The Political Clout of the Small Business Lobby

October 16th, 2011 at 10:01 am

Lots of good comments re small biz: a few clarifying points.

–There should be no confusing the key point of the previous post.  It has nothing to do with ideology or politics: most firms are small, but most employees work for large firms.

–I make a distinction, though perhaps I did not emphasize it enough, between small businesses and the small business lobby.  The former are worthy of support and help for reasons I emphasized in the post and that commenters have as well.  The latter—their lobby—seems to me to have tremendous political clout which too often blocks progressive policy.

–I could be wrong about this clout factor—I’d like to be, in fact, though I’m afraid I’m probably right.  To find out, I’m going to invoke my friend Jacob Hacker, co-author of the excellent Winner Take All Politics and a premiere expert in precisely this type of question. He’s the guy to adjudicate this question.  If he’s amendable, I’ll post his response.

–Here’s another point I should have made.  The small business lobby is NOT a monolith.  I’ve done some work with this group—the Small Business Majority—and I really like where they’re coming from.  Ditto re the Main St. Alliance.


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2 comments in reply to "The Political Clout of the Small Business Lobby"

  1. Tyler says:

    A great way to aid both the poor and small businesses would be to eliminate the highly regressive FICA tax. Social Security and Medicare are federal programs; they do not need a trust fund.

    Also, we should offer full Social Security benefits and Medicare to all Americans age 60 and up. This would allow millions of Americans to retire, thus creating millions of job openings. The unemployment rate would drop swiftly and dramatically.

  2. Tony P. says:

    Slightly off-topic, but: has any prominent Democrat ever called BS on the GOP’s mantra about “small businesses that pay income taxes at personal rates”? Small-business structures like sole-props and partnerships are called “pass-throughs” because THEY DON’T PAY TAXES. They pass their profits through, UNTAXED, to the sole props or partners. The GOP insinuation seems to be that a sole prop who draws $500K of PERSONAL income from his own “small” business ought to pay less income tax than the employee who draws a $500K salary from somebody else’s BIG business. The objective, obviously, is to fool the public into supporting lower taxes on $500K personal incomes, period.

    I used to think that the GOP mantra was a cynical attempt to exploit the public’s ignorance, but I have recently begun to wonder. Is it possible that the Cantors and the Ryans in Congress actually do not understand the difference between gross income to a business and personal income of the owner(s)?