President Speaks with Women Small Business Owners on the Economy
Remarks by the President in a Conversation on the Economy with Women Small Business Owners
U.S. Department of Commerce
Washington, D.C.
10:45 A.M. EST
THE PRESIDENT: Thank you all. Thank you, Mr. Secretary. You
wrote that -- you read that just like I wrote it. (Laughter.) It's
good to be here at the Commerce Department. After all, that's what
we're here to discuss, is commerce -- and jobs and how to keep the
entrepreneurial spirit strong in America.
Let me start off by saying, first of all, thank you all for
coming. We're going to have an interesting discussion about what it
means to own your own business and risk capital and employ people, what
it takes to be a business owner. And we've got five really smart,
capable women who are running their own businesses. Before we get to
this discussion, though, I want to say I'm really optimistic about the
future of our nation's economy. This economy is strong and it is
getting stronger. (Applause.)
I'm optimistic for one reason, because I just spent a little bit of
time with five people who are on the front line of hiring. Their
optimism was really evident, as I think you'll soon hear. Secondly,
I'm optimistic because I see things happening. Unemployment dropped
today to 5.7 percent. That's not good enough. We want more people
still working. But nevertheless, it is a positive sign that the
economy is getting better.
I see the manufacturing orders are up dramatically. I know the
productivity is high in America. Home construction is strong. All the
signs in our economy is -- are very strong. And that's positive for
somebody who might be wondering about whether he or she is going to
find a job.
Secondly, I know what we have overcome in this country. I mean,
this economy has got to be pretty darn strong to have come through what
this nation has come through. Just very quickly, in the beginning of
2001, the country was entering into a recession. I'm sure that
affected you all. Recession, by the way, is when there is negative
growth for three quarters, when things aren't going well for three
consecutive quarters. That's a long period of time if you own your own
business. It's a long period of time if you're looking for a job, by
the way.
Then, all of a sudden, as the economy was getting better, the enemy
hit us. And make no mistake about it, the attack of September the 11th
affected not only our national psyche, it affected the economy. It
hurt. It hurt people who were thinking about risking capital. It made
it hard for people to find a job.
As well, we had a problem that fall when it turned out some of our
corporate citizens failed to live up to the responsibilities of
leadership. They didn't tell the truth to their shareholders and their
employees. That affected the psyche of the American investor. You
know, capitalism is only as strong as the integrity of the people
involved in the process. And these leaders will tell you that you've
got to be open with your employees; otherwise, they're not going to
work for you very hard. In this case, these corporate criminals had a
negative affect on the country.
And then, of course, I made some tough decisions about how to
secure America and keep the peace by spreading freedom. And we marched
to war. It is not conducive to economic growth to see on your TV
screens "America is marching to war." It's not a very positive,
optimistic message to hear if you're thinking about risking capital.
Who wants to take risk when we're marching to war?
Now we're marching to peace, and people feel more comfortable about
making a risky investment. We've overcome a lot. And I'm optimistic
because not only do I talk to people who are optimistic all the time,
I'm optimistic because I recognized what this country has been
through. It really speaks to entrepreneurial spirit and ingenuity of
the American people, is what I'm talking about. This is a fabulous
country.
The system says if you work hard, you get rewarded. You can own
your own business -- hopefully, without a lot of government
interference. Speaking about government interference, we made a
conscious decision to make government less intrusive into the
pocketbooks of the American people in order to affect economic growth.
You might remember we went to the Congress, not only once, but three
different times, to affect real substantial tax relief -- (applause) --
tax relief which left more money in the pockets of the working people;
tax relief which encouraged spending and saving and investment.
You see, we cut the taxes on everybody. We didn't try to pick and
choose who got the tax relief. Our attitude was, if you pay taxes, you
ought to get relief. It ought to be fair and simple to understand.
And by the way, the tax relief had a significant impact on the
entrepreneurial spirit of America because a lot of people who own their
own small business pay taxes at the individual income tax rate.
They're what you'll hear as a sub-chapter S corp or a sole
proprietorship. And so when you cut the taxes on the individuals,
you're really cutting the taxes on business, small businesses. And
after all, that's important, because most small businesses -- small
businesses create the most new jobs. Seventy percent of new jobs are
created by small business owners and entrepreneurs. The tax relief was
important.
We had incentives in there for people trying to raise a family by
raising the child credit. We reduced the marriage penalty. Heck, we
want a tax code that encourages marriage, not discourages marriage. It
doesn't make any sense to say, if you're married, you get to pay more
tax.
We gave small business owners incentives to invest by raising the
deductibility limits. And I think you'll hear some discussion of that
today. We reduced taxes on dividends and capital gains, which was
particularly important for retired citizens who rely upon dividend
income to -- in their latter years.
So we did a lot, we've done a lot. I'm telling you, the tax relief
came at the right time and made a big difference for economic growth.
(Applause.)
There's more to do. First of all, every one of these business
leaders and owners will tell you that if there's uncertainty in the tax
code, it will make it difficult for them to plan for the future.
Business owners like certainty. They want to know what the rules are.
Much of the tax relief I described goes away soon. Congress passed the
tax relief, but they didn't make it permanent. Job creation is vital.
Permanency in the tax code will mean more job creation. Congress must
make every part of the tax package permanent. (Applause.)
These business leaders will tell you, health care costs are rising
and are difficult to manage. We need association health care plans to
allow small businesses to pool the risk across jurisdictional
boundaries. Congress must act. (Applause.)
We need medical liability reform. Frivolous lawsuits drive up the
costs of health care. They affect the budgets of these small
businesses. They also affect the federal budget. I mean, if you think
about what frivolous lawsuits do to the cost of Medicare and Medicaid
and veterans' health benefits, you understand what I'm talking about.
I mean, it's an enormous cost to the federal budget. We got a good
bill out of the House. The medical liability bill is stuck in the
Senate. We need tort reform there; we need class action reform; we
need asbestos reform if we expect this economy to continue to grow.
We need an energy policy. Congress needs to give me an energy
bill. I mean, it's hard for businesses to plan, particularly in the
manufacturing sector, if you're wondering where you're going to get
your next watt of energy. So we need an energy bill. Congress needs
to act. Congress needs to join this administration in listening to the
voices of these entrepreneurs to figure out how to keep a pro-growth
agenda on the forefront. So long as anybody is looking for a job in
America, this administration is going to be promoting a pro-growth,
pro-entrepreneurial agenda.
And I'm honored to be joined by entrepreneurs, strong, strong women
who have taken the lead in their businesses and are providing a great
service to our country. They're not only providing a wonderful example
for people who are wondering whether or not I can own my own company,
but whether -- but providing the service of hiring people and keeping
them at work and caring about their employees.
I'm going to start off by Nancy Connolly. She is the President and
CEO of Lasertone Corporation, Littleton, Massachusetts. Welcome.
(Applause.)
* * * *
THE PRESIDENT: Yes, see, Nancy hires 20 -- there's a lot of
companies the size of Nancy's around the country that have got this
sense of optimism. I mean it's -- I don't think we would have had
Nancy sitting here two years ago saying, gosh, I look forward to hiring
20. I suspect she might have been saying, I hope to keep the 70. A
lot of small businesses were just hanging on to what they had during
tough economic times. And now this leader and this entrepreneur are
saying, 20 minimum -- it sounded like to me. And that's how this
economy works. It's very important for people to understand it's the
cumulative effect of many, many hirings that take place on a daily
basis, particularly in the small business sector that affect economic
growth and vitality.
Thank you for doing what you're doing.
Catherine, tell us about yourself and your business -- Knowledge
Information Solutions.
* * * *
THE PRESIDENT: One of the things I think is very interesting for
people to understand that Catherine just said -- she said the tax
breaks that we focused for small business owners caused her to buy new
equipment and new software. Well, somebody has to make that equipment
and somebody has to design that software and sell it.
So my point is, is that it's important for our American citizens to
understand the ripple effect of good tax policy. Good tax policy
encourages an owner to make a decision. That decision then makes it
more likely somebody else is going to find a job who will provide -- in
the company that provides the product. In Catherine's case, equipment
and hardware.
It's very important that this incentive stay in place, because it
is -- you just heard one example of the decision-making process that
takes place as a result of good tax policy. If the tax policy -- if
Congress lets this lapse, the ability to deduct to $100,000 their
capital equipment, it would then cause her to make different decisions
in the out years. And so the Congress needs to be mindful of what tax
policy does to the decision-makers, the job creators, people like
Catherine, who made a rational decision based upon good policy.
It's my honor to welcome right now -- why don't we go with Sharon
Evans. Sharon is a CEO of CFJ Manufacturing, Fort Worth, Texas.
MS. EVANS: There you go. (Laughter.) And I have to tell you, as
a fellow Texan, I'm very proud of what you're doing for this nation.
But as a business owner, I'm very thankful.
Because of the tax relief this last year, we were able to hire new
employees, we were able to purchase $170,000 in equipment. For the
first time in four years, we were able to bonus our employees, and we
saw those bonuses reinvested in our 401-k program.
CFJ Manufacturing was started 20 years ago. I was a single mother
with three children, so I know how difficult it is to start a
business. It was myself and one other employee. Today, we have 85
employees. We anticipate a 25 percent growth this next year, and it's
clearly all related to the tax benefits.
THE PRESIDENT: I disagree. I think it's related to vision and
hard work and the Texas spirit. The tax relief helped, but none of
these women should discount their courage and their vision and their
willingness to take risks and to make wise decisions. (Applause).
MS. EVANS: I do have to commend you, too, as well as -- we utilize
and we are a certified women-owned business, and your support of women
in business has increased my customer base, which has, in fact, grown
my business, as well.
THE PRESIDENT: I think it's very important -- what she's talking
about is contracting. For example, at the federal government, we ought
to bust these contracts down to smaller sizes. The role of contracting
at the federal level -- (applause) -- the proper role of contracting --
obviously is to get good service for the government, but at the same
time have the added dividend of enhancing the entrepreneurial spirit;
is encouraging small business ownership; is to really achieve what we
want to achieve, and that is to expand the ownership society in
America.
And by the way, the role of government is not to create wealth, but
the environment in which the entrepreneur can flourish. Make no
mistake about it, the role of government is to create the architecture
in which people are willing to take risk and make choice. But that
doesn't happen unless somebody's got a good idea, works hard, dreams
big, treats their employees with respect, and is capable.
So thank you for giving government the credit, but we don't deserve
it.
Let me call upon Maria Coakley David. She is the CFO of CJ
Coakley, Inc., right here in Falls Church, Virginia. Thanks for
coming, Maria. And thank you for the hat.
* * * *
THE PRESIDENT: Well, let me talk about job hiring, particularly in
the construction field. It's very important for these companies to
understand who they're hiring. I'm excited about the fact that you're
expanding your job base. I just want to make sure that you stay legal
in your hiring practice. And we've got a problem here --
MS. COAKLEY DAVID: It's a big concern, as well, for us, and I
appreciate you bringing that up.
THE PRESIDENT: It's got to be a big concern. Well, I'm talking
about this immigration issue that I brought up. My attitude is, any
time an employer can't find an American worker to do the job, that in
this case she ought to be able to hire a willing foreign worker, so
long as that foreign worker has got a -- what -- we're going to issue,
a new card, a temporary worker card.
I don't like the idea of having an undocumented economy in the
greatest country on the face of the Earth, where people walk miles
across deserts at the hands of sometimes these coyote border smugglers
who treat these people inhumanely; they get into our society, they're
doing work, but they're doing work in an undocumented way, not
above-board, but below the surface. They can get exploited and have no
recourse. And it's just flat wrong in America. And we ought to
recognize the system hasn't worked.
And so I proposed a plan that is a worker plan. It is not an
automatic path to citizenship, what they call amnesty. It is a plan
that recognizes reality in a common-sense way, so that when Maria's
company starts expanding, and she can't find somebody to lay tar on a
hot August day, and somebody else wants to, because they've got a
family to feed, she can find this person, and the person will show up
to work. And by the way, that person ought to be able to go back to
his or her family without being harassed, to be able to take money
home, which is what they're trying to do.
So this is a common-sense plan. It makes eminent sense. It
recognizes the reality of today's workplace. We want our employers to
be aggressive at hiring people, but we don't want them breaking the
law. And we've got to recognize, in this society, there are just
simply some jobs that are not being filled by American citizens.
MS. COAKLEY DAVID: You're correct, and it is definitely a big
concern for our company. We probably have 70 percent Hispanic work
force. We've recently hired a bilingual receptionist to help us
communicate effectively. We have a lot of our newsletters translated
in Spanish. And we do have to face the facts. And we would greatly
benefit from your plan.
THE PRESIDENT: This is important. The other thing what she's
faced with -- first of all, the fact that you've got an Hispanic work
force means you're doing well. These are fine people, we know well in
Texas. They're great people. Great people.
But there's a lot of false documentation. What kind of society is
it where the system allows for false documentation, falsifying these
different papers so Maria is not sure whether or not she's dealing with
somebody she ought to be dealing with. We need to make this
above-board. And by the way, it is humane to treat people with
respect, citizen or not citizen. We want to treat people with the
utmost respect in this country. This is America. It's the greatest
country on the face of the Earth. We're not giving special privilege.
They don't get to but in line where somebody who wants to go through
the process in a legal way. We're just recognizing reality in a
common-sensical way. It's the right thing to do. (Applause.)
* * * *
THE PRESIDENT: One of the most meaningful things that's happened
to me since I've been the governor -- the President -- governor --
President. (Laughter.) Oops. (Laughter.) Ex-governor. I went to
Bethesda Naval Hospital to give a fellow a Purple Heart, and at the
same moment I watched him -- get a Purple Heart for action in Iraq --
and at that same -- right after I gave him the Purple Heart, he was
sworn in as a citizen of the United States -- a Mexican citizen, now a
United States citizen.
It's a pretty special country, isn't it, where people are willing
to come not only to work to provide for their families, but to wear
this nation's uniforms and to go into harm's way for our peace and
security. And Americans have got to recognize how special America is,
and how lucky we are to be Americans in this country, and how a lot of
really decent people would like to join us. We've just got to make
sure the system is orderly and fair and meets national objectives.
Lurita. Lurita Doan is with us. She is the president and CEO of
New Technology Management, in Reston, Virginia. Welcome.
* * * *
THE PRESIDENT: I'm here to thank you all. I think the -- I hope
you come away with the same sense of optimism I do about the future of
this country when you hear these five women speak. I mean, this is a
country which speaks to five entrepreneurs here on the stage and says,
dream big and go for it; live your dream. Can you imagine a country
where a woman like Lurita walks in to Kinko's and says, I think I'll
start a business by printing my first business card. And here she is,
13 years later, speaking to the nation about a business which is
thriving, and is going to hire 75 new people.
It's a fabulous country, where people can dream big dreams and
people can risk, take risk and achieve their dreams through hard work,
clear vision and a good idea. It's hard to be a small business owner,
particularly in hard times. It's easier when the whole economy is
growing, but it's even hard then. It's hard to make the right
decisions. But, obviously, I'm surrounded by success, people who have
been able to realize their dreams and accomplish what is not easy to
accomplish.
Government can help, but we can't make these women smart; we can't
make them dream; we can't make them compassionate. These are choices
they've made. And our job is to stand with them and to serve as a wind
at their back as they provide not only valuable goods and services,
but, more importantly for me right now, and for the country, is to
provide a chance for somebody to find work -- find work so they can
fulfill their obligations as a mom or a dad.
I want to thank you all for joining us. Thank you for being great
Americans. I appreciate you helping me to explain how our economy
works and why we should be optimistic about our future. May God bless
your endeavors and God bless you all. May God continue to bless our
great country. Thank you very much. (Applause.)