses.
To add insult to injury, the Small Business Administration
that provides critical lending, counseling and technical
assistance to small businesses saw it's budget cut by
43 percent. In place of the funding used to run these
programs were new fees and hidden charges that would force
small businesses that use many of the valuable loan programs
and the small business development centers to pay thousands
of dollars in additional costs --- this means any tax
relief that small businesses would receive under the Bush
plan would be quickly gone. This bait and switch ploy
is fooling no one because ask any small business owner
about fees and they will tell you it is nothing more than
a code word for a tax.
While many of you may think --- "I don't use SBA
programs. This doesn't affect me." --- Think again,
while you may not, many of your customers and suppliers
do, meaning if they can not get access to the loans and
technical assistance to support and grow their business,
they may have trouble suppling a product or because of
a cash flow issue be forced to scale back, and that will
affect you.
Last week in a hearing on this issue, our committee,
once again in a bipartisan way, made clear to the administration
that this is unacceptable. But we can't do it alone and
we need your voices as well.
I believe that the President's budget with it's cuts
to vital business programs and his philosophy of "a
rising tide lifts all ships" was far too high a price
to pay for too little. With my colleague Don Manzullo
and other like minded members on the committee, we introduced
a comprehensive small business tax package, H.R. 1037
(The Small Employer Tax Relief Act). This legislation
provides important tax relief, simplification and protection.
One critical component of this legislation is the increased
meal deduction for small business. Long ago, many berated
this as nothing more than the two martini lunch --- we
all know differently. Small businesses don't have the
large advertising budgets or elaborate conference rooms
that are taken for granted in corporate America. We know
that much of your business is conducted with over a sandwich
or hamburger --- and in many cases the local diner or
restaurant serves as your conference room. The provision
relating to the meals deductions recognize these realities
of doing business and will allow the needed flexibility
to grow your business.
As you can see, there is still much that needs to be
done to help this country's small businesses. I would
like to close with what I believe has become a sort of
a mantra for me in regards to small business, and that
is "Small business is big business in America."
We see it in the dominate role you play in economic output
and in leading job growth. The economic boom of the last
eight years has been largely built on the foundation of
small business, and if it is to continue, it must remain
anchored firmly in small business.
Thank you.
