New small biz survey supposedly supports tax increases

Oct. 26, 2012

By Katy Grimes

A new survey of 500 small businesses claims that a majority of small business owners want high income earners to be taxed more. This is difficult to believe, and amazing timing with the election less than two weeks away.

I participated in an early morning conference call on Thursday with Small Business Majority. They just published the survey titled, “Scientific Opinion Poll Finds Majority of Small Businesses Support Letting Tax Cuts for High Income Earners Expire.”

But during the conference call, when I heard the CEO claim that the majority of entrepreneurs “see a productive role for government in helping small businesses achieve success,” I nearly flipped.

John Arensmeyer, the founder and CEO of Small Business Majority, also claimed nearly six in 10 small business owners “agree that government can play an effective role in helping small businesses thrive.”

The Small Business Majority is a liberal Democratic group based in San Francisco.  They backed Obamacare and AB 32, California’s Global Warming Solutions Act of 2006, and  enthusiastically support government subsidized green energy.

Putting an end to tax breaks

“Entrepreneurs agree no one likes to raise taxes, but because of the budget crisis, 52 percent believe we should let tax cuts for the wealthiest 2 percent expire at end of year,” the subtitle of the survey said, referring to President Bush’s national tax cuts.

The Small Business Majority CEO claimed numerous times throughout their press release that their survey was “scientific.”

Survey says…

The Small Business Majority website reports:

The majority of small businesses support raising taxes on high-income earners; nearly 9 in 10 oppose raising taxes on the middle class: Small business owners recognize the gravity of our budget crisis: 52% agree that while no one likes to raise taxes, we should raise taxes on the wealthiest 2%, given the budget situation, and 4 in 10 strongly agree. Only a 39% minority believes raising taxes on the wealthy means raising taxes on job creators and small businesses. A sweeping 86% oppose raising tax rates on household income below $250,000, and 71% strongly oppose it.”

And they offered this graphic as an example:

“Figure 2: When probed about tax cuts, the majority believe tax cuts on the top 2% should expire because it’s the right thing to do given our budget crisis

Please indicate which of these statements comes closer to your point of view, even if neither one is exactly right.

When probed about tax cuts, the majority believe tax cuts on the top 2% should expire because it’s the right thing to do given our budget crisis


“Despite rhetoric claiming otherwise, scientific opinion polling shows they simply don’t believe it’s in their best interest to extend tax cuts for high-income earners as a way to do it,” the survey reported.

Who is Small Business Majority?

Arensmeyer is also an entrepreneur. “John Arensmeyer has used his long experience as a business owner to build Small Business Majority into a nationally recognized small business organization…,” according to his biography. “John was the founder and CEO of ACI Interactive, an award-winning international e-commerce company. Information Week named ACI’s signature product one of the nation’s top 100 e-business innovations, and the company was cited by the San Francisco Business Times as one of the top 100 fastest growing private companies in the Bay Area.”

Reading through the biographies of the staff, nearly every one of them is tied to liberal causes. The “strategic” partnerships with other non-profit organizations are also highly suspect.

Not everyone is buying these claims

“Arensmeyer sold ACI Interactive, a $3 million Sausalito (Calif.) online-financial-services company, in 1999,” according to a story about business buyouts from 2005.

The New York Times’ small business blog apparently had difficulty swallowing some of Small Business Majority’s unusual claims, particularly about small business support for Obamacare.

“As far as the we know, the Small Business Majority research is the only research that has found that small businesses buy in to pay-or-play,” NYT blogger Robb Mandelbaum wrote in a 2009 story. “All of the other small-business advocates claim the opposite, and by greater margins — even the National Small Business Association, whose moderate leanings seem practically radical, at least compared to those of its larger rivals, the U.S. Chamber of Commerce and the National Federation of Independent Business.”

“The group has gotten a lot of press this spring, first as one of two small-business invitees to the White House health care summit meeting in March,” Mandelbaum reported.

There’s nothing like being invited to the White House to solidify support for presidential policies.

Mandelbaum discovered Arensmeyer’s political bias for Democrats, and even questioned just how “scientific” the surveys are. “Informally, however, it is allied with the Democratic Party,” Mandelbaum wrote. “Mr. Arensmeyer serves as a board member of the Bay Area Democrats, which describes itself as ‘a network of private citizens active in national Democratic Politics.’ Since 2002, Mr. Arensmeyer has given generously, and exclusively, to Democratic candidates, according to F.E.C. records.”

“Small Business Majority is nonpartisan only in the most technical sense, in that it is not formally allied with any party,” Mandelbaum wrote. “Informally, however, it is allied with the Democratic Party. The whole project, frankly, seems fundamentally ideological, and clearly liberal. It’s received a leg up from Demos, the advocacy group that counts among its objectives ‘a more equitable economy with widely shared prosperity and opportunity’ — no initiatives to foster Ayn Rand-style self-reliance here. (Demos serves as a fiscal agent, which allows the group to raise money as a 501(c)(3) nonprofit.).”

Maybe I’m just a little too suspicious. But when a survey of small business owners finds that they support higher taxation on wealthier people, and policies which redistribute wealth, it doesn’t feel scientific, or even rooted in basic economic principles. Claims like this feel  very unscientific, and very partisan.

Read the survey HERE.

The Small Business Majority website is HERE.

And be sure to read Mandelbaum’s story HERE, on the NYT blog.

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