For most small business owners and their families — particularly those that have suffered so much because of the pandemic — there is little to be thankful for this holiday season. Except for one thing: Donald Trump. “I’m disappointed that he lost,” a client told me last week. “But I’m thankful for the four years we had.”
She’s not alone.
While many are celebrating the president’s election loss, millions of small business owners and their employees who made up the historic 74 million people that voted for him will lament his departure in the new year. Sure, they are frustrated with his behavior, communication style, personality and leadership flaws that significantly overshadowed the many policy achievements of his administration … and cost him the election. But — at least economically — they are thankful for what he did.
For example, during the president’s tenure, economic growth picked up significantly from the weak and erratic pace we saw under two terms of former President Obama — at least until COVID-19 hit. During that three-year period, regulations were cut, millions of jobs were added, unemployment fell to historic lows, and GDP increased at higher rates than before.
Very significantly, the stock market — where most business owners and their employees invest their profits and retirement savings — rose an unprecedented 50% since his inauguration, buoyed by less regulations and a pro-business environment. All of this happened amidst remarkable lows in interest and inflation rates. Until the pandemic hit, small business optimism was at historic levels and profits were strong, and that’s in very large part due to the president’s handling of the economy.
And then the pandemic hit.
Yet, it was the Trump administration’s Operation Warp Speed program that was responsible for seeing through the regulatory approval process of vaccine candidates at a pace never seen before, as well as providing the infrastructure and funding for the production of more safety equipment and supplies. It was his administration, through the Treasury and Federal Reserve, that provided the needed liquidity that kept businesses and banks from failing. It was his party that authored bills providing billions in aid to small businesses.
And it was his steadfast fight against closing down the economy — and the trillions of dollars of damages and additional deaths that would have occurred — that kept businesses going in many parts of the country. Many small businesses around the nation and their employees are right now desperately pleading to continue to remain open or face ruin amid a wave of new cases and the president’s support has given them that opportunity in Texas, Florida and other states that sided with him.
Sadly, and frustratingly for many, it was Mr. Trump’s own behavior — his childish and ultimately tragic public arguments with scientists, infection disease specialists, the media and political opponents — that overshadowed what his administration actually accomplished behind the scenes.
One of the biggest expenses — if not the biggest — for a small business is taxes and many firms, already weighed down by the ever-increasing amounts levied by their local and state governments, were relieved to have extra money in their pockets to hire, save and invest thanks to the tax savings they enjoyed from the 2017 tax legislation signed by the president.
The new law brought an historic decrease in taxes that not only pushed down individual and corporate rates but provided special deductions for millions of “pass-through” partnerships and S-Corporations, as well as other incentives for small businesses to invest and buy capital equipment. The good news is that these benefits will continue for the for the next few years. Why?
It’s because despite himself losing the election, his party won. The GOP significantly (and unexpectedly) narrowed their minority in the House and will likely remain in control of the Senate.
Regardless of the two remaining Georgia runoff elections in January, the Democrats will still not have enough votes to overcome the filibuster rules and pass any major legislation affecting the taxes, health care premiums and other labor costs small businesses pay, which means that, at least for the next two years and probably beyond, small businesses can continue to enjoy the economic fruits of the Trump administration and not suffer any major uncertainties or disruption. Because of this the stock market continues to react positively and economic growth will likely fully recover in 2021.
Unfortunately for Mr. Trump and his supporters, his personality flaws and leadership style cost him the election. But his economic policies that have added wealth and savings will continue for the foreseeable future. And for that reason alone, millions in the small business community — whether they voted for him or not — will be thankful to have just a few more dollars in their holiday stockings this year.
• Gene Marks is a CPA and owner of The Marks Group, a technology and financial management consulting firm that specializes in small- and medium-sized companies.