Small Business Gets Share of Spotlight in State of the Union

by Kevin Casey on January 26, 2011
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If I had to distill President Obama’s 2011 State of the Union address down to one word, I’d go with: Jobs. If I had three words? Jobs, jobs, jobs.

The President’s message last night was quite clear: America needs them. Bad. And although Obama said that message was not about the 2012 presidential vote, it seems apparent that jobs will be the front-runner in the looming election rhetoric. To that end: Expect small business to be mentioned often by politicians on both sides of the aisle in the coming year. You know the refrain: Small business is the engine for jobs growth… You can fill in the rest.

Small business certainly got some airtime in last night’s State of the Union. (Missed it? You can read a complete transcript here.) In a sense, it helped bookend the President’s address, starting with an early mention. After noting the rise of corporate profits, the recent gains in the stock market, and the return of a growing economy, Obama said: “But we have never measured progress by these yardsticks alone. We measure progress by the success of our people. By the jobs they can find and the quality of life those jobs offer. By the prospects of a small business owner who dreams of turning a good idea into a thriving enterprise.”

Notice the close proximity of jobs and small business there?

Obama later reached out to Americans frustrated by the digital revolution and its impact on manufacturing and other industries. To paraphrase: Times have changed. Global competition is white hot. But out of the tumult of massive change comes opportunity: “Today, just about any company can set up shop, hire workers, and sell their products wherever there’s an Internet connection,” Obama said.

That’s absolutely true, and it highlights the tremendous entrepreneurial power of the online world. But digital access is still an issue for some. In discussing the need for infrastructure investment, particularly in high-speed wireless networks, Obama said: “It’s about connecting every part of America to the digital age. It’s about a rural community in Iowa or Alabama where farmers and small business owners will be able to sell their products all over the world.”

Obama made several mentions of small business owners by name. He pointed to the Allen brothers and their Michigan roofing company, which began manufacturing solar shingles as a way to adapt to recessionary pressures. In talking about health care, Obama said: “I’m not willing to tell Jim Houser, a small business man from Oregon, that he has to go back to paying $5,000 more to cover his employees.”

There was one particularly noticeable call to action in the speech that would have day-to-day impact on smaller companies: In the course of discussing health care, the President essentially called for the repeal of the so-called 1099 rule that is set to take effect next year: “We can start right now by correcting a flaw in the legislation that has placed an unnecessary bookkeeping burden on small businesses.”

I’ll make a prediction here. Once the powers-that-be figure out the dollars and cents — the State of the Union did, after all, call for fiscal responsibility — expect the 1099 rule to be repealed quickly and with a certain amount of public flourish. It’s a relatively fast feather for the caps of both Republicans and Democrats: Look how we worked together to get rid of this onerous red tape on behalf of small businesses everywhere. Eliminating the rule would also align nicely with Obama’s recent order for federal agencies to review their regulations to ensure they’re not impeding small business growth.

The President returned to small business at the close of his address, citing Brandon Fisher, whose startup’s drilling technology contributed to the safe rescue of the Chilean miners last year. Obama quoted one of Fisher’s employees, who said: “‘We proved that Center Rock is a little company, but we do big things.’”

That became Obama’s closing mantra: We do big things.

Small business owners and entrepreneurs everywhere were likely nodding in agreement.

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