Five things Congress may do that will affect your business this year
The August lull is upon us so let’s all be grateful. We can definitely use a few weeks of the congressional recess to at least try and forget about the ugliness in Washington and instead focusing on the more important things, like catching up on Stranger Things, spending some quality hours with the family and seeing Once Upon A Time in Hollywood for the third time. At least, that’s what I’ll be doing.
But the fall political season – and the 2020 presidential election cycle – will unofficially begin in earnest come 9th September when our congressional leaders arrive back in Washington to start the next term. Putting aside the rhetoric, will there be any legislation that will pass before year end that will affect your business and mine? Perhaps. Here are five things I’m watching.
The Secure Act
This bill – which stands for Setting Every Community Up for Retirement Enhancement – passed the House in May and now sits in the Senate. It has strong bi-partisan support and includes tax incentives for setting up retirement plans along with the ability of business to band together to negotiate better plans as well as allowing older workers to keep contributing without penalties. Passage of this bill will not only give us more motivation to establish and improve our retirement benefits but also help more workers save for retirement.
Spending approval
It’s unlikely that the president’s full budget will be passed by this Congress anytime soon. But a spending limit increase has been approved and many expect individual spending bills to be signed into law for departments including defense and health and human services. Although the new spending thumbs its nose at the terrifying rise in the country’s deficits, it does provide more cash for ongoing weapons programs, military research and social programs that are often performed by small contractors, nonprofits, startups and tech companies. The Defense Department alone will see an increase in defense spending to $738bn in 2020 and $740bn in 2021, from $716bn this year. The General Services Administration’s recent announcement that 24 small businesses would be part of a first pool of a potential $3.45bn contract to provide human capital and training support services for federal agencies and additional initiatives in biotechnology, space missile defense, hypersonics, nuclear modernization and Stem workforce programs are all examples of the spending programs that will benefit small businesses in those areas.
Trade deal with Canada and Mexico
A House committee is currently evaluating the Trump administration’s new trade deal with Canada and Mexico – called Nafta 2.0 – and will be debating its value this fall. Legislatures in Mexico have approved the deal (Canada is expected to do the same before year end) and it now awaits congressional approval for it to become effective. Although some groups are calling for stronger environmental protections the deal – which includes extended copyright and intellectual property protections, increased requirements for hourly wages for workers making automobiles and greater access for US farmers in the Canadian dairy market – is a positive for small businesses and would secure, at least for the next 16 years, a more open business environment throughout North America.
Tax extenders
The House Ways and Means Committee approved in June a bill that extended through 2020 a bunch of tax breaks from 2017 and 2018 to help middle and lower income families. Significant provisions would benefit small businesses in the renewable energy industry, help to provide paid family leave and reduce alcohol excise taxes. The earned income tax credit, the child tax credit and the child and dependent care credit were also extended – all provisions that provide added help to employees and take away this burden from small businesses to provide. Both parties will debate how the measures will be funded, but it’s likely - given this election year - that this legislation will pass before year end.
Paid family leave and minimum wage
Nah, I don’t think either is going to happen by the end of the year. But there was a recent unveiling of the bi-partisan Cassidy-Sinema Plan which provides for federal assistance for new parents. And more states continue to increase their minimum wages as movement for a Democratic-backed $15 an hour national minimum wage gains momentum in Congress (President Trump – who supports an increased minimum wage – has said publicly that he is “weighing” the proposal). Both initiatives will certainly become more prominent by year end as political candidates make their stands heading into 2020. I’m betting – regardless of the outcome of the 2020 elections – that we’ll be seeing movement on both paid family leave and minimum wage at the federal level in the next year or two and business owners will need to be paying close attention.
All of that is stuff that will impact my business and yours. However, I’m leaving out three big things that will likely dominate the news during this period: a potential Trump impeachment by the House as well as firearm and immigration laws. While I expect little to come of these initiatives this year by way of legislation I do think that both parties will use them to stake their ground for the upcoming election year and their candidates’ positions on these issues will have an impact on our businesses in the future.
But for now, let’s enjoy the vacation folks. Take a dip in the pool. Have a few cocktails. Catch a few rays. Soon, September will be upon us and as our political leaders arrive back to their jobs, we’ll all have to prepare for potential legislation that may – or may not – benefit our businesses over the next year or two.