Promoting Competition in the US Economy

Earlier this month, President Biden signed an Executive Order to “promote competition in the American economy.”  This seeks to decrease costs for families while increasing salaries, promote innovation and ultimately result in faster economic growth.

The idea behind this order is a “decisive action” on the part of Biden to somehow decrease the trend that has been escalating in the creation of corporate consolidation and increase realistic competition, putting consumers, farmers, workers and small businesses in the driving seat.  The Executive Order features 72 initiatives undertaken by over a dozen federal agencies who will be expected to counter some of the most worrisome competition issues nationwide.  Ultimately – once they are fully in place – people’s quality of lives will be enhanced.

Too many people were hit financially hard by the pandemic.  With this Executive Order strategic action is meant to provide hope for people seeking to start a business, grow a business or even get a better job. The Order has many features.  Some of these are:

  1. The banning/limiting of non-compete agreements and bureaucratic occupational licensing requirements which hinder economic flexibility. This should help people change jobs more easily.
  2. Sell hearing aids over the counter, saving thousands of dollars for hearing-impaired.
  3. Enforce clear disclosure of add-on fees from airlines, making it easier for consumers to get refunds.
  4. Help federal agencies promote greater competition via their spending decisions and thus increase opportunities for small businesses.
  5. Augment the Department of Agriculture’s tools, empowering farmers, increasing their wages and ending the abusive practices of some meat processors.

As Biden said in his recent White House Briefing,

“The heart of American capitalism is a simple idea: open and fair competition — that means that if your companies want to win your business, they have to go out and they have to up their game; better prices and services; new ideas and products. That competition keeps the economy moving and keeps it growing.  Fair competition is why capitalism has been the world’s greatest force for prosperity and growth.”

Let’s hope the Executive Order works the way it has been intended. 

Small Businesses in a Pandemic Era

Small businesses have definitely had a lot to deal with over this past year-and-a-half.  Since March 2020, many have suffered from lockdowns, stay-at-home orders and restricted gatherings. While no-one has managed to avoid challenges during this time, it seems financially that this particular demographic has possibly suffered the most.

According to a recent article  on the subject, the first thing we have to remember anyway is that America’s business demographic is made up of 99.9% small businesses. Of those working in the private sector, a little less than half work for these firms.  Closure of these businesses is currently 34 percent (compared to January of 2020) and San Francisco has been severely impacted with a rate much higher than that of 48%. Experts are now discussing a K-shaped recovery but with these numbers, that could be slowed down as well.

Despite all of this, people’s spirits are still strong and there is much work that is being done to turn this around.  For example, while there is a national Small Business Day held in November, New Jersey had one last month.  NFIB New Jersey (New Jersey’s leading small business association) held its Small Business Day on May 5 2021 and discussed a variety of issues relating to the devastation small businesses have encountered and what they need the state to do.  One action is aid to provide the $1bn lost from New Jersey’s Unemployment Fund since the start of the pandemic.  To do this, liability protection laws must be passed for small business owners and of course, re-opening the economy.

Joe Olivo, NFIB member and a local small business owner further explained:

“I know I am not speaking just for myself when I say that the past 13 months have been among the most challenging I have faced in the 33 years that I have been at the helm of my business. Many of the Executive Orders coming from the Governor have made the cure worse than the disease. Many of our political leaders and the media continue to lump all business together as though we are all multi-national corporations. Fortunately, NFIB provides us a way to collectively voice our opinion regarding legislation that is often detrimental to not just our businesses, but to the millions of people we collectively employ.”

 According to New Jersey’s NFIB State Director, Eileen Kean, the recent Small Business Day provided a “wonderful opportunity for our small business owners to engage with their legislators…[who] need to hear from real people that are being affected by what they do in Trenton.”

Yes, much work still needs to be done but the fact that days like this are being held – in which legislators can really hear what the people need – is a good start.