Rockford's Manzullo fights for small business

In this age of big corporate dominance, the entrepreneur has fewfriends in high places. But if there's a guardian angel for thelittle guy in business today, the title might well go to Rockford'sDon Manzullo, Republican chairman of the House Small BusinessCommittee.

Over the past 14 years, this maverick, high-energy U.S.congressman has been a fanatic on one subject: equalizing the breaksfor America's 25 million small-business owners. Typical of the wideranging legislation he has authored or co-sponsored during the yearsis a new initiative he's introducing in the House this month, theEquity for Our Nation's Self Employed Act (H.R. 4961). With co-author U.S. Rep. Melissa Hart (R-Pa.), Manzullo has crafted a billthat would allow small-business owners to deduct health care costsfrom their payroll taxes (Social Security and Medicare or self-employment tax for a sole proprietor). Nationwide, the average self-employed individual pays $10,880 annually for health insurance, andthe bill -- if enacted -- would save that person $1,664, Manzullosays. This saving is on top of the existing right to deduct healthcare costs as a business expense on a personal tax return, ScheduleC, he says.

DROWNING IN HEALTH CARE COSTS

"Surging health care costs are drowning our small businessowners," he says, "especially the self employed who have to pay extrataxes."

Despite the estimated decrease of $1 billion to $2 billion infederal tax revenues it would create, Manzullo is confident the billwill be passed by the House this spring and go to the Senate.

This move follows two other major health care initiatives co-sponsored by Manzullo, both of which he successfully drove throughthe House and are now pending Senate approval.

One is his Small Business Health Fairness Act (H.R. 525), whichwould create national Association Health Plans to allow smallcompanies to band together and buy health insurance at group rates asbig corporations do. This would counteract a reluctance by manyemployers to offer any health coverage at all -- which has left 45million uninsured. The latest stats show that among businesses with25 employees or less, only 31 percent offer coverage to theirworkers.

While health care cost relief is his biggest single priority thisyear, Manzullo says, there are numerous other areas in which he'sbeen a relentless source of ideas to aid small companies.

With 90 percent of all U.S. employers in that category andcreating 70 percent of all new jobs annually, it's essential that welevel the playing field vs. the big boys, he maintains. With pit bullferocity, he's been sponsoring bills aimed at tax relief, litigationreform, regulatory reform, paperwork reduction and access to capital.Currently pending in the Senate after he helped win House passage arebills to permanently eliminate estate taxes after 2010, a $56 billiontax reduction that extends more liberal rules for small business onexpensing and depreciation, Alternative Minimum Tax rules relief andlimiting frivolous bankruptcy filings.

But in shuttling between Capitol Hill and homes in Rockford andVirginia with his wife and three children, the 62-year-old lawmakersays, "Above all, my interest is in issues facing small manufacturerseverywhere, but especially in Illinois. We've held 40 hearings thisyear, pushed the Commerce Department to issue a White Paper oncritical needs nationwide, and it's a blessing that AssistantCommerce Secretary Al Frank is a former tool and die maker who reallyunderstands manufacturing.

"In our state, we've lost a huge number of manufacturing jobs.Thanks partly to government help, many new jobs have been created,and now our biggest challenge is a lack of enough skilled workers.We've launched programs with associations, community colleges and theLabor Department to attract more kids into this sector."

ATTRACTING ENGINEERS

"Further," he says, "we're making great strides also in turningRockford into a center for high tech manufacturing and R&D, andattracting engineers to integrate academia into production." A newpublic-private lab "is developing lower cost methods of machiningtitanium and miniaturized machine tools that can make spare parts onlocation in Army combat zones."

Meanwhile, Manzullo says, "another big need is to motivate morekids toward involvement in public policy. . . . [Sen.] Dick Durbinand I are like the odd couple, but we hope to collaborate on aneffort to attract new young talent into this arena."

Ted Pincus is a finance professor at DePaul and an independentcommunications consultant and journalist.

e-mail: theopincus@hotmail.com