Business Round Table Wrap Up (Feb 23, 2010)

Ed Martin with small business owners discussing the current business climate

Tuesday afternoon (Feb 23, 2010) I had the opportunity to have a round table discussion at Imo’s Pizza in South County.  The owner Brian was kind enough to host this discussion with fellow business owners.  After a few minutes of conversation and enjoying good St. Louis style pizza and toasted ravioli, we began to go over concerns they have about the current business environment.

“I don’t need a loan, I need customers” was one of Brian’s poignant statements.  He was addressing the obsession this President has with getting banks to lend.  Certainly there are businesses who depend on access to lines of credit, but Brian’s concern was the fact that no amount of loans would make up for the fact that his customer base is seeing their disposable income eroded.  Some are out of work but more are feeling the crunch of other issues such as increased consumer prices.  Brian believed these factors were forcing his customers to tighten their belts.

The owner of an insurance agency noted that his business was seeing a lot of business owners calling him to see if they can economize on the costs of their policies.  Health insurance costs became a topic of discussion.  Premiums are on the rise.  The owner of a local nursery indicated that she has to carefully balance her staffing to prevent health insurance costs from destroying her bottom line.

We talked about the creation of association pools for health insurance.  Small businesses, among other groups, could band together to create larger risk pools just as large corporations can and negotiate better rates.  For instance, a pool could be made for all Imo’s pizza franchisees making a pool of hundreds.  This measure would cost almost nothing while doing a much better job of solving a significant portion of the uninsured issue.  I’d like to end the restrictions that keep these associations from flourishing and plan to do my part at the Federal level.  This is one of many inexpensive health insurance reforms that can do a lot of good and do not require the heavy hand of the Federal government.

An attendee working in real estate noted that after years of “if you have a job and a pulse, you get a loan”, banks are tightening up their standards.  Easy homeowner credit was fueled by a long series of misguided efforts by the Federal government to distort the mortgage lending market. Now, the credit crunch was hurting otherwise viable businesses.  The nursery owner noted that her business depends on a line of credit to operate.  If the bank, driven to restrict lending by losses in real estate, trims her access to this credit line she will face very difficult days ahead.  These responsible business men and women felt that they are paying the price for the folly of others.

The consensus was that government has become an obstacle, not just through taxation and regulation, but by creating great uncertainty.  What will energy costs be next year?  It depends upon the success of Cap and Trade legislation.  What will health care costs be next year?  It depends upon what version of the health care legislation passes.  I don’t think anybody believed it would relieve their burden.  All assembled believed that the course government was on would make the business environment harder.  The question was to what degree.

This input and that of many other meetings I have had will inform my policy decisions.  My opponent has a track record of avoiding talking with small businesses, preferring to cavort with representatives of well-connected corporations in photo-op summits.  No surprise that Russ Carnahan’s latest rubber stamp will be to borrow more money and watch it get funneled to the politically connected interests in Washington.  I will represent the interests of all businesses, and that includes the beleaguered entrepreneurs who cannot afford to pay a lobbyist to bend Russ Carnahan’s ear with a fat contribution.