When my father arrived in the United States in 1956, he had big dreams of starting his own successful business. He and my mother came from a country like most in the world, where their opportunities were determined by the circumstances of their births rather than how hard they worked or how big they dreamed. In America, my dad was determined to be his own boss, so he set to work opening a series of small businesses, including a vegetable stand, a dry cleaning store, a discount store, and a supermarket.
My mom claims he never had much of a business mind. He was too generous, she said, and often gave items away to customers who couldn’t afford them. The businesses all failed, and at some point he gave up his dream, deciding instead to provide the best living he could for his family by working in the employ of others. The job he would hold for much of his life was as a bartender at hotel banquets.
Though my father never found success as a small business owner, he was nonetheless employed by those who did. Working for their businesses, he was able to earn a comfortable wage, provide for his family, and empower his children to accomplish all the things he never could himself. My parents achieved the American Dream. Their story was made possible by the growing, inclusive, opportunity-rich economy that marked the latter half of the American century.
Throughout our nation’s history, small businesses have been the fulcrum of the American Dream. The success of our society and the prosperity of our people have rested on the ability of businesses to be born, to grow, to innovate, and to hire. When America has succeeded, it is because we have been the best place in the world to turn an idea for a product or service into a reality.
Today, America has strayed far from her status as the most business-friendly economy on earth. The United States now has the highest corporate tax rate in the developed world. Rates for small businesses can be as high as 50% when state and federal taxes are combined. Our tax code also punishes American companies for competing in the global economy, and our regulatory system prevents small businesses from challenging established players.
As a result, in a global economy that prizes innovation and productivity above all else, we have hindered the ability of our people to innovate and produce. For the first time in 35 years, we have more businesses dying than being born. In the first quarter of this year, our economy shrank for the third time since our recovery began. And over the last decade, the U.S. has lost $179 billion worth of domestic companies through foreign takeovers.
For the first fifteen and a half years of this century, even as technology and globalization have changed the fundamental structure of our economy, Washington has looked to the past. Our economy has changed, but our economic policies have not. We have learned, painfully, that the old ways no longer work – that Washington cannot pretend the world is the same as it was in the ‘80s, it cannot raise taxes like it did in the ‘90s, and it cannot grow government like it did in the 2000s.
With our unmatched human capital, we remain uniquely equipped to lead the world in innovation and growth, but not if our outdated leaders hamstring the efforts of our business community. As president, the protection and empowerment of small businesses will be one of my greatest economic priorities. There are two reasons for this.
First, because small businesses will always be the primary drivers of new innovation and job creation. They have provided 55% of all jobs and 66% of all net new jobs since the 1970s, and among our nation’s most innovative firms, small businesses account for 16 times more patents per employee than large businesses.
Second, small businesses are disproportionately impacted by public policy, both good and bad. Unlike larger firms, most small businesses lack the financial resources to comply with costly regulations and to hire the lobbyists or lawyers necessary to navigate the system. This is one reason why large corporations have generally performed well since the recession ended, while smaller firms have continued to suffer.
Many government mandates and subsidies are the result of an alliance between big business and big government. Throughout this campaign, you will hear Hillary Clinton argue that the economy is rigged in favor of wealthy interests. But what she won’t tell you is that big government is doing the rigging. The inevitable effect of our massive regulatory apparatus is that it becomes the instrument of those with the money and power necessary to influence laws and comply with mandates.
Real free enterprise is not about helping one business succeed over another; it is about promoting competition and opportunity for all. I believe the post-industrial economy of the 21st century carries more opportunities for our small businesses to innovate and grow than ever before. But whether they are able to do so will depend on the leaders we choose and the reforms we adopt. I am running for president to empower our businesses to succeed, our economy to grow, and our people to prosper.
To once again make America the most business-friendly economy in the world, we must first overhaul our currently regressive tax code. I have partnered with Senator Mike Lee to propose a comprehensive tax plan that I will work to pass into law as president. My plan would provide instant relief to struggling small businesses and spark the historic economic growth our current recovery is missing.
My proposal will start by ensuring equal treatment for businesses of all sizes. It would cut the top corporate tax rate to 25%, down from upwards of 40% today for many small companies. The plan also eliminates double-taxation on savings, investment, and family-owned farms and estates, punitive taxes that can cripple small businesses and force them to hire tax accountants instead of new employees.
My tax plan will also allow immediate, 100% expensing for all businesses. This means the more a company invests in creating jobs, the less they owe in taxes; and the more they pay their workers, the less they pay government. This reform gets to the essence of my tax plan. From the individual to the business side, my reforms would yield a tax code that makes it easier for Americans to find jobs and easier for businesses to create them. They will help everyone succeed, from stock brokers to stock clerks.
In addition to reforming our tax code, I will put a ceiling on the amount U.S. regulations can cost our economy. Just since 2008, federal regulations have cost us $771 billion, and these costs tend to disproportionately impact small businesses. For every 10 percent increase in regulatory costs in an industry, the number of small and medium-size businesses in that industry falls 3 to 6 percent, while the number of large businesses grows by 2 to 3 percent.
Rolling back regulations will also require repealing Dodd-Frank, which impedes the community banks that provide loans for business creation. Since Dodd-Frank was signed into law in 2010, community banks’ market share has withered by 12 percent, twice as fast as it did the previous four years. This has snuffed out the creation of businesses in the American communities that have the greatest need for new jobs and new economic activity.
ObamaCare is another policy dragging small businesses down. Its requirements include tracking every staff member’s hours, absences and health insurance costs, which many smaller firms simply don’t have the resources to handle. According to one study, the average cost for a small business to comply with ObamaCare is more than $15,000 a year. Starting in 2016, the law will expand its requirements to all companies with 50 or more workers. As president, I will put an end to this burden by repealing ObamaCare and replacing it with market-centered reforms.
Government should work to empower and protect the private sector, not to control it. This requires recognizing the industries that need special attention in the 21st century. In the Senate, I have advanced a comprehensive wireless plan to expand unlicensed spectrum. Spectrum is the highway of the digital age, but the amount made available to the public is limited, and the result is a digital traffic jam. As president, I will reallocate spectrum for public use, which could create an estimated 350,000 jobs per 500Mhz.
Even with these reforms, start-ups will not be able to grow and thrive if they do not have a skilled workforce to draw from. This is why we must develop and utilize the extraordinary human capital our nation possesses.
I believe the failure of our higher education system to adapt to the modern economy is one of the primary inhibitors of business creation and growth today. Existing student debt discourages many graduates from starting a business of their own, and the failure of our higher education system to cater to the needs of middle and working class Americans has resulted in a lack of skilled labor.
We do not need timid tweaks to the current higher education system; we need a holistic overhaul – we need to change how we provide degrees, how those degrees are accessed, how much that access costs, how those costs are paid, and even how those payments are determined. My agenda will do all of these things. It will encourage innovative, low cost providers to enter the marketplace, and it will create an influx of graduates with the degrees our modern businesses need the most.
Finally, in addition to shaping and empowering our existing human capital, we must attract the best and brightest innovators and workers from around the world. This requires reforming our legal immigration system to make it skill- and merit-based rather than family-based, which will protect American workers and attract more talent to start and staff our small businesses.
This is only a segment of the policy blueprint I have drawn up for my presidency, but my whole vision is built on a simple concept: New opportunities cannot be seized by old ideas, and the future must be embraced with enthusiasm and vision.
In the 19th century, a generation of American businesses and workers did exactly that. They faced challenges similar to ours: the steam engine made the world smaller; the telegraph opened a new age of communication; new machines created new industries and upended a centuries-old economic status quo.
Imagine what the world would look like if that generation had resisted these changes rather than embraced them. Imagine if government had held businesses back with policies of the past. The loss would have been suffered not only by their generation, but every generation after. The American Century would never have existed.
The stakes for our time are just as high. If our businesses are unable to capture the promise of this new age, our people will be unable to build a new American Century. But if our small business community is empowered by our government rather than encumbered by it, America will not just recover economic ground, we will gain it. We will see the creation of higher paying, more fulfilling, more exciting jobs than ever before.
As the readers of this publication surely know, nothing has changed about our people. We are a nation of creators, innovators, and go-getters. In our veins flows the blood of men and women who refused to accept the burdens of their pasts, or to resign to the old ways of doing things.
Just as we pay respect to the Americans of the Industrial Revolution, so will the verdict on our time be written by those who have not yet been born.
Let them write that we did our part – that in the early years of this century, we turned the corner on the past; we adopted policies that encouraged Americans to invent the products of tomorrow, manufacture them, and sell them throughout the world; and we enabled our small businesses to transform our nation, empower our people, and lead the world toward a new era of growth and innovation.
Born in Miami, Florida in 1971, Marco Rubio is the son of Cuban immigrants. After earning a bachelor’s degree from the University of Florida in 1993, he went to the University of Miami for his law degree. Rubio’s political career began with his election to the West Miami City Commission in 1998. He was elected in the Florida House of Representatives the following year. In 2009, Rubio won his campaign for the U.S. Senate. In April 2015, Rubio announced his plans to run for the 2016 Republican presidential nomination.