Small Business to Get Short Shrift from Obama Administration
As the Ford Motor Company prepares to cash its first multi-billion dollar corporate welfare check and hand part of it over to the union, it’s easy to forget that almost exactly a century ago, this multi-billion dollar behemoth with 240,000 employees was just another young small business with big dreams about to launch its next product.
While many small businesses fail, including Henry Ford’s first two attempts, a precious few survive, thrive, and then change the world, creating hundreds of thousands of jobs in the process. Just about all of the great American companies were once mere dreams in the mind of an entrepreneur. Microsoft, Apple, Intel, McDonald’s, and WalMart are but a few examples.
The ability to start a small business and grow it into a much larger enterprise is the greatest wealth creation opportunity in America. Studies have shown that 2/3 of all millionaires are small business owners. Entrepreneurs and their children and grandchildren make up almost the entire Forbes 400 list of richest Americans.
If small businesses are the economic engine that creates jobs, builds wealth, and makes the American dream possible, then naturally our new president plans to support and rely upon them and give them everything they need to pull us out of the economic slump, right? Well, no.
Small businesses are facing the most hostile climate in a generation, and it is not just the slumping economy and credit crunch. With the quiet scrapping of the $3,000 job creation tax credit — which was “never set in stone” according to a senior Obama adviser – there is no more small business tax relief on the horizon. (Clearly, campaign pledges are only valid if chiseled into tablets, Ten Commandments-style.)
Instead, American small businesses face not only tax increases on individual income, dividend income, and capital gains as the 2003 tax cuts expire, but new environmental fees and regulations, health care “pay or play” mandates, and a significant expansion of new “rights” for workers that may well include compulsory unionization. The entrepreneurs we are counting on for future economic growth have only higher expenses and reduced flexibility and opportunities to look forward to.
Still, that’s no problem because small businesses can just send their CEOs and lobbyists to Washington D.C., by private plane to pick up their bailout checks, right? No, instead they can only watch on C-SPAN as their bloated and well-connected competitors cash in their political favors.
That’s because unlike the rogues gallery of special interest groups such as SEIU, La Raza, ACORN, etc., that helped lead the Democrats to victory, small businesses have no favor bank or political clout with the new administration but only the hostility from the infamous Joe the Plumber exchange. In fact, small business begins the new administration in the dog house, with their objection to the American-dream killing tax hikes already derided as “making a virtue of selfishness”.
And small businesses hoping to pick up the slack by selling goods and services to a swelling government sector may be in for a rude surprise. Decades of well-meaning regulation and social engineering have turned government procurement into a technocratic social justice program in which race, gender, and inside knowledge and connections can play as large a role in contract awards as the price or quality of the services rendered.
This means that small businesses that focus on the government market have every incentive to become experts at lobbying, litigating, and banking political favors rather than to build great products and companies. When businesses like that grow up they don’t become Google or Apple, they become CDR or Rezmar. (CDR Financial is the firm linked to Gov. Bill Richardson’s pay-for-play scandal, and Tony Rezko’s Rezmar needs no introduction.)
What should be done to help small business fuel an economic recovery? Clearly, we need Barney Frank to lead a House oversight committee, a $700B rescue program to buy failing small businesses, a progressive Small Business Czar — maybe Naomi Klein or Andrew Sullivan — and, of course, new carbon taxes to ensure that entrepreneurs living in polar regions don’t drown as the arctic ice melts.
But if you’re a little skeptical of that approach, may I present another. Stop the planned tax hikes that disproportionately hit small businesses and their owners. Stop turning small businesses into tax collectors and social workers. And stop the bailouts — after all, new businesses can never succeed if their competitors are subsidized indefinitely.
And how much does it cost for government to do nothing and stay out of the way? Trillions, according to the bureaucrats who are counting on the higher taxes to fund new wealth-spreading initiatives. Still, I’m sure we can come up with a solution to solve that problem too.
Just Obama keeping his campaign pledge to really stick it to the top 5% and redistribute their wealth. The small business guys have been responding since the election by liquidating and laying off. There’s gonna be nothing to tax. John Galt, the voice of capitalism, has spoken. It’s gonna get really bad, folks. Wait until all the rest of the world is broke, too, and no one can afford to buy our debt….
The engine that would drive us out of the recession is being choked. The only potential positive is that four years of recession may turn the unconquerable messiah into a one-termer.
where do i pay to be a friend of the administration, so i can get a billion dollars too? i guess i came to late to this ponzi scheme.
Those who have successful small businesses will, obviously, just choose to keep the businesses at a size where they (originating families) can do all the work themselves and thus keep more of their profits.
Limits the size of the business, of course, along with the need for more employees, but it won’t hurt them as much. So those unemployed people who were never hired by the small businesses can just thank President Soetero for their situations.
I think it ironic that Obama has removed the bans on the use of embryonic stem cells on the biological side of life but intends to poison the well of the embryonic business side of life.
He just doesn’t get it.
Sadly, the very people that voted for Obama are the ones that will be hurt the worst. The people who are getting their taxes jacked up and their businesses over regulated will be OK. They will pull back, liquidate and wait for a better business environment. However, during that time there will be less opportunities for young people and low skilled workers.
I don’t know what kind of hope he is selling, but the change is going to be crushing.
barack hussein obama… afirmitive action in action, socialist style.
It´s not that they are stupid – they don´t WANT small businesses. The left has no interest in growing the number of free, independent citizens who pay their own way (like Robert Reich´s “white male workers”). The middle class may have fallen for Obama´s promises but it is not a constituency of the left. In fact, it is in the way of building an all-powerful socialist nanny state.
Big business is somethign else. As numerous authors have pointed out, corporatism is a corollary of collectivism. Corporatism does not need free markets. Big corporations can be directed, they will comply because taxes and regulations bankrupt their smaller competitors, or they get bailed out. This is how it always worked in France where the elites, whether in politics or business, all went to the same schools and universities together and form a tight clique. Nice if you have a union job, not so nice for everyone else.
As a small business owner I had already decided not to hire unless absolutely necessary and then only as part time contracted help. I will not place my small business in the position where the local, state and federal government will get a dime more than I absolutely have to pay. And I can guarantee that if someone drives up in a car with an Obama sticker on it they won’t even be considered for the part time job. Discrimination? You bet.
Who is John Galt?
I’m a small businessman (one emplyee, me) and I’m hunkering down. I don’t plan on expanding anytime soon, and I do plan on doing small projects, accepting lots of cash payments, and hiding my slim profits the best I can for the next few years.
It’s bunker mentality time folks.
Don’t forget the Consumer Product Safety Improvement Act (CPSIA), which is set to go into effect on Feb. 10 and devastate small- and medium-sized businesses that make children’s products. Businesses that sell children’s goods (including apparel and books, not just toys, and thrift stores, not just new goods) have to pay for testing to prove on an ongoing basis that their products fall below the lead threshold or face felony charges, even if their products have always been lead-free. Between now and August when the next level of lead “protections” falls into place, thousands of these businesses will close.
I know, it sounds unbelievable that our government could do this, but it’s true!
http://www.forbes.com/opinions/2009/01/16/cpsia-safety-toys-oped-cx_wo_0116olson.html
http://www.forbes.com/2009/01/22/cpsia-waxman-cpsc-oped-cx_wo_0122olson.html
This was foisted upon us by “consumer” groups like Public Citizen and USPIRG who assured Congress that because it was “for the CHILDREN” it was by definition a good law. By this summer, we’re all going to regret it.
You are not being respectful enough to Dear Leader. We are building an army of civilian truth enforcers who will teach you respect. We are building camps in the hinterlands for you to stay until you have become civilized enough to respect Dear Leader.
“With the quiet scrapping of the $3,000 job creation tax credit — which was “never set in stone” according to a senior Obama adviser – there is no more small business tax relief on the horizon.”
I am actually relieved that the so-called $3,000 job creation tax credit has been scrapped. Why do employers need an extra financial incentive from the government to be more productive? That doesn’t make a bit of sense. Either a new worker is needed—or they are not. However, this is my only difficulty with Tristan Yates’s article. I agree completely with everything else he says. Barack Obama’s big government economic policies will indeed royally shaft the small business owners. This is also exactly what occurred during FDR’s New Deal era.
Taxation without representation.
American Revolution II … better than the first.
Let’s roll.
The fear in the small business community of which I am part is palpable. My partner and I decided not to try to ride out the slowdown this time around and sell our business while husbanding our cash because we see the writing on the wall. The most ironic thing is that the least skilled employees (who voted for Obama) will not be retained by the new management. They might as well have just quit their jobs as to vote the way they did since the effect will be exactly the same.
Frankly, the overriding emotion amongst small business guys is that we are tired of putting up with the government’s crap and we don’t want any part of a country where the government picks the winners and losers by fiat through taxes, regulations and handouts. There is no point in starting your own business if the government is going to run it. I don’t plan to contribute to a country that is what the US is becoming when I can live off what I have. That won’t really help my daughter but given the fact the government will just take most of what I make while I am living and then the rest of it when I die I have absolutely no incentive to put money away for her when it costs me time I could spend with her instead.
To john from cinncinatti:
I miss your show.
I have helped start five small businesses, three succeeded, one was a home run. But, regarding the home run, as we started to generate income after two years of our families eating peanut butter and jelly, I had to start paying the government on a quarterly basis before I could make my family whole. If the marginal tax rate had been a couple points higher I don’t think we would have made it. We ended up employing over 100 workers at solid wages.
To get liquidity into the market and expansion moving we should cut payroll taxes, income taxes, and capital gain taxes to the bone. That is called stimulus and it will work almost immediately.
Yesterday I was talking with the owners of a start-up solar panel company and I asked him about all the government programs coming into play for renewable energy. He laughed and said most of that money will be wasted and that they viewed the government as the enemy of small business. I couldn’t argue that point.
My predictions…1. The press will ignore this story…..2. For every dollar that disappears from the visible part of the economy a dollar will show up in the underground economy.
A year ago I was telling anyone who would listen that Obama, Soros, and their big corporate oligarchs are hostile towards entrepreneurs and small companies. The new model The One wants is France. A country where there are very few small businesses that are growing. Almost no entrepreneurship. Just large corporations in monopolistic or oligopolistic industries that are favored by the government.
The result is a stagnant economy with structurally high unemployment. You either work for the government or you work for a large corporation.
In France it is the young people who suffer the most. They can’t find work even after the leave the universities. Yep, it’s the crowd that mostly voted for Obonga who are going to be hurt the most.
Collectively, small businesses employ more people than big business. They’re also harder for government to control because there are so many of them. So much easier to get control of a business that employs tens of thousands, rather than maybe a few dozen. So what better way to deal with them than drive them out of business by making them economically unfeasable? In the new United Socialist States, government control of everything is the name of the game.
I would enjoy watching all those who voted for the messiah being hoist by their own petard, but they are dragging us over the cliff with them.
#9 wrote ~ I can guarantee that if someone drives up in a car with an Obama sticker on it they won’t even be considered for the part time job.
~~~~~~~~~~
There was one small business owner, when contemplating who he would lay off becasue of the new taxes, was pacing in his parking lot. He noticed the Obama stickers, and decided those employees would go first.
You want to help businesses get rid of Sarbanes Oxley. This government wants the government to run half the economy, have heavily regulated big businesses run the other half of the economy, and don’t want any small innovative businesses. The stimulus package is a trillion dollar pig that needs to be fried into bacon along with it’s creators.
And 1.4 million people will be hired for the 2010 census at a cost of $6 billion using pencils and paper. What would it cost in the private sector in dollars and employees in comparison, what a joke.
John go out and start a bank with your piggy bank and that qualifies you for the Great Monopoly money giveaway. Our money will be as good as Monopoly money by 2012.
Number 9 Two thumbs wayyyyy up.
Pilot: John Galt is the main character in Ayn Rand’s “Atlas Shrugged”. Get it. Read it. It’s prophetic.
The campaign to suppress entrepreneurs is intentional and will be opaque, except to those with bullseyes on their backs
Liberals in all countries maintain power by
taking from the middle class. An oligarchy
of rich take some of this money to fund large
corporations. The rest of the money is distributed to the rabble in order to get
elected. This builds a large power base.
The middle class is the enemy in all senses.
Only they can challenge the oligarchy for
power. The rabble won’t. Also if enough
people are brought into government jobs the
politics of fear becomes a powerful tool. Swivel
servants break into a cold sweat when they
hear “cutting the budget”.
Unions thus become another tool to the
oligarchy in addition to the rabble and
large corporations. Hmm these are the
supporters of what new President? Sorry
small businesspeople and middle class,
you are not just a cash cow but the enemy
as well.
Yep, I do not hire liberals either.
Last week I gave a bid to someone with an obama sticker on their car. You guessed it I added 50% to the bid. Funny thing.. I got the job.
Pilot: “Who is John Galt?”
FictionWriter: “Pilot: John Galt is the main character in Ayn Rand’s “Atlas Shrugged”. Get it. Read it. It’s prophetic.”
Irony is my favorite thing.
El Gordo, the elites mostly work in big state sonsored enterprises, in multinationales, in big enterprises, in medias
the tissue of the small and average enterprises is the most important job supplier, represent more than 90 % of the labour force and these are not squatted by the unions
“sponsored enterprises” infeoded to unions
I have made posts with links and statisctics, all got swallowed
#29 Fantom – He accepted the bid? Funny! I bet you’re laughing every day! Talk about loving your work!
The current anti-business atmosphere is a direct effect of having lawyers in charge in Washington. Lawyers are trained in removing and redistributing wealth, not creating it.
I have reduced our lower wage workers and plan to do the majority of the work. Next step is to manage the growth of sales, only enough to pay new expenses. I have lowered my salary and will be taking full advantage of my dependents deductions.
Less money to the “One”.
$300,000,000 for condoms, I wish i was in the latex business. Stimulus package. eah, right.
The people who voted for the One, sold their vote for $2000.00. 4×500. That is not enough to feed a family.
i>The new model The One wants is France. A country where there are very few small businesses that are growing. Almost no entrepreneurship. Just large corporations in monopolistic or oligopolistic industries that are favored by the government.
what kind of industry are you “really” quoting here, I am curious
http://www.insee.fr/fr/themes/tableau.asp?reg_id=0&ref_id=NATTEF09305
insee.fr/fr/themes/tableau.asp?reg_id=0&ref_id=NATTEF09304
insee.fr/fr/themes/tableau.asp?reg_id=0&ref_id=NATTEF09306
insee.fr/fr/themes/tableau.asp?reg_id=0&ref_id=NATTEF9303
insee.fr/fr/themes/tableau.asp?reg_id=0&ref_id=NATTEF9302
insee.fr/fr/themes/tableau.asp?reg_id=0&ref_id=NATTEF9302
“janvier 2004, il existait en France 2.390.000 TPE relevant du champ ICS (Industrie Commerce Service), soit 96,6% du total des entreprises françaises (proportion identique en Europe). Les TPE exercent tous types d’activité de l’industrie au commerce en passant par les services (bâtiment, hôtellerie restauration, conseils aux entreprises, services médicaux, services sociaux…).
61% des TPE françaises n’ont aucun salarié, 23% en ont entre 1 et 3 et 16% employe entre 4 et 15 salariés. L’ensemble de ces TPE employait 5.798.700 personnes (dont 4.017.900 salariés) en 2002.”
Ces TPE réalisaient la même année 8,6% des exportations françaises.
http://fr.wikipedia.org/wiki/Tr%C3%A8s_petites_entreprises
The result is a stagnant economy with structurally high unemployment. You either work for the government or you work for a large corporation.
still 1,14% groth rate last trimester (may-be Germany too), while 0,xx for the other EU countries, how about the US ????
In France it is the young people who suffer the most. They can’t find work even after the leave the universities. Yep, it’s the crowd that mostly voted for Obonga who are going to be hurt the most.
insee.fr/fr/themes/tableau.asp?reg_id=99&ref_id=CMRSOS03311
the bad rates are mostly in the “bad” surburbs
othewise it’s about the same as in the US
http://www.newschool.edu/cepa/research/papers/04_06_Howell_French_Students_2.pdf
I guess you like to babble against your supposed former ancestry, it doesn’t appear that you are honest, as ment by your background, ie philo, ie seminary !!!
I have several possible real estate investors who are all keeping millions of investment dollars on the sideline until they see what the ‘great one’ will do.
as of yesterday, one is not investing because it is clear that ‘the one’ is going to make the next several years difficult or impossible for investment.
Lower capital gains to 15%, cut all tax rates by 5% and we will be out of this slump in 3-6 months. But no….. we’re going to spend all of this money on nothing. Get out of our way and we’ll make it happen.
BackwardsBoy @34 wrote:
“The current anti-business atmosphere is a direct effect of having lawyers in charge in Washington. Lawyers are trained in removing and redistributing wealth, not creating it.”
I’ve thought that for a long time. The other comments from others about the creation of a new oligarchy are right on target. Soros and his coterie of multimillionaires and billionaires are out to create an oligarchy.
If you want to know what an oligarchy is, at its most refine? Look towards Moscow and Beijing. And there you have your answer.
I work as a securities’ analyst for a small investment firm. In total, the staff comes to 18 people. I’m very loyal to the owner of this firm, because he gave me my break after I graduated from Boston College’s MBA Finance program. I am very nicely compensated, even if I make less money than the people in New York make, but living in rural New Hampshire is a far, far better lifestyle. I applied to dozens of very large firms, but because I did not have an Ivy League pedigree and sheepskin I never had a chance. I graduated back in 1991 during a recession that hit New England particularly hard. While in grad school I had a project whereby we had to select some large regional banks, do fundamental analysis of their businesses, and then come up with a value for their stock. I predicted all three banks would be gone within two years – and they were. While I was doing my work on this project I ordered up the reports from an analyst working for Lehman Bros. in New York (her name was Katherine Hensel). She was covering the banks I was doing my analysis of, and she had them valued far, far above the numbers I came up with. I, an amateur, whipped her butt on that one, even with her Ivy League pedigree and education thrown in.
My point: small businesses can and do employ people with talent looking for a break. Bigger is not always an indicator that the corporation has corralled the best talent or even has the best business model.
Macro policies that punish small business do great harm to the American economy. And they detract from opportunities that young people need when they are getting out of high school, college, tech school, and graduate school.
Marie Claude,
It is you who is babbling, trying to put one over on people who are pretty smart. I am friends with two people – educated people who lived and worked in France – and they say that many of the young and educated want out of there. These are people who have engineering and computer science background and they would love the chance to come here and either find work or start their own businesses. Taxes and regulation in France strangles small businesses.
Two years ago your unemployment rate, during an expansion/recovery, was about 8.6%. At the same time ours was 5.5%. Right now, during a bad recession, our unemployment rate is approaching 8%, which is about where you people were during an expansionary phase.
No, Marie, I don’t want the French model for our economy. Or the German one, or the Swedish one, or the British one.
It’s may-be cuz your friends aquaintances have no experience, and yes it’s difficult to find a first job with wages that you expect to get from your grades. Too often these grades aren’t worthy on the market, they don’t correspond to what a realistic boss wants from an employee ; because of their grades these youngs think they are valuable, and have no intention to invest themselves into the developpement of the enterprise, but to get the bigger profit from it. Bosses nowadays choose persons that are adaptable, mobile, that can innove, that can work with and or leads a team… I had a son in that category, he wasn’t afraid to undertake a job below his capacity, his skills made him improve his situation quikly. None of my sons found difficult to get a job in France, though most of the youngs have no ideas of what the world of work is, they believe it looks like what they were taught at the university, too bad if you have no will to insert into a different universe, then you’ll become a slowcoach that goes into unemployment agencies, and that finally accept a low paid job in associations or get a pass to enter into an administration.
from the link above, the unemployment rates are not counted the same way wether you live on one side or the other side of the pond, though, the final results are simingly equal
With substantially higher hourly productivity, the French economy has produced almost
as much employment growth as the U.S. since President Bush came into office (3.1 vs
3.5 percent growth between 2000 and 2005).12 The two countries have almost identical
shares of young people in unemployment — the high youth unemployment rates so often
cited in the media give a distorted view of the situation in France because so few French
youth enrolled in school are employed. And perhaps most importantly, the shares of
French and U.S. youth not employed and not enrolled in school – by far the most
important measure of social dysfunction – are nearly identical.
At the same time, the French have far higher shares of the young adult (20-24) population
enrolled in school, which on balance must be a good thing. And as American students
will be the first to appreciate, French students do not enter the labor market with crushing
debt burdens (school tuition in France is negligible compared to the U.S.).
I particularly love this one: “the bad [French unemployment rates are mostly in the “bad” surburbs othewise it’s about the same as in the US." Translation: if you just take out a bunch of the unemployed, voila, the French unemployment rates are the same as in the U.S. Bwa-ha-ha-ha! Descartes would probably observe: Marie Claude thinks [or at least she thinks she thinks], therefore she is.
boqueronman, I was referring that way to the surburbs just to please the “stoopid” Americans that are remnently ironising on them, et vlan, t’es tombé dans le panneau !!!! LMAO
Somebody been peekin’ at the mail? he boqueronman LMAO
Can anyone cite a federal poverty program that worked?
#36 Marie Claude – I read your statistics. Here’s how I interpret them:
96.6% of French enterprise are small businesses. This is meaningless, as big companies are naturally less numerous;
61% of small business have no employees. This means that these are just people struggling to make a buck. They are not thriving businesses. Most are probably underemployed people who would like a real job if they could find one;
23% of them employ 1-3 people. These are nascent businesses, family businesses, or professional services like accountants, lawyers, or doctors;
16% employ 4-15 people. Storefront size businesses. I once worked for a furniture store with 7 designers, 2 office staff, 2 warehousemen, and the boss. To wit, a basic storefront business;
Thus, 10% are larger small businesses.
I don’t have current numbers, but American businesses tend to employ more people. They grow or die quickly. To demonstrate this, I point to your numbers. Your small businesses produce under 6,000,000 jobs. What’s the population of France? What percentage is that: 10-12%? American small businesses produce 76% of the new jobs in America.
Europeans simply have no idea how dynamic the American entrepreneurial system is. We call it the big fish in the small pond mentality. The U.S. has 6% of the world’s population, but is 30% of the world’s economy. We are the biggest fish, by far. When our economy tanked, so did the rest of the world’s economies. America is an economic dynamo, despite all our problems. We conservatives here at this site are lamenting the suspension of that dynamic system. John Galt has spoken, and it makes us sad.
As regards your son, I admire that he was willing to take a job below his skillset and make something of it, rather than expect it all to be given to him on a platter. We here call that either underemployed, or ambitious and unwilling to make excuses for failure, depending on the person’s mindset. Congratulations to you for raising your boy right. I’m sure he’ll do well. Winners always do. Donnez-vous il ma respete.
#40 Marie Claude – Our job growth numbers are very false. We have a huge illegal immigration problem. Around 10,000,000 or so came her during the Bush years, and of course, most found work… say, 9,000,000. Add that to the official 5,500,000 jobs created here in the Bush years, and the job growth rate becomes obscene. This also helps explain why the U.S. dominates the world.
Marc Malone, thanks, I’ll tell him soon, (he’s just been father of a little girl)
most of the smallest enterprises are of owners, declared as self employees, or mostly not declared at all, though as owners, then one gets his benefit retributions at the end of the year, after bilan, it’s how I am working at the moment. As it’s a SARL, then I can live upon it during the whole year, with what we call “charges of the enterprises”
Also, in the link below (in french), it doesn’t say that there are no creation of jobs, in the contrary
http://www.insee.fr/fr/themes/document.asp?reg_id=24&ref_id=13229
also, to make a comparison, what I wrot on another place :
the housing bubble in UK and in Spain has been said of the same process, though it hurts more Spain as she is a recent economical partner, causing lot of cuts down in jobs, while France is still preserved
http://www.building.co.uk/story.asp?sectioncode=32&storycode=3131842&c=2
Marc,
got a more precise stat :
http://stats.oecd.org/WBOS/Index.aspx?DatasetCode=CSP2008
I will side with Marie on one thing in today’s WSJ they said Spain unemployment is at 14%.
But if we all just pool our money into the same bin, and then take what we need when we need it, there would be plenty of money for everyone. I just don’t understand why no one listens to me when I say that! Waaaaaaahhhh!
stoopid American, go get your red bull !!! May-be it’ll give you a bit more inspiration, your not good at imitating me !!!!
AND don’t use my name !!!!
Marie-Claude,
Please convey congratulations to your son on the birth of his child and you being a grandmother. And I too admire his grit, in doing whatever it takes to get on some kind of career path.
I just don’t want my country to use Euro-socialism as a model. The young socialists in America who swept Obama and his party into power are moving in the opposite direction that Europe is gravitating towards. In Europe, socialism is increasingly being discredited, again, as a system that fails, has failed, and always will fail. Our young people have been taught a different view. They’ve been taught that socialism is a shining ideal that only fails because of incompetence or corruption or reactionary measures. So, the kids are told that “we will get it right next time.” And so now they have set upon that task, and will learn a painful lesson.
Free markets work. Less government and lower taxes work, everywhere. Even in Russia they have a low flat tax system. Now Russia’s economy is not doing well, but that is because the siloviki are trying to structure Russia’s economy as one based on natural resources. Corruption and lack of transparency in transactions make it difficult for investors to trust the whole thing. Russia is an old fashioned oligarchy.
The Democrats and their internationalist allies (the money men like Soros) are trying to set up an oligarchy.
It will all end badly.
The press will use GWB as a cover for all BHO’s foibles for a year at least. There will be no criticism.
Don’t worry pal, there will always be enough people willing to go into business, small or large. No matter how high taxes are, or how low the incentives, a free market system in a free society will make a way.
Let us be brutally clear about this: “Small Business to Get Short Shrift from Obama Administration” This was the policy of Nazi Germany in the period before World War II. Industrialists had the ear of the government and Hitler doled out money to whomever he thought would serve his purposes best. I do hope with all my heart that this is a superficial similarity and that this will not be “the way the cookie crumbles” here in America in the 21st century. We need a coherent policy that favors small business because small businesses innovate. It is this innovation that powers true economic productivity. We cannot simply be ordered to innovate in a vacuum.
The government will not be able to count on old sources of income to tax. Dividend income will be reduced as companies can no longer pay them. Interest from government instruments such as Treasury Notes, Bonds and Bills no longer exists on new issues and so cannot be taxed if owned by US citizens. Business transfer taxes will dry up. Taxes on income will decrease as per capita income decreases or stagnates. Large corporations will translate their losses into decreased tax revenues. Capital Gains taxes will go down as businesses fold since buyers cannot be found and stock prices wallow in a narrow range, thus yielding small amounts upon sale. Even taxes on Social Security will be reduced as the Social Security system is “fixed.” Perhaps a tax on breathing air will yield some revenue.
If I am wrong in my analysis, will someone set me straight please.
fred
thanks
We still have a too high amount of charges, because of the public debt,-the helps that we allocate to an invariable percentage of population that is or will never be able to work (I think 3,5% to 5%, corresponds to a “normal” unemployment rate of a modern society), -healthcare, less and less gratuitous (only the remnent percentage of work “handicapeds” and the elders can gratuitly benefit from it), we need a private insurance to compensate, -the helps that we give to the third world countries for keeping their populations on place), -the still too high number of administrative servants, -the different regalian and unavoidable services of a state (army, police, education…), though these administrative charges tend to decrease as the babyboomers are progessively going into retirement (still on the state budget), half of them will not be replaced as forecasted, that,I hope, no lazy “socialist” leader will change, -oil, tobacco, taxes are high, EU taxes (TVA 19,60% on the “sales”)…
Apart of a few (or several)dumb and obtus politicians and local responsables, la vie est belle !!!
#50 Marie I vehemently disagree with throwing all our money in one pot and everybody takes what we need when we need it. I want to choose what I do with my money, if I wish to donate to charity that is my choice. Taxes are so high now at about 40% marginal rate of my salary I consider that my charity donation the wasteful way it is spent, and donate very little else. If I paid less taxes I would have more donate more to charity and help more people and the value would get to the people faster without the government sticking in their sticky crooked fingers to get their share of pork to who they want.
I don’t need the Social Security Administration between what my sister and I pay in social security taxes, we could directly write our mother a check each month without the bureaucratic crap that is in place now. My nieces could do likewise with my sister when the time comes.
I guess I incarnate, what boqueronman… the last but the “beast”, M.C. (for naming his recent nics here, and different on other places, that I suppose are all of the same poster, nonetheless that I can’t help myself to find funny, but if relying on “their” aleatory alcohol-of-the-evening, then “their” prose can become really mean), undestand as the evil mirror of what “they” fear of the new US administration. Sorry “fellows”, I have no such large shoulders so that I could wear all these cold frocks, and I’m far nearer to share thegr8 1 sentiments, I also don’t donate money away to social charity associations, that I already financed
#47 &48 Marie Claude – I read through the stats you offered. My French is a bit rusty, and I had some difficulty, because what you all measure as important, as opposed to what we do, is a bit different. so, I had to translate a bit.
I see fairly stagnant population numbers, overall as well as workforce. Hard to tell, but 78% of the job growth seems to be in small business… about the same as here. Most job growth is in retail and service (hotel/restaurant particularly robust). Industry and transportation seems a bit flat. You seem to have a huge increase in retired elderly, so the workforce numbers must be coming from immigration. I’m guessing Arabs, which fits with the growth in service industries and microbusinesses.
I’m also getting a sense of growth in underground economy, with all these microbusinesses of self-employed and no employees like you. This is indicative of people getting around all the hyper-regulation and gaming the system. This sounds like a natural, John Galt reaction to Socialism. It allows for a certain amount of hiding of one’s assets and earnings.
Of course, I could be misinterpreting all this. It was in Frog-speech, after all. :p
Marc,
You seem to have a huge increase in retired elderly, so the workforce numbers must be coming from immigration. I’m guessing Arabs, which fits with the growth in service industries and microbusinesses
Yes, because of the age of retirement, 60 for the average French, 55 for the administration servants (often, if they reach their conventional legal amount of working years, which depends on the services policies)
Well, these positions vacuancies can’t be replaced by an african muslim immigration, even if they live in our country, they have to be “educated” or trained, another immigration from Africa can’t fill the goals either, those who managed to enter into our county made mostly the construction, mines, manufactures works, and they, for most of them, are now retired or will soon go on retirement.
Also as our mines are closed, our manufactures, often dislocated in cheap labour force countries, construction, roads maintenance, etc… still supply them jobs ; the contractors don’t need so much to hire abroad workers, sons of the former immigrants, Frenchs, “non educated”, still find their ways there, plus since the “Schengen agreements”, the new “priviliegied” immigration comes from the eastern EU republics, comprise their selves immigrants, ie Turcs from germany.
http://en.wikipedia.org/wiki/Schengen_Agreement
As far as the “higher” positions, as we have some quite a large number of “educateds”, due to our low univerty fees, hence no problem to replace the retirees
also seems that we won the price of the best birth rate in EU lately
http://news.yahoo.com/s/afp/20090113/lf_afp/francehealthwomendemography_20090113200836
New tax revenue?
Why, that’s simple. In the name of being progressive introduce a services tax, similar to Canada’s GST (Goods and Services Tax) or Britain’s VAT (Value Added Tax).
REAL VOODOO ECONOMICS
They are pushing political payoffs, not economic well being.
http://greensrealworld.blogspot.com/2009/01/markets-not-government-stimulate-our.html
Thanks for the article. I am one such small business owner who has worked very hard to earn the success that we enjoy. I see no ‘hope and change’ in the new administration. Instead I have an onerous feeling that I’m in for a helluva fight to stay in business and remain successful under the new Obama regime.
In The Wealth of Nations, Adam Smith wrote:
“It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest”
That seems like common sense to me.
I don’t think Obama and his crowd agree with this, or believe it to be true.