Business Groups Decry Impact Of Biden’s Inflation Reduction Act

Business Groups Decry Impact Of Biden’s Inflation Reduction Act

By Terri Jo Neff |

The Arizona Chamber of Commerce and Industry is hoping the U.S. House of Representatives takes a hard look at H.R. 5376, which was formerly known as the Build Back Better Act until being recently rechristened as the Inflation Reduction Act of 2022.

“Arizona job creators oppose the vast majority of the provisions in this bill,” Chamber CEO Danny Seiden said Sunday after the U.S. Senate passed the legislation on party lines. “This bill will not reduce inflation and it will not make the U.S. economy more competitive. Renaming a massive tax and spending bill the Inflation Reduction Act does not improve it.”

Seiden says Sen. Kyrsten Sinema met with Arizona business stakeholders to hear their concerns and did help blunt some of the more harmful provisions, especially those which impact manufacturing businesses already doubly hit by inflation and supply chain disruptions

He also acknowledged there are a few beneficial elements of H.R. 5376 such as provisions which encourage continued business investment and provide significant drought resiliency funding to promote a water secure future.

But despite some of “positive aspects,” Seiden insists H.R. 5376 leaves much to be desired. Which is why he and other state business leaders are calling on Arizona’s nine Representatives to take a closer look at the bill in advance of an expected Aug. 12 vote.

“With the bill headed to the House, we would encourage the Arizona delegation to consider the legislation’s negative effect on Arizona jobs,” Seiden said, adding that that renaming the unpopular Build Back Better Act does not improve the fact the legislation is a massive tax and spending bill.

The legislation is estimated to raise $740 billion in additional revenue from new taxes as well as more enforcement of existing tax laws. It also authorizes $430 billion in new spending, although a more thorough analysis by the Congressional Budget Office has not been completed.

One thing the CBO already knows, U.S. Senator Bernie Sanders said on the Senate Floor, is that what he labeled the “so-called” Inflation Reduction Act will have “a minimal impact on inflation.”

The CEO of the National Association of Manufacturers also expressed disappointment with H.R. 5376. According to Jay Timmons, the Inflation Reduction Act will stifle manufacturing investment in America, undermining the very businesses which kept America’s economy afloat during the COVID-19 pandemic.

“To be sure, (the bill) was worse before Sen. Sinema worked to protect some areas of manufacturing investment,” Timmons said. “But the final bill is still bad policy and will harm our ability to compete in a global economy.”

Also speaking out against H.R. 5376 is the Pharmaceutical Research and Manufacturers of America, whose members will be directly impacted by Medicare drug price controls included in the legislation.

“They say they’re fighting inflation, but the Biden administration’s own data show that prescription medicines are not fueling inflation,” said PhRMA CEO Stephen Ubl. “And they say the bill won’t harm innovation, but various experts, biotech investors and patient advocates agree that this bill will lead to fewer new cures and treatments for patients battling cancer, Alzheimer’s and other diseases.”

Small Business Report Draws Attention To Lack Of Optimism

Small Business Report Draws Attention To Lack Of Optimism

By Terri Jo Neff |

The number of small business owners across America who expect business conditions to improve over the next six months dropped considerably in June, hitting the lowest level in the 48 years the National Federation of Independent Business has conducted the survey.

That was the dismal news released Tuesday by Chad Heinrich, NFIB’s state director for Arizona.

“With small-business-owner expectations dimming to a record low, it becomes even more important that we have state leaders focused on ways to improve business conditions for the small-business owner,” Heinrich said. “All Arizonans have benefited from state legislative and executive leaders who have adopted pro-small-business policies year-after-year.”

Heinrich’s statement drew attention to the NFIB’s Small Business Optimism Index for June which showed a drop for the sixth consecutive month. That means the expectations of small business owners for better conditions have worsened every month of 2022.

NFIB Chief Economist Bill Dunkelberg also addressed the pessimistic news revealed by the Small Business Optimism Index.

“On top of the immediate challenges facing small business owners including inflation and worker shortages, the outlook for economic policy is not encouraging either as policy talks have shifted to tax increases and more regulations,” Dunkelberg said.
 
Among the key findings in Tuesday’s report is that 50 percent of small business owners reported job openings that could not be filled, a historically “very high” rating. Of those hiring or trying to hire, 94 percent reported few or no qualified applicants for the positions they were trying to fill.

Even one bit of good news in Tuesday’s report wasn’t all that positive. According to NFIB’s Small Business Optimism Index, the net percent of owners raising their average selling prices decreased three points. However, the decrease comes after May’s record high reporting of price increases.

Heinrich advised that Arizonans cannot rest on the successes that have kept the state at or near the top of post-pandemic economic gains.

“We must continue to support leaders who understand that most new jobs are created by small business owners,” he said. “Small businesses drive the Arizona economy forward.”

The NFIB Research Center has collected Small Business Economic Trends data with quarterly surveys since the 4th quarter of 1973 and monthly surveys since 1986. Survey respondents are randomly drawn from NFIB’s membership.

Independent Business Group Report Finds Arizona “Well-Positioned”

Independent Business Group Report Finds Arizona “Well-Positioned”

On Thursday, the National Federation of Independent Business released its monthly Jobs Report, which found that Arizona is well-positioned to beat its neighbors to full economic recovery.

“Early legislative action this year to enact COVID-19 liability protection for businesses followed by recently adopted, historic tax reforms for income and property taxpayers will feed the flames of optimism and build confidence in business owners–leading to more investment, hiring and growth of small businesses in Arizona,” said Chad Heinrich, Arizona state director for National Federation of Independent Business (NFIB). “While small-business owners remain in a struggle to fill open jobs, in Arizona our small businesses are seeing the support that comes from having a pro-small-business Legislature as our elected officials wrap up business at the State Capitol.”

According to NFIB’s report, 46% of small business owners reported job openings they could not fill in the current period, down two points from May but still above the 48-year historical average of 22%. Small business owners continue to struggle to find qualified workers for their open positions while raising compensation at a record high level.

A net 39% (seasonally adjusted) of owners reported raising compensation (up five points), a record high. A net 26% plan to raise compensation in the next three months (up four points), according to the report.

“In the busy summer season, many firms haven’t been able to hire enough workers to efficiently run their businesses, which has restricted sales and output,” said NFIB Chief Economist Bill Dunkelberg. “In June, we saw a record high percent of owners raising compensation to help attract needed employees and job creation plans also remain at record highs. Owners are doing everything they can to get back to a full, productive staff.”

According to NFIB, “the Jobs Report is a national snapshot not broken down by state. The results were based on 592 respondents to the June survey of a random sample of NFIB’s member firms, surveyed through 6/28/2021.”

Independent Businesses Join Arizona AG In Challenge Of American Rescue Plan

Independent Businesses Join Arizona AG In Challenge Of American Rescue Plan

Last week, the Small Business Legal Center for the nation’s largest and leading small business association filed an amicus brief supporting the Arizona Attorney General’s lawsuit against the federal government over a provision in the American Rescue Plan Act of 2021 that would prevent states from lowering their own taxes.

The American Rescue Plan Act of 2021 made funds available to states if and only if states agree to not pass any laws or take any administrative actions that decrease their net revenue, whether that decrease comes through tax credits, rebates, reductions in tax credits, or new or expanded deductions.

“Congress passed the American Rescue Plan to relieve some of the financial pressure caused by the pandemic, but a provision that blocks Arizona and other states from cutting taxes is eroding state sovereignty and hurts local businesses,” said Karen Harned, executive director of the NFIB Small Business Legal Center, which filed the brief today in the U.S. District Court of Arizona.

In a March 25 news release announcing the filing of his lawsuit, the Arizona Attorney General said, “It’s unacceptable for the federal government to commandeer states’ tax policies and micromanage their budgets. We will always fight on behalf of hardworking taxpayers and push back against federal overreach.”

“Every state should be insulted by the last-minute amendment the US Senate adopted into the American Rescue Plan,” said Chad Heinrich, Arizona state director for NFIB. “If a state can no longer be a master of its own destiny on tax and spending matters, then we may as well resort to a central planning model run out of DC. What needs to be made clear and repeated often is that the State of Arizona’s financial health is a product of prudent fiscal management with sound policies that attract businesses and residents to live, work and enjoy life in Arizona.”