Obama on Balancing Needs of Small Business and Multinationals

Posted by: John Tozzi on July 29, 2009

We just published an interview that BW editor Stephen Adler and Washington Bureau Chief Jane Sasseen did with President Obama in the Oval Office earlier this week. Among other things, the president points to his record to refute critics who call him antibusiness. Here’s a snippet of his response to a question about his administration’s approach to taxes:

We now live in a 21st century global economy. And so we’re going to have to update a whole host of rules, and tax policy is one of them. I would like to see a lower corporate tax rate. I’d like to see fewer loopholes to go with it so that we don’t lose revenue in the process. I also have to think about the relationship between multinational businesses and small businesses. So all those folks at the Aspen Institute may get really ginned up about the prospect of changing multinational taxation. On the other hand, I’ve got a bunch of local companies here who are paying 35% taxes when some Fortune 100 company is paying an effective rate of 12%.

What I hope develops is a healthy debate with business in which we are trying to find a stable, sustainable set of policies—regulatory policies, tax policies, environmental policies—that create a level playing field and that are predictable enough that companies are able to thrive and compete. What you haven’t seen from our Administration is a suggestion of a bunch of command-and-control, top-down, heavy-handed bureaucratic regulations that would bog businesses down. That’s not our model. That’s not how we think about these problems. That’s not going to be our approach.

Read the whole thing here.

Reader Comments

Lynn

July 30, 2009 12:19 PM

His policies scare the cr_p out of me. The key word in this address is "regulatory". Interpreted, that means heavy handed and bureaucratic. He intends to control business just as he is trying to control the private sector.

Steve

July 30, 2009 12:54 PM

The guy makes Clinton look like an amateur. Says one thing, does the opposite.

Re healthcare, folks need to be aware that the policy being considered does nothing to address tort reform, a large factor in helath care costs. With 50% of all legislators being attorneys, this is no surprise. The public also needs to demand that whatever policy they come up with, the lords presiding over it all, (ie those same legislators) need to be subject to the same health plan, not their own special plan funded by the tax payers. Like all attorneys, they forget who they work for.

RonB51

July 30, 2009 01:32 PM

When you start studying who he allies with and what they represent, and then watch as he seems to be literally lying about so many subjects he's talked about, then all I can do is start taking notes on what Congressman/woman is going the same way. It really is past time to start cleaning house.

Nick P

July 30, 2009 01:39 PM

It is becoming clear that he is a compulsive liar. Obama is Enenmy #1 of small business and we should all be working and contributing to stop him.

John Tozzi (BusinessWeek reporter)

July 30, 2009 01:49 PM

I appreciate the comments, but let's have a substantive discussion about this. Steve makes a good point about tort reform -- that has not been thoroughly discussed in the health reform plans coming out of Congress.

But as for Obama's record on small business, what specific actions has he taken or policies has he enacted that trouble business owners? In the full interview, Obama points to specifics to refute critics who call him antibusiness. So can critics answer with evidence that he is?

Joseph Reich, Jr

July 30, 2009 01:53 PM

There is no one in the administration I am aware of that has any hands on experience at running a business. Do you really believe there is such a thing as a "level playing field"? That is what makes it a challenge and exciting. Let the markets do their job.

Geoff

July 30, 2009 02:03 PM

The scariest part about this president is that he has no idea about business...any aspect of it, from competition, to innovation, to profit motive, any of it.
He's like our senators from MA, both inherited oodles of money, always fed from the public trough, and never ever had to create a dime of their own...but Obama is even less experienced.
So he's got interns and statistician writing copy for his teleprompter, focus groups determining how to say the right thing, but not a clue as to what any of it means.
This total unfamilairity shows through his actions. He's not interested.

Geoff G

July 30, 2009 02:35 PM

OK, John, Here are a few specifics that we've seen right out of the gate:
Union card check bill: Obama favored this, lining himslef up solidly on the union side of this issue. Would have created an un-level playing field.
Cap and Trade: there seems to be a broad consensus that this would kill small manufacturing in U.S. (and other energy intensive businesses) with its expected higher cost of electicity.
The most recent health insurance bill would effectively snuff out HSAs with the provision that plans pay out some high percentage (not certain of detail) of premiums to benefits. Good bye high deductibles. Good bye choice.
And by the way, let's surcharge payroll tax on businesses who don't provide health benefits that meet federal requirements.
To my earlier point, his statements belie an utter lack of understanding of business machinations and challenges. It seems business is nothing more than a personal piggy bank, and the ONLY question that interests this administration is, "how hard can I squeeze this before it breaks?"

Steve S

July 30, 2009 05:45 PM

The comments the president has made about the wealthy people paying more to give to the poorer people for health care or education sounds like something Lenin spoke about during the Russian revolution. Redistributing the wealth is worse than socialism, it's communism. When has a poor person ever hired employees or started a business or even paid taxes to fund the government? This administration is very bad for the business community.

Laurence

July 30, 2009 06:54 PM

O.k., Mr Tozzi, how would you respond to Mr Obama's push on healthcare. You wanted to know what he has enacted, I'd rather point towards what he is proposing.

As a 27 year-small business person, I could literally be forced out of a successful business enterprise if we were to be forced to ante up an 8% penalty/tax for not providing healthcare for our employees. If we could do that now, we would have done so already.

I personally can live with a break-even business P & L until the economy clears, but I don't need a fiscal spearing by Obama.

Northwestern Mutual(A great local corporation, headquartered here in Wisconsin, already pays around 15% for the health benefits for it's employees.
They would make more money dropping coverage and paying the 8%...while small businesses could easily be crushed.

If that mandate is the start of Obama's new vision for a business relationship, no thank you, I want no part of it.

Rita m

July 30, 2009 07:47 PM

Mr. Tozzi,

As a small business owner with 47 employees, I can listen to the nice things President Obama says, but back in reality, I need to make payroll and that is getting harder to do. The health care tax seems to penalize my company, even though we already offer great health insurance my own family uses. The bottom line is there is no function the government can provide better than a private enterprise. And, regulatory = interference with free enterprise. The bailout proved that every time a politician steps onto Wall Street, he embarasses himself.

John Tozzi (BusinessWeek reporter)

July 30, 2009 09:38 PM

Thanks everyone for the comments. There's obviously real concern about how health reform would impact small business owners, and we'll continue to cover that as Congress hashes out a bill.

John

July 31, 2009 01:02 PM

My company already pays half of the premium for full time employees.
In my opinion, President Obama is taking this country down the "Road to Hell" as he was told during the G-20 Summit. There is not one degree of sustainability in his programs.
Take health care. The government can't manage Social Security and they think they can take on health care? The real issue with health care is the astronomical prices charged by the pharmaceutical companies. It is such a cash cow for so many people, the average person is defensless against their pricing practices. If you get a life threatening desease, it will cost $30,000 a month if you want to try to beat it and the insurance companies will pay it and charge the citizens in premiums. The pharm companies pay the doctors to sell their product. (sometimes more than one) They spend billions of dollars on un-needed advertising. They have paid lobbyists in DC who control our government officials with gifts and money so no-one will do anything about it. I was told by one doctor, the insurance companies get a piece of the pie as well. In ordinary business this is called a kick-back and is un-ethical.
The government always trys to fix things with charging more taxes or cutting services to the people. The citizens take a beating either way.
The governnment never looks at cutting back their un Godly spending. I won't apologize for bringing God into my conversation for anyone. It is what I strongly beleive.

Eric

July 31, 2009 01:11 PM

Geoff,

You say "there seems to be a broad consensus that [cap and trade] would kill small manufacturing in U.S."

There is no such consensus and the claim is nonsense. This would help domestic manufacturing, by reducing the advantaged derived from sourcing wherever labor is cheapest and shipping goods to the US from overseas.

On health care, I confess to not knowing enough about the array of proposals out there, but if 8% of payroll would provide good health care, that's better than what I'm paying now.

Jim

August 1, 2009 10:08 AM

Eric,
Possibly i have misunderstood your stance.
"There is no such consensus and the claim is nonsense. This would help domestic manufacturing, by reducing the advantaged derived from sourcing wherever labor is cheapest and shipping goods to the US from overseas."
How does charging small business another 8%, on top of all the American taxes already paid (EPA,OSHA,UEMPLOYMENT,SOCIAL SECURITY etc) level the playing field? Leveling the play field for foreign companies maybe, but not domestic manufacturing. With all these taxes, the major corps have moved their manufacturing to 3rd world nations that change pennies. When we operate at less than 10% profit, then 8% means the world to us.

Kimberley

August 3, 2009 12:04 PM

Ladies and Gentlement, write your congressmen and women. Tell them that you are not interested in "insurance reform." If we want to fix rising insurance premiums, we have to look at the underlying cause - rising healthcare costs!

My company provides 100% paid health insurance for full time employees. It's a good policy and my family is on the coverage. We deal with rising premiums every year. And yet, I'm still very concerned about what the new legislation will do to our ability to select competitive coverage and control our costs!

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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