American Potential

Cutting Red Tape: How Tennessee Is Empowering Small Businesses

17 min
Apr 7, 202612 days ago
Listen to Episode
Summary

Tennessee Senate Majority Leader Jack Johnson discusses how the state is empowering small businesses through conservative fiscal policy, low regulation, and the proposed Regulatory Freedom Act. The episode explores Tennessee's competitive advantages as a business destination and Johnson's personal journey into public service.

Insights
  • Small businesses employing 10-30 people drive more employment than large corporations, making regulatory burden disproportionately impactful on them
  • Tennessee's fiscal conservatism (least indebted state per capita at $266) combined with low taxes creates competitive advantage for business attraction
  • Regulatory Freedom Act addresses bureaucratic rule-making by requiring private sector input on cost impact and expediting removal of outdated rules
  • State-level policy innovation and competition between states ('laboratories of democracy') drives business migration and economic development
  • Personal engagement and showing up to community events is the foundational step for political involvement and public service careers
Trends
States implementing systemic regulatory review processes to reclaim legislative power from bureaucratic agenciesBusiness migration from high-tax, high-regulation states (Illinois, California) to low-tax, business-friendly states (Tennessee, Texas, Florida)Conservative state legislatures prioritizing fiscal discipline and limited government as economic development strategyBipartisan or unopposed support for regulatory reform legislation in Republican-controlled legislaturesSmall business advocacy driving state-level deregulation efforts through organizations like Americans for ProsperityState competition for talent and business relocation as economic development modelFocus on prospective regulatory impact assessment rather than retroactive complianceGrowing recognition that government efficiency and fiscal responsibility are business recruitment tools
Companies
Americans for Prosperity
Spearheaded the Regulatory Freedom Act initiative and brought the idea to Tennessee legislature
Third National Bank
Nashville-based bank where Jack Johnson worked in computer training in 1991
Tennessee Realtors Association
Named Gavin Newsom as realtor of the year, highlighting migration from California to Tennessee
People
Jack Johnson
Guest discussing Tennessee's business-friendly policies and the Regulatory Freedom Act
David Fromm
Podcast host conducting interview at America's 250th anniversary event in Nashville
Ronald Reagan
Cited as major political influence on Jack Johnson's conservative values from age 12-20
Laura Trump
Speaking at the America's 250th anniversary event in Nashville at Musicians Hall of Fame
Darrell Worley
Scheduled to perform at the America's 250th anniversary event in Nashville
Quotes
"Small businesses are the backbone of our economy. When you look at who employs the most people, it's not your big giant companies. It's small businesses that employ 10, 20, 30 people."
Jack Johnson
"I'm not anti-regulation, but I'm anti-unnecessary regulation. If we're going to implement a new regulation, we need to know what the impact is going to be."
Jack Johnson
"I would say I'm not good at much, but I'm pretty good at showing up. Show up at a campaign event, show up for your county Republican Party summer picnic. Show up, meet people, get involved."
Jack Johnson
"Tennessee is the least indebted state per capita in America. If you take the entire debt of the state of Tennessee and divide it by the population, it's two hundred sixty six dollars."
Jack Johnson
"The founders wanted states to be laboratories of democracy. They wanted them to compete."
Jack Johnson
Full Transcript
Small businesses are the backbone of our economy and I have nothing against big companies. They employ a lot of people. They do a lot of good things. But I've been a small business owner and they really are so incredibly important. When you look at who employs the most people, it's not your big giant companies. It's small businesses that employ 10, 20, 30 people. And they're the ones who can be the most impacted by these rules or unnecessary regulation. And so, again, I'm not anti-regulation, but I'm anti-unnecessary regulation. And so, if we're going to implement a new regulation, we need to know what the impact is going to be. And if we determine that an old regulation is outdated and unnecessary, we need to be able to get rid of it quickly. Wow, it sounds so commonsensical. I imagine that. Imagine that. What's this doing in the governmental process? Are you encountering any real opposition to it? Americans are capable of achieving extraordinary things when they have the freedom and opportunity to do so. This is American Potential. Welcome to the American Potential Podcast. I'm your host, David Fromm. So today we're coming from Nashville, Tennessee at a celebrating America's 250th anniversary with our friends here in Tennessee. We've been going all over the country at these events, and it's just been a wonderful opportunity to highlight our one small step campaign and talk to great leaders and great people, great Americans, really. And I'm really excited to be joined by a great leader here in Tennessee. I mean, if you don't know it, there's some magic going on in Tennessee. It has been for a few decades, but from a policy standpoint, it is a state that is leading in this nation, empowering its people in education reform, keeping taxes low or non-executing and existing in some cases, and really spurring innovation and economic development. And so I'm really proud to have Jack Johnson, the Senate Majority Leader for Tennessee here to talk about it. So, Senator, thank you so much for joining us. We really appreciate it. Well, thanks for the invitation. It's great to have you all here. This is a great event, huge crowd. Got Laura Trump speaking right now. I think Darrell Worley is going to perform. And here at the Musicians Hall of Fame. So if you ever visit Nashville, you got to make it a point to come here. It's an incredible venue. It's fabulous. We wandered around it, a little social media, like kind of stuff all around. I went to the Johnny Cash portion because I'm a big Johnny Cash man. Me too. Me too. Me too. My kids listen to a lot of Johnny Cash and I loved it. So, we've talked about one of the themes of these 250th anniversary events is our One Small Step campaign. And we're talking about like, what was that initial step for somebody to get involved? Because we want to spur people, through example, encourage people to get involved in their community, politics, public service, to try to make a difference in their state and their community and their nation. So what's, you know, I found that actually state legislators sometimes have some of the best stories. So, you know, what got you involved and interested in public service? Well, I would say I'm not good at much, but I'm pretty good at showing up. And I think that I think there's a lot of value in showing up. And so if you're a young person or even not so young person and you care about your community, you care about the direction of the politics, show up. Show up at a campaign event for someone running for school board or county commission. Show up for your county Republican Party summer picnic. Show up, meet people, get involved. That's what I did at a young age. And it, you know, it turned out pretty good because I had a passion for conservatism, I had a passion for, you know, the Republican Party and conservative values. And I didn't have any money. I couldn't contribute at that time. But I could show up and I could help and volunteer. And I'm glad that I did. Where did your values come from that made you believe in conservatism and want to actually get involved? Sure. Like, like some folks, not everyone, but I had two incredible parents. I had an amazing mom and dad that were wonderful parents, loved me, loved my two sisters. And you know, they weren't overly political, but they voted and sitting around the dinner table as a kid, you know, you could hear them talking about different things. Something that was very impactful for me at the age of 12, I was fascinated with the presidential election between Ronald Reagan and Jimmy Carter. Nice. I was 12 years old at the time. And I don't really know why. Looking back, my friends weren't necessarily paying that much attention, but I was that nerdy kid who would make sure I was in front of the TV at 5.30 for World News Tonight or, you know, NBC Nightly News or whatever, because especially as that campaign was ongoing. So Ronald Reagan had a really big impact on me. Not only his message, but the way he articulated that message. You know, he was a happy warrior. He was very positive. And so from the time I was 12 till I was 20, Ronald Reagan was president of the United States and those were very formative years. So I think a combination of my mom and dad, my faith that was instilled in me by my family and Ronald Reagan, I didn't have any choice but to turn out to be a conservative. Funny enough, even though I was in New Jersey, not Tennessee, I had a very similar journey. I mean, I'd watched the news religiously. I loved Ronald Reagan. He was my main memory. And yeah, it was in my faith, played a big role in it. So I kind of moved towards the right. Am I am I mistaken though that you met your wife through young Republicans? I did. I did. So I was born and raised in Texas, but moved here right out of college in 1991. And it had been here for a few months. And a guy that I worked with, I was working at Third National Bank, Old Nashvilleians will remember Third National Bank. But I was in a computer training and I was sitting next to this guy about my age. And we got to talk and he was taking the same training that I was taking. There's an all day kind of thing. And during a break, we got to chatting and talking about politics. And I expressed a few, you know, pretty strong opinions. And he said, you know, you need to meet my girlfriend. And I said, yeah, why? And he said, my girlfriend is is the secretary of the Davidson County, Nashville, young Republicans. I said, I would love to get involved in the young Republicans. I'd only been in town for a few months. And he said, well, I'll call you the next time they're meeting and we'll walk over to their meeting. They just meet a couple of blocks from here. So we did a couple of weeks later. And as I tell people, and I'll be speaking to a group telling the story, and it's a true story, we walk in, he introduces me to his girlfriend and she and I have been married. It'll be 30 years this October. Well, good for you. You know, I say she was interested in politics and I was interested in her. So it worked out very well. It worked out well for everybody. Yeah, we have three beautiful children and it's been a wonderful, wonderful journey. That's awesome. That's great. Well, first of all, what kind of district you represent? What part of Tennessee is it? So I'm just south of Nashville in Williamson County. It's the county immediately adjacent to the south from Davidson County, which is Nashville. So about 30 miles from where we're sitting right now are 30 minutes. It's made up of several cities, Franklin, Brentwood, Nolansville, Fairview, Thompson Station. That's a wonderful place. Yeah, it's a special place. I'm a little biased, but it's a really, really wonderful community. And I've had the honor of being their state senator for quite a while now. That's fabulous. I met my daughter, lived in Franklin for a summer. Went to college and just it was wonderful. So, well, so, you know, I think I mentioned to you, I'm from outside of Chicago, the state of Illinois, which has hemorrhaged people to Tennessee. I can't tell you how many friends and even now my some of my kids are wanting or have moved to Tennessee and I'm sure you see them. And but and there's there's great reasons for that. I mean, there's a lot of good stuff going on here. You're a senior leader here. You know, you're running body of legislature. Obviously, I have a big hand in what's happened in the state and have been for eight years. I mean, that's a big deal. Talk to me about what makes Tennessee like a great place to to locate a business, bring it, you know, raise a family. And then where do you think the state needs to go? Yeah, so, you know, I take a lot of pride in the fact that as someone who grew up as a conservative and believed in those values and has been very passionate. I'm very grateful that that God has placed me in a in a position now to where I get to enact some of those conservative policies with my colleagues in the General Assembly and see them work. And, you know, Tennessee is the least indebted state per capita in America. If you take the entire debt of the state of Tennessee, general obligation debt and divide it by the population, it's two hundred sixty six dollars. The next closest, it's either Texas or Florida, and they're at about seven hundred sixty or seven hundred seventy dollars. So people like, I think, knowing that the government has well run. It's fiscally conservative, depending on how you measure it, whether the second or third lowest tax state in America. And yet we have a thriving economy. We don't overregulate. I'm not anti government, but I'm very limited government. Government has a specific role to play. And when you compare us to and I believe that the founders wanted states to be laboratories of democracy, they wanted them to compete. Yeah. And you talked about Illinois, probably second only to California in terms of the number of people that are moving here and from another state. In fact, I can give you some exciting news. The Tennessee Realtors Association met recently and they named the realtor of the year and it's Gavin Newsom. Well, so one of the things that you're doing is really spearheading an effort to take on over regulation or get rid of excessive regulation to make Tennessee even more competitive. Talk to me about the regulator Freedom Act and why you're pursuing it and what it does. Well, it's a very important piece of legislation and I'm so grateful to Americans for prosperity, for spearheading the effort and bringing us the idea. And they're doing that in a number of states. You know, Tennessee is a wonderful state. We got great, got a great legislature, great governor and we're passing good laws. But what a lot of people don't think about, you have to get a little bit off of the normal talking points that when we pass a law and or the state passes any state or the federal government passes a law, they usually empower the bureaucracy. They empower the state departments and agencies to promulgate rules. Now, that's OK, because we don't want to have, you know, a bill that's overly prescriptive and dictates, you know, how you fill out a form. Or I mean, there are things that you should allow departments to enact via rule. And we have an oversight process in that. But what the regulatory Freedom Act says is that if those rules are going to affect the private sector, then you need to let the private sector weigh in on the effect of those rules. And and if it's going to cost them a certain amount of money, we need to know that. And is there a way we can do it more efficiently? So that, you know, prospectively, when you're thinking about rules that may be proposed or enacted, we need to have the input from the people that are going to be affected by those rules. It sounds like very common sense. And so that's what the Act calls for. And then it also allows for a much easier, more expedited process to remove rules, outdated rules and antiquated rules. So again, it's it's not the kind of thing that's going to make a lot of headlines, but it's critically important to the function of government. Well, we've seen this trend across the country of states stepping up and saying, hey, we, you know, we need a systemic way to to take back power, really, of the of the legislative bodies to stop over regulation. What have you heard from like small business people as to, you know, why we need to do this? Yeah, so, you know, small businesses are the backbone of our economy. And I have nothing against big companies. They employ a lot of people. They do a lot of good things. But but I've been a small business owner and they they really are so incredibly important. When you look at who employs the most people, it's not your your big giant companies. It's it's small businesses that employ 10 20, 30 people. And and they're the ones who can be the most impacted by these rules or unnecessary regulation. And so again, I'm not anti-regulation, but I'm anti-unnecessary regulation. And so if we're going to implement a new regulation, we need to know what the impact is going to be. And if we determine that an old regulation is outdated and unnecessary, we need to be able to get rid of it quickly. Well, it sounds so commonsensical. Imagine that. What's this doing in the governmental process? But are you encountering any real opposition to it? Not really. You know, we're very blessed in Tennessee to have conservative Republican supermajorities in both the House and the Senate. I've not heard of any opposition coming from the Democratic Party. We'll see if there if there is any. And, you know, we've worked with our governor and various agencies and departments, and they've been wonderful to work with. Because they basically agree that, you know, we don't need to be passing unnecessary rules and regulations, and we need to be able to get rid of ones that are outdated. Well, that's great. I'm really excited for what has been happening here in Tennessee. Even though I don't live here, we come down here a lot. My wife's family has a place. We need kids here to move down here. I mean, well, you know, I got, I got 11 kids. And so I do. I do. Yeah. Some of us, you know, kind of feel like we're a little more committed to organically growing the grassroots army for to make change. Well, good, good. Maybe there's hope for Illinois then. It's a long term plan. Although actually I wouldn't be surprised if more than one for sure ends up here in Tennessee because it's the destination. There's the what's happening here is this great stuff. So yeah, it's a special place. Yeah. Well, Senator, I really appreciate you joining us. Yeah. It's a joy to have you here. I'm so glad you could join us here at this event. Thank you for hosting us. And we look forward to seeing the, you know, the Religatory Freedom Act passed. Sure. I'm excited. We're going to have it up in committee very soon. And, and again, very grateful to Americans for prosperity for the great work they're doing here in Tennessee. And it's going to be a good bill and make Tennessee even better. Thank you. So folks, if you liked this episode and would like to find out more, feel free to subscribe to all of our channels and follow us on social media. At Facebook, YouTube and Instagram. Always remember, Liberty and freedom are easily taken for granted. Don't take them for granted. Go out there and defend Liberty and freedom. Thanks for joining us and we'll see you on the next episode. Thank you for listening to American Potential. You may listen to more stories from Americans working every day to expand freedom and opportunity in their communities by visiting AmericanPotential.com.