Access to Capital for Small Businesses
The driver of capitalism is, of course, capital. So, it makes sense to make it easier for small businesses to obtain capital to aid in business expansion.
It is important that lenders behave responsibly and it helps to have some level of protection in place. But at the same time we need to make sure the loans that grease the engine of small business are still obtainable.
Step one would be taking an objective look at current regulations to ensure a balance and access to small business loans.
Consistent, Simplified Tax Codes
Business tax rates in the U.S. are among the highest in the world. The effective rate – taking into account various deductions – is 27.9%. We would foster a more competitive business climate with a lower rate.
But, perhaps more important than the actual rate is consistency from the government in how taxes and regulations are applied from one year to the next.
Investment is needed in capital equipment and R&D across a broad spectrum of businesses. But Schedule 179 and other depreciation rules seem to be moving targets from year-to-year.
The same holds true for R&D credits. Accountants don’t know from one year to the next how rules for depreciation will be applied. What is a deduction last year might not be a deduction today.
This is a challenge for any business that invests heavily in capital equipment and R&D. The fear of the unknown can deter investing in new technology or equipment. This hurts the business and suppliers who miss out on a sale.
The current tax code is riddled with similar examples. Consistency from one year to the next allows businesses to better plan their resources, make capital acquisitions and understand the tax implications.
A simplified longer-term commitment from taxing authorities would go a long way toward creating stability in capital equipment and R&D investments.
Workers Need Re-Training
President Trump’s announcement that Carrier was keeping 1,000 jobs here was a nice win for the U.S., Indiana and affected workers.
But this is more the exception than the rule. I like President Trump’s promises to bring back manufacturing jobs, however some of them simply aren’t coming back.
While the exodus of many manufacturing jobs can be traced to international trade deals, and of course cheap labor beyond our borders, many simply vanished because of robots, automated material handling systems and overall greater efficiencies in manufacturing
Frankly, Americans are manufacturing more than ever before, we’re simply more efficient and consequently can do more with less manpower.
Workers who have been displaced need retraining in burgeoning industries such as the high-tech, health-care sectors, and even the trades where job opportunities often go unfilled.
Providing federally funded job re-training programs for displaced employees and tax credits for companies that hire them is a win-win-win for people, companies and communities.
More Students Need STEM Training
My advice to college students: science, technology, engineering and math. Repeat over and over again. Then pick one and study hard. The majority of high paying jobs in the coming generation will predominantly revolve around STEM and we need to point as many people in this direction as possible.
We also need to recognize technology is advancing rapidly. It is difficult to keep pace. Imagine the changes a class of 2007 information-technology graduate has seen in the past 10 years.
Now, imagine as an employer keeping your team up to speed and investing in their continuing education, only to see the best and the brightest cherry-picked away. In essence, you just paid for your competitor’s talent pool. Kind of discouraging.
I would support a program where businesses receive tax credits for workers’ continuing education. That way, more companies will invest in ongoing education, as a society we will have a much more educated workforce and risk of training investment will be mitigated.
I know these aren’t all of the answers, but it would be a start.