Good Morning –
With Facebook set to become one of the largest global IPOs in history, we are all reminded of what is possible when entrepreneurs have the opportunity to take an idea and grow it into a business. Only in America can a college student launch a game-changing venture in his dorm room that grows into a multibillion-dollar company, creates jobs and puts our country at the forefront of innovation. The Facebook IPO is also a reminder that we need to keep doing everything we can to create an environment that will boost startups and small businesses growth. Earlier this year, both parties came together to pass the JOBS Act to spur the growth of startups and as Small Business Committee Chairman Graves writes today, “America must remember that our entrepreneurial free market system will be the primary driver of job creation and innovation, and policies like the JOBS Act will pave the way for more small businesses to go public and create jobs.” We must continue to work together on solutions that empower small businesses and startups, not Washington, so the future Facebooks of America can seize opportunities, grow, create jobs, and perhaps, change the world.
Today In History: In 1954, the U.S. Supreme Court handed down an unanimous decision in Brown v. Board of Education of Topeka, ruling that racial segregation in public educational facilities is unconstitutional. The historic decision, which brought an end to federal tolerance of racial segregation, specifically dealt with Linda Brown, a young African American girl who had been denied admission to her local elementary school in Topeka, Kansas, because of the color of her skin.
Birthdays: Sugar Ray Leonard, Bob Saget, Bill Paxton, Jordan Knight, Enya, Dennis Hopper, Craig Ferguson
Here are the Top 6 things you need to know today…
1. State Of Play: Leader Cantor Calls On President Obama To Focus On Boosting The Economy Through Small Business Growth. House Majority Leader Eric Cantor responded to the president's small-business proposal by recommending instead the House GOP's approach. "We welcome the president's about-face and his pledge to help our nation's small businesses," Cantor said. "However, his proposals again take a Washington-knows-best approach. Rather than mandating what businesses can and can't do in order to receive a tax cut as the president suggests, House Republicans have passed a common-sense 20% small business tax cut that would allow all small businesses to keep more of their hard-earned dollars to invest and hire." USA Today
2. Leadership Fail: Senate Democrats Reject Multiple Budgets, Including President Obama’s, Despite Bipartisan Agreement We Need A Path Forward On Deficit Reduction. The Senate became a political staging ground for meaningless budget votes on Wednesday, as five different budget plans spanning a range of fiscal ideologies failed, the latest chapter in Washington’s dysfunctional spending wars….For a third straight year, Senate Democrats refused to offer a budget resolution of their own — opening themselves to criticism that they’re dodging tough decisions in an election year. But Democrats argued that no budget is needed since spending levels were already set by last summer’s bipartisan debt deal. Politico
3. Small Biz: Chairman Graves: The JOBS Act Boosts Gazelle Firms, Encourages Entrepreneurship. The JOBS Act will particularly boost the so called "gazelle" firms (ages three to five years), which comprise less than one percent of all companies, yet generate roughly 10 percent of new jobs in any given year. According to the Kauffman Foundation, those gazelle firms contribute about 88 jobs per year per firm. Since 2007, we've seen a 23 percent drop in new business creation, according to the Bureau of Labor Statistics; and October’s annual World Bank's Doing Business report found that the United States fell to No. 13 for ease of starting a business, down from No. 3 in 2007. The JOBS Act will help address our recently declining entrepreneurial track record by making capital formation more attainable and paving the way for more small scale businesses to go public and create more jobs. The JOBS Act encourages IPOs by lowering the regulatory burden and cost associated with IPOs. The JOBS Act eases securities laws, originally crafted in the 1930s, to take advantage of technology for small businesses to raise money. Specifically, the law makes soliciting investments through the Internet legal, called crowdfunding. Just as Facebook and other social media websites have changed the way that small businesses communicate with customers, new innovations like crowdfunding have the potential to change the way that small businesses solicit investors. CNBC
4. Pro-Growth: High Corporate Tax Rates Stifle Innovation & Economic Growth, Put U.S. Firms At A Competitive Disadvantage. As of April 1, 2012, the United States has the highest corporate tax rate of any country in the world. Does it have to be said that this is not a good thing? High rates chase businesses and jobs out of the country. In fact, as a new study by O'Melveny and Myers's Jonathan Sallet and Robert Rizzi found, high corporate tax rates stifle innovation and retard economic growth. Key findings of the Rizzi-Sallet paper include: 1) The United States has continued to adhere to the policy of high corporate tax rates combined with targeted narrow tax breaks. 2) This approach to tax policy creates substantial uncertainty regarding future policies and undermines job creation. Firms facing a burdensome corporate tax rate like those in the United States are at a competitive disadvantage against their international counterparts and could potentially "fall behind in innovation and productive capacity." 3) A lower federal corporate income tax rate will lead to additional capital investment and greater productivity. This boost in earnings and capital will serve as a direct catalyst for job creation and growth. 4) Lower corporate tax rates equal a lower cost of capital while higher rates raise the cost of capital to firms…A bipartisan consensus is developing on Capitol Hill that it's time to reduce the U.S. corporate tax rate, as long as a lower rate goes hand in hand with the reduction or outright elimination of special interest credits and loopholes that distort economic behavior. If the president is looking for a real job creation program, he might want to think about getting behind this idea. US News
5. Energy Focus: House Committees Focus On Increasing American Energy Production, Lowering Cost Of Energy Prices. The Energy and Commerce Committee is marking up a pair of bills Thursday. One would set up an new interagency committee to study the cumulative effects of a number of EPA rules on gasoline and diesel prices, economic competitiveness, employment and other areas. The bill would delay — for at least a year — new EPA fuel emissions standards, air pollution rules for refineries and any new ozone standards while the interagency panel prepares reports and seeks comment. A separate bill would require an increase in the amount of federal land leased for oil-and-gas drilling if there’s a drawdown of oil from the Strategic Petroleum Reserve. Another GOP panel is pushing drilling even more aggressively. The House Natural Resources Committee approved GOP bills Wednesday aimed at speeding up and expanding onshore drilling on public lands. The Hill
6. Keeping Tabs: Chairman Upton: We Need Common-Sense Fixes To Reduce Pain At The Pump. Since taking the House majority in January 2011, Republicans navigated a different direction, offering a series of common-sense solutions to ease pain at the pump. Instead of trying to artificially reduce prices by selling our emergency oil reserves, mandating and subsidizing alternatives that are even more expensive or cynically blaming business bogeymen, we propose better answers: Create more supply and cut red tape…In the next several weeks, the House will move two additional measures from the American Energy Initiative, taking further steps to address the upward spiral of higher prices. Rep. Ed Whitfield (R-Ky.) authored the first bill. It directs the Environmental Protection Agency to delay further action on a series of pending new regulations on refineries until we better understand their cumulative effect on transportation fuel prices. If allowed to go forward immediately, these EPA directives could raise gasoline prices and contribute to the closure of American refineries. Heaping a host of uncoordinated regulations on businesses will only increase the price of gasoline, with little environmental benefit. But the Obama administration still wants to push ahead with its crusade. Roll Call
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