With just over a week until Election Day and our economy in disarray, it’s little surprise that the economic policies of both John McCain and Barack Obama have come into sharp focus for many Americans. This has, of course, been aided by the emergence of Joe the Plumber as a major figure in the presidential campaign — though he is hardly the only current or prospective small-business owner looking closely at what the candidates are pledging to do to move the economy forward. Since the beginning of the race, as the owner of a small business (and a Democrat), I have been carefully reviewing what each ticket proposes to do to help my business grow and prosper. I wanted to take the opportunity to explain to you today why I believe the McCain-Palin ticket offers the best policies to aid small businesses in these difficult times.
This should be a big concern for readers of this site for a number of reasons. It is often said that small businesses are the backbone of our economy — a truth evidenced by the fact that, according to the Small Business Administration, in 2006, the U.S. was estimated to have over 26 million small businesses, with 99 percent of employer firms in the U.S. being small businesses. If we want to fix our economy, it is essential to keep small businesses growing and ensure they can take on more employees and pay them better and offer them better benefits. Also, though, many women across the country have chosen to apply our entrepreneurial spirit to our professional lives and become our own bosses. It’s fair to say that women have a particularly vested interest in making sure that the next president implements policies that will help, not hurt, small businesses, and I believe that John McCain will do that to a much greater extent than will Barack Obama.
Taking as an example my own business, which I own through my company, CKB Swanson Inc., I can tell you that taxes — and the prospect of them rising — is a big worry. Barack Obama has worked hard to assuage fears of him taking office as a tax-hiking president, but his recent comment to Joe the Plumber was telling: Obama wants to “spread the wealth around,” and that is why he is proposing raising taxes, on both individuals and corporations. To be fair, Obama is proposing nearly $1.3 trillion in new spending over just one four-year term, and he will need to pay for that somehow, but for small-business owners like me, his plans are a big cause for concern. John McCain is pledging to keep taxes on individuals low (a help to the roughly 80 percent of small-business owners who file under the individual income tax schedule). However, he is also proposing to cut corporate taxes to 25 percent from 35 percent, which would benefit small businesses that, like mine, are incorporated.
And McCain is proposing other changes that really will help small businesses like mine, too. The main item that springs to mind is a first-year deduction for costs associated with business equipment and technology investments. For a business like mine, this is critical. We focus on helping restaurants reduce waste and recycle their oil, and hope to one day begin selling the B100 biodiesel fuel we convert from left-over oil and currently use to power our company fleet. So we’re equipment-intensive, making McCain’s deduction proposal particularly appealing. But we’re also dependent on the best technology, that will allow us to do even more green business, reaching the market — and that’s where the McCain-Palin proposal to create a permanent tax credit equivalent to 10 percent of wages spent on R&D is an added bonus. My business, which I have described as operating in an “uncharted” area (the green sector), clearly is reliant on constant innovation, and this policy will help spur that innovation in a meaningful and serious manner. Barack Obama talks about “investing” to allow new technologies to be developed. But as someone who owns a business doing some pretty cutting-edge things, I simply don’t believe that Obama’s proposal for what amount to subsidies will be as effective as John McCain’s proposal, which empowers innovators and entrepreneurs.
The same could be said regarding the candidates’ respective health care policies. Put simply, Obama wants to fine employers that don’t provide health insurance to their employees, and while he says he will exempt small businesses, he has not been clear on what he would define as a small business. Where he decides to draw the line will prove critical, because smaller businesses will find it the most difficult to fund the cost of insurance, or the fine, for their employees — and the levying of that fine could make it tougher for small businesses to expand, take on new staff, and pay them well. John McCain has a different solution: Provide families with a $5,000 refundable tax credit to purchase health insurance privately, which they can then keep, irrespective of where they work, and whether they change jobs. Every family in every tax bracket with employer coverage under the McCain plan can not only have the same coverage as a “Member of Congress” but will now have additional dollars for their health care needs. Those purchasing insurance on their own and the uninsured, who previously had no help from the federal government, will now have the same tax benefit as those with employer coverage. That $5,000 would go further than it would now, also, because along with focusing on getting the 47 million Americans who currently lack insurance covered, McCain also would focus on reforming the insurance market, allowing families to buy insurance across state lines to give them more options as to coverage, and pricing. The plan promises to drive up the number of insured, give Americans more choice with regard to their health care, and make insurance more portable and affordable. I believe that McCain can deliver this change — and if he does, it will benefit small-business owners and employees alike.
Ultimately, if you own a small business like I do, the choice between Obama and McCain could not be clearer. McCain’s economic proposals offer the prospect of greater prosperity and opportunity for expansion — and if you work for a small business, that should matter as much to you as it does to me. Barack Obama’s plans, by contrast, amount to policy that would burden small businesses and threaten up to 16 million jobs across the country. Given the current state of the economy, that’s a risk I’m not prepared to take — and that is why I am voting for John McCain.
Christy Swanson is the owner of CKB Swanson Inc, a Democrat and former Obama supporter. She lives in Virginia.
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