No matter who gets elected President in November, an advocate for small business expects there will be little change in Washington policy toward small business and federal contracts.

“You’ve got this pool of around $150 billion in federal contracts that’s supposed to be going to middle class firms and small businesses,” says Lloyd Chapman, president of the American Small Business League, based in Petaluma. “And yet because there’s really no one to defend it, you’ve got Fortune 500 corporations trying to raid it.”

Mr. Chapman has battled the Bush Administration for years over how billions of dollars in federal contracts supposedly earmarked for small business have, he says, actually gone to the largest corporations.

But neither Mr. Obama not Mr. McCain has yet to speak out, Mr. Chapman says.

“It’s all about money,” he says. Mr. Chapman says venture capitalists have showered cash on top Democratic leaders buying their silence on the issue.

(Lloyd Chapman talks about the candidates and small business in today’s CVBT Audio Interview. Please left-click on the link below to listen or right-click to download the MP3 audio file to your computer or mobile media gadget.)

“People just need to realize that this is affecting you no matter what you do for a living,” Mr. Chapman says. “When the government pulls a hundred billion dollars a year out of the middle class economy, it’s going to affect you and your family.”

How many small businesses are there in the U.S.? Maybe not as many as the politicians say.

Mr. McCain is among those saying there are 23 million small businesses in the United States.

But if you look at a small business as one that has a payroll, that figure reduces to under a million, according to FactCheck.org, which describes itself as a “nonpartisan, nonprofit, "consumer advocate" for voters that aims to reduce the level of deception and confusion in U.S. politics” and which is funded by the nonpartisan Annenberg Public Policy Center of the University of Pennsylvania.

The vast majority of “small businesses” have no employees other than the owner, who might also be the chief cook and bottle washer – or a physician, attorney or other professional.

FactCheck analyzes the claims in the campaign and points to a current one about small business.

“McCain has repeatedly claimed that Obama would raise tax rates for 23 million small-business owners. It's a false and preposterously inflated figure,” FactCheck says.

“We find that the overwhelming majority of those small-business owners would see no increase, because they earn too little to be affected,” it says.

What do the candidates’ websites say about their stands on small business?

Mr. Obama “will eliminate all capital gains taxes on start-up and small businesses to encourage innovation and job creation,” the candidate’s website says.

It also says Mr. Obama will also support small business owners by providing a $500 “Making Work Pay” tax credit to almost every worker in America. “Self-employed small business owners pay both the employee and the employer side of the payroll tax, and this measure will reduce the burdens of this double taxation,” it says.

Mr. Obama would support entrepreneurship and spur job growth by creating a national network of public-private business incubators. The federal government would invest $250 million per year to increase the number and size of incubators in disadvantaged communities throughout the country, .

Mr. McCain’s website makes no highlighted mention of his specific plans for small business or the Small Business Administration, but does offer some of his past remarks.

In June, for example, he told a meeting of the National Federation of Independent Businesses that he would push for a two-tier income tax, part of what he called “a simpler, a flatter, and a fair tax code.” He also supported NAFTA, bemoaned the loss of “millions” of jobs, said he would improve federal aid to the unemployed, “break down trade barriers,” cut the corporate tax rate, and “keep the current low income and investment tax rates.”

President-elect Barack Obama would do well to resist the corporate-friendly urgings of the advisers who persuaded him to scrap his proposed windfall profits tax on Big Oil.

The fact that oil prices have fallen well below $40 a barrel from a high of $147 a barrel in mid-2008 is not a valid reason for scrapping a plan to retrieve a small part of the obscene profits the oil industry raked in when prices were sky-rocketing.

Then and now a windfall profits tax would have provided a wonderful and fast-acting economic stimulus for the people who need it the most. Indeed, Obama originally proposed using it to help fund a meaningful rebate to middle class and poor American families.

Gas prices are unlikely to rest long on their current low plateau. In fact, oil industry indicators already are pointing to a future rise in the price of oil triggered by production cutbacks in oil producing nations and a resumption of high demand in high-growth nations like China and India.

Obama promised to use funds from the windfall profit tax to help middle-class and lower-income Americans stung by the usurious gas prices earlier this year.

Americans were forced to pay not only higher prices for fuel but for basic food staples that increased in price due to Big Oil's money grab. Obama promised American middle class families a $1,000 rebate garnered from the windfall profit tax to offset the cash Big Oil grabbed from their wallets at the gas pump last summer.

During the campaign, Obama said he would "put a windfall profits tax on oil companies and use it to help families pay their heating and cooling bills and reduce energy costs." After securing the White House in November, Obama went back on his word to the majority of Americans who were convinced he was a man who would do what he said.

Obama's message of "Change" now appears to be changing his mind about the lofty promises he made on the campaign trail. He certainly has discarded his pledge to deal with Big Oil's excessive profits.

Rather than rescind the departing administration's infatuation with the oil patch, he now wants to do everything he can to help an industry that effectively turned the executive branch into its wholly owned subsidiary for the last eight years.

The claims by oil and gas producers that the recent drop in oil prices has hurt their ability to explore and innovate are almost laughable.

Unfortunately, Obama, who was swept into office by a huge and enthusiastic progressive turn-out, now seems more attuned to the bellyaching of few, select oil company chieftains than the growling hunger pangs of millions of Americans struggling to put food on their tables.

Granting Big Oil a stay of execution on a windfall profits tax does nothing to advance a move away from carbon-based fuels in America. As a consequence, environmentalists have become justifiably skeptical about his promises to move America to a "green economy." Weaning America away from carbon fuels, after all, was a keystone of Obama's presidential campaign.

There can be little doubt that the post-election Obama has shifted his concerns away from the working-class base that propelled him to a landslide victory -- replacing them with the special-interest agendas of Big Oil moguls like T. Boone Pickens.

As middle-class and poor Americans struggle to recover from the worst economic collapse since the Great Depression, Obama seems intent on shunting them to the back of the breadline -- behind the very fat cats whose greed for excessive profits created the current economic debacle.

Rather than acting like a latter-day FDR, he is disappointing his loyalist base with actions that hark back to the hapless measures carried out by the ineffectual Herbert Hoover. He can get back on the right track by reviving his windfall profits tax proposal.

Wayne Madsen is a contributing writer to the progressive Online Journal. (McClatchy-Tribune Information Services)

During the campaign, Mr Obama repeatedly promised to submit oil and gas companies to a profits windfall tax, citing the disparity between their huge profits and the struggles of ordinary Americans.

In the summer he said the tax would "help families pay their heating and cooling bills and reduce energy costs".

But the proposal has been quietly dropped from his agenda listed on transition team website's www.change.gov, setting off a storm of protest among liberal bloggers and small business groups.

An aide explained the change by saying: "President-Elect Obama announced the policy during the campaign because oil prices were above $80 per barrel. They are below that now and expected to stay below that."

But the shelving of the proposal was spotted by the California-based Small Business League, which asked if "the sudden elimination of this issue is a further indication that large corporations are already demonstrating their ability to influence the Obama administration".

"President-Elect Obama owes the American people an explanation as to why these campaign promises have been pulled from his agenda," it said.

The League was also disappointed that Mr Obama has dropped a reference that expressed concern that federal contracts designated for small businesses were being awarded to major corporations.

Mr Obama's decision follows indications that he will probably go back on another pledge - to introduce higher taxes for those earning $250,000 (£165,000) or more a year.

David Sirota, writing on the liberal blog Campaign For America's Future, said: "It seems like the Obama team is buying into the right-wing frame that raising any taxes - even those on the richest citizens and wealthiest corporations - is bad for the economy."

Mr Obama's emphatic victory on Nov 4 had left many of his liberal supporters hoping, if not presuming, that he will fulfil the parts of his agenda they most yearned for. This may not be the last time they are disappointed, as Mr Obama has so far shown an inclination to govern from the centre.

The oil industry, however, welcomed the move. It had argued that a previous windfall tax under Jimmy Carter cost the country billions as suppliers spurned domestically-produced oil and looked overseas.

"The judgment to withdraw the concept of a windfall profits tax is an important recognition that developing America's oil and natural gas would be seriously damaged by such a tax policy," said Lee Fuller of the Independent Petroleum Association of America.

Planners for Mr Obama's inauguration are meanwhile grappling with the sensitive issue of how celebratory the tone should be in light of the grim national economic mood.

There are normally numerous of gala and civic events in the days around the inauguration, but too much celebrity and glitz in the capital could look inappropriate to those struggling elsewhere.

Josh Earnest, a spokesman for the inaugural committee, said that while the depth of the crisis would be recognised, the inauguration "serves as a reminder that in these challenging times, our citizens want the kind of leadership that's going to galvanise the country".

Up to four million people are expected to flood Washington for the Jan 20 event, while more than 1,300 groups have applied to take part in the parade, compared to the 400 that applied for President Bush's second inauguration in 2004.

Source:  http://www.telegraph.co.uk

President-elect Barack Obama has quietly dropped his original proposal for a windfall profits tax on oil companies, according to a spokesperson.

Obama has jettisoned the plan after the price of oil has fallen precipitously in recent months. An unidentified aide told Reuters that Obama announced the policy back when oil was above $80 per barrel. However, the price of crude oil has fallen $100 per barrel since it hit a record level of $145.29 on the New York Mercantile Exchange on July 3.

The money from the tax was supposed to be used to help low-income families pay their energy bills. "It isn't right that oil companies are making record profits at a time when ordinary Americans are going into debt trying to pay rising energy costs," Obama said back in May. "That's why we'll put a windfall profits tax on oil companies and use it to help Indiana families pay their heating and cooling bills and reduce energy costs."

However, the oil industry has fiercely resisted calls for a windfall profits tax, pointing out that the tax did not work when it was instituted in the 1970s by the Carter administration.

A small business advocacy group, the American Small Business League, first pointed out the absence of the windfall profits tax proposal on the Obama transition team's Web site last week (see Group Charges Obama is Backtracking from Tax Promises). ASBL president Lloyd Chapman blames the oil and gas industry for pressuring the Obama team to remove the proposal suddenly from its Web site with no explanation.

"The oil and gas industry needs to be regulated," he told WebCPA. "Skyrocketing gas prices contributed to the downfall of the big three auto makers, and I don't think we should allow the big oil producers to have that power over our economy."

He is also upset that the Obama team has removed another proposal from its Web site requiring the federal government to stop awarding contracts to large companies that are supposed to go to small businesses. A 1997 law required 23 percent of federal contracts to go to small businesses that have less than 500 employees, but Chapman contends that up to $200 million per day in federal contracts is going to Fortune 500 companies that should have gone to small businesses.

"Over 80 percent of the new jobs in our country have come from small businesses," he said. "When you watch the news, they're putting money into Wall Street and Detroit, and now they're talking about bailing out the states. Now Obama is going back on promises to help small businesses. I want Barack Obama to end the diversion of federal contracts to corporate giants."

Source:  http://www.webcpa.com/article.cfm?articleid=30014