Kraham: Young entrepreneurs could help kick-start economy
From business CEOs to politicians, arguments rage about effective means to create jobs and move the unemployment needle away from 8 percent. Meanwhile, highly skilled college students sit on the sidelines, worried about massive student loans and a gloomy job market once they graduate.
What our leaders don’t realize is that these students could be the job creators we’re looking for.
From 1980 to 2005, companies less than five years old were responsible for nearly all net job creation in America. These are the companies being sketched on whiteboards and dreamed up in dorm rooms on college campuses around the nation.
Our country needs young, motivated business leaders to carry on that American tradition of entrepreneurship. By unleashing the creative power we see in classrooms and young startups, our economy will grow faster, and we will create jobs and build the foundations for yet another century of American economic prosperity.
First, lawmakers must secure the fundamentals of our economic system and reach a budget deal before we go over the fiscal cliff. Although both sides are finding it difficult to sacrifice ideology, compromise is far better than a congressionally induced recession.
Congress must also pass Startup Act 2.0, legislation that aims “to help jump-start the economy through the creation and growth of new businesses,” said the bill’s sponsor Sen. Jerry Moran (R-Kan.) in a Politico opinion piece.
The measure would make it easier for young startup companies to grow and stimulate our economy. It would expand support for entrepreneurs, as well as set pro-business policies for the future.
Specifically, the bill would exempt capital gains taxes on investments in startup companies and provide research and development tax credits. Startup Act 2.0 also bridges the gap between higher education and industry, sending federal funds to “support university initiatives designed to bring cutting-edge research to the marketplace more quickly,” according to Moran.
Also, immigrants with an advanced degree in a STEM field — science, technology, engineering and math — could more easily file for permanent resident status. That means the brightest minds would stay in this country instead of leaving to innovate for our global economic competitors.
But as expected, Startup Act 2.0 is moving at the speed of the public sector. Despite bipartisan support, the bill has collected dust in congressional committees since the summer. It appears Congress is unable to react as quickly as the nimble tech startups it wants to help.
Although Startup Act 2.0 only creeps through the committee process on Capitol Hill, it’s exactly the kind of economic stimulus the U.S. needs — policy focused on innovation in the private sector.
That innovation and job creation will carry far beyond tech companies and Internet startups. Brick and mortar businesses have long been our industrial backbone and require a young generation to digitize them for the 21st century. Globalization demands small businesses to compete and adapt in an international economy.
With effective public policy from Congress, college students and young entrepreneurs might just take that leap of faith into capitalism and provide the rocket fuel needed to launch our economy back into orbit.
Jared Kraham is a senior political science and broadcast journalism major. His column appears weekly. He can be reached at firstname.lastname@example.org and followed on Twitter @JaredKraham.
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