Opinion

Congress Should Boost Small Business Digital Trade and Pass USMCA

Small businesses employ 85 million Americans, and yet for decades we’ve heard “small business” spoken of with a kind of nostalgia for a bygone era. Today, however, the economic dynamism of Main Street is growing, due in no small part to new opportunities created by the internet. Small businesses have leveraged the digital economy to become a driving economic force on the global stage.

The growth we’re seeing in this area is increasingly tied to trade. Six million American jobs are now supported by small business exports. To unlock more digitally enabled exports in the future, and ensure more Americans benefit from trade, Congress should pass the U.S.-Mexico-Canada Agreement.

For over 20 years, Google has worked with small businesses across the country to help them leverage the digital economy to grow and compete globally. In that time, the landscape for small businesses has shifted dramatically. When NAFTA was passed, the best advice for a company looking to reach distant customers was: “Be larger.” Back then, gaining access to foreign markets required a global footprint, a wide distribution network, and a hefty marketing budget. While large companies had some of these capabilities, for small businesses, exporting was nearly inconceivable.

The internet and the digital economy changed that. Yesterday, we released a report in partnership with the U.S. Chamber of Commerce that examines small business exports. The report shows that  exports are growing at a rapid clip: Small business export revenue has increased by 26 percent in just three years, generating over $540 billion in annual U.S. impact.

But the report also finds that there is much more room for growth that can be enabled by trade rules fit for the digital age. North America’s trade rules haven’t been updated since the internet was in its infancy, even though Canada and Mexico are America’s largest export markets. Indeed, the U.S. Chamber report found that 57 percent of U.S. small business exporters sell to Mexico or Canada.

USMCA has received widespread bipartisan support, and has the power to help small businesses and promote digital trade across our continent. It advances a comprehensive set of digital trade provisions that keep the internet open, while protecting the businesses and consumers that rely on it to trade. It promotes trusted infrastructure and innovation-oriented rules that undergird the digital economy. And it can serve as a model for digital trade for the rest of the world.

USMCA will help small businesses like Strider Bikes from Rapid City, S.D. Strider uses digital tools like YouTube and Instagram to drive global growth for pedal-less kids bikes. Today, nearly half of Strider’s sales come from exports. USMCA will help Smart Retract, from Dubuque, Iowa; it exports safety gates for kids and pets, and is using online advertising to expand its direct-to-consumer model to reach foreign customers. And USMCA will support Erie, Pa.’s SleepPhones, which uses website analytics to understand and capitalize on new sources of foreign demand for headphones that help you fall asleep.

We’ve supported small businesses like these over the years with free advertising tools and products like Market Finder, which recommends the best expansion markets for businesses and helps them reach those overseas markets. The combination of new technologies and a new digital trade framework has the potential to create hundreds of thousands of new American jobs and to expand America’s already robust $452 billion in digital exports.

The American economy’s power and optimism springs from entrepreneurs like those behind Strider Bikes, Smart Retract and SleepPhones. Congress should pass USMCA and make it easier for businesses like these to trade. With new digital tools and updated trade policies, there’s no limit to what innovative Americans can achieve.

Karan Bhatia is Vice President, Government Affairs & Public Policy at Google, and formerly served as Deputy US Trade Representative.

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