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Republican Control Provides ASBC with Some Policy Opportunities

The 2016 election gave Republicans control of the House, Senate, and White House. The last time Republicans held all three branches was during the Bush Administration from 2003 to 2005.

Trump Administration policies – based on election rhetoric – are likely to be both right of center and controversial. That raises the question of how ASBC will address center-right, single-party rule?

The answer: Express our strong opposition to policies that violate our core values. At the same time, we’ll look to collaborate with both President Trump and Congress when we share common interests. In both instances, we will stand firm on our principles that any policy proposal must help to build a more sustainable economy and embrace the triple bottom line.

First, let’s look at the policy areas where the interests of ASBC and President-Elect Trump may overlap:

Sustainable taxation: ASBC advocates for tax laws that reward entrepreneurs (who are critical to job creation), reduces compliance costs, and ensures tax equity for small and mid-size businesses. Trump has called for simplifying the tax code and cutting taxes for businesses large and small. He would do this in ways that we believe will drive up the deficit and require cuts to critical programs. That said, ASBC supports tax relief for small pass-through businesses, as does Trump and the Republicans in Congress.

Or, consider tax reform: Trump has called for an end to the rule that allows U.S. corporations to defer taxes on the income they earn (and keep) overseas. ASBC also wants to end the deferral rule, and advocates tax reform that equalizes the tax treatment of multinationals and Main Street businesses. House Republicans have proposed taxing businesses on just the income they earn within the U.S. Under this approach, business income from U.S. exports would not be taxed, which would support U.S. manufacturing and the creation of U.S. jobs.

Look at sustainable trade: ASBC wants trade agreements that do more for small businesses and improve labor and environmental standards. President-Elect Trump wants trade deals that support the U.S. economy and create U.S. jobs. We are looking for the middle ground, wherein a fairer trade system is put into place which helps grow local economies and limits damage to the environment.

High-road workplace issues: ASBC calls for high-road practices, such as paid sick days, family medical leave, fair wages, and strong retirement plans. By contrast, Trump wants to create a childcare deduction, to quadruple the standard deduction. While these ideas may produce some good, ASBC differs from Trump in significant ways -- for instance, the need for a livable minimum wage. At best, Trump has waffled on this, whereas ASBC calls for a higher minimum wage which allows people to meet their basic needs and reduces the growth in income inequality.

ASBC is open to finding common ground with a Trump Administration in any of these areas.

There will also likely be times when ASBC works with Congressional Republicans over the new Administration. For example, Trump’s tax proposals favor the very rich and drive up the deficit needlessly. House Republicans’ tax proposals are more realistic. They deal with real problems, such as the need to simplify the tax code, which ASBC can support even as it pushes to improve the outcome.

There will be opportunities for ASBC to promote bipartisan legislation. In the area of worker-ownership for example, the Promotion and Expansion of Private Employee Ownership Act (H.R. 2096, S. 1212), would extend to owners of S Corp ESOPs the capital-gains relief already given to the owners of C Corp ESOPs. ASBC backs this bill, which has very strong bipartisan support in both chambers.

ASBC is concerned about wealth extraction from already marginalized communities and believes we should invest in our inner cities, by providing capital to small and mid-sized businesses that create jobs and strengthen local economies. We oppose severe cuts in spending and needless subsidies for large corporations. We should get behind public-private sector partnerships where they can do the most good.

ASBC supports greater investments in infrastructure, which is critical to the long-term health of businesses and communities. Our infrastructure spending should target new construction, not projects already underway. It should be financed with a sustainable income source and not through tax breaks for existing work. Also, ASBC opposes the wholesale privatization of the country’s infrastructure.

In many cases, ASBC will oppose the new Administration’s goals, for example, the repeal of Obamacare or overturning of the Paris Climate accord, or Clean Water regulations.

At times like this, ASBC will look to partner with both Democrats and moderate Republicans. We’ll be keeping an eye out for unlikely or ‘bridge’ alliances that cross the partisan divide. While Republicans have a majority of Senate seats, Democrats have enough members to filibuster, i.e., to slow or stop action on a bill through endless debate, procedural motions, and other means. All legislation must pass both Chambers, which means Democrats in the Senate can filibuster House bills as well.

In conclusion, ASBC will work with the Trump Administration whenever there’s agreement about the goals and methods. We will collaborate with Congress when we share common interests. However, when we see policy that runs counter to our principles, we will fight to stop it.

John O’Neill is ASBC’s Tax Policy Analyst.