A few days ago I declined the honor of commenting in the press on which of the two presidential candidates would be better for small business. I know why I'm asked. I own a business, we have 45 employees, and decent (multi-million-dollar) sales. We have no outside investors, and we've never missed payroll in 25 years (except when I didn't pay myself).
The following day I saw an analysis of how and why small business owners should vote for John McCain. It was done by a man I respect, know and like, a journalist with pull in the small business world. He has a good reputation.
And that disturbs me for several reasons.
- First and foremost, it's crazy to vote for president based on the supposed details of what's best for my business. What's best for my business on the long run is whatever is best for my country. Before I go into my office every morning, I walk or drive through the town I live in. I pass schools, homes, and businesses. We win together, or we lose. When I get to the office, I deal with sales involving thousands of Web users, all of whom are affected by what my government does for the population in general, not what it does for a small minority of business owners. Voting simply on small business issues related directly to my business is like sticking my head in the sand.
- Secondly, I'm not at all sure he's even right about the Republican offerings.
- I've been signing checks for employee health care for 15 years now. We've never linked our benefits to exactly what the government wants for us; we've always done a lot better than minimum requirements. As far as I can tell, ironically, the Democratic platform leaves us alone to do what we've always done, and the Republican platform messes with us a lot, and not in a way that's good for the company or our employees. And I'm no expert, but it doesn't seem to me like it's good for the general population either.
- The arguing about tax rates seems to be full of misinformation. The campaigning seems to mislead people on what it is to have $250K in profits; that's a lot of profits. Don't confuse that with having sales of $250K. I think I read that the Democrats say that only 2% of businesses make more than that in profits. I'm surprised that it's that high.
- Furthermore, who are we kidding? Tax rates these days are about how we calculate taxable income, not about the final rates. It's all smoke and mirrors.
- And if we fix the deficit spending a bit by raising taxes, that's much better for all business that the hike which affects a small minority, and not the main public, even if we're part of that small minority. Ultimately, in my business at least, we want our buyers to have money.
Ultimately, when people start talking for small business, they're almost always off base. Small business includes more than 21 million business owners in this country, not counting the millions more who own shares in large businesses. We don't vote as a block. We are as diverse as the country itself. And, I guess this is a cheesy statement, but I think each of us should vote for what we think is best for the country, not just what's supposedly best for our specific business.
But that (what I've stricken out above) is too damn non-committal. Let's just get to the real meat of it, which is that the Republicans have co-opted a lot of small business analysis to foster this misinformation, as if that bait-and-switch McCain health care plan and the pie-in-the-sky tax cuts were really good for anybody in small business. What it's really good for is confusing issues, and its authors are same Republican leadership that has laid siege on the SBA and made business harder for everybody. The only thing they've really done for small business is add to our numbers by turning so many formally medium-sized and larger businesses of the past into small businesses today.
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1. 40% don't pay income taxes, which will increase to 45-50%. Like Obama, we're only talking about INCOME TAXES.
2. Those who will be hit the hardest will flee to tax havens like tax free bonds or other countries. So you can bet that the $250K will be lowered considerably. Now we hear it's $200K and Biden earlier said it is $150K.
3. Obama's plan will increase the amount of FICA taxes on those making over $95K. For nearly all it will offset the income tax cut and for most it will be a net loss.
4. Obama's plan will also raise taxes on gasoline, natural gas, electricity and home heating oil which will offset nearly all those remaining income tax payers and be an increase for most.
5. Obama's tax plan to raise taxes on business's will be passed on to the consumers and will be a net increase on the standard of living for all working Americans.
6. The only one's who MIGHT see a benefit will be those American's on welfare.
7. Obama's bill, the $845 Billion a year Global Poverty Act passed in the Senate in 2008 will insure that the rest of the world's poor will benefit.
The Democratic socialism has done nothing but kept those recipients chronic dependants on the government. It is equivalent to economic slavery. The government rewards those for having more dependants especially for those born out to wedlock. It’s just enough to get by and insure that those in the receiving end vote Democratic. Open your eyes and look at who controls the urban areas and see that the problem is only getting worse. It’s the ultra rich liberal elite using the “Uncle Tom” minority leaders to solidify their power and kill the American dream for all who work hard to achieve it.
5. maybe, but look at who is taxed and who isn't. Only businesses which don't provide health care with over 50 employees will pay the tax. Right now they are using that advantage to provide goods cheaper than competitors who provide health care. once this tax exists, there will no longer be an incentive to screw your employees.
6. The ones who might see a benefit are the middle class that have gotten poorer every year of Republican leadership this century.
7. if the rest of the world's poor do better, the rest of the world will be forced, by economic pressures, to give better pay to their workers, which will make our workers more competitive, and maybe turn around the job drain to the third world. But that might hurt your stock values, so who cares if it makes the US stronger.
6. Don't forget the fact that Obama will let the current tax plan expire in 2010 which will INCREASE the tax rate on all those earning over $42,000 per year. The $1000 tax rebate Obama offers will be offset for most of those tax payers. Unlike the Socialist countries, the middle class makes up the largest class with the upper and lower class being similar is size. Oabam's plan with change the statistic daintily eliminating the upper class and turning more workers into the lower class. If you can get something for free, why work?
7. The primary reason the for the prosperity of Communist China is trade with the huge consumer markets of the capitalist countries of the U.S., Japan and the few remaining free markets. Once those markets dry up from Socialist redistribution, the entire world will be worse off. The former Soviet Union was denied from trading with the Capital markets and was forced to abandon its form of Socialism.
One thing I do know, the repubs have been campaigning on and cutting taxes for the past 30 yrs. Where has it gotten us? More jobs lost. No money for needed infrastructure. Dwindling wage earners to pay taxes, less middle class. More people living in poverty. The list goes on and on.
But I appreciate your point that "small business," and perhaps over-idealistically so, even mid- and large business do not have to vote as a bloc. As you note, it may be outrageously old-fashioned, declasse and outre, but your wanting to vote for what is best for the country is, for me, the basis of a civil society, something which is everyday belied by the mentality evinced by such as enochsmoky above and many others. These last 8 years of unbridled greed and selfishness have been particularly ugly.
I'm sorry, but I will have to call it what it is.
Say Joe's S Corp. grosses $500,000. Joe got a loan to purchase the business, and the interest on the loan is a deductible business expense. Joe pays his 5 working plumbers $50,000 each, totaling $250,000. Joe pays himself (as manager/salesperson) a salary of $50,000. Corporation Profit is $200,000 , and Joe pays himself (as sole stockholder) $200,000 in the form of dividends. Dividends are currently taxed at only 15%, and are not subject to withholding for Social Securiity, etc.
A business owner is a CAPITALIST. After he pays himself a plausible salary, the remainder can be distributed as a profit on his investment.
Imagine how much PROFIT Joe's would actually have to produce for him to actually declare a salary of more than $250,000. I would call that RICH.
And is McCain actually suggesting that I'll refuse to make another dollar because I'll pay 39 cents in taxes instead of 35? I still get 61 more.
Unless you are making at least $300,000 a year, the republican tax scam is actually costing you money - and that includes small business owners!
It's not that hard to figure out what profit you want to declare and then put the rest of the money elsewhere - higher salaries, high retirement account contributions, more research spending, less depreciation, expand more, upgrade equipment, etc.
So for McCain and Palin to say businesses will be taxed out of business is WRONG. Now removing a deduction, like for healthcare, would have a BIG impact -- for one thing, it removes one of the ways to remove business profit, which also benefits employees at the same time.
What I don't understand is... why would you decline to say who's better?... it almost seems like you would prefer Obama, so why not just say that?... I just think that declining to speak up allows those who won't shut up more say...