The blue tsunami: What does it mean for small businesses?

Democrats absolutely dominated the midterms, in large part, because of concerns about affordability. This issue has been front and center for small businesses struggling with health insurance premiums, inflation, supply chain costs, and tariffs. What does the massive blue wave mean for small businesses?

Health insurance

Health insurance is becoming much less unaffordable for the small business community. Small business owners and their employees are struggling to keep up with massive premium increases. We are hopeful that Democrats will embrace Association Health Plans with essential ACA benefits. These plans will allow small businesses who lack negotiating power, to come together and procure more affordable health insurance. It will increase competition and give the little guys more leverage against large insurance companies.

In Illinois, Democrats should enact tax credits for businesses that provide stipends to their employees to purchase health insurance. Less than 40% of small businesses can afford group coverage in our state. Tax credits for Health Reimbursement Arrangements can be an important tool for businesses struggling to provide health insurance.

Democrats have positioned themselves as the party focused on providing affordable health care to Americans. Perhaps they have other solutions which can address excessive health insurance and health care costs. One thing is clear: prompt action is needed.

Tariffs

The 120th Congress should immediately pass legislation that reinstates its authority over tariffs. The ever-changing trade policies enacted by this administration have been devastating to many small businesses. Our current and future presidents should not have access to loopholes that circumvent Congress.

Certainly, we support incentives that encourage goods to be made in America, and tariffs can be important when enacted through Congress in a cohesive and targeted way. However, small businesses need certainty, and the executive branch should not be able to cause chaos and confusion through shifting trade policies.

Artificial intelligence

Democrats will likely enact regulations on large AI companies. It will be important however, that they do not paint all businesses that use AI with a broad brush, because there are profound differences between small businesses that use AI to support their operations and large frontier AI company. Democrats should not place mandates on small businesses without providing time, education, and the resources to foster compliance. Congress should also place federal guardrails around the development and deployment of AI because differing state regulations will be difficult to enforce and cause confusion.

Taxes on small businesses

Small businesses have faced so many challenges in recent years. Democrats should not impose new, or increase taxes, on small businesses. Many small businesses simply do not have the capacity to pay higher taxes, maintain their operations, and retain employees. The new Congress should embrace small businesses and enact policies that foster their growth.

This election should have sent a clear message to politicians from both sides of the aisle: enacting good policies and finding solutions matter. The Democratic Party campaigned on affordability. They will now have the chance to deliver that for the small business community.

Elliot Richardson is president and co-founder of the Small Business Advocacy Council.