Case in point is a recent piece in the Daily Caller by Neil Stevens.  His piece correctly asserts that closure of the online sales tax loophole now enjoys bipartisan support from progressives and conservatives, Democrats and Republicans alike.  But the “risks” that Stevens points out are based upon unwarranted concerns, and his remedies would, in many cases, actually increase federal powers and burdens upon state and local governments.

The Marketplace Fairness Act’s purpose is straightforward: create a simple framework for states to work out their own issues with collection of the sales tax for online purchases, and thereby leveling the playing field between Internet and over-the-counter retailers.

Both small brick-and-mortar retailers and larger retail stores argue that closing the sales tax loophole will be good for business.  Even online retailers have stated leveling the playing field will not noticeably impact them in a negative way.  Most notably Amazon.com has come around to agree that closing the sales tax loophole must be a high priority for the American economy to continue to grow.

The reasoning is simple: government shouldn’t extend its heavy hand into the market place, disrupt free market competition, and artificially pick winners and losers.

If this were simply an issue of allowing cash-strapped states to haul in more revenue, it would not have the support of conservative, limited-government leaders like South Carolina Governor Nikki Haley, former Mississippi Governor Haley Barbour, Indiana Governor Mitch Daniels and former Florida Governor Jeb Bush, to name just a few.

Nor would these conservative leaders support the principle of sales tax equity if it were an infringement on states rights, as Stevens seems to imply.  The exact opposite is true – the Main Street Fairness Act gives states the right to manage their tax collection issues as they deem fit.  The Marketplace Fairness Act is fair because it eliminates the default preferential tax treatment of one segment of an industry over another.  This allows the free market to operate without the government picking winners and losers, something conservatives tend to support when the subject is raised in virtually any other industry.

The Marketplace Fairness Act is not an attack on online retailers.  It is not about revenue enhancement.  Nor is it a gift to brick-and-mortar retailers.  It is about getting rid of a glaring loophole in the tax code.  It stops government from interfering with free market competition.  Internet and over-the-counter retailers each have their own advantages and disadvantages, but ultimately it should be up to the consumer to choose which suits their needs.

Conservatives agree that an antiquated federal tax policy that gives preferential treatment to one industry over another is wrong. Conservatives also agree that a federal tax policy that prohibits states from addressing these issues on their own is not something most free market and limited government individuals will support.

In response to the public outcry over this legislation, 30 members of the House and 21 Senators came out in opposition to the bills within a 24-hour period.  While we are excited to see the discussion transform and the public’s voice heard, we recognize that this battle is far from over.   As revised legislation is proposed, conservatives must draw a line in the sand as to what absolutely should not be a part of any piece of compromise legislation.

With votes on both SOPA and PIPA now postponed and so-called “alternative” bills in the works, it is important that conservatives remain engaged and aware about the negative repercussions even amended versions of these bills could have for our economy.  We must avoid placing onerous, expensive regulations on technology companies that will pull resources away from growing businesses and instead, place those resources in the hands of lawyers and lobbyists who are charged with maintaining compliance with burdensome red tape.

In order to protect innovation, prevent undue regulation, and maintain the underlying structure and security of the Internet as well as the First Amendment rights of our citizens, we must ensure the following four items are not a part of any alternative legislation.

Private right to action: From a conservative perspective, one of the most troubling parts of both SOPA and PIPA was the so-called “private right of action” – a provision which would allow copyright holders, and eventually trial lawyers, to get a court order to shut down entire websites rather than simply removing infringing material.

Search engine liability and blocking requirements: Any potential bill cannot find companies like Twitter and Facebook, which host user-generated content, to be found culpable if a user posts illicit content.  Both SOPA and PIPA would have forced Internet Service Providers, search engines and other sites to police user-generated content—effectively killing social media.

Vigilante provisions:  The “vigilante” provision incentivizes search providers to censor content, putting legal pressure on them that would essentially force them to block innocent sites that receive any sort of complaint.  This greatly endangers innovation in the Internet space, as it only takes an accusation to shut down a competitor’s site – not a courtroom where evidence of infringement is given.  For many small businesses, their website is their front office.  A vigilante provision would too often close the doors of these growing businesses.

Expanded Attorney General Power:  SOPA and PIPA would give the federal government the power to unilaterally de-list websites from search engines and block specific domain names.  This is an unprecedented level of power that would be handed over to the unelected bureaucrats at the Department of Justice.  This cannot be allowed.

In every other industry, conservative correctly wretch at the thought of the government picking winners and losers through the tax code. One need look no further than the Obama administration’s Solyndra debacle.

Respected leaders in the conservative movement, including Govs. Haley Barbour and Nikki Haley and American Conservative Union chairman Al Cardenas have endorsed e-fairness as a conservative principle for free enterprise:

Gov. Haley Barbour (R-MS):

“As Governor or Mississippi, I value the important role that our Main Street retailers play in our communities. Failure to level the playing field threatens to, and in fact has, run many of them out of business, taking with them jobs and the sizable contribution they make not just [to] our community culture, but to the organizations who have long benefited from their charitable involvement … government shouldn’t be picking winners and losers.  In this area, at least, the Marketplace Fairness Act will end that practice, and that’s something conservatives should be proud to support.”

 Gov. Nikki Haley (R-SC):

 “And I will tell you regardless of what happens with Amazon, we want them.  I have told them we want you to do business in this state, but we want you to do it on a level playing field.  They got free property, they got tax incentives, they got plenty of things. Don’t ask us to give you sales tax relief when we’re not giving it to the book store down the street or we’re not giving it to the other stores on the other side of town, it’s just not a level playing field.”

 Al Cardenas:

“Whether it’s the Department of Energy’s disastrous Solyndra project, or levying sales taxes, or a multitude of other policy decisions that impact the private sector, the government picking winners and losers is a perversion of the free market system. Lawmakers on Capitol Hill — especially conservatives — ought to at least acknowledge this when deliberating important reforms to the tax code. As we consider wholesale reform, exempting Internet sales can no longer be justified…the Marketplace Equity Act of 2011 begins this conversation.”

Stevens concludes by arguing, “Firms like Best Buys simply deserve to lose.” He may, in fact, be correct about that. But they don’t deserve to lose because of a bad law that punishes them through the tax code.

Up to this point, the health care industry has been one of the lone bright spots in this dismal economy.  While the country has lost more than 7.5 million jobs during the recession and monthly jobs numbers show little-to-no new growth, the health care industry has consistently added positions.  Due to the misguided policies of this administration, however, that could quickly come to a halt.

President Obama’s Stimulus II contains a section entitled “Encourage efficient post-acute care,” which would shift funding from lower-cost Medicare providers to more expensive ones.  More specifically, President Obama has proposed to shift funding from nursing homes (for which Medicare pays $500 per day) to long-term acute care hospitals (for which Medicare pays $1,500 per day).  While long-term acute care hospitals cost three times more, nursing home facilities see the same types of patients and deliver the same quality of care.  So, why are cost-effective programs being cut while expensive ones maintain their funding?

This transition from lower-cost health providers to costlier alternatives also has a real impact on local economies and jobs.  In fact, nearly every state will lose jobs as a result of the President’s proposal.  The shift further erodes the fragile financial base of long-term care facilities which would drive a majority of skilled nursing providers into bankruptcy, killing jobs and limiting quality care for seniors.

President Obama touts the provision, and others like it, as a means to cut government spending, but pro-business, limited-government conservatives must be wary.    As conservatives, we believe massive cuts must be made to the federal budget and changes to the way taxpayer dollars are spent should be a priority for Members of Congress and the President.  But these issues are not being addressed if federal funding is redirected to more costly services and lower-cost facilities are driven out of business (causing large-scale job loss) as a result of reduced funding.

Unfortunately, this is far from the first misguided policy to emerge from the Obama administration. Similar changes were a major part of Obama’s health care bill, and if the “Encourage efficient post-acute care” provision is passed, the administration will have taken those changes one step further, causing even more damage to the nursing home facility industry.

Unquestionably, policymakers need to have a meaningful discussion about reforming Medicare and Medicaid.  Arbitrarily slashing funding for health care programs, however, is not the right way forward, as it too often leads to higher costs, greater inefficiencies and more government waste.

American workers need President Obama to get serious about jobs, and the “Encourage efficient post-acute care” provision not only fails to focus on jobs but actually works against job creation efforts.  We can’t afford an anti-economy “jobs” plan like this.

Stephen DeMaura is President of Americans for Job Security a leading pro-business trade association focusing on promotion of conservative pro-growth solutions to our fiscal and jobs crises.

While House Democrats and the NLRB have already vowed to stop the legislation from ever reaching the floor, the hearing itself puts the NLRB in the position of yet again defending its controversial workplace rulings after its national PR disaster with Boeing, and a darkening jobs environment.

The new bill, called The Workforce Democracy and Fairness Act and introduced by committee Chairman John Kline of Minnesota, empowers and protects employers and employees in the face of NLRB rules supported by labor bosses.  The bill ensures a reasonable period of time for workers to consider union proposals, and protects the time-honoredtradition of voting in union elections by secret ballot.

According to Chairman Kline’s committee, the Workforce Democracy and Fairness Act (H.R. 3094) will do the following:

·      Ensure employers are able to participate in a fair union election process;
·      Guarantee workers have the ability to make a fully informed decision in a union election;
·      Reinstate the traditional standard for determining which employees will vote in the union election; and
·      Safeguard privacy by allowing workers to decide the type of personal information provided to a union.

Supporters of the bill are expected to shine a light on the dangerous overreach by the NLRB in forcing heavy-handed rules on small business owners, and on union members rendered powerless in the face of backlash if and whenthey – heaven forbid – disagree with or oppose collective bargaining agreements.  And they’ll be right to do so.

Congressman Kline’s legislation has the support of small business owners, retail organizations, and employers seeking basic parity against union bosses – not union members – in the collective bargaining process.

If the NLRB and its allies in the AFL-CIO use this hearing to continue its defiant opposition to Congressman Kline’s bill and stand shoulder to shoulder with union leadership amidst 9 percent unemployment, the agency and its bosses at the White House will prove the Boeing fiasco wasn’t just a labor dispute gone wrong.  It was only the beginning.

At issue is whether online retailers who have facilities in states have to abide by the same rules as every other local business.  Amazon.com, in an attempt to improve their delivery and distribution system, is building regional shipping and distribution centers.  In order to protect the favorable tax status it enjoys in nearly every state, the company has been feverishly lobbying for tax exemptions.  In sum, Amazon is using the government to further protect their competitive advantage over brick-and-mortar stores.

What exactly is this competitive advantage?  Amazon is able to provide an average of 7-10% discount on the items it sells over local competitors because it has steadfastly avoided collecting local sales taxes.

A recent agreement with California Governor Jerry Brown provided Amazon with a one year sales tax exemption in exchange for reinstating many of the state’s affiliates and allowing time for the Federal government to act.  The company has sought similar, but lengthier deals in other states.  Just yesterday, Tennessee Governor Haslam announced a tax deal which hands local retailers a government-imposed disadvantage to the direct benefit of Amazon.

The tax deal announced by Gov. Haslam disadvantages local retailers for two full years and three holiday shopping seasons.  While some claim that Amazon will provide 2,000- 3,000 badly needed jobs, a recent study cited the potential cost as being the loss of 8,500 jobs across the state as small businesses are unable to compete with Amazon and shut their doors.

An opinion released last week by Tennessee’s Attorney General echoes the decisions made by California and Arkansas: when locating in a new state, a company must abide by the same rules as other local retailers.  The attorney general’s opinion further states that “the state cannot waive requirements to collect sales taxes on items sold in Tennessee without specific legislation being passed by the Legislature.”

Amazon has shown that it is both willing and able to collect sales taxes at the point of purchase, just like every other state retailer.  Yet, they continue to fight for and receive government protections which keep the playing field unlevel for local businesses.  Amazon’s sales tax exemption has seriously penalized its competition, which is mostly smaller, locally-owned retail shops.  It has hurt job creation and economic growth, resulted in government superseding market and consumer preferences, and left Main Streets barren across the country.

With nearly 20% of the country unemployed, we caution against supporting any additional burdens on job creators.  However, it is important that we do not misapply this principle and provide unjust government subsidies to one company to the detriment of other businesses.  Consumers, not the government, should determine a company’s success.

Before we look for a way forward we must first come to a simple conclusion as to where we have come from. During the past twenty five years America’s economic position in the world has weakened, we have become less competitive in competing for jobs and growth and we have allowed for our tax system to become antiquated, overly complex and burdensome. Americans can no longer afford to be apathetic about our global competitiveness.

The first step we should take to reinvigorate our economy and improve our status as a magnet for jobs and innovation would be to significantly reform our corporate tax code. Closing loopholes, simplifying and reducing rates would free our nation’s job creators to start hiring again.

At 35 percent, America’s corporate tax rate is the second highest in the world.  When companies look to open new branches or to relocate their headquarters, America can’t compete with countries whose tax rates make it easier, not harder, for businesses to succeed. And what is the result of such an unfriendly business environment? Jobs, capital and investment that could have helped the American economy sent overseas.

America is far behind the rest of the globe when it comes to corporate tax reform. Since 2000, 34 of the 30 nations within the Organisation for Economic Cooperation and Development have lowered their statutory corporate tax income rates. Even Japan, the nation with the highest corporate tax rate, is considering lowering their rate by five percent. But despite the numerous changes in technology, globalization and business development, the American corporate tax code has remained static for the past 25 years.

A reasonable corporate tax code that made America globally competitive would not just benefit CEOs and stock holders, but workers as well. Recent research has shown that workers bear a significant share of the corporate income tax in the form of reduced employment opportunities and lower wages. In fact, the U.S. Treasury Department estimates that 25 percent of the corporate tax is borne by workers.

The impact of a high corporate tax rate is increasingly apparent —the number of Fortune 500 Global headquarters in the U.S. and Japan has decreased 30 percent in the last 11 years. By closing loopholes in our corporate tax code while lowering the rate to make America more competitive, we have the chance to increase the corporate tax base by attracting companies to start in and re-locate to the U.S..

There are many areas in which we can and should halt the anti-growth policies of this administration but lowering and simplifying the corporate tax rate is the single best proposal to empower businesses of all sizes to reinvest in growth.

The lawsuit, which has certainly stifled job creation here in the United States, is the type of government action that encourages manufacturing jobs which may otherwise be located here in the U.S. to be sent overseas.

In an attempt to combat such blatant federal involvement in the business decisions of private companies, South Carolina Representative Tim Scott sponsored legislation called “The Protecting Jobs from Government Interference Act,” which would stop the NLRB lawsuit in its tracks. The bill passed the House 238 to 186 today. Scott says the NLRB’s actions threaten more than 1,000 jobs in the Charleston area, “My legislation will remove the NLRB’s ability to kill jobs,” Scott said. “The government, especially the unelected board, does not need to be involved in the business decisions of the private sector.”

Scott’s bill would “ban the National Labor Relations Board from ordering any employer to shut down plants or relocate work, even if a company violates labor laws,” according to the Boston Herald.

Unfortunately, seven Republican conference members chose to side with big labor rather than job creators on this important legislation; Rep. Fitzpatrick (R-PA), Rep. Chris Gibson (R-NY-20), Rep Grimm (R-NY), Rep. Young (R-AK), Rep. LaTourette (R-OH), Rep. McKinley (R-WA) and Rep. Meehan (R-PA).

With each day that goes by there are additional indications that our economy is in a recession. Worse yet, we have some in Congress who appear, based on today’s vote, to be more concerned with appeasing big labor allies rather than doing the right thing for our economy.

I’m talking about the disparity between the methods sales taxes are collected when purchases are made online versus at a brick-and-mortar store on every Main Street in America.  But if I were talking about any other policy, like say the Federal government’s favorable treatment of Solyndra, conservatives would rightfully express outrage that government is picking winners and losers.

Amazon.com, the biggest dog in the online retailer market, has created confusion by co-opting conservative language to position itself as a victim of allegedly greedy politicians who just want to raise taxes on good American businesses to pay for bigger government.  Rather the opposite is true. The true victims are the local businesses who do not have the favorable tax status that Amazon has long enjoyed. Take, for example, Amazon’s response to a recent California law demanding it collect sales taxes at the point of purchase, just like thousands of Main Street retailers are required to do.  It immediately challenged the state legislature and the governor by threatening to spend tens of millions of dollars on a ballot referendum to avoid collecting hundreds of millions in sales taxes.

The result? Amazon sees record revenues with its preferred tax status while small and community-oriented Main Street retailers foot their bill and struggle to stay alive.

But the story Amazon has been telling is fictitious.  And its use of conservative nomenclature to do it has been cynical.  The fact that Amazon relented and has agreed to begin collecting sales taxes in California beginning next year proves it.

The truth is, Amazon’s unfair sales tax exemption has seriously penalized its competition, which is mostly smaller, locally owned retail shops.  It has hurt job creation and economic growth. It has resulted in government superseding market and consumer preferences.  And it has left Main Streets across the country barren.

And as for those so-called liberal politicians who just want to fund their big government programs?  Look again.  They include people like South Carolina Gov. Nikki Haley who said last spring, “And I will tell you regardless of what happens with Amazon, we want them.  I have told them we want you to do business in this state, but we want you to do it on a level playing field.  They got free property, they got tax incentives, and they got plenty of things.  Don’t ask us to give you sales tax relief when we’re not giving it to the book store down the street or we’re not giving it to the other stores on the other side of town, it’s just not a level playing field.”

They also include former-Florida Gov. Jeb Bush who recently counseled Gov. Rick Scott, “It seems to me there has to be a way to tax sales done online in the same way that sales are taxed in brick and mortar establishments. My guess is that there would be hundreds of millions of dollars that then could be used to reduce taxes to fulfill campaign promises.”

Amazon’s argument has fallen apart and its campaign to maintain a government-endorsed unfair advantage over its competition has been exposed.  Other states and the Federal government should stop picking winners and losers and institute sales tax fairness that levels the playing field for small businesses once and for all.

With a crippling unemployment rate of 9.2 percent and millions more out of the work force or underemployed it is not the time to intimidate, handicap or attempt to manipulate small business owners. The NLRB’s recent approval of intimidation tactics, their efforts to kill new jobs in South Carolina and now their attempts to expedite union elections are proof positive that they favor union bosses over workers, job creators and business. President Obama’s so-called ‘independent’ NLRB is seeking to penalize and marginalize small businesses, our nation’s job creators, in order to push the pro-union agenda. America’s unemployed simply can’t afford their tactics any longer.

View the photo.