Standing up for Small Business

The National Federation of Independent Business

The National Federation of Independent Business (NFIB) has its hands full. The member driven association represents over 350,000 small business owners across the United States, promoting their interests at the state and national level.

When I caught up with Jean Card, NFIB’s Vice President of Communications, she barely had time to squeeze in a conversation amidst the day’s demands. “We’ve been running around today,” she admitted. “We have a real membership demand around the first Obamacare deadline. There is so much that people still don’t know – and people in Washington are still trying to figure out what people need to do to comply.”

For Ms. Card and her colleagues at the NFIB, guiding members through tough scenarios like this is all in a day’s work.

Supporting Small Businesses
In 1943, NFIB founder Wilson Harder had had enough. “He felt like, when it came to business issues being considered in the public sector or in the legislature, that small businesses never quite got the attention they deserved,” Ms. Card explains. “When discussions were around business and public policy it always skewed toward the big.” Mr. Harder’s response? To quit his job and launch the association from the basement of his house.

Today, after 70 years of growth, the NFIB is truly a force to be reckoned with. As a single, unified entity with influence in all fifty states, as well as in Washington, the NFIB has remarkable reach. “We have a very strong national presence and we also have a lobbyist in every single state capital, which is very unusual for an association,” Ms. Card explains. “A lot of trade organizations will have state or local chapters, but there is actually no legal connection to the national. So for us to truly be under one umbrella is very unusual and very powerful.”

Equally important – and unusual – is the fact that the NFIB is completely member driven. “A lot of associations set policy decisions through a board of directors or [through a process that is] very staff driven,” Ms. Card points out. The NFIB, on the other hand, goes directly to the people it represents. “We ballot our members on both state and federal issues multiple times a year. They vote and we tally those ballots and we do what they’ve told us to do. And that is very unusual. I don’t know of another association that does it that way – that is 100% member driven.”

The association also regularly surveys its members to gain crucial information about the current state of small business. Data is shared in widely referenced publications such as Small Business Problems and Priorities and the Small Business Economic Trends report, which “is considered so accurate and so representative that even the Federal Reserve uses it.”

The NFIB is also able to maintain an accurate understanding of members’ policy positions through its activity at the state level. “Our state directors… they are very close to our members and to our members’ wants, desires, and challenges,” Ms. Card points out. “That helps us be powerful from a grassroots point of view, because we have people all over the country who are actually in day to day conversations with small business owners. No other organization in America can say that.” Small business owners around the U.S. agree; in fact, the NFIB boasts record membership. “No other organization comes close to our numbers,” Ms. Card reports. “So we’ve got the age, the national network, and the numbers.”

This “power in numbers” is crucially important to the NFIB. Big business has the time and money to act on its own, Ms. Card explains. “They can afford their own representative or afford the time to go themselves to the state capital or Washington, DC and make connections. Small business owners do not have the cash flow or the time to be lobbyists. But if they all join together they can hire a team of lobbyists. And that is what it means to join NFIB. You join with hundreds of thousands of other small business owners and together you can afford to have a very fine advocacy team working for you all over the country.”

Achievements and Current Concerns
The NFIB has achieved remarkable results through the collective power of its members. In fact, the association pioneered some of America’s most important and effective lobbying techniques. “We invented grassroots,” Ms. Card remarks. The concept dates back to the 1980s when NFIB employee John Motely began waging blitz campaigns against the Washington establishment. “He used to say ‘I’m going to make it snow on Capitol Hill.’” The strategy was simple. The NFIB would fax notifications to hundreds of thousands of members nationwide to report that a certain policy was being voted on – and that immediate action was required. The result would be “thousands of business owners calling, writing,” Ms. Card remembers. “We really started that. We changed how lobbying, and business lobbying in particular, was done… because we were able to turn out that kind of megaphone on Capitol Hill.”

One key NFIB grassroots victory was against the Clinton health care plan in the 1990s. “We were widely credited with stopping Hillary Care,” Ms. Card reports. “A lot of people were involved in fighting it, but there was a lot written at the time that NFIB got it done. We figured out how much it would cost, we figured out how it would affect the economy, and a lot of people believe we put the nail in the coffin. That was a really, really big deal and that put us on the map in a very big way.”

Today, the NFIB is working hard to represent members’ interests in regards to the Affordable Care Act (ACA). “This issue hits very close to home,” Ms. Card explains, because “the cost of healthcare has been the number one issue for our members for 30 years.” A key member concern has been around the individual mandate, which requires most Americans to be insured or pay a penalty. In fact, the NFIB was the lead plaintiff in the lawsuit that went all the way to the U.S. Supreme Court contesting this aspect of the law. “We also had two of our members on the suit – real small business owners,” Ms. Card adds. “When you talk about the power of the individual, I can’t think of a better representative than a small business owner.” The NFIB lost the case, however, and has now turned its attention to helping members navigate the complexities of the new health care law.

“What we are focusing on right now is making sure that our members know what they are responsible for. It is very confusing. [Even lawmakers and government officials] are still trying to figure out what is required and what the penalties are.” The team is also headed back to Congress and to the Obama administration to ask “for a break on a couple key areas,” Ms. Card explains. First of all, the NFIB wants to stop the Health Insurance Tax because, even though it is technically levied against the insurance companies, the cost is passed on to the consumer. “It is a tax that only hits fully insured plans,” Ms. Card says. “And fully insured plans are the ones that small business owners and individuals purchase. Big companies aren’t paying this tax.” The NFIB doesn’t want its members to carry a tax burden that larger, better funded businesses escape. “We are trying to get that one off the books. It is just so blatantly unfair.”

The employee mandate is another key issue that the NFIB is working against. The mandate only applies to businesses with fifty or more employees, but Ms. Card says that it has the potential to create a serious ripple effect. “There is a lot of fear around the employer mandate,” she reports. “It is not good for the economy. Imagine that you have [employee numbers] in the high 30s, and your business is growing. You will think twice about how much it is going to grow and whether or not you will limit the growth or limit the number of people you hire because you don’t want to hit that mandate. And that is a really unfortunate unintended consequence.” If the NFIB can’t get the employee mandate off the books, members would at least like to see the definition of full time employee revised. “Under the health care law, the definition of full time employee is 30 hours per week, which is totally different than what labour law has been for decades,” Ms. Card says. “It has been forty hours forever. So we are fighting really hard to at the very least make it a normal definition that is consistent with other labour laws.”

While healthcare, and the ACA in particular, is the issue of the moment, the NFIB is also focused on representing members on the two other critical issues that small business owners reliably face: taxes and regulations. “Right now we are talking to Congress about comprehensive tax reform that most importantly deals with individual rates because, as a self-employed person, you do not pay a corporate tax or a business tax. You pay at the individual rate.” The danger, Ms. Card explains, “is that Washington gets focused on corporate tax reform and thinks that takes care of ‘business.’ But individual rates are what matters to the community that creates two out of three net new jobs.” Regulations are also a critical concern for small business because “a big company can hire lawyers to figure out all that paperwork. Small business owners have to do it themselves. We are trying to draw attention to the fact that this is a serious burden.”

Specific laws and lobbying efforts have changed over the past seven decades, but the commitment to represent members has remained steady and, Ms. Card says, will continue steadfastly. In fact, the NFIB views its efforts to defend small business as an issue of rights. “We really see it that way and our members see it that way, that it is their right,” Ms. Card insists. “We show up here every day with the goal of protecting our members’ right to own, operate, and grow their business,” Ms. Card says. “It is our mission.”