Bush or Kerry? Which Candidate is Best for Small Business?
Between us and our two extended families, we probably count a dozen or so small businesses that we either run or are somehow connected to. While entrepreneurial drive is central to getting a small enterprise―from manufacturing to technology―off of the ground, policy and the overall economy also play a central role in determining how quickly a venture will realize success―or get tossed into the rubbish bin.
To better inform the voting efforts of our families and readers, we thought an analysis of the Bush/Kerry policies impacting small business would be helpful. For many, it’s difficult to look at the situation objectively. A good number of voters blame Bush for the overall economic downturn in 2000-2002. We believe the downturn was more a factor of an overheated economy spending a few quarters in rehab after overdosing on the bubble of the late nineties. Either way, we think Bush’s overall economic record to date―not focusing on small business―is either slightly positive or a wash, depending on when you catch us during the day (and how our balance sheets are looking).
In terms of the current election, we believe that there are three general areas small business owners need to evaluate Presidential candidates on. These are: small business economic policy, labor policy, and overall trade policy.
From a small business economic policy perspective, both Bush and Kerry look solid on paper. Both candidates have made small business growth a centerpiece of their domestic economic agenda—which we believe is a great thing. Bush cut small business taxes by $75 billion in 2004. Kerry supports similar incentives, including a government sponsored fund to encourage small business investment and reduced healthcare costs through government sponsored credits. Where the two candidates differ fundamentally is the role of government in this growth. Bush believes that lowering taxes and regulation are critical, while Kerry advocates government funded programs to encourage small business success. Both candidates offer sharply different views―let your core philosophy decide which candidates are most aligned with your own.
The candidates’ labor policy views are more contentious. Bush believes in limited government involvement in labor issues while also reducing government regulations that add costs to managing a workforce. Kerry, in contrast, is strongly pro-union (he won’t cross a picket line), believes in raising the minimum wage, and drafting new legislation that will require businesses to comply with an increasing stack of employment laws. As small business owners, John Kerry’s labor policies downright scare us, and will introduce non-market forces that will hinder our capability to grow, while also adding costs to manage our employees. Here, we give Bush the edge.
From a trade perspective, we do not believe that either candidate represents the free market ideal that is best for small businesses in a global economy. Kerry has gone on the record in favor of tariffs and protectionist policies that will hinder access to low cost goods and services from abroad, increasing costs for small businesses here. And if you recall. Bush imposed steel tariffs which also contributed to increased costs for small manufacturers who purchase metal products and raw material. In general, though, our gut tells us that Bush is not as much of a protectionist as Kerry, though both candidates could seriously benefit from a class in Capitalism 101.
Overall, while neither Bush nor Kerry is the ideal small business candidate, we give the slight edge to Bush from a policy perspective, if only because Kerry’s views reek of isolation and collectivism in a global economy where, as small business owners, we can afford neither. Bush is not much better, but we don’t lose sleep thinking about the implications of his policies on our businesses.