Trump News - 5 Executive Orders Affecting Small Business in 2018

Trump News - 5 Executive Orders Affecting Small Business in 2018
Eric Goldschein
on March 19, 2020
Read in 4 min

As the Donald Trump administration looks forward, it’s important to remember that the president has already signed a number of executive orders and memos that don’t require congressional approval to have a real impact on the U.S. economy.

Trump’s economic policies and proposals have engendered confidence among many in the small business community.

For example, the National Federation of Independent Business has measured a surge in its small-business confidence index, the Federal Reserve has hiked up interest rates, and the stock market appears to be booming.

Learn more about Rising Interest Rates in 2018

But how much of this is the result of hopefulness and optimism on the part of business owners?

And more importantly, how much can be tied back to the actual orders Trump has put forth?

What Executive Orders Has Trump Signed?

President Donald Trump has signed 13 executive orders and almost as many alternative presidential actions as of the date of this article.

The following is a list of executive actions that could potentially affect business owners, so you can better anticipate what they might mean for the future of small business in America.

1. Executive Order 13771 – Reducing Regulation and Controlling Regulatory Costs

Regulations are almost always at or near the top of the list of small business concerns.

A survey from the National Small Business Association shows that startup businesses spend $83,000 on regulatory costs alone.

This EO says that when a new regulation is introduced, two other existing regulations must be eliminated as a way to keep the private expenditures necessary for federal compliance down.

It also says that the cost of new regulations in 2018 shall be “no greater than zero.”

Part of the excitement for the Trump administration was the expectation that regulations of all kinds would be cut.

This should spur small business investment in the short-term, but its long-term effects are less clear.

After all, federal regulations aren’t the only regulations small businesses contend with.

The Small Business Majority says it’s actually state and local regulations that are more burdensome to SMBs.

Not to mention, there are plenty of exceptions that would allow certain agencies to skirt the rule altogether.

2. Executive Order 13755 – Expediting Environmental Reviews and Approvals for High-Profile Infrastructure Projects

In another attempt to cut through red tape, Trump directed environmental reviews of infrastructure projects to be conducted more quickly, and for those projects to jump to the head of the review line if a governor or cabinet member selects it as high-priority.

It could spur infrastructure projects to move forward, some of which can go to small businesses that were promised to have a better chance at winning federal government contracts.

It may also promote growth in industries that support those working on the projects, such as local hospitality.

But the long-term effects of this action should not be overlooked:

A rushed review process for infrastructure projects may eventually put our environment at risk.

3. Executive Order on Promoting Energy Independence and Economic Growth

This EO mobilizes a policy shift away from achieving climate change goals and towards fostering more energy production domestically.

It rescinds a number of Obama-era orders that limited the country’s coal production and enacted stricter environmental regulations.

Some of the changes include opening federal lands for leasing and easing pollution restrictions that would delay the closing of some coal-fired power plants.

The short-term effect might be a small boost to the market share of coal companies in places like West Virginia and Kentucky.

But it does little to change the market forces that have diminished coal’s place in the energy hierarchy.

Cheap natural gas, along with alternative sources of energy like wind and solar, appear to be the way of the future.

State mandates and federal tax credits can make renewable energy more economically feasible than ever; plus, they’re cleaner.

Even coal experts and industry leaders admit that the long-term outlook on coal is bleak, and that removing regulations won’t change that.

The question remains: 

How can we pivot those dependent on coal mining into new, more lucrative, and more sustainable careers?

4. Memorandum Regarding the Construction of American Pipelines

A memorandum is less powerful than an executive order or law, but it aims to create priorities for the administration.

In this case, Trump asked the Secretary of Commerce to draw up a plan in which all new, repaired, retrofitted, or expanded pipelines use “materials and equipment produced in the United States.

This should be a boon to U.S. iron and steel makers in the long-term.

Unfortunately, we already see how little power memoranda hold:

Despite Trump’s claim that neither the Keystone nor the Dakota Access pipelines would be made without U.S.-produced steel, the controversial Keystone XL pipeline will use steel produced in Russia, since that steel has already been acquired.

5. Federal Budget Blueprint for 2018

In March, the Trump administration released a blueprint for the 2018 budget, which calls for massive spending cuts in almost all areas of government that aren’t the military or social security.

Organizations and programs that deal with small businesses were not excused from the cuts.

For one, the Small Business Administration is expected to lose $42 million in federal funding.

While guaranteed loan programs would not be cut, the SBA’s microloan program (which targets small, low-income businesses by providing technical assistance, and which has very low default rates) will see a 20 percent cut.

The SBA budget would also lose money for various counseling and development programs, such as PRIME technical assistance, regional innovation clusters, and growth accelerators.

The Trump administration says some of these programs overlap, and they want to reduce redundancy.

The budget also eliminates the Minority Business Development Agency, part of the Commerce Department that promotes minority-owned business growth through public and private sector initiatives.

Again, the reason given was redundancy, since the SBA already has some minority-development programs.

Learn more about Trump’s Pick for Head of the SBA and Government Business Loans

So has small business benefitted from a Trump presidency?

So far, Trump has made cuts to regulations and changes to laws that may provide some short-term boosts to small businesses.

The long-term outlook, however, is less clear, particularly in regards to budget cuts to programs that help alleviate the stress of business ownership.

The question remains for Trump whether his proposals truly align with the small business owners and leaders he often meets with, or whether it’s politics as usual.

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Eric Goldschein Finance Journalist

Eric Goldschein is a freelance journalist who covers entrepreneurship, small business trends, emerging technologies, culture and sports.

He was previously the managing editor of SportsGrid.com, and has written for Business Insider, Trep Life, the Huffington Post, Fundera and more.
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