Memo to Congress: Small Business Can Save America -- If You Let It

To: Congress

From: Steve Strauss

Re: Your tired debate over jobs

Look, I don't envy you. You have a very tough job at a very tough time. We get that. And Standard and Poor's downgrading of the U.S. credit rating for the first time in history was only the latest salvo in a batch of bad news that seems to have no end or solution.

Except it does, which I will get to in a moment.

But boy, bad news is all around. If it's not your failure to speak rationally with members of the other party, it's our ever-growing debt, a potential double dip recession, and your inability to even consider raising a few taxes to help pay our bills.

And that's just for starters.

Of course, our biggest problem is that unemployment remains seemingly structurally set at a new, higher level. What are we to do? What are you to do?

The first thing I would like to suggest is that what this country does not need are more "shovel-ready" make-work projects or more phony baloney faux-balanced budgeteers. If you really want to create jobs, fix the economy, and get this country moving again, then I have one word for you:

Entrepreneurs.

Almost every problem listed above can be solved by fostering business startups, by unleashing the power of the entrepreneur.

But don't just take it from me. Just recently, one of the most respected entrepreneurship voices out there proposed the answer. The Ewing Marion Kauffman Foundation's "Startup Act" [pdf download] is draft legislation that is far more relevant to spurring the economy and creating jobs than a second stimulus or a balanced budget amendment or what have you.

According to the Kauffman Foundation, the Startup Act proposes some of the following:

• "Entrepreneurs' visas" and green cards for immigrants with degrees in science, technology, engineering, and math, and who show promise in building high-growth companies
• Better access to early-stage financing
• Capital gains tax exemptions for long-held startup investments
• Tax incentives for startup operating capital

The idea is simple: If we want a lower unemployment rate and more jobs, then we need to cultivate more startups. If we want more revenue in the coffers, then we need a law that will turbo-charge entrepreneurial growth. If we again want to see America create the Next Big Thing, then we will do everything we can to help small businesses and then stand back and watch the amazing places they lead us.

But of course, this is nothing new. The last great economic boom came during the Clinton administration, with the creation of more than 20 million jobs. It was a dynamic time: The dawn of the Internet, the dotcom era, the fall of communism, the rise of capitalism, a world that was becoming flat. And entrepreneurship ran rampant.

Back then, in 1992, Jeff Bezos did a research project for his boss in New York and discovered that this thing called the Internet was growing at over 1,000% a year. Inspired, he and his wife left Wall Street, and she drove cross-country while he tapped out a business plan in the car on the way to Seattle. Amazon.com was started in their new garage. Today it employs about 30,000 people.

Similarly, maybe the best friend small business ever had in the White House was Ronald Reagan. In a May 1988 speech to students at Moscow University, he put his business philosophy this way: "The explorers of the modern era are the entrepreneurs, men with vision, with the courage to take risks and faith enough to brave the unknown. These entrepreneurs and their small enterprises are responsible for almost all the economic growth in the United States." And, just as with the Clinton boom, the Reagan boom was fostered by entrepreneurship, with companies like Microsoft and Sun launching small and then growing big.

Multiply these sorts of stories by the thousands and you get a balanced budget and 4% unemployment. That's why we need a Startup Act.

That is, of course, if you are willing to put the needs of our country above your petty politics. Above all, fixing this mess will require something you in Washington have forgotten all about: cooperation, conciliation, and compromise in the pursuit of solving our country's common problems.

If you are ready to do that, then here is the answer: Small business.

What do you think the Startup Act should include? Let me know, below.

(photo credit: Flickr, Creative Commons, Robert Couse-Baker.)