The federal Small Business Innovation Research conference is coming to Wisconsin in April. Don’t be shocked if it’s one of the last to be held – anywhere.
Like many other research and development programs funded by the federal government, the 30-year-old SBIR grant program faces an uncertain future. Federal budget deficits and skeptical attitudes about the value of investments in science, from the space program to energy to climate change studies, have put R&D spending under a budget-cutting microscope in Congress.
Even though programs such as SBIR and the related Small Business Technology Transfer grants have proven their worth over time in terms of launching private businesses, it’s uncertain when they will be renewed by Congress and at what spending levels.
Between October 2003 and March 2010, according to figures kept by the Wisconsin Technology Council, 134 Wisconsin companies won SBIR grants worth a total of $190 million. While critics say some R&D companies live on the grants year after year and never really grow, most companies use them as early seed money and attract hundreds of times more in private investment dollars. Those investment dollars, in turn, create well-paying jobs.
Those kinds of stories, as well as hands-on advice from researchers, federal experts and others, will be featured at the federal SBIR spring conference, to be held April 10-13 at Madison’s Monona Terrace Convention Center. The event will be followed by a special Biofuels Showcase on April 14, also in Madison.
Eleven different federal agencies make highly competitive grants to researchers whose small businesses are helping push innovations closer to the marketplace. In Wisconsin, the federal agencies most active in making SBIR grants are the National Institutes of Health, the Department of Defense and its various branches, the Department of Agriculture, the Department of Energy and the National Science Foundation.
Reauthorization of the SBIR program has been delayed for more than two years, in part because of policy differences between the U.S. Senate and the House of Representatives, but lately due mostly to budget pressures. That’s not unlike what is facing other science programs in the federal budget.
With the federal budget deficit projected a $1.5 trillion this year, some members of Congress are taking no prisoners when it comes to cuts – especially in “discretionary” spending programs such as scientific research. Washington’s total investment in scientific research isn’t large compared to other parts of the budget, but the feds fund more than one-third of all R&D spending nationwide. That represented $398 billion in public and private spending in 2008, according to NSF. Of that total, about $30 billion is spent on “basic” research, the kind of unfettered inquiry that can lead to game-changing technologies.
Some members of Congress say cuts to the federal science budget are long overdue, calling some programs wasteful or politically motivated. Other critics suggest it’s time to go back to an era when private businesses funded most R&D breakthroughs.
Science proponents say the United States will be eating its seed corn if it slashes spending on science. They believe federal investments in R&D over time have not only sped life-saving inventions to the market, but created millions of jobs, spawned hundreds of thousands of companies and helped ensure national security through technological innovation.
“Well over half of our economic growth in the last century came from investing in science and technology,” said Raymond Orbach, who headed the Energy Department’s science office under President George W. Bush. Writing in Science magazine in February, Orbach said proposed research spending cuts “would effectively end America’s legendary status as the leader of the worldwide scientific community.”
Orbach, who now heads the Energy Institute at the University of Texas at Austin, said it’s not just a matter of bragging rights – but economic vibrancy and national defense.
“Other countries, such as China and India, are increasing their funding of scientific research because they understand its critical role in spurring technological advances and other innovations. If the United States is to compete in the global economy, it, too, must continue to invest in research programs,” Orbach wrote.
Wisconsin fares poorly in attracting most kinds of federal aid but it does well in winning merit-based federal science grants. About half of the $1.2 billion in R&D grants won by the state’s academic research institutions each year come from the federal government. Slash those grants, and Wisconsin’s ability to create a more competitive economy will be disproportionately harmed.
Reducing the federal deficit is serious business, but cutting the very research that will keep America prosperous and safe is a short-sighted way to go about it.
-- Still is president of the Wisconsin Technology Council. To learn more about the national SBIR conference, go to http://www.wisconsinsbir.org.
February home sales in state down. Dane County sales off by nearly 30 percent. One Dane County Realtor reports his firm lost 100 sales in February. Harsh weather? Wisconsin climate? Perhaps. Or perhaps it's Wisconsin's economic climate.
If you just got a notice that your wages are going down 7.7 percent you are not likely to be buying a new house. If you are worried about keeping your job, you are not likely to be buying a house. Admit it. It is time to take a moment and realize where we are and where you are.
Wisconsin is facing a self-made economic catastrophe. We are sending money back to Washington at a record pace. First it was $810 million for high speed rail because it would cost us $600,000 for upkeep. Now we must cough up $60 million to repair a rail line that would have been repaired with federal money.
We will lose $46 million in federal transit aids because of the collective bargaining bill. Federal medicaid and family planning dollars will likely be lost. We rejected $23 million in for broadband access to rural areas. Wind power projects are going away and taking jobs with them as a result of new rules that benefit your profession.
A University of Wisconsin study by economist Steven Deller says the current state budget proposal will cost 21,800 jobs. Governor Walker has threatened to give pink slips to 11,500 more state workers. Those folks won't be buying homes.
Recently a person who does job siting for major corporations said he would not advise any business to look at Wisconsin. Our brand is tarnished. All because we elected a governor who acts as though he never set foot inside of an economics or history classroom.
Certainly our situation show many of us were guilty of dereliction of our duty as citizens. But you were leading the charge. Your association was the leading contributor to his campaign. Two of your PACs gave more money to his campaign than the infamous billionaire Koch brothers. Your PACs gave seven times what the Republican Party gave to his campaign. Individually, you gave hundreds of thousands of dollars more.
You did not mean for this economic disaster to happen. It is not in your interest. But sorry, you must take some responsibility. And your generosity to his campaign puts you in a unique position to help. He will listen to you or he will listen to no one. For the sake of your business and for the sake of Wisconsin you must try.
A governor has a myriad of choices as he fashions his budget. We should be open to new revenues other than cutting the tax credits for the working poor. Is it really wise to be taking $95 million from schools so we can make a partial down payment on a $2.3 billion zoo interchange?
Some wise cuts can be made. But some taxes can also be raised with minor problems. There are hundreds of millions of dollars of taxes that are left uncollected because we do not enforce our tax laws. Ninety percent of the labor force is working. Mostly, through no fault of their own, 10 percent of us are not. Can the 90 percent of those of us who are working not pay a small surtax until the others are employed again?
It won't be easy, you may not succeed, but as a lifelong citizen of this great state, I urge you to try.
-- Krajewski is a retired public affairs consultant, former legislative analyst and former state economic development consultant.
After months of planning and organizing, the Fifth Season Cooperative is ready to start operation with this coming growing season.
“We are planning on starting with a select number of vegetables and then developing from there,” said Sue Noble, executive director of the Vernon County Economic Development Association and a catalyst to the co-op formation.
Fifth Season has drawn interest regionally, statewide and even nationwide because of its somewhat unique structure. It is a multi-stakeholder cooperative that includes membership classes of producers, producer groups, food processors, distributors, buyers and co-op workers.
“This represents all of the key players in the food system at the local level,” reads a promotional brochure for Fifth Season. “The goal is to keep local dollars circulating in the community and to develop long term relationships between the institutional buyers and the farmers in order to ensure a fair price for everyone.”
Members so far in the co-op include organic and conventional farmers, Organic Valley, Westby Coop Creamery, Premier Meats and other producers and processors and Gundersen Lutheran, Vernon Memorial Healthcare, UW-La Crosse, Western Technical College, Viroqua Area School District and other institutional buyers.
Fifth Season also has drawn interest because it received the largest Buy Local Wisconsin Grant in 2010, a $40,000 grant for starting up.
Long range plans -- as co-op sales and activity scale up -- call for housing Fifth Season storage, processing and distribution in the Western Wisconsin Food Enterprise Center, a remodeled former manufacturing building in Viroqua. That renovation project received a $2 million grant in September from U.S. Economic Development Administration and is in the planning and early stages of development. VEDA and the City of Viroqua received the EDA grant.
Fifth Season was recently featured in the USDA’s Rural Cooperatives publication posted on the Rural Development web site and has received other media attention regionally.
The coop grew from an 18-month food assessment in the Vernon County region. That assessment was undertaken in part because of concerns about large quantities of food leaving the region for larger cities such as Madison, Milwaukee, Chicago and the Twin Cities without economic benefits to the businesses in the county and Driftless region.
From the assessment, potential projects and policies to move toward a more sustainable food system were identified. Goals were set.
The Valley Stewardship Network, which works on several projects in the Kickapoo Valley and beyond, launched a Food and Farm Initiative (FFI) to encourage the development of a sustainable, equitable local food system.
“The work of VSN and other groups in the assessment and early stages of developing a food system has proven to be invaluable,” Noble said. “It gave us a foundation to start bringing people together for the cooperative effort.”
Fifth Season was incorporated in August of last year. Signers of the incorporation papers include Brian Wickert of EZ Farming, Marilyn Volden, food service director for Viroqua Public Schools, Terry Hoyum, owner and manager of Premier Meats, Peter Kondrup, general manager of the Westby Co-op Creamery, Larry Ringgenberg, director of student centers at UW-La Crosse, Mark Hutson, food services director for Gundersen Lutheran, and Nicole Penick, a co-op employee and the Buy Local Development Coordinator.
“This co-op is one of a handful of multi-stakeholder cooperatives in the United States,” Penick recently wrote in Pea Soup, a newsletter of the Viroqua Food Cooperative. “The Fifth Season Co-op Board is currently in its initial planning stages, working to connect the dots between generating a fair price for produce, meat and dairy products and the tight budgets of our area’s hospitals, schools and college food service departments.”
Penick also said that the co-op is now accepting investments from the community to raise capital. Shares are available for a minimum investment of $500. The co-op will pay an annual dividend of 5 percent.
Fifth Season’s mission statement reads: “To produce, process and market healthy, local foods in our region by supporting the values of environmental, social and economic fairness for all.”
This vision has been evident for quite some time in Vernon County -- which has the most organic farms in the state -- and elsewhere in the Driftless Area. In part, it is driven by the terrain and geology of the area, which does not lend itself to vast farms that produce huge volumes of food.
Instead, small farms producing quality food has been emphasized. Organic Valley and Westby Co-op Creamery have brought that approach to dairy and developed it into markets regionally and around the country. It’s been more of a challenge with produce, meat, eggs and other farm products.
Many of the small farms bring their produce to farmers markets in the region and to Madison, Chicago and Twin Cities, but there has not been an integrated system in place for them to distribute to those cities and closer to home.
“Many producers will continue to supply those markets individually,” Noble said. “Fifth Season’s coordination helps these businesses scale up and distribute their products to area schools and institutions, and other new markets.”
-- Hoffmann has written on a variety of topics for WisPolitics.com and WisBusiness.com. He writes the GreenBiz feature column monthly.
Over time, the state of Wisconsin has found itself wading deeper and deeper into the business of providing health insurance for our citizens. The downturn in the state’s economy has resulted in a record number of enrollees in the state’s BadgerCare suite of products – products that are meant to provide a safety net for low income families around the state to ensure they receive quality affordable health care as they work to improve their personal financial situation and obtain private insurance.
The underlying reason behind this rapid expansion over the last several years is commendable. However, the economic assumptions supporting the recent creation of the BadgerCare Plus Basic program were woefully unrealistic.
With a waiver from the Bush Administration, the state created the BadgerCare Plus Core Plan, a program for childless adults with an income of less than $21,780 for individuals, or $27,214 for a couple. This program was funded with a combination of federal and state funds through the state’s Medicaid program. When the Core Plan was created, the state was given the green light to begin enrolling Wisconsinites as long as the cost of providing these services remained fiscally neutral to the federal government. Put simply, the federal dollars available for this program were capped.
Last October, the Doyle Administration realized that they were at the tipping point of the federal cap and was forced to freeze enrollment resulting in the creation of a waiting list. To date, the waiting list for the Core Plan has more than 82,000 people signed up.
With federal funding fully utilized, the legislature and Governor Doyle created an alternative plan for the people on the waiting list – the BadgerCare Plus Basic Plan. To create this government run, private insurance option, the state exempted this insurance plan from the benefit mandates imposed on private insurance policies. Since there was no state funding available for the Basic Plan, the cost of the benefits needed to be fully covered by the premiums paid for by the members who choose to enroll in this plan.
Currently, a Basic Plan member pays a premium of $130 per month plus copayments for services. Enrollment in the Basic Plan has grown from 1,675 in July 2010, to current enrollment of 5,902 members. In return, as the plan’s name suggests, the Basic Plan provides more modest benefits compared to the Core Plan.
In just nine short months since this government run insurance plan was launched, spending on the Basic Plan has exceeded premium collections by more than $1 million, and this deficit does not include the traditional three month lag in medical claims that have yet to be processed and paid to providers for services that have already been provided.
Knowing that this program could not maintain short or long term solvency, the previous Administration began relying on a short term federal grant to plug the hole. They also tried to prolong the inevitable by moving more than 500 Basic Plan members to the state’s Medicaid plan, despite the fact that federal funding for that program had already been maxed-out.
So, where does that leave a state already facing an estimated $3.6 billion deficit over the next two years? Currently, the non-partisan Legislative Audit Bureau (LAB) is conducting an audit on the Basic Plan. The LAB audit is expected to be released later this spring and will contain a detailed program analysis with likely recommendations for program improvements.
As we wait for the audit results, it is clear that we must take the difficult steps to stop enrolling new members in the Basic Plan. When the State Legislature approved this program, it was clear that no state tax dollars could be used. In addition, if the Basic Plan is to remain at all viable for current enrollees, premiums will also need to be doubled, if not tripled.
Due to these actions, we will assist individuals on the waiting list and current Basic Plan participants who decide to leave the plan in finding alternative health coverage that may be available to these members through private coverage, the state’s high risk pools or COBRA policies.
While doing this, we must also take a moment to learn from the lessons of both the CORE and Basic plans. The intentions were good, but the design flaws in these plans made them predictably unsustainable from the onset.
Currently, there are more than 780,000 nondisabled children and adults who receive health insurance coverage from a variety of Wisconsin’s Public Insurance Programs, including BadgerCare Plus Standard, BadgerCare Plus Benchmark, BadgerCare Plus Core and BadgerCare Plus Basic. Among these various plans, participants at lower income levels are paying more for less coverage than others at higher incomes for more generous coverage, raising legitimate issues of fairness. Moreover, we should consider how our government health programs compare to private sector coverage that insures the majority of Wisconsinites.
It is troubling when public programs are created before the costs of promises are appropriately and accurately assessed. It is easy to create programs, expand eligibility, and add services if the cost can be pushed out into the future or shifted to someone else. The Core and Basic plans are certainly not the only examples of good intentions that created unrealistic expectations. The road to the new federal Patient Protection and Affordable Care Act (PPACA) is paved with similar unsustainable promises.
While we must take the difficult action of freezing enrollment and raising premiums in the Basic Plan now, this outcome was unfortunately predetermined from the very beginning of the program we inherited.
-- Smith is secretary of the Wisconsin Department of Health Services.
Just when American small businesses thought things couldn’t get much worse, they’re realizing that President Obama’s health reform law has even more pain in store for them. And it’s not yet fully implemented.
One year after the law was signed, health insurance companies are “softening up” many small firms with unprecedented premium increases of 20 percent or more well in advance of deadlines that might boost prices. Even worse, many businesses are getting the rude letter from insurers that health plans the president said they could keep are being cancelled in anticipation of not meeting the law’s Cadillac standard required in 2014.
It’s not that these small-firm owners were expecting great things from the Patient Protection and Affordable Care Act. But they did have hopes that someone in Washington, D.C. had heard their pleas over the past 25 years for affordable health coverage for themselves and their employees.
As the nation’s primary creators of new jobs, they were wishful that additional burdens would not be heaped upon them while struggling to survive in the midst of a crushing economic recession. But neither the recession nor the high unemployment rate slowed the White House from mandating costly minimum benefits or limiting health savings accounts or slipping a tax paperwork demand into the law, costing them massive amounts of time to fulfill.
The hopes of small-business owners did get a boost recently when a U.S. District judge voided the entire health reform law, ruling it unconstitutional in a lawsuit filed by the National Federation of Independent Business and more than half of U.S. states. But the White House, intent on implementing the plan despite the ruling based on inviolable principles created by America’s founders, has not only appealed the ruling but has maintained its steady pace to force all citizens to buy health coverage whether they want it or not.
The U.S. House of Representatives raised small-business optimism when it voted to repeal the whole health law. But owners are keeping a wary eye on the Senate and even if that chamber gives the measure thumbs down, they know the odds of the president agreeing to repeal his own law are slim.
Last stop? The U.S. Supreme Court.
Small-business owners are hopeful that reasoning people who have actually read and understand the Constitution of the United States will agree with the basic tenets of democracy and free enterprise and shut this business buster down before it can cause even greater damage.
Even if victorious at the high court, those who have built small businesses, created jobs, and historically added significant strength to their nation’s financial stability cannot help but be dismayed at the astronomical waste of time, money and energy President Obama’s ill-conceived health law has cost them in just one year.
So don’t expect small business to celebrate Year One in the life of President Obama’s Patient Protection and Affordable Care Act. They’re hoping this anniversary will be its last.
-- Danner is president and CEO of the National Federation of Independent Business in Washington, D.C.
Bruce Block, a lawyer who leads the private foundation that recently bought 89 acres for UW-Milwaukee’s Innovation Park, is characteristically cautious when he talks about how long it will take to get the research park to get up and running.
But he’s emphatic in declaring when that process will begin: Now.
“Until you actually own the land, it’s a dream,” said Block, chairman of the UWM Real Estate Foundation, at a recent meeting of the Wisconsin Innovation Network in Milwaukee. “It’s now a real deal.”
The mid-February purchase of the land, which is within sight of Milwaukee County Research Park and the Medical College of Wisconsin on Milwaukee’s west side, is the latest step forward for the research and development hopes of UW-Milwaukee. While some payments on the land have been extended until 2014 and beyond, work will begin soon on converting the site into a research park that could spark high-tech growth in Milwaukee for years to come.
Early actions will include converting some historic buildings into high-end residential units; preserving sensitive habitats; putting in roads and other support structures; and building a 25,000-square-foot accelerator building to house university and business research activities. Next in line is a $75 million engineering research building, the prospect of which has already helped to attract a fresh crop of researchers to UW-Milwaukee.
As Innovation Park develops, it will help forge relationships between UW-Milwaukee, the Medical College of Wisconsin, the Blood Center of Wisconsin and, most important, businesses large and small as they look for cutting-edge ideas and research partners.
The evolution of Innovation Park is a reflection of the growth of R&D at the UW-Milwaukee, which is the second-largest campus in the University of Wisconsin System but for years a research backwater. That changed with successive chancellors who decided to invest more in UW-Milwaukee’s research base in engineering, medical technologies, fresh water technologies and more.
Private and federal research grants to UW-Milwaukee have grown from $21 million per year in the early 2000s to $68 million this year, with a goal of $100 million within a few more years. That’s still dwarfed by the $1 billion in research conducted each year at the UW-Madison, but the growth of R&D on the Milwaukee campus is significant when matched with other institutions such as the Medical College, the Blood Center, Marquette University and the Milwaukee School of Engineering.
Collectively, those Milwaukee institutions spend about $250 million on research each year – a number that represents an opportunity for the region to convert technology into economic growth and jobs.
Innovation Park stands to be a catalyst for that kind of growth. That’s not unlike what has happened 30 years ago in North Carolina’s Research Triangle, or more recently at Madison’s University Research Park. The Madison research park was an experimental farm in 1984; today, it is home to 120 companies with more than 3,500 employees who earn an average of $60,000 per year.
Milwaukee’s Innovation Park will be patterned after what David Gilbert, president of the UWM Real Estate Foundation, called “third-generation” research parks. A leading example is the Centennial Campus at North Carolina State, which was designed to facilitate collaboration across a number of academic, corporate and community lines.
What does Innovation Park mean to the rest of Wisconsin? Milwaukee is the state’s largest city and UW-Milwaukee is Wisconsin’s second-largest campus. A healthy economy in Milwaukee is vital to all of Wisconsin, for reasons ranging from tax generation to job creation to attracting young professionals who can help reverse Wisconsin’s “brain drain.”
It’s also an example to watch as the debate emerges over splitting UW-Madison away from the rest of the UW System. A plan advanced by Gov. Scott Walker, at the urging of Madison Chancellor Biddy Martin, would give the Madison campus more freedom from state oversight to chart its own course when it comes to hiring, building, tuition and more. If UW-Milwaukee proves it can successfully manage projects such as Innovation Park, it could help make the case for independence for the rest of the UW System.
Innovation Park is now a “real deal” in a real-estate sense. In time, it will become a symbol of the research-to-jobs growth of Milwaukee.
-- Still is president of the Wisconsin Technology Council and the Wisconsin Innovation Network. He is the former associate editor of the Wisconsin State Journal.
There was a time, and not so long ago, when people who attended conferences about the “greening” of America could be safely lumped into one of two categories – environmental activists or academics.
That time has passed, if last week’s eight annual “Green Energy Summit” in Milwaukee was any indication. While environmentalists, academics and even a few no-growth diehards gathered for the three-day summit, they were joined by company executives and other business leaders who are quietly transforming how Wisconsin defines its green economy.
From large companies such as Johnson Controls, Diversey and A.O Smith, to mid-sized firms such as Orion Energy, Virent Energy and Helios USA, the conference featured a number of business speakers who talked about their successful corporate efforts to save energy, water and other resources – and how it’s essential to their bottom-line performance.
“The greening of business is an unavoidable shift, and it’s sweeping the world,” said Andrew Winston, co-author of “Green to Gold” and a Fortune 500 consultant whose Wisconsin affiliations include serving on the Sustainability Advisory Board for Kimberly-Clark Corp. “I don’t care what (political) party you are, it’s good for business.”
The “unavoidable” part of Winston’s observation is based on trends driving consumers behavior, manufacturing, transportation, information technology, natural resources, real estate, government and energy generation. While some skeptics believe the “green movement” is little more than the byproduct of global warming scares, some of the best examples of green thinking, research and action have come from business.
Speaker after speaker discussed innovations that have helped companies save energy, water, packaging, transportation costs or time, all without sacrificing business efficiency. In most cases, such steps have improved profitability and helped companies to prosper in today’s highly competitive, global economy.
Wisconsin’s “green businesses” may also help Gov. Scott Walker hit his ambitious goal of creating 250,000 private-sector jobs by 2015. Here’s why:
In a state that still ranks among the nation’s manufacturing leaders, efforts to save energy, water and other resources give manufacturers an edge over their competitors while retaining and attracting customers. In some cases, those customers are retail consumers who are demanding green products – and using social media to tell others what they like or don’t like. Other customers are bigger businesses in the supply chain. Those businesses are increasingly demanding green practices on the part of their contractors and suppliers.
Wisconsin has know-how in a surprising range of green business sectors. Those include next-generation biofuels companies such as Virent, solar panel manufacturers such as Helios USA, clean water technology companies such as Aquamost and Bioionix, and a number of wind turbine companies that collectively employ about 2,000 workers. Major companies such as Johnson Controls and smaller firms such as ZBB Energy and PowerDesigners Inc. are producing breakthroughs in battery storage systems, corporations such as A.O. Smith are producing high-efficiency water heaters, and companies such as Diversey are making green cleaning, sanitation and hygiene solutions.
Smaller Wisconsin companies are engaged in those sectors and more. Biomass, biofuels, digesters, wind, solar photovoltaic, geothermal, conservation technologies, green building design and construction, transportation, information technology and electrical equipment are all examples.
Study after study shows that innovation, whether by larger businesses or start-ups, is essential to creating jobs. Wisconsin needs that innovation – and a huge crop of start-up companies – to create 250,000 jobs and reverse the state’s economic decline.
At a time when oil prices are hovering around $100 per barrel, when fresh water is becoming a scarce commodity in much of the world, when food prices are climbing and when smarter use of all resources simply makes sense, look for Wisconsin’s existing businesses – as well as many yet to be created – to help find profitable solutions.
-- Still is president of the Wisconsin Technology Council and co-author of “Hands-On Environmentalism,” a book about private strategies for land, water and wildlife conservation.
Every person is a potential target of a consumer scam, as anyone with an email account knows. The rise of computers and the internet have spawned new methods of consumer fraud, which can now be committed by someone in another state or even another country. But we still face plenty of fraud committed through telephone solicitations, door-to-door and mail-order sales, and a host of other types of fraud.
National Consumer Protection Week is a good occasion to reflect on the importance of protecting consumers and promoting responsible consumer activity. Wisconsin has strong laws protecting consumers, and my office will continue to enforce those laws vigorously. In the past couple of years, my office has filed cases against telemarketers, remodeling contractors, internet vendors, telecommunications companies, locksmiths, phony charities, travel clubs, fitness centers, and many other types of businesses who have tried to take unfair advantage of Wisconsin residents.
We will continue to take strong action against those who violate our consumer protection laws. But the best way to prevent consumer fraud from happening in the first place is for consumers to follow basic precautions so that they can recognize consumer fraud and avoid falling victim to it.
Here are some basic tips every consumer should follow:
* Be wary of solicitations from persons or entities you are not familiar with. There are numerous ways to check out companies, including the Better Business Bureau (“BBB”).
* Beware of dramatic promotions or claims. Remember that if it sounds too good to be true, it probably is.
* Do not respond to emails that seek account or other financial information. Legitimate companies do not send such emails. When in doubt, call the financial institution or company to confirm that the inquiry is legitimate.
* Paying with a credit card provides more protections to buyers than other forms of payment, such as cash, checks or debit cards.
* Avoid transactions that require you to wire money to someone you don’t know.
* Read “the fine print” and keep good records of your transactions.
* Before you donate to a charity you are not familiar with, be sure to check it out carefully. Many resources are available on-line, including the BBB.
An educated consumer is the enemy of would-be scammers. By taking proper precautions, and by reporting illegal activity to law enforcement, we can work together to defeat consumer fraud.
-- Van Hollen, a Republican, is Wisconsin's attorney general. The federal district court in Chicago is hearing the first arguments on the states' motion for preliminary injunction on Monday.
Help is on the way for small business. That’s great to hear. No sector of America’s economy could use a leg up more than the one that creates most of the nation’s jobs, spins off a major share of the Gross Domestic Product and offers hope for future generations of entrepreneurs.
But those promises of help are coming from inside Washington, D.C., a city not widely known for extending the hand of friendship to those who own and operate businesses. Actually, there’s quite a grand misconception in our nation’s capital about what, exactly, makes a small business.
Because of this, some of the most notable so-called small-business initiatives, particularly those emerging from the White House, won’t raise an eyebrow of the average small-business owner.
There are plenty of definitions of a small business. For instance, the U.S. Small Business Administration says it is an enterprise that must be independently owned and have fewer than 500 employees.
Our standards at the National Federation of Independent Business are somewhat different. To hold membership in the organization, a business must simply be independently owned, though the vast majority of our members employ fewer than 20 people.
President Obama’s small-business initiatives, however, seem to define them as high-technology startups holding their hands out for millions of dollars of outside investment. For example, a recent proposal the president floated would eliminate the capital gains tax for certain small companies, but only those organized as C-corporations that issue stock.
That definition disqualifies about three-fourths of all small firms. Of the remaining eligible businesses, only a handful issue stock in a way that will allow investors to take advantage of this benefit-- high-tech companies looking for investors to take a stake in a risky new idea or technology.
We don’t begrudge the president’s intent but his proposal will help only a small slice of certain entrepreneurs and small-business owners. Worse, it further complicates the tax code and plays favorites.
Listening to some of President Obama’s speeches lately, you might also get the idea that all small-business owners aspire to grow into huge corporations. Not so, most people start small-businesses for more humble reasons: to be their own boss, to work in their own community, or to do what they love.
We know the president is eager to put the economy back on its feet and we appreciate the fact that he believes small businesses can make that happen. We hope he’ll take careful note that it’s the bedrock small businesses of America who can deliver that boosting impact--the ones the Small Business Administration credits with creating two-thirds of net-new U.S. jobs and employing half of all private-sector workers—not those that roll the dice with taxpayers money.
President Obama has started down the right path by highlighting small businesses as saviors of the economy, but he would gain greater insight into their true needs just by listening carefully to them.
What they want—and need—is a government that will dabble as little as possible in their dealings. One that will simplify the tax code, eliminate burdensome regulations, and provide certainty and fairness in policies that affect them. That kind of help would go a long way toward helping small-businesses grow and thrive.
Help is desperately needed along Main Street America and it’s encouraging to learn that the president and his administration are looking for ways to provide it. They’ll find the doors of small business always open and will be heartily greeted by owners eager to share their ideas about how government can once again be a partner in America’s prosperity.
It’s a simple formula: helping small business helps America.
-- Danner is president and CEO of the National Federation of Independent Business in Washington, D.C.