Hope has been a major campaign theme for Barack Obama in both of his presidential campaigns.
Some Maryland business executives said this week that they hope his re-election Tuesday translates to more lending and contract opportunities and boosts the state’s infrastructure.
“President Obama has a job to finish,” said Jamal Lee, owner of Laurel audio, lighting and video production company Breasia Studios. “Four years is not enough time to fix the economy. I don’t think eight years is enough for as bad as the recession has been. ... I know he’s spent a lot of money, but he has worked diligently to keep us from falling into a real depression. He kept the auto industry going. He got some control over Wall Street.”
In January 2009, when Obama moved into the White House, Maryland’s unemployment rate was 6.3 percent. The rate rose to as high as 8.0 percent in about a year before falling, and was down to 6.9 percent in September. The national jobless rate was 7.9 percent in October — about the same as in January 2009 — after rising to as high as 10 percent in late 2009.
One area that needs more attention is funding for small businesses, whether in the form of loans, grants, contracts or other instruments, Lee said. He hasn’t been able to get a significant loan for his small business, just a line of credit for less than $30,000. He’d like to see lenders and the U.S. Small Business Administration loosen the reins and provide more loans to companies such as his.
“I tried to get a loan from a larger bank for about $250,000, but they told me no,” said Lee, who formed Breasia in 2005. “President Obama has worked with the SBA to get more loans for businesses, but more has to be done. ... Small businesses also need more access to federal contracts. Those contracts can’t just go to large companies.”
The election helped settle some of the cloud of uncertainty that hung over businesses for the past year or so. Many executives have said they were waiting to see which way it would go until making concrete hiring plans for next year.
“Now, we can get back to business as usual,” said Charlie Maier, partner with Rockville public relations and marketing firm Maier & Warner. “I’m optimistic about the next four years. I think companies will hire more, and it will be a good year in 2013.”
More regulation, mandates ahead?
However, others wonder if there will be more regulations, taxes and mandates ahead.
“The economy remains a struggle for many small businesses,” said Ellen Valentino, Maryland state director for the National Federation of Independent Business. “These issues are nonpartisan. We hope there are fewer regulations and no additional mandates. Small businesses want to be left alone to run their business.”
The closer popular vote this time than in 2008 should send a message that more has to be done by the Obama administration and members of Congress to work together, said David Kitchens, principal-in-charge of the Alexandria, Va., office of architectural and design firm Cooper Carry. He has done work in Maryland.
“I’d like to see a balanced budget and the federal debt reduced,” Kitchens said. “Those of us in the private sector have to live under a budget.”
U.S. Sen. Benjamin Cardin (D) of Pikesville, who also won re-election this week, said in a statement that he “will continue to seek common ground to get things done for Maryland and for our nation. ... We need to set partisanship aside to develop a balanced approach that considers reasonable cuts in spending with fair tax reform and invests in our future. We cannot leave our children a pile of crippling debt any more than we can leave them polluted air or contaminated water or deny them quality education.”
Maryland should get more infrastructure funds under Obama than it would have if Republican candidate Mitt Romney had won, Kitchens said. Projects such as the Purple Line, a proposed rail line from Bethesda through Silver Spring to New Carrollton, and “layered” improvements such as bus rapid transit and light rail might become more of a priority, he said.
Romney would have cut funds for the Federal Transit Administration’s New Starts program, which supports transit capital projects such as commuter rail, light rail and bus rapid transit, said Glenn Orlin, deputy staff director of the Montgomery County Council. Obama has not said if he would slash or boost that program, he said.
“That could help us develop the Purple Line faster,” Orlin said. Among the roadblocks to developing that line is coming up with state funding, which he said would need a major revenue infusion such as more cash from higher taxes on gasoline and diesel fuel.
Another key issue for Maryland is the trend of federal agencies to consolidate office space, said Steven A. Silverman, Montgomery County’s director of economic development.
“That is leaving a lot of space to fill,” he said.
Affordable Care Act moves forward
With Obama’s re-election, the federal medical insurance law is on track. Romney had vowed to repeal the Patient Protection and Affordable Care Act, a signature piece of legislation in Obama’s first term, if he won the election.
“Business owners can now at least begin to plan for what lies ahead,” Valentino said.
The federal legislation, which allows small businesses a federal tax credit to provide medical insurance for employees, and a state subsidy program allowed Lee to start offering health insurance more than a year ago. That in turn helped improve morale among employees, making his business more productive and competitive, he said.
“The tax credit is so important,” said Lee, a member of the network council of a national advocacy group, Small Business Majority. “It allows us to save some money so we can perhaps bring some more people in part time. ... My employees really appreciate having the coverage.”
About 50 percent of respondents say they want the new law to be kept intact with some minor tweaks, according to a recent survey by Small Business Majority.
But most members of the National Federation of Independent Business want to see substantial changes in the law, such as allowing tax credits for individuals who purchase insurance, not just for the employer-sponsored market.
Maryland is among the fewer than half of the states that already have set up insurance exchanges, where small businesses and individuals will shop for private medical coverage. The U.S. Health and Human Services Department will run the exchanges in states that don’t set up their own.
Open enrollment for exchange plans is scheduled to start next Oct. 1, with coverage effective Jan. 1, 2014. Maryland officials say about half of the roughly 730,000 Maryland residents without health insurance will obtain coverage by 2020.
Starting in 2014, employers with more than 50 full-time employees or equivalents that don’t offer health insurance to workers will face a penalty. Businesses will pay $2,000 per employee after the first 30 employees; a business with 50 employees would pay $40,000.
The large majority, about 90 percent, of Maryland businesses with more than 50 employees already offer insurance, state officials say. Still, some businesses with more than 50 employees that now offer insurance could decide it is less costly to pay the penalty than provide insurance, Valentino said.
“They have to weigh the options presented to them,” she said.