Inspecting The Lobbies

Are small-biz advocacy groups worth your time?

Maybe you'll be elated by the election results. Or disgusted or ambivalent. No matter which, it's important to remember that it's not all over on Nov. 3. Numerous national organizations constantly lobby on behalf of small businesses. Two smaller ones have national aspirations. But is your voice really being heard? And are any of these groups worth an investment of your time?

At first, the four large organizations -- the U.S. Chambers of Commerce, the National Federation of Independent Business (NFIB), the National Small Business Assn. (NSBA), and the Small Business Survival Committee (SBSC) -- look uncannily similar. They all lean Republican, though the NSBA stresses that it is bipartisan. Their top concerns are health care, taxes, insurance and liability costs, and regulation. They all back decreased marginal tax rates, permanent abolition of the estate tax, medical malpractice and product liability reforms, and better policing of government agencies under the Small Business Regulatory Enforcement Fairness Act.

But there are subtle differences -- in the opportunities each group offers to get involved setting policy, in philosophy, and in health-care strategy.

If you're looking to play a very active role, you might consider the Chamber or the NSBA. The Chamber has the broadest agenda, from health insurance to transportation infrastructure. Its small-business priorities are set by 100 business owners active in their state and local Chambers.

The NSBA follows the direction of a 30-person board elected from and by the membership. All members are encouraged to serve on one of five key- issue committees. The NSBA also has monthly "meet-ups" in 600 cities.

Members voice their opinions through surveys at the NFIB. Those surveys ask members to rank their concerns as well as proposed solutions. The NFIB's leadership decides how to respond to each.

The SBSC tackles a wider slate of issues, with member input solicited via e-mail. The SBSC supported the Cingular/AT&T Wireless (AWE ) merger, for example, saying the merged company would enable small companies to get broadband access more quickly. President Karen Kerrigan and a three-person board set strategy.


The differences in the groups' philosophies can be seen in their approaches to the Small Business Administration. While all claim close ties to the SBA and its Office of Advocacy, neither the NFIB nor the SBSC was particularly upset when the 7(a) loan program ran out of money early in 2004. "We try to advance things that allow small businesses to be more self-reliant for their capital needs," says Kerrigan. Dan Danner, the NFIB's senior vice-president for public policy, says that the NFIB's surveys do not show that its members have trouble getting access to capital, so SBA loan programs are not a priority.

The NSBA and the Chamber, on the other hand, think the SBA can be a valuable partner to some small companies. Both want to continue federal appropriations for the 7(a) loan program next year, even though the Bush Administration wants to eliminate them. Giovanni Coratolo, director of small-business policy for the Chamber, says: "We are all for a robust 7(a) program. We feel it was the wrong move to shut it down."

Health care is one of the few fields where the groups split on policy, though each says the health-care mess is its first priority. The NFIB is pushing for association health plans (AHPS), which would let small businesses join across state lines to buy insurance. The bill passed the House of Representatives and has been endorsed by President George W. Bush. The Chamber and the SBSC also support AHPs. But the SBSC is pushing hardest for the Healthcare Choice Act. That legislation would let individuals, but not businesses, buy health insurance in any state.

The NSBA, alone among the major groups, does not favor AHPs as currently proposed. NSBA President Todd McCracken says AHPs would be cost-effective only for the young and healthy. Instead, the NSBA wants any health-care expenses not covered by insurance to be tax-deductible. It also backs a bill to exempt small business owners from paying FICA tax on money used for health insurance, as big-company chieftains already do.


If these positions aren't in line with yours, there are two fledgling alternatives to the left of the political spectrum. The American Small Business Alliance, which is building its first chapter in Maine, sees itself as an outreach group focusing on state issues. But nationally, it favors tax incentives to make health insurance more affordable and the establishment of statewide health insurance purchasing pools. It also supports policies encouraging the use of alternative fuels.

Small Business For America, founded by four entrepreneurs, believes the existing national organizations are too conservative and is trying to appeal to moderates. Priorities are health care, access to capital, and technology. SBFA supports AHPs in general, but not the current proposal. They oppose the consolidation of SBA loan processing, and applaud John Kerry's plan to use tax credits to cut the cost of health insurance or small businesses.

Of course, not every business owner has time to get involved in politics. That's O.K., too. Each of these groups will be out there working furiously -- all in your name.

By Kimberly Weisul

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