Small Business Lobbies—Working for You?
Lobbying groups representing small business have diverging agendas
While you were busy running your company this week, the nation’s small business lobbying groups were in Washington, D.C., representing—they say—your interests on Capitol Hill. But what are they saying? Are the issues that they champion really those that are essential to your success? And do they truly represent you on hot-button topics, like affordable healthcare plans and tax relief?
The most high-profile of these groups is the National Federation of Independent Businesses (NFIB), which bills itself as the nation’s largest small business advocacy group,with 600,000 members. NFIB surveys its members every year to see where their concerns lie (access to health care coverage has topped the list for years) and has been a leading advocate of association health plans, which would allow groups—including the NFIB—to gather members into buying pools, in theory to create buying clout and reduce premiums.
Its other hot button has been tax reduction. While NFIB says it is nonpartisan, it has been closely associated with the Bush Administration agenda, pushing for permanent adoption of the 2001 tax cuts and championing estate-tax repeal. BusinessWeek called the NFIB a Republican group in an article on small business lobbying (BusinessWeek SmallBiz, Fall 2004 issue) and early this year the NFIB issued a blanket endorsement of President Bush’s State of the Union agenda.
In lobbying for estate tax repeal, the NFIB adopted the “death tax” label that was cooked up by a Republican lobbyist working for a group supported by billionaire heirs, including members of the Mars and Walton families. It has spent the past few years trying to draft its members for a “grass roots” movement for repeal, even though the measure would have little effect on most of them; 72 percent of NFIB members are businesses with fewer than 10 employees, almost none of whose owners will be subject to estate taxes. (A 2005 report by the credit-scoring company Experian found that the average income among small business owners it surveyed was $71,690.) According to the non-partisan, Center on Budget and Policy Priorities, at the current exemption level ($2 million for an individual and $4 million for a couple), only about 1% of estates in the U.S. are taxable. In 2000, when the exemption was just $675,000 per individual, the Congressional Budget Office found that 135 family-owned businesses in the country would have owed estate tax.
After pushing for full repeal—and lambasting the Senate for stopping the measure—this week the NFIB endorsed a new House bill that exempts the first $5 million of an individual’s estate from taxes beginning in 2010, when the current temporary law expires.
The NFIB’s other hot button is the Bush Administration-supported version of association health plan legislation, which would allow small businesses to band together and buy healthcare insurance across state lines.
The proposed bill has not gotten out of committee, because it includes language that would supercede longstanding state rules preventing discrimination and establishing minimum levels of coverage by insurers. Under the proposed bill, insurance companies would be able to exclude from coverage sick workers, or workers with certain diseases like diabetes and hypertension, which strike disproportionately in minority populations. A broad coalition of healthcare, politicians, woman's and labor groups have allied against the so-called Enzi bill, which it says actually result in less coverage (for details, see previous story in Small Business Review). (continued on page 2)
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