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Tim Berry

Tim Berry

Posted: October 25, 2010 12:47 AM

As the November 2nd elections near, every politician is suddenly small business' best friend. Every problem in small business is caused by the opposing party, and every new proposal is going to rejuvenate small business and entrepreneurship in this country, they say.

The question is: do you believe it? Try this top 10 list of political truths (and half truths, or outright falsehoods) about small business. You be the judge.

 

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As the November 2nd elections near, every politician is suddenly small business' best friend. Every problem in small business is caused by the opposing party, and every new proposal is going to rejuve...
As the November 2nd elections near, every politician is suddenly small business' best friend. Every problem in small business is caused by the opposing party, and every new proposal is going to rejuve...
 
 
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09:18 AM on 10/29/2010
I used to have a business accountant who always told me, "Don't worry about paying taxes... It means you are making money!"

What he meant by that is that taxes are only charged on the NET profits and not the gross. Dont leave money on the table by obsessing over your final tax bill. If your taxes went up, so did your profits.

I've said many times that the only person that has the ability to convince a business to hire someone is a CUSTOMER!
Instead of all of this nonsense about creating jobs, we need to create a few customers.
06:47 PM on 10/26/2010
The problem with minimum wage laws is that they don't help someone who's labor value is below the wage floor set by government. Higher employment could be achieved were the government to lower the floor.
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09:58 PM on 10/26/2010
And the moon is made of green cheese.
09:20 AM on 10/29/2010
See my comment on creating customers.
Min wage and lower earners are crappy customers.
08:21 PM on 11/22/2010
But that doesn't help to create wealth -- it only serves to redistribute it.

It's similar to the broken window fallacy.
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Tim Berry
Founder and Chairman of Palo Alto Software, entrep
05:37 PM on 10/26/2010
Ok, revisiting this post a day later, as author, I can't resist commenting on three comments:

Re those two comments asking for facts, or "where are the links?," what makes you think we live in a world where the facts or the links to facts come riding into the scene like the cavalry in bad movies, to save us all with the actual real truth? More and more now, in our public political debates, slogans and half truths are presented by both sides as facts, and, worse yet, facts are virtually manufactured to match slogans. All the talking points, on both sides, are backed by alleged research. Which side do you like? You can find research to support it. That's one of the points I wanted to make.

Re the third comment, bloc vs. block, I thought about it, chose not to, because it focuses the headline on the bloc and not the heterogeneity. Interesting word example, because block may be wrong, but it works better. IMO.
08:45 PM on 10/25/2010
Good questions. My two cents:

1. Gov't doesn't make or break most, but it can certainly influence them and make or break a few at the margin.

2. No (might qualify a little but still no)

3. Hard to quantify since FIT hasn't changed much in almost 10 years. Small-business owners definitely take taxes into account in hiring decisions, though it's never the primary factor.

4. It helps struggling families if they can get a job. But makes them less likely to find one.

5. I haven't studied the issue but every large business once started out small. It intuitively makes sense that the success stories in small business drive job growth.

6. There's good arguments on both sides but I vote for free trade.

7. No - if you protect one business you too often provide a disadvantage to another, more vibrant business.

8. Definitely. Current effective marginal tax rates are extremely discouraging to the would-be-entrepreneur once (s)he starts to expand.

9. I'm sure they don't all vote the same - I don't try to talk politics with my clients but you do get to know people. For example of my top 3 clients I'd say 2 are center-right and 1 is center-left. (In a very liberal state, if that makes a difference.)

10. Absolutely go-getter immigrants are a positive influence. But I've also seen them compete against illegal immigrants.

We might disagree some but I'd be interested in hearing back.
02:49 PM on 10/25/2010
The gov't definition of small business is crazy. I am a corporation and have never employed more than 9 people at one time. I believe the definition is something like 500 employees. People in my boat would gladly give up their small business to make $251,000/yr.
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AndyWright68
Freedom is inevitable!
02:25 PM on 10/25/2010
Government has no control over jobs.

Government should stay out of businesses business.

Corporations are government protection.

Minimum wage destroys jobs.

Government only makes matters worse and should stay away from businesses completely.
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cyclone70
When one facepalm isn't enough
02:59 PM on 10/25/2010
in opposite land
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AndyWright68
Freedom is inevitable!
03:15 PM on 10/25/2010
Okay. Your government has been controlling businesses, protecting corporations, manipulating interest rates, stealing half your money at gunpoint, waging perpetual war and devaluing your money among other destructive actions. How is that working out for you?
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KenGirard
"American" is my religion. I have faith in it.
11:02 PM on 11/02/2010
OK, so a guy is making minimum wage: $15,080/year, IF he can get 40hours/week. That is $290/week, around $1250/month.
In my neck of the woods, it $600/month for a real cheap apartment, another $300/month for utilities, $60/month for the bus, living him with $290 for everything else. That is $10/day.
What does he live on? Ramen?
And he might as well die if he has to see a doctor, since there is no way he has health insurance.

But you think this is to much money to pay him.
How much is so low you might consider it worth hiring him?
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AristophanesJones
I am a happily negative person
02:15 PM on 10/25/2010
No links to hard data on each issue?

Facts are not a matter of "HOT or NOT."
02:13 PM on 10/25/2010
Tim,
Thank you for taking the time to make ask some very valid questions that make great points without even an answer. While you and I have differing opinions on some issues, I am glad that you are providing thought provoking questions like these. Both sides of the aisle would do well to consider.

I do want to address the lower tax issues, I can tell you from personal experience that getting funding has counted on tax incentives int he past that I would have otherwise not got. It allowed investors to take money from one investment and move it into mine, which has helped grow jobs and a stronger tax base.
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alkahest
01:59 PM on 10/25/2010
You should have included "Wages go up when taxes go down" because, when taxes do down, employers already know how little employees will take for a job, so what capitalistic sense would it make for them to pay a higher wage/salary for the same value that they can get for a lower wage/salary and then pocket the difference?
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JanusDaniels
01:53 PM on 10/25/2010
some good questions, some questionable presuppositions, and no information, not even links to research
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Hugh-Gee
My micro-bio is infectious.
01:50 PM on 10/25/2010
Nobody votes as a "block." Small businesses probably don't vote as a BLOC, but nobody votes as a "block."
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Flokk
This is embarrassing... I mean, I'm Quickman!
01:49 PM on 10/25/2010
It is funny. Corporations account for the vast, vast majority of business dollars in this country, and the politicians who talk about "small businesses" are infinitely more beholden to the campaign contributions and backing of large corporations than they are to small businesses themselves. Good times in the Corporate States of America.