Donald Trump is known for his massive net worth of around $4.5 billion, his wide range of business ventures over the years and his ruthless character. He may be the consummate businessman, but would he be a good President for small business? In a video on his website he claims that “I will be the greatest jobs producing president that God ever created,” so let's find out how he plans this endeavor.
Early Small Business Favorite
If you want to gauge support from a specific demographic, the place to start would be to look at campaign donations. Mr. Trump happens to have overwhelming support from the small business community for one simple reason, their leaders are looking for an alternative to the established government in Washington. The Center for Public Integrity conducted a cross sectional study about why so many small businesses are donating to the billionaires campaign and concluded that these small business owners are fed up with politicians and ready for a shake up. To these small business owners who hustle day in and day out, they can respect a candidate who isn’t settling for the status quo and won’t be bought out. Small business owners fear that the opposing candidate, Hillary Clinton, is just another Washington insider who won't offer a fresh perspective.
Trump wants to drop the corporate tax rate from 35% down to 15%, this is an easy draw for small business owners. In his own words, “No business of any size, from a Fortune 500 to a mom-and-pop shop to a freelancer living job to job, will pay more than 15 percent of their business income in taxes. This lower rate makes corporate inversions unnecessary by making America’s tax rate one of the best in the world.” Trump wants to stop these corporate inversions and ensure that small business owners are not outsourcing from overseas, thus bolstering the American economy.
Will Severe Immigration Reform Affect Small Business?
Trumps immigration policy might be a negative for small business growth. It is widely known that Trump wants to build a wall between Mexico and the U.S. in order to stop illegal immigration. He also wants to deport the 11 million illegal immigrants that already reside in the country. But, where does small business fit in? According to Forbes, around 40% of Fortune 500 companies were started by immigrants or children of immigrants.
Immigrants make up a large portion of small business startups, especially in the tech sector where global recruiting is frequent due to the increased level of STEM education in foreign countries. Under Trump’s controversial plan, companies such as Apple may have never come to fruition, Steve Jobs was the son of a Syrian immigrant and would never have had the chance to follow create the company if his father had been deported.
Cutting Government Spending
Up to this point Trump has talked about all sorts of disruption, one such initiative is to cut the $77.4 billion budget allocated for the U.S. Department of Education. This would not only be a hindrance to our higher education system, further separating ourselves from countries who place STEM education as a priority, but the DOE funds many important programs that are unrelated to public education. One which is particularly relevant to Eastern Foundry members is the Small Business Innovative Research program, or SBIR. This program is one of the easiest ways for small businesses to raise capital and without it, many ideas may never come to fruition. Google Glass is a well known instance of innovation coming from an SBIR grant, but aside from large companies using the money for R&D, the small business who rely on this grant money to succeed will likely struggle without access to the program.
What About The Tech Sector?
In a world where leaders would rather talk about the the next big tech IPO than politics, the tech scene has a had a field day when it comes to this campaign, often times in a mocking fashion. Jeff Bezos (jokingly) let it be known that he would send Trump to space on a Blue Origin rocket, while many other leaders seem to have taken up the mantra of “Anyone But Trump,” and it’s no wonder why they are so outspoken. Trump has persistently antagonized Silicon Valley, slamming Mark Zuckerberg for his immigration stance and almost boycotting Apple over its recent FBI encounter. In fact, according to CNN Money only 52 tech industry workers have made contributions to Trump.
So, will Donald Trump be “the greatest jobs producing president God has ever created?” That is yet to be seen, with the unemployment rate at 4.7% as of May 2016, it will be interesting to see where that number sits two years from now when the new president will be halfway through their first term in office. Among heated debate, and controversial ideals, Donald Trump has found himself in a position to take control of the most powerful country in the world. The growth of small businesses is often reliant on the government, and their leaders will certainly be keeping a close eye on Trump’s policies as we come closer to Election Day.
If you missed our previous blog, check out Hillary Clinton’s stance on small business.
Dan Bowman is the Communications Associate at Eastern Foundry.