If you had a great running back, wouldn't you design your plays around him to win the game? Then why aren't we?
Over the past twelve months as our nation has tried to recover from the recession, over 1.6 million private sector jobs have been created through the sheer grit of small businesses; during the same period, large firms and major corporations generated only 50,000 jobs. I know who I would hand the ball to as the real engine of job growth. And yet, as Congress reconvenes this week and the President makes his jobs speech, it is almost certain that once again very few plays will be designed for our star running back.
It's hard to understand why. In normal times, small businesses create 80 percent of new jobs; and today, they are generating 99 percent of all private sector jobs, with large firms doing almost nothing. One would think that it makes sense to target tax breaks and easier access to investment capital for those companies actually creating jobs, and to pay for it by reducing the subsidies of those that don't. Unfortunately, we have a tax code skewed the other way, written by and for large businesses.
And yet, the job discussion in Washington today is principally about tax reform for corporations, not small business. There are calls for reducing the U.S. corporation tax rate; still others argue for tax-free repatriation to America of the billions in profits these same corporations have made in foreign markets. Yet, corporations are already sitting on $2 trillion cash right here in America, but they are still not investing it in American job growth. If the corporation tax rate is lowered, why not at least close the tax loophole that allowed the corporations to avoid paying U.S. taxes when they kept their overseas profits overseas, reinvesting them in their factories in China or Germany where they had moved jobs, rather than in America?
In contrast, small businesses are paying some of the highest taxes around. Double-taxed on their income for Social Security and Medicare, they also pay some of the highest profit tax rates. They also lack special tax deals, such as the 15 percent 'carried interest' tax subsidies for hedge fund managers, even though they also put their own financial and intellectual capital at risk.
Rationalizing the tax code so the nation's real job creators are the true beneficiaries of the changes is what is needed for a much more rapid job recovery. Imagine the impact: 99.9 percent of all firms are small businesses; they employ the majority of Americans; and they produce 13 times more patents per employee than large businesses. How can those who claim to be on the side of the working family not be on the side of small business, and the opportunity to do the right thing for our economy?
Rugged, innovative, small businesses have fought through the earliest and the roughest parts of this recession: very small firms of less than 20 employees were the first to experience job losses by the middle of 2007 as their banking loans and other lines of credit were the first to tighten up; and then they lost over half of all jobs during this recession.
Just like today, small businesses carried the ball and soaked up the majority of unemployed during the 1992 and 2003 recoveries. But now, sitting in the luxury boxes watching the game are corporations that are flush with cash and record profits. It is both unhelpful and disingenuous that they are not invested in the game of job creation with their cash reserves when they are also asking that their profits earned overseas be brought home tax-free for "investment purposes."
I spoke with a small businessman last week with a perfect credit record who has been ready to use a dozen mortgage-free commercial properties as collateral for a new real estate venture. Yet, no local, regional or nationwide bank will lend to him for job growth. He is far from alone. Meanwhile, cash held by U.S. banks is at a record high; awash with deposits from uneasy investors in Europe, some of the 25 largest lenders with $4.7 trillion in deposits are asking regulators to soften rules or waive fees to park their excess cash at the Federal Reserve, rather than to have to lend the money.
If job creation for Americans is our real goal, and not large companies' bottom line, the data over the past twelve months has sent a strong message: small businesses are the real engine of job growth and should be the focus of any policy to spur job acceleration. Yet the sole job creator for the team is encumbered with higher taxes on his earnings than those corporations that have free luxury seats, two thirds of whom pay zero corporate tax. To design plays around our star player means closing many of the tax entitlement loopholes and useless spending subsidies of large firms that don't spur job creation.
If one looks at the facts, the solution to job generation is both simple and effective. In this case, it is past time for us to try it.
Admiral Joe Sestak was a Congressman (PA-07) from 2007-2010, serving as Vice Chairman of the Small Business Committee. He holds a PhD in Political Economy and ran for the U.S. Senate in 2010.
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Also, Sestak keeps claiming that small business generate 80% of new jobs, however the Small Business Administration states quite clearly on their website that from 1993 through 2009, small businesses (< 500 employees) created 65% of net new jobs. Is Sestak misinformed, or he just make up 80% because it sounds "important"?
The REAL solution to helping small business get their hands on the money the banks are hoarding is to RAISE the Fed overnight interest rate for banks that do not do enough business lending.
Nothing is being done for jobs. Nothing of consequence will be done. This is not an accident and not a conspiracy -- just simply Harvard Business School.
US citizens should demand re-industrialization of the USA because that will create a bigger economic pie, create more jobs for US citizens, and create more NATIONAL WEALTH in the USA that could be subjected to taxation to pay for government expenses.
US citizens should demand an increasing economic pie instead of demanding larger and larger piece of the existing ever shrinking economic pie, and selling or mortgaging our existing NATIONAL WEALTH assets to pay for more and more federal government expenditures that only consumes the NATIONAL WEALTH that was created by others!
I want someone to start a new political party to save the US government by creating conditions that economically require or allow the re-industrialization of the USA to create new wealth.
New wealth is needed to be created so that new wealth will be available to be taxed in order for governments at each level can have increased revenues sufficient to pay for their increasing expenses, and also to maybe pay off some of the US National Sovereign debt.
I am still hungry, may I have another piece of the economic pie for supper?
You failed to mention that US businesses that might want to create more US jobs in the USA are hamstrung with more expensive labor costs, more expensive electrical energy costs, health care payroll tax costs, unemployment payroll tax costs, social security and medical care payroll tax costs, environmental manufacturing EPA compliance costs, fringe (holiday and vacation) benefit payroll costs, OSHA compliance payroll costs, union labor work rules, anti-business laws, and general anti-business attitudes that make manufacturing products in the USA many many times more costly than manufacturing the same product in almost any other foreign country.
US manufacturing businesses must therefore take advantage of the US FREE TRADE TREATY AGREEMENTS that were created and then ratified by the Democratic and Republican members of the US Congress and then signed into law by US presidents.
These FREE TRADE AGREEMENTS ECONOMICALLY REQUIRES that US Businesses offshore US jobs and/or import the products (including parts and sub assemblies for assembly in the USA) in order to meet the US CONSUMER'S DEMAND for the absolutely LOWEST POSSIBLE PRICE for each product, without the US manufacturing business going bankrupt by using US labor and US environmental manufacturing costs!
Federal, state, county, municipal, school district and other various government taxing authorities CONSUME (or destroy) a portion of the NATIONAL WEALTH that was created by the GREEDY private sector and then confiscated and spent by tax supported activities for government contracts, government payrolls, wealth re-distribution, and other wealth consuming government activities.
The USA needs to generate new NATIONAL WEALTH, not mortgage or sell the existing NATIONAL WEALTH including the assets that were created by previous generations of US citizens to foreigners and then spend that money on bureaucratic government employee payrolls, government contracts, other government expenses, and distributing that wealth to the poor!
The USA cannot continue to live on borrowed money raised by mortgaging (selling freshly printed paper US Treasury Bonds that can be redeemed for title to) our privately owned NATIONAL WEALTH that includes businesses, factories, casinos, hotels, farms, land, ports, refineries, forests, ports, breweries, distilleries, and other privately owned wealth and assets located in the USA that were created by previous US generations prior to de-industrialization in order to pay these foreigners to manufacture our imported products that we consume and also to pay for growing US government expenses that are in excess of our federal tax collections.
A part of this newly created (plus the existing) NATIONAL WEALTH is then available to be CONFISCATED through taxation TO PAY FOR GOVERNMENT bureaucratic employee payrolls, infrastructure improvement contracts, military payrolls and other government expenses.
This NATIONAL WEALTH is then also available as security redeemable for any US Treasury Bonds that come due, and also to pay off any existing government bonds when they become due at maturity.
Large businesses create jobs mostly in foreign nations, small businesses create jobs mostly in the USA.
Millions of jobs
How can we let them do this to our country! How can we let this happen as a country I feel like I am taking crazy pills!
A simplification of the tax code does need to be done but it is not a flat tax, it is treating all income as equal. It will take a very strong effort to get the country out of the hole that government since Reagan has put us into. Clinton was successful due to an anomaly of the tech market but the little extra surplus that provided was wasted by Bush and our National Treasures of both money and blood continues to be wasted on Wars of Choice started under Bush and not halted by President Obama.
End the Wars,End the tax loopholes,ALL of them. Return the tax rates to where we know the government can provide those services the American Public demands.
-Reclassify factory farms as industrial facilities and subject them to environmental laws while means testing direct farm payments to give local and organic crop producers a leg up.
-Legalize and tax Marijuana
-Expand the Small Business Administration.
And just watch small business hiring pick up even more.
http://www.marketwatch.com/story/cutting-taxes-or-red-tape-wont-create-jobs-2011-09-09?reflink=MW_GoogleNews&google_editors_picks=true
That's the real kicker isn't it?
IS job creation the real goal?
Not from what I can see.
Wall street got billions in tax supported bonuses....................for failure. For driving our economy to the edge of extinction.
What did small business get?
Speeches, lip service, and diddly squat.
Small business represents the American capitalistic ideal. We provide the best service we can, for the lowest price that we can. The competition amongst small businessmen (and women) is fierce.
Big Business?
They don't compete, they collude. Either that or drive out the competition. Millions in CEO compensation packages, yet they lay off workers because "business is bad, we can't afford them".
IMPO, Washington's only real jobs concerns are keeping their own.
They pander to large corporations for campaign cash, the people "buy" their lies and promises like any other commercial product.
Big Business OWNS this country. Congress is just bread and circuses for the masses.
http://www.flixya.com/blog/3201910/Beautiful-Butterflys