By Madeleine Neal
One former life-insurance CEO, one union leader, one physician, two former or active mayors, a city councilor, a state senator, a former management analyst, a public-policy group co-owner, and an incumbent governor. From CEOs to union leaders, the candidates on the 2018 gubernatorial roster face a question: How can Iowa’s small businesses coexist with its larger corporations?
According to the U.S. Business Administration’s Office of Advocacy, the state is home to approximately 266,382 small businesses, which are defined as firms that employ fewer than 500 people. These businesses account for Iowa’s nearly 641,288 small-business employees, according to the agency.
But these small businesses face large corporations such as Apple, which announced in August 2017 that its next data center will be built in Des Moines. Apple’s $1.3 billion investment is set to create more than 550 construction and operations jobs in the Des Moines area and is also contributing nearly $100 million to a public-improvement fund, according to a news release on its website.
Steve Ray, a Republican candidate for governor and Boone city councilor, said he is an advocate for small-business owners and larger businesses alike.
“Well, [small-business owners] are going to have a great amount of support from me,” Ray said. “I’ve always been pro-small business, and I understand the entire concept behind big business, communities do stuff to try to attract big businesses … not necessarily the economic impact that a bigger business can make, but, you know, a lot of times they’re supposed to bring in large numbers of jobs.”
While he said he understands the big-business perspective, small businesses, he noted, employ the vast majority of Americans in the country, including Iowa.
“There are a lot of times I think they [small businesses] get put on the back burner of their importance to the overall economy. And as a matter of fact, let’s say for instance, the issue with Apple coming to Iowa — you know, that’s great for that community,” he said. “That’s going to happen there, but when you talk in terms of tax incentives — I would much rather take that kind of money over a period of time that is given in tax incentives, be able to put that into much greater work by helping small businesses across Iowa.”
Despite his support for small businesses, Ray said, CEOs and large business owners shouldn’t have anything to fear from him should he be elected.
“I mean, I’m pro-business, and I always have been,” he said. “Business is what makes America strong, and that’s what makes America what it is, and the type of capitalistic society that we have, that’s what makes our economy flourish. They make that economy strong; they employ people.”
Ray said he is much more concerned with CEOs of large businesses supporting the communities that they’re in.
“… I think anytime that we attract great businesses to come to Iowa is wonderful. My only issue — and not many on the Republican side always look at it this way — but I look at it that I want to make sure that we have more bang for our investments,” he said. “So when we want to talk in terms of bringing in large corporations like Apple … ‘is it worth all that money that you are willing to invest taxpayer money and incentives over a period of time?’” he said. “For just a small pool of people, or would that money be better invested into small businesses, where that amount of money could really substantially help many small businesses around the state in terms of economic growth?”
While The Daily Iowan did not receive a response from Gov. Kim Reynolds by the time of publication, she did acknowledge the accomplishments her administration has made in terms of big and small businesses in her Jan. 9 Condition of the State Address.
“We reformed collective bargaining and worker’s compensation laws,” Reynolds said in the address. “Putting more power in the hands of local governments and school districts, small businesses, and taxpayers.”
Reynolds also noted that she will propose a tax reform package that “significantly reduces rates, modernizes our tax code, eliminates federal deductibility, and provides real tax relief for middle class families, farmers, and small businesses.”
“This session, we must work together to pass legislation that gives Iowa farmers, small business owners and their workers access to affordable insurance,” she said.
The DI also reached out to Ron Corbett, Republican candidate for governor, but did not receive a response. By the time of publication.
Like Ray, Sen. Nate Boulton, D-Des Moines, a candidate for governor, also said he is an advocate for business, especially on a smaller scale.
“While the current administration focuses on giveaways to large, out-of-state corporations, we can offer better support and development assistance to Iowa employers and entrepreneurs,” Boulton wrote in an email to The Daily Iowan. “We can also help sustain and grow opportunities for employers of all sizes by ensuring our state is addressing the real problem employers want addressed: creating the skilled workforce we need for the future.”
His goals for the state can be reached by supporting education, Boulton said, which he said will enhance the quality of life for working Iowans.
“The state of Iowa should be a better partner with our small businesses to ensure success and create jobs in both urban and rural Iowa,” he said.
Like Boulton, Andy McGuire, a Democratic candidate for governor and former chair of the Iowa Democratic Party, wants to hone in on eduction to help stimulate local businesses.
“This mismatch of qualified employees is holding our economy back and making it difficult for local businesses to grow,” McGuire wrote in an email to the DI.
McGuire said she will focus on education should she be elected to help small businesses grow.
“I’ll also work to make it easier for our community colleges to collaborate with their local business community and chambers of commerce to better align the supply of new workers with the needs of local available positions,” she said. “And I’ll support the creation of new entrepreneurship programs within our community colleges that work with people who want to start a small business but need help getting it off the ground.”
McGuire said with smart investments, she thinks Iowa’s local economies will head in the right direction.
“We should do all that we can to train Iowans in their local communities so they can stay right here in Iowa,” she said.
But in treating small businesses equally with large corporations, and with the caucuses approaching, there’s a growing concern about who will help make the decisions to help future jobs.
Fred Hubbell, a Democratic candidate for governor and a retired insurance executive from Equitable Life Insurance Company of Iowa, said large corporations are not harmful single-handedly; they have to be run by the wrong person to negatively affect smaller businesses.
“Whether you’re good or bad, what determines that is how you manage a job, how you treat people in your job, and how you support your community … there are plenty of bad CEOs, there are plenty of bad unions … there’s corruption everywhere,” Hubbell said. “… The question is, how did you treat people and how well did you treat the community in which you did business?”
Hubbell emphasized that each side of the spectrum, from CEOs to labor unions, can be at fault or can work for the “better good.”
“I think there are plenty of examples where big business has been harmful, and there are plenty of examples where big business has been very helpful — just like the example of labor unions,” he said. “Some labor unions are wonderful — there are corrupt labor unions, too … bad apples, bad actions, happen in all kinds of walks of life.”
Cathy Glasson, a Democratic candidate for governor and the president of SEIU Local 199 and a Coralville nurse, said Iowans should elect real people who understand the challenges facing what she called everyday Iowans.
“It’s clear that sometimes they’re out of touch with the reality of what’s going on on the ground, so we need leaders who are going to stand up for everyday Iowans — not just look out for their corporate friends,” Glasson said. “We’ve got that now in the Republican Legislature and our governor — I don’t want that in a Democratic governor who runs our state in 2018.”
Ross Wilburn, a Democratic candidate for governor and a former mayor of Iowa City, said seeing non-politicians run for office shows a concern about both the state and the country.
“… That it’s [the state government] not benefiting the majority of Iowans, not benefiting the majority of Americans, and it’s getting toward focusing on corporate interests,” he said.
Corporations still play an important role in both the state and federal levels, Wilburn said, but he noted that Iowans need to ensure that people of low to moderate incomes have the opportunities that those in higher income brackets benefit from.
“There are two critical issues related to business or corporations for me — first of all, is when you’re going to provide a tax-breaker incentive, we want to make sure that they are targeted, that the public is getting a return on the investments for allowing a tax break,” Wilburn said. “So the issue isn’t big business, small business. It’s when we give tax incentives, ‘What does the community want to sustain?’; ‘What do the city or some of the rural areas get out of it?’”
One of those sustainable takeaways would be jobs, he said, and the other would be helping generate revenue for the state in terms of infrastructure.
“… Also on the individual level is … ‘How are workers being treated? Are they able to make a living on the wages that are being paid?’ ” Wilburn said. “If we’re going to invest or incentivize a certain type of business, then this goes to the targeting piece — ‘are we providing what we should provide … where groups of folks may be able to make a living and operate, you know, driving business, regardless of where they are?”
The DI also reached out to John Neiderbach and John Norris, both Democratic candidates for governor, but did not receive responses by the time of publication.