John Arensmeyer Transcript — Sept. 16. 2025
Kevin Johnson/NPF (00:00:00):
This is a session devoted to infrastructure and anytime I’ve used that word in my reporting, editors would invariably roll their eyes, not because it wasn’t important, but because it covered such a wide swath of resources and public services. John Arensmeyer is with us today to discuss the crucial elements essential for small business to survive and thrive. John has used his long experience as a small business owner to build small business majority into a nationally recognized organization focused on empowering America’s entrepreneurs to build a thriving and equitable economy. Small business majority is the leading advocate for critical public policy issues facing America’s small businesses, particularly access to capital, healthcare taxes, fair competition, childcare, retirement, asset building, and other workforce issues, all infrastructure. In recent years, John has spearheaded the growth of small business majorities of venture eyes.org portal, providing critical practical resources to our nation’s, 34 million small businesses and independent self-employed entrepreneurs. Please join me in welcoming John.
John Arensmeyer/Small Business Majority (00:01:41):
Wow. Thanks for the warm welcome. I don’t normally get applauded by journalists, so I’ll take it. I’ll take it. And thank you Kevin and National Press Foundation for inviting me here to talk about this obviously very important issue. I want to share my perspective on the state of small business and to share insights about how you can really integrate coverage of small business into all of your reporting. As Kevin mentioned, first of all, small business majority. We’re a national small business organization focused on supporting and advocating for small businesses and also providing access to resources to small businesses across the country. And all of our work is underpinned with research that we do, which I will be referring to periodically as we talk. We have a network of 85,000 small businesses and equally importantly, we work with 1500 partner organizations, mostly some form of business support organizations around the country, whether that’s local chambers, local BSOs, as we called, business support organizations, technical assistance providers, really any organization that has in its mission the policy of supporting small businesses.
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So they are partners of ours. We work with them to help provide resources. We engage them on policy and advocacy issues, and they’re really critical. We are really about giving small businesses a seat at the table. Small businesses really don’t have the infrastructure to do that most of the time the way maybe large businesses do or labor or other environmental organizations. So we really see it as our role is to provide the forum for them to express their views, share their stories with policymakers, and as I said, we also make sure that they’re educated about policies during the pandemic. That was really critical that we educate them about PPP and idle loan programs and kind of make sure that they are connected to well vetted resources. And as I said, our research underpins all of this. We have 30 team members working from 11 offices across the country and we’re very excited that we are celebrating this fall, our 20th anniversary.
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So three themes that you really need to keep in mind and you all cover business. So you probably know all of this. Quite frankly, when I started small business majority, even though I’ve been an entrepreneur, I didn’t know so many statistics, I was surprised at some of these statistics. So I will tell you, you probably know the general public is not that familiar with these statistics, so I want to reemphasize them. Small businesses account for 99.9% of all businesses. They employ more than 62 million people, nearly half of our private sector workforce and responsible for two thirds of net job growth. And what people really need to understand is 80% of them employ fewer than 10 employees, and in fact, many of those are self-employed.
Speaker 3 (00:05:02):
Could you just to begin, how many I missed the first percentage of
John Arensmeyer/Small Business Majority (00:05:07):
That, of which
Speaker 3 (00:05:09):
What you just said,
John Arensmeyer/Small Business Majority (00:05:10):
62 million workers are working small business and then they’re responsible for two thirds of net job growth and 80% of businesses employ fewer than 10 employees. And that’s where we focus. We focus on the smallest businesses. People ask me that, I just was at a conference today, oh, what do you consider a small business? Well, you can argue that different ways the SBA says 500 or less. We think that’s a little insane. You could say a hundred or less, but we really spend most of our time focused on 25 or less I would say, and in particular the really smallest businesses, quite frankly, they need the most help. They’re the largest number of businesses, and so that’s where we focus our energies.
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Really important, as you probably all know, 21 million new businesses have been formed in the last five years coming out of the pandemic. And this is a reversal of previous trends. So we are seeing an actual growth in entrepreneurship. Many of those are small, most of ’em are self-employed people, but they’re not only going to survive, some haven’t survived to date, but it’s a real change and it’s something that really we need to understand as we focus on small business issues. That’s number one, the importance of small business in the economy. Number two, small business issues intersect with virtually every policy issue out there, and we’re going to talk about a bunch of those. And these are in ways that are surprising to most people, healthcare, childcare, monopoly issues. And so it’s really important that we understand that, and I can’t tell you often I get, wow, I never realized that.
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I never thought about that in the context of x, y, Z issue. The third thing I want you to remember is that the fortunes of small business, I mean the political leaders throughout everywhere, they really struggle to understand this. And quite frankly, it’s surprising given that polling shows that small businesses by far and away the most respected institution in the country, the recent Gallup polling showed that 94% of Americans regard business have high confidence in small business, 70% of that great deal or a lot the military, 62% great deal in a lot organized religion, 36% in a lot. That’s obviously a big change in recent years. Organized labor, 29% in a lot big business, 15%, but they do beat the last one on the list by one point Congress, 14%. I was wondering who are those 14%? But anyway, underscoring these statistics are, as I mentioned, that small businesses are almost five times as well-regarded as big businesses in our country.
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And we must remember that the priorities and needs of small businesses are not the same as big business. They may intersect at times, that’s great, but they’re distinct in many ways. They’re often more aligned with consumer issues and they face different challenges. To put it another way, Microsoft and Main Street do not have exactly the same needs and agenda. So this gives you all an opportunity as reporters to have new insights, uncover new scoops, and in fact, because some of this stuff is still not well enough understood out there, you have an opportunity. You have an opportunity to dive in, figure this out, and report on things that a lot of people are not reporting on or certainly not reporting on to the degree that they should. So that is a tremendous opportunity for you in my humble opinion.
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Why else is it important to focus on small business? Well, underpinning a lot of stories that get traction is conflict, and we are seeing a fair amount of conflict right now between policies and the needs of small business. The three areas that weren’t really at the top of the list nine months ago, and they’re huge now, they’re huge tariffs, immigration, particularly mass deportations and slashing of government programs. Again, these were not issues. I mean these are issues we focus on. Tariffs, not very much actually, but they have become the biggest issues in the small business community now and they’re killing small business to be perfectly frank with you. So let’s take these one at a time. Tariffs. Tariffs are a legitimate tool for organizing the economy. Every country has them as we’ve all learned, but the kind of extreme large, I would even say draconian levels of tariffs, the fact that they’re changing all the time has become is really weak havoc on small business fortunes out there.
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It’s probably the one issue that we’re hearing about the most and that people are really fired up about our latest research. I said we’d be talking about our research throughout here. 84% of small business owners are concerned about the impact of tariffs on their business. Small businesses report they’ve taken on considering a number of steps including price increases and delaying business expansion. 60% of businesses note higher cost due increases in tariffs with most saying costs have gone up between 10 and 25%. One quarter of small businesses surveyed import goods from other countries on nearly a half by American supplies from entities that use imported products. So this is huge really. You’re talking about businesses coming out of the pandemic and has thin margins and this is really creating big problems and they have no choice in many cases, but to pass the costs onto customers or close their doors, even large businesses are one, they have more flexibility to absorb these shifts and changes, and two, they are in a position to lobby for exemptions in a way that small business is not.
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Now, there is a bill on Capitol Hill now to provide funding and relief for businesses. Small businesses have been impacted by tariffs, but they don’t have the ability to go and negotiate with the administration on a particular industry or a particular line of products. So the one thing, last thing I want to mention is most small businesses would love to buy domestically. The economy has changed. Supply chains have changed in the last 20 years, and either these products are in short supply and very expensive or they don’t exist at all. And oftentimes a business is buying from a supplier who’s buying imported products. They don’t even have control over that. Those who do and import, they’ve shifted around some of their sources of supply, but it’s really become a problem.
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Alright, that’s number one. Number two, immigration and the mass deportations. I’m sure all of you have seen in your communities the impact of these deportations on businesses. It’s notable as I’m sure immigrants are twice as likely as the average citizens born American to start businesses start small businesses and they create one in 10 US jobs. So they’re really essential to our job creation and our economic growth in the country. This is something that is agreed upon by economists across the entire ideological spectrum. From the chamber to the most liberal, progressive business focused organizations. There is very little disagreement about this among most economists and most business leaders out there.
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Our growth depends upon an ever-growing workforce that has traditionally and continues to be fueled by growth immigrants and the mass deportation is leaving businesses fearful, their workers fearful and really driving incredible labor shortages, not just read today and the farmers can’t get their crops harvested. I’m not telling you anything you don’t know, but this is really important to understand. We hear about this all the time from small businesses, but to be honest with you, unlike tariffs where they’re willing to speak out, it’s hard for us to find businesses are willing to speak on this for obvious reasons. They are scared, they’re scared if they speak out, they’re going to be targeted. And so it’s more of a challenge to advocate on their behalf. Our polling shows that more than one third of entrepreneurs are concerned about messy deportation in their own business. That’s more than a third.
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And almost 70% are concerned about the negative impacts on the economy. So they are aware of what’s going on. Just a couple examples in our network, Los Angeles restaurant owner told us her entire kitchen staff didn’t show up for days out of fear. A Phoenix venue operator said that instead of the record breaking years, getting expected businesses down dramatically because immigrant communities are afraid to hold public events and your company may not survive a staffing agency in Philadelphia that helps train Haitian nurses no longer has clients because of this. So it’s across the entire economy.
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So just there are many stories out there and as I said, we got some of them anonymously, but it is harder to relay them when we can’t put a face to it. So instead of allowing mass deportations, we need, we’ve arguing this for years as have many other people. We need a comprehensive immigration policy. Small businesses don’t want to break the law, but they need workers. We need obviously to lock down the border. We need to deport criminals, not criminals because they lied about their immigration status, but real criminals. But we need a system that provides for varying levels of legal immigration allowing people to legally work. And it is simple. I mean, small businesses don’t want to have to play games or break the law. So anyway, unfortunately we’re going in a different direction.
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Third issue that’s really hitting right now or cuts to government programs, we weren’t even, as I said, this was not a big issue a year ago. Many government programs were completely bipartisan. The small business administration was founded in the Eisenhower administration, 1953. It has been supported by Democrats and Republicans and it has supported businesses across this country since its inception. The Minority Business Development Agency, the law was signed by President Nixon. So these were not founded as controversial agencies or support mechanisms for businesses. What do we see now? 43% of the SBA staff has been laid off and they’re being asked to handle student loans. We haven’t heard too many detail about this, but really, I mean this is not exactly an agency that has expertise in managing student loans. A whole bunch of their funding for business support organizations have been cut in women’s business centers.
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The SCORE mentor program, veterans Business centers. So that’s a huge cuts to the SBAI mentioned the Minority Business Development Agency. It’s the only agency dedicated to supporting minority entrepreneurship. It’s been reduced to wait for it one. Why is that? Because it was authorized by Congress. So they can’t shut the whole thing down. So they have one employee there. Despite the fact that MBDA has a strong track record of offering a fantastic RO, I received almost $70 million in funding for fiscal year 25 and the previous fiscal year with a similar budget and help businesses access loans totaling more than $1.5 billion. And BDA also leveraged funds from the State Small Business Credit Initiative and they were authorized, they were the lead in terms of providing funds for technical assistance for business as part of the S-S-B-C-I. And it was very successful and was moving forward at a clip through 2024. Speaking of state small business credit initiative, S-S-B-C-I, this was actually something that was originally came out of the Great recession in the Obama administration, started incredibly successful in providing funding for equity and debt capital products with a 10 to one leverage ratio, meaning that for every million dollars that was put in, $10 million in private financing was provided.
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That has been supported by partisan level. All the money has been allocated. Not only has it been authorized by Congress, it’s been allocated and yet they’re living deathly fear that they won’t be able to distribute about half of the money that’s still remaining. And this has been a successful program. Republican governors have loved it. They’re able to launch programs. They don’t have to say the money came from Washington and everyone’s happy. So the last thing I wanted to point, I want to mention about a federal program, and this is what is so, I hate to say it, infuriating the community development finance institutions, the CDFI fund completely supported by bipartisanship. They just announced the administrations announced they were going to cut off all funding. There’s been a strong bipartisan pushback. There’s something known as the CDFI caucus in Congress, 10 Democrats, 10 Republicans sent a letter. Secretary Bestin is in favor of it, but OMB director vote wants to cut it. And this is money going to CFIs that are providing capital for housing but also for small businesses with the greatest need. They provide the technical assistance that goes along with it. And as I said, it is, it is had bipartisan support. It doesn’t seen too much of that on Capitol Hill, but to get a letter signed by 10 Republicans and 10 Democrats, that does say something.
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So a couple of research points on this, needless to two thirds of small businesses in our polling are opposed to these cuts and 79% of entrepreneurs are really worried about the SBAs Flagship seven A program. Alright, those are the three big conflict issues that are new this year. Then we have other issues, and I’m not going to cover all of them, but many of them that where small business issues intersect. The first is healthcare and we actually cut our teeth and launched ourselves on the back of initially state healthcare reform programs, including California, and then on the lead up to the agate. And this is research that we’ve been seeing consistently for years. Small businesses are unbelievably impacted by rising healthcare costs for them and their employees. And so we see recently insurance premiums have increased by 78%. Deductibles, copays, prescription drug copays have all gone up and unfortunately businesses are having to make tough choices. Now the level of support, the level of is providing healthcare through the business is going down there is the option of the exchange. We’ll get to that in a second, but on the exchanges, but that is something that continues to be a huge issue.
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A couple other statistics here, 29% of businesses in our most recent polling have cut benefits. Nearly half have moved to an insurance plan offering more limited coverage, and one quarter of these businesses have dropped healthcare coverage altogether. So right across roads when it comes to funding for healthcare, I just talk about focused on two issues here. One is, and again, this is where people don’t think of business, small business issue, Medicaid, the cuts to Medicaid in the one big beautiful bill, they don’t go into effect until 2027, but they are going to wreak havoc. Over 7 million small business owners and employees are on Medicaid and a third of all people enrolled in Medicaid have some connection either through their own employment or through a family member’s employment to the Medicaid program. So if these stay, it’s going to have a huge negative impact on small businesses.
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No surprise, 76% of small business owners in our polling oppose these custom Medicaid while only 12% supported them a ratio of more than six to one. There’s more. So right now you may be aware, one of the biggest fights on Capitol Hill is what’s called the extended premium tax credits. The premium tax credits are the credits you can get based on income to buy into the exchange and they were expanded during the pandemic and that expansion has allowed them to cover a lot of small business owners and small business employees that weren’t covered or at least gives support and given off ramp for businesses and their employees where their business isn’t offering anymore.
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So that’s what’s going on here. In 2024 record, almost 20 million people qualified for premium tax credits and 21 million people signed up for a marketplace coverage. So what’s going on is it’s actually a big issue right now and the Democrats are threatening to not vote for a continuing resolution for the 2026 budget unless the Republicans or at least enough Republicans come to the table and say they’re going to increase these extended premium tax credits run out at the end of this year. I should have pointed that out. So this isn’t like Medicaid versus another year down the road. This is a here and now issue and it’s a big small business issue and we’ve been involved in a whole bunch of meetings and events on Capitol Hill and quite frankly, Republicans are sweating quite a bit about this because if these go away, it’s going to not be a great thing for them as they head into the 2026 midterms. Needless to say, 70% of small businesses in our research support extending these credits. So there’s a lot of other healthcare issues, but those that Medicaid and their premium tax credits are huge childcare, you wouldn’t think that was a small business issue.
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It’s estimated the US economy loses 122 billion a year on due to childcare challenges. Businesses lose an average of over 1600 a year per working parent because of insufficient access to childcare. These financial losses are no doubt felt by the smallest businesses and they simply can’t afford to lose this kind of money and this kind of productivity in their businesses. So our research, the majority of small businesses agree the lack of access to affordable high quality healthcare childcare for their own children created an impediment for them to start their businesses that were over half who said that? And same percentage to grow their business. Their own childcare issues include taking out substantial time away from the business, losing out on business opportunities, need to hire additional help and even shutting down their own business for their employees. The issues are lower productivity, inability to operate longer hours.
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These are all percentages we pick up on our polling of issues that were impacting small businesses, lost revenue or earnings work absences, employee resignations, candidates not accepting jobs and so forth. And again, small businesses are often competing for employees with larger businesses who can actually help provide coverage of small businesses can. So bottom line is 60% of businesses in our polling field that employees childcare issues have negatively affected their business. And again, you get another opportunity to look at an issue that isn’t just small business but has a strong small business component to it and cover it on that basis. So these issues about portable healthcare and childcare, other benefits, these are even more important now as I mentioned with the 21 million new businesses, many of whom are self-employed, and in fact the whole self-employed economy is poorly understood. I’ve had, and I will not name names, a very senior official in administration, economic official, very senior, tell me that, go ahead tell me that.
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Self-employed people don’t create jobs really. I think they create their own jobs and they may grow to where they will actually create more jobs. It’s just a poorly understood and poorly appreciated huge sector of our economy. We’re going to see more and more Americans choosing this path, flexibility, desire to be their own boss, ability to use technology in ways that couldn’t use it before. And so this is a hugely overlooked area and we need to focus on it and make sure that we’re taking care of their needs. And again, a lot of their needs intersect with needs of ordinary consumers but not well understood that it’s actually impacting our economy.
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Another big central issue for us is access to capital. We’ve already talked about the cuts to SBAS, SBCI and BDA, but businesses need capital. Not all businesses, but many businesses do. In the last year from our polling, over half of businesses have taken steps to access funding or capital. They’ve pursued traditional bank loans, grants, SBA loans, loans from CDFIs or nonprofit lenders, venture equity capital and crowdfunding of the entrepreneurs that pursued funding for their business, only one third were able to secure what they needed. Among those who were funded more than four in 10 reported it was only partially met their needs. Only around one third received sufficient, as I said, receive sufficient funding. So what happens? Well, you need money. I ran a business. There were times when I didn’t know if I could make payroll. It’s awfully tempting. Somebody’s dangling money out there for you and there’s a lot of that out there.
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You online looking for quick money as a business owner, there’s money out there for sure, but it comes with a huge catch. It ends up, first of all, the rates and the terms are not properly disclosed in these predatory loans. Interest rates are so high that business may actually have to go out of business. It doesn’t matter the people making a loan get their money, they don’t care if the business takes around, they’ve gotten their money, they move on. Unlike consumer loans, small business loans are not covered with the same protections around disclosure of rates of a PR. And so this is a huge loophole because again, all these businesses, they have to put their personal collateral up, they have to put their home up, they have to put all their assets up sometimes. So to not treat it as a consumer loan and not give them the same protections is crazy. And many of these cases, the fees that are added on can raise interest rates as high as effective interest rates as high as three 50%.
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As I said, in many cases the business is just going out of business and all of this is perfectly legal. So all we’re asking for initially is disclosure, provide the same disclosure requirements for consumer loans, for small business loans. And we’ve succeeded in a few states, not enough. New York, California, Illinois, we’ve come close, but we’ve tried to do this on the federal level. You would think this was a bipartisan issue. And of course some Republicans on Capitol Hill used to be in support of these sorts of disclosure requirements, although not this specific one and it’s not. It’s just we haven’t been able to turn it into something.
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87 in our research, 87% of small businesses support some kind of truth in lending bill for small businesses. Only 1% said they were opposed to that. So this is a huge problem and I’m sympathetic because quite frankly, I took a few loans I probably shouldn’t have taken. So when you’re backs up against the wall and you’re trying to keep your business afloat, this is reality. Just a couple other issues here. I mentioned sort of the difference between big and small businesses and our entire economic system is indeed, I’m trying to sound inflammatory here, but it is skewed toward the benefits for big businesses. And we do have issues in promoting a fair competition where all small businesses are asking for is a level playing field. Again, our research, 56% of businesses say one or more large companies dominate their industry. Same percentage agree with the statement.
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Large companies have an unfair advantage in my industry or line of work. Small businesses favor a number of policies to make it easier for them to compete. 84% support a full disclosure, 80% favor enforcing existing antitrust laws, protecting small business against any competitive practices, 76% specific prohibitions on certain predatory lending practices under the Biden administration. And by the way, a lot of these laws were more ab under both Democratic and Republican administrations. I don’t want to single out one party or the other. It was for the last 30 40 years, the Antitrust enforcement fair competition enforcement has been very, very slow. Federal Trade Commission under the Biden administration did take some substance direction. They passed a rule banning non-compete agreements. Most non-compete agreements, I have to say this shouldn’t be a partisan issue. There are three states that have non-compete bans, California, Oklahoma, and North Dakota. That is a nice range of bipartisan blue and red there. So it’s not just blue states or blue folks that have done that.
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They took steps to enforce something called the Robinson Patent Law, which is a new deal era law that prevents price discrimination. We have stories all the time of businesses who are paying double for their supplies, what their big competitors are paying and it’s not legal under ROMs impediment, it has not been properly enforced. And they’ve actually started examining a whole area of unfair franchise agreements. So they didn’t end up passing a rule that regard. What’s interesting about this issue is there’s actually bipartisan populous bipartisan support for some of this. You have some really interesting bedfellows. You had Bernie Sanders and Senator Klobuchar on one side of this issue. You had Josh Hawley and Mike Lee. Very strong members of the Senate equivalent of the Freedom Caucus agreeing Josh Hawley even went so far as to praise Lena Kahn, the former head of the FTC. So there’s an opportunity I think to get something done here. This is not just a democratic issue. The Trump administration has pulled back. They did pull back on the non-compete rule, but they have indicated that they’re open to looking at some solutions to this. So it’s not going to be quite what the last administration did, but they are open to that. Alright, the final issue I wanted to talk about, which was in the news a fair amount over the summer is tax policy.
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So one was just a couple of statistics from our polling here. Sorry you’re hitting with the polling. Over 80% believe that our tax system favors the largest corporations over small businesses and the large corporations don’t pay their fair share of taxes. One thing I want to add here is that polling we’ve done over the last 20 years shows that small businesses accurately, they’re not opposed to government intervention is often the case. I mean, nobody likes regulations obviously, and there needs to be fair and balanced regulation. They think that government’s in collusion with big business against them. So that’s their concern.
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There are many provisions of this. Summers one big beautiful bill we’ve already discussed one of them, the cuts to Medicaid. So I’m just going to talk about one more. I mean there are so many tax provisions in there. This is the what’s called the pass through deduction. Now you maybe familiar with this 1 99 A is what’s referred to sometimes this enables pass through entities of which most small businesses pass through their profits and are taxed at their personal level to deduct 20% of their profits of their business profits from their personal income tax. It sounds great, right? Well who would be opposed to that? The problem is when you’re doing the math and you look at the data, 73% of the benefit has gone to 5% of the pass through entities. So it’s a combination of the tax rate being higher for those entities, the tax rate being higher and the fact that they have more revenue.
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So some will say, well sure, I was testified in congress a couple years ago and I had a senator saying, well that’s crazy. Of course the bigger businesses you get more. And my response was, you don’t have to design it that way. You can design it any way you want. So we came up with a proposal that said, let’s do bottom up instead of top down, let’s give. We didn’t want to eliminate the pass through deduction. We wanted to say take the first 25%, first 25,000 and you can deduct it and then you have a cutoff. So what you’re doing is you’re benefiting the businesses who need the benefit the most.
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You’re not benefiting, they getting trickled down right. Now a statistic in here somewhere, I want to make sure I have this right, that businesses in the highest earning businesses a average deduction of over a million dollars and the smallest businesses with incomes below a hundred thousand took home an average of just under $2,000. So again, you can design any law any way you want and you can say we really want to help the smallest businesses here. And so that was something that unfortunately did not go through. They just passed it as it always been. Again, 74% of businesses we poll, and by the way, our polling is usually plurality Republican, heavy, independent. So these polls we take are not, they’re not skewed toward one party or the other. And in fact the respondents lean in some cases slightly Republican. So this is the reason we exist is to give voice to Main Street small businesses on these and other issues.
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As I said, most small businesses don’t have the resources to sort of lobby and advocate on their own. And in some cases business organizations out there still conflate the needs of bigger businesses with smaller businesses. So we’ve got a long ways to go to level the playing field and we need quite frankly, your help in getting the word out there and just the facts, just the facts. As I’ve tried to make this presentation as I do all the time, these are the facts. This is not ideological. This is if this is a part of our economy that is so important, so many lives are connected to it, it intersects with all these issues, let’s support it. And one thing I forgot to mention, what’s so important to our work, I mentioned that folks talking about terrorists, not when they’re talking about immigration, the stories are so important.
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I was just at a conference today and small business owners were telling their stories about what they’re experiencing that is way more powerful. So a major thing that we do, my colleague Simon Brown here, our PR director spends a lot of time on this, is connecting business owners with the media, with the press and more and more, and this is fine with me, the reporters are more interested in talking to the business owners and finding out what they’re doing than talking to me. And that’s great. So with that, I will thank you again and happy to answer any questions you have.
Kevin Johnson/NPF (00:41:07):
I’m going to start just with one quick question. We had two small business owners here earlier this morning who made no bones about how difficult the environment is out there and you just referenced a number of small business owners are telling the same story. When does that translate into major political power? And you’ve been around the hill long enough, is there a recognition or is there just a lack of recognizing what’s in front of them at this point in terms of what the political implications of this environment might be?
John Arensmeyer/Small Business Majority (00:41:50):
It’s an excellent question. You would think given the level of support and confidence in business across the country, this would be recognized. Small businesses don’t have the organized political power that a lot of other groups have, and that’s across the spectrum, labor environment, civil rights, big business, and they just don’t have that. And we have focused to date on advocacy federally and in the states, as I said, we have 11 offices across the country and we have moved the needle in the states and at different times on the hill, I think we had a major impact on helping to get the a c passed, but they’re not organized politically. And I would say that is a weakness and that is something that I’m looking at very carefully on how we might help to facilitate that. Particularly at a time when our political system is a bit jumbled and some folks are walking around in the wilderness. It might be an opportunity to do that. But it has been difficult to get some of these issues really the attention, as I said, we’ve been more successful at the state level over time, but just being there and talking to legislators and the media has been helpful. But I think small business in general, we collectively need to figure out a way to increase their political power.
(00:43:25):
Somebody else? No, go ahead.
Marlon Hyde | WABE News (00:43:27):
Marlon Hyde, WABE News in Atlanta.
John Arensmeyer/Small Business Majority (00:43:29):
We have an office in Atlanta.
Marlon Hyde | WABE News (00:43:31):
Alright, perfect. We got to talk. A lot of the small businesses that I’ve spoken to over the course of this year, they always try to veer away when I ask about potentially closing. And it’s not really, again, it’s not a thought that they want to again think about too often, but in your experience, the businesses that you represent, That you speak to, that you interact with, how real or again, how many of them are thinking about or on the verge of closing?
John Arensmeyer/Small Business Majority (00:44:08):
Well business owners are by nature gritty. They wouldn’t have done this in the first place. They got to be a little crazy to do it. And the last thing they want to think about is closing down from what we can tell in our research and anecdotally, I would say a quarter of them are very concerned, but to your point, they’re not likely to share that with a reporter. So that’s where you’re running into some issues there. I dunno if that answers your question, but I think it’s a real fear, but it’s a last thing a business owner really wants to admit to.
Tanya Babbar | Hearst Connecticut Media (00:44:51):
Hi, Tanya Babbar with CT Insider in Connecticut. You had mentioned something, I just had missed it. You were talking about businesses paying double for their supplies where as opposed to big chains, you had mentioned a lot, I missed it. I was wondering if you could repeat explaining that if that’s okay.
John Arensmeyer/Small Business Majority (00:45:13):
It’s called the Robinson Patman Act. It was passed in the 1930s doing and nearing the new deal and it has not been well enforced in recent years. It basically forbids, it forbids the suppliers from charging different rates depending on simply the size of their customers.
Tanya Babbar | Hearst Connecticut Media (00:45:39):
Sorry, if I could just ask a quick follow up. What do you mean by not well enforced? Could you expand
John Arensmeyer/Small Business Majority (00:45:46):
On It hasn’t been, there’s not a private right of action right now, so it would have to be enforced by government and as I said, government under both Democratic and Republican administrations has not enforced a lot of anti-monopoly fair competition laws over the last 40 years dating back to the eighties.
Diara J. Townes | Sandhills News (00:46:07):
Thank you. All right. Hi there. My name is DJ Townes. I’m with the Sandhills News down in central North Carolina. My question is regarding SNAP benefits. I know that because of the big beautiful bill, there are cuts coming and mainly I want to know what’s that impact between grocery stores, farmers and so forth. And then the follow-up is the distribution of those benefits, is it dependent upon the federal fiscal schedule? Because if so, the fiscal year starts 2026, which means these cuts would happen on October 1st. I’m not sure if you would have that information, but trying to work on a story to help let folks know when should they expect cuts to their SNAP benefits.
John Arensmeyer/Small Business Majority (00:46:50):
We’ve probably not covered the SNAP stuff as much as we should have and Simon jump in here if I’m missing something that we’ve done. But yes, I mean both impacting both the stores who are going to lose revenue, but also impacting the lives of the people who are not only spending money at the stores, they’re spending money elsewhere and no doubt have to cut back elsewhere if they don’t have the support to buy food. So it’s just another example of a program you don’t think of as a small business issue. That, and I’d be happy to try to get some more information for you that I don’t have all the stats on the top of my head, but there were a lot of provisions of the one big beautiful bill that we chose to focus on a few. But yeah, I mean it’s analogous to the Medicaid situation.
Diara J. Townes | Sandhills News (00:47:49):
I am curious with a lot of the statistics you’re citing, what is generally the sample size that you’re looking at?
John Arensmeyer/Small Business Majority (00:47:56):
It ranges. I’d say on our polls it’s between three and 500 nationally. We like to get 500. Don’t always get it. We also do some surveys of our network and we recognize those are not scientific. Our network is made up, but we also want to get a sense of the folks who are connected to us. But the polling, it’s about three to 500. We have had a few that are higher. Sometimes we’ll do an over sample of like a hundred in each in certain states, but the margin of error is usually about plus or minus four to 5%.
Omar Mohammed | The Boston Globe (00:48:36):
Sorry. Hi Omar. Mohammed from the Boston Globe. I have a question about childcare costs. You talked about that being one of the critical issues that your members are facing. I was just curious about how businesses are navigating that, especially since for most of your members, they seem to be solo entrepreneurs who have to
John Arensmeyer/Small Business Majority (00:48:58):
Yeah, I mean big businesses in many cases are offering childcare and it’s actually a bill in Congress that would provide tax credits to businesses that offer healthcare, which is not something, excuse me, that provide childcare, not something a small business can do. So they don’t have that option. Basically they end up having to navigate a workforce and even many cases their own lives that it’s just an added burden. I gave some of the statistics we got from our polling about how businesses and their employees are responding to this, but it is disruptive and in some cases they’re not able to survive. In some cases the childcare providers are not able to survive. A lot of them are small physicists themselves. So I don’t have a great answer for you because there isn’t sort of a magic bullet. Most developed countries around the world have a more robust system for childcare.
(00:49:52):
And again, it’s an economic benefit. It’s not just because being nice. If you’re going to have an economy where in many cases both partners are working, you’re going to need to have a system of childcare that makes it affordable for people to work and participate in the economy. But I think I level some of they cut back hours, they’ve had to juggle shifts. In some cases they haven’t been able to hire someone, they have to spend longer hiring. So it isn’t that they have any magic bullet solution, it’s that it’s how are they ducking and weaving from all the things that are being thrown at them. It’s just one more set of challenges that small business owner faces.
Omar Mohammed | The Boston Globe (00:50:32):
I’m just curious if that innovative, I mean unfortunately is a fact of life in the US where that’s a huge challenge. I’m just curious, are there kind of innovative way where folks are having because they have to figure it out that maybe we could write about? That’s what I’m
John Arensmeyer/Small Business Majority (00:50:54):
Trying to see. Yeah. Yeah, I think summer may perhaps forming co-ops, but we haven’t heard a lot about that because again, that’s challenging to manage and figure out. So I don’t have a lot of stories that there were expanded support for childcare that ended a year ago, October a year ago, I think it was a year ago, not two years ago, and did not get, the Democrats were a hundred percent in favor of continuing the additional support. It was pandemic level. Again, the argument on the other side was, well pandemic’s over, why do we have to keep doing this? And that actually kept the childcare costs down and the availability of providers higher. So we can get back to you and see if there’s any others folks on the team who work on childcare more than I do. So we’ll get back to you on that.
Matthew Glowicki | Courier Journal (00:51:56):
Hi, my name’s Matt Wickier Wright for the Courier Journal newspaper in Louisville, Kentucky. Wanted to ask you your thoughts and what you’re hearing from your members on two different topics. One of which is the no tax on tips, no tax on tips provision and any implementation or concerns that you’re hearing. And then earlier this afternoon we had a session on AI and concerns that small business owners might have about that or opportunities there. Curious what you’re hearing on that front.
John Arensmeyer/Small Business Majority (00:52:33):
Well, on the tips, and we haven’t delved into the issue in detail as I think you all know, it’s not as pristine a policy as it was sold. And there’s certain limits and it’s definitely created in restaurants. It’s created friction between the servers and the kitchen. The folks in the kitchen who are not getting tipped, and we haven’t hold on this. So sort of speaking personally, income is income. I mean, there’s not really an economic reason to say this kind of income should be taxed and this kind of income should not be taxed. And particularly because it only impacts certain people working in certain industries and there’s no real reason to do that. We have heard that it’s been, and so I don’t have a lot more to offer than that ai, you use the two words that are important opportunity and concern. Absolutely. And we did do some polling on this.
(00:53:40):
I didn’t include it in here. Not a lot of policy work going on now, but hopefully there will be. Small business owners really want to know better. I mean, first of all, they’re already using ai, they want to be trained better, they want more resources to help them use AI effectively. There’s no question that AI can be a huge benefit marketing inventory managing the whole business, no question about that. But consistent with my comments about the concern about the big businesses dominating the economy, we have seen in this research, we did see that small businesses are very concerned that the big guys and gals are going to dominate. They’re going to use it more powerfully, more effectively and exacerbate the lack of a level playing field. So yes, opportunities for sure, but so many other policies, we need rules of the road and that is an issue we’re going to be getting into involved in even more. And as I said, we did some initial research on it.
Ashley Murray | States Newsroom (00:54:55):
Hi Ashley Murray from States Newsroom. I’m wondering about retirement savings infrastructure and small business owners, particularly like the 10 employee or under one employee. Someone in my family who’s approaching retirement age as ven a sole proprietor. Imagine that. And let’s just say the retirement planning has been underwhelming. So that makes, I
John Arensmeyer/Small Business Majority (00:55:24):
Was an entrepreneur. So imagine that.
Ashley Murray | States Newsroom (00:55:26):
That makes me think wonder how widespread of a problem this is or is it just like a financial literacy problem and people who are educated all have SEP IRAs? What are the big issues here that you’re seeing?
John Arensmeyer/Small Business Majority (00:55:44):
It’s an issue that we’ve dealt with. I was going to say a couple of things about it. It is a problem. It is a big problem individually and also macroeconomically, the gap that exists out there. I will tell you, well a couple of solutions. Something, what was it? 2.0, the big retirement bill that passed two years ago. Secure. Was it secure? Yeah. What was the name? I’m blanking on the name. Anyway, it actually did provide a bit of an opportunity for, it expanded the opportunity to save for retirement. It gave credits to businesses that are offering expanding their retirement programs. And in this number of states, I’d say it’s like 15, 20 states now of passed secure choice programs that where the state has come in and is basically managing a retirement program. I mean it’s still private retirement insurance, but they’re managing the platform and in many cases have required businesses, in some cases all businesses, some cases above five employees, some cases above 25 employees to require them to offer this on an opt out basis, which opt out under the research shows that if it’s opt out, you’re more likely to stick with it.
(00:57:12):
So great. I’m actually good friends with the former state treasurer of Oregon, who was the lead, the person who actually, I dunno if anybody from Oregon here, but I’ll put it in a plug for him now. The Secretary of State, he was the lead in coming up with this kind of estate program. So that is an option. There’s a big but here though of all of the issues that we deal with getting small business owners fired up about, this is at the bottom of the list. We really struggled. We got funded to work on this issue, all these state initiatives that were in Illinois and California and other states that we worked on. We then had went out and tried to get people to come to webinars, seminars and get them information. It was like pulling teeth with everything that’s going on for small business that we just talked about, the current crises and certainly all the other stuff, taxes, healthcare, access of capital. It has been, and you alluded to this, it has been bottom of the list and too many small business owners, and I was guilty of this myself, just kind of ignored it as it was moving along. So it is politically challenging even though economically it’s hugely important.
Ashley Murray | States Newsroom (00:58:33):
Even though social security is going to be insolvent and the Social Security trust fund is going to be insolvent in a decade or so, that does not,
John Arensmeyer/Small Business Majority (00:58:43):
It’s really hard light a fire. People in general, including small business owners fired up about something that’s going to maybe happen in 10 years. I’m not saying it’s not important. And I would say we spent four or five years heavily involved in this work and quite frankly we’re funded to do so and we struggled. We struggled.
Kevin Johnson/NPF (00:59:12):
Probably last two.
Olivia Evans | Courier Journal (00:59:15):
Hi, I’m Olivia Evans at the Courier Journal in Louisville, Kentucky. And I’m wondering when you say the self-employed economy, are you considering or factoring in contract workers, freelancers, gig workers? And regardless of if you do count them into how you identify that, what influence or impact are you seeing those workers have on small businesses and how are small businesses impacting and influencing that category of workers?
John Arensmeyer/Small Business Majority (00:59:42):
Your first question was the small business economy. That was the beginning of your question. How do we define that?
Olivia Evans | Courier Journal (00:59:47):
The self-employed
John Arensmeyer/Small Business Majority (00:59:48):
Economy. Oh, the self-employed. Yeah. It does include all of those. However, we’ve tried to stay away from the gig economy because first of all, there’s people who are misclassified and should be employees. No question about that. On the other side, there are people who sell legitimate businesses and they’re undervalued. And I will say some folks on the left say that’s not, oh, that’s not good. They’re being abused. You want to start a flower shop, you’re not being abused. You don’t have to be a W2 employee. So in between that, you’ve got a range of people and the gig economy, it got so caught up with Uber and Lyft, it’s tough. I mean, in many ways self-employed are both workers. And my point about the person saying they don’t employ people, they’re both workers and businesses. We choose to look at them as businesses. We recognize their needs though or any other worker, and we don’t think there should be a discrimination against them because they’re running legitimate.
(01:00:54):
I don’t mean misclassified, I mean legitimate small businesses, legitimate solo businesses. And we look for a system where they can have access to healthcare, childcare, paid leave and other programs where it’s honored. Not everybody agrees with this on the left, quite frankly. They think no, they’re being abused, they shouldn’t be. So when we talk about small business economy, the self-employed economy, we do include generally those people. But we kind of stay away from the Uber, Lyft sort of fights and there’s kind of a blurred line in the center there. And we’ve chosen to not go head to head on coming up with a bright line other than you shouldn’t misclassify people. I think the other part was how to small small business owners themselves use my business. I didn’t first hire employees. I hired some contractors and freelancers to help me when I got going.
(01:01:55):
It was probably a year or two before I actually hired a W2 employee. That’s very common. And again, what we hear from small business owners, they want that flexibility. They don’t want to feel they have to hire a W2 employee. They want to know, well, there’s legitimate freelancer out there who can help me 20% of the time, 50% of the time, whatever it is. Now, if they come in, they’re working for you a hundred percent of the time, they’re probably really an employee. So that is a big need and that is definitely one that where small businesses want the flexibility to be able to hire contractors.
Jasmine Robinson | Verite News (01:02:30):
Hello, I’m back here. My name is Jasmine Robinson. I’m a reporter for Verite News in New Orleans. And my question is kind of similar to that one on the topic of self-employed. The self-employed workforce, I do a lot of reporting about self-employed folks who sort of operate in what some people would call the underground economy in New Orleans. So we’re talking like street vendors, street artists, street performers, musicians, essentially anyone making a living, but they’re not necessarily paying taxes on it. I guess that’s how I delineate a legitimized business, self-employed person, street vendors along those lines. So I’m curious, can you talk about just your thoughts on that sort of underground economy, but also are there any particular hurdles for people in the underground economy to legitimizing their business?
John Arensmeyer/Small Business Majority (01:03:30):
Yeah, absolutely. That is actually the economy you’re describing that is a huge part of the economy and it’s one, quite frankly, our bias is to, we want to support those people. If you’re going to go out and you want to have a food truck or sell food from your home, quite frankly, which is not allowed in a lot of states, we got the law passed in California to allow. It is. That’s great. It’s all what I was saying. We encourage people to go out, make their own way, be their own boss, control their lives. Now we also encourage people to pay taxes. So we would never advocate, it’s okay to do that. What these folks need support. They need resources. They need access to resources, which is very hard to get in, more in under-resourced communities or that’s urban, whether that’s rural. And so that’s the solution is to get them resource, get them educated. You really need to pay taxes. Oh, you hired somebody. Not a lot of people don’t hire anyone, but you got to pay a minimum wage. So it’s a combination of resources and educating them. But we absolutely, you are absolutely right. There is a huge part of our economy. Again, not well understood. I say one thing about this economy, we’re talking about the self-employed and people don’t understand it. We come into contact with these people and we do business with people every day, every legislator, every member of the administration, all of us, this is like, we don’t even think about it. These are people who are part of our lives. So, so that is a big part of the economy.
Kevin Johnson/NPF (01:05:15):
Well I want to thank you all for your great questions and John, especially for the great message and commitment of your time today on an ugly day.
John Arensmeyer/Small Business Majority (01:05:26):
I’m going to put in one plug and Simon will kill me. But Simon is a resource for those of you who are covering these stories in your respective areas. And we’ve got offices around the country and we’ve got small business owners in every state. Sorry Simon. So we welcome we, we are here to help you and provide you with information and provide you with support and provide you with access to research and small business owner voices. So please think of us that way, but thank you very much. Thank you. Thanks sir.
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