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Nose Under the Community Tent

By Paul Losch

About this blog: I was a "corporate brat" growing up and lived in different parts of the country, ending in Houston, Texas for high school. After attending college at UC Davis, and getting an MBA at Harvard, I embarked on a marketing career, mai...  (More)

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Jobs, Small Business, Candidates and Politicians

Uploaded: Mar 4, 2010
As a small business owner who has managed to hang on the last couple of years, and with no assurance that things are "coming back," I am tired of the platitudes people in office or running for office enunciate around "small business."

Tax credits? I'm not looking for tax credit. I am, as are many peers I talk with, trying to make sure that I am running a viable business. Tax credits are downstream, the business has to be viable before tax credits kick in. If I am making money, I am happy to pay taxes.

Here is what makes small businesses suffer, IMHO--all the *&%$# insurance costs--medical (as I choose to offer to employees and for my own benefit,) liability, property, workmans compensation--easily over 10% of company revenues. Cost of doing business, and excessive. Excessive rent when buildings near my company sit empty. Minimal order quantities from vendors when sales volume is from my customers is down.

"Too small to succeed" is the plight of small businesses. "Too big to fail" is what some of the assholes that attended Harvard Business School, as I did, managed to cajole tons of money out of W before he left office and Obama since he became President.

Neither party has a clue what small businesses are about. W talked about it while he was in office, with little to show for it. He never had a real job in which he succeded, business-wise, he was just using "Daddy." The Texas Rangers don't count.

Obama talks it up as well, and his time as a community organizer, a law professor and a politician also is showing litle understanding.

When it comes to the race for California Governor, only Steve Poizer comes close to understanding what a small business experiences. Meg Whitman, for all that she has accomplished in her business career, has been part of corporate environments from the time she started at Procer and Gamble and left EBay. Jerry Brown is hopeless when it comes to experience in this realm.

Smart or stupid, if you have not been there and done that, you can spout the platitudes, and not understand what it is to make a payroll and maintain a viable enterprise.

Let alone hire more employees thanks to a "tax credit."
What is it worth to you?


Posted by R Wray, a resident of ,
on Mar 4, 2010 at 7:15 pm

If you were an advocate of limited government and free markets, I would have sympathy for you.

Posted by agree with R Wray, a resident of ,
on Mar 4, 2010 at 7:42 pm

Gotta agree, R Wray.

The expression "you made your bed, now you gotta lie in it" comes to mind.

The shadenfreude wears thin, though..because

Unfortunately, the rest of us have to lie in it also. And all our now-ex employees.

All the dems and half the repubs have to go..any one of them who supported the Community Reinvestment Act, which "cajoled" banks into giving the keys of houses to folks with no money down, no jobs, nothing..guaranteed failures, but at least diversity in home ownership was achieved!

Over the screams of a few conservatives who were just waking up, but called racists.

The Dem controlled congress, and most of the Repubs, voted for the "bailouts" over the screaming of conservatives.

And the votes for ever more debt, stealing from us and our children to prop up businesses that should have failed..all over ever growing screams from conservatives.

Insurances rise as more and more regulation requires silly stuff to be language translation ( I thought it was supposed to be MEDICAL insurance!!!) chiropractic, aromatherapy etc. C'mon..who you gonna blame in CA for these laws??? Remember what health insurance USED to cover, for a lot less? Who paid what legislators to "force" all insurances to cover silly things?

Liability insurance..join the club..what do you think health care workers/doctors have to pay and who do they pass the cost onto? Who do you think has made us such a litigious society we have to insure against absurd lawsuits?

Workmen's Comp...same problems as liability..

Property costs: limited housing, from what??? ( do I hear the din of silence from environmentalists limiting housing?)

Taxes..from which State govt, controlled fully by whom..have all these taxes come?

Other States have much better business climates in all these areas...why?

Gotta admire your willingness to post such an honest post...but for some of us, we learned these lessons long ago, and tried to stop us from going this far down the path..but were outvoted every time.

I suggest listening to McClintock more often. You will find you are agreeing with him more often now.

Posted by anonymous, a resident of ,
on Mar 4, 2010 at 7:53 pm

some of us are just tired of politicians and their talk...but I have to mention, I understand Obama was not a "law professor" but rather an adjunct instructor. SIf so, quite a difference. Someone want to confirm that?

Posted by Jarred, a resident of ,
on Mar 4, 2010 at 8:58 pm

Well said, R Wray!

Now Paul: I thought the man with the nice voice explained that we need to spread the wealth around, and that the government needs to run all the important stuff like banks, cars, insurance, education and health care. Did you not get the memo? We are not supposed to worry our pretty little heads about this stuff. Remember, we are the change we've been waiting for. Or was it the hope we've hoping for? Whatever.

Eventually, you'll have to buy food insurance and fill out claim forms at the government supermarket.

Posted by Agree with R Wray, a resident of ,
on Mar 4, 2010 at 9:00 pm

Correct, he taught some classes, he was not a professor.

W had an showed in the business policies he supported, which, btw, led to a great and furious economic recovery from 9/11, so much so, I might add, that we had the most money, in real dollars, come into our Federal know, from those "dumb" eonomic policies from a guy who held on to the coattails of daddy.

right..please give me back "dumb" with results like that.

With the current policies in place then, we would have sunk long and deeply into a recession...depression? Don't know.

If we follow JFK, Reagan and Bush's policies toward economic stress, we would be business friendly, and our economy would blossom, again. Even Clinton got the call after the 1994 rage of the people, and allowed Repubs ( who were still conservative, before they were corrupted with their power and largesse) to put in place a few good things to return some to Reaganomics. Tada!! Economic turnaround. Still some bigger govt ideas snuck in, and started to recess us a bit by the end of term, but this was on the way to being returned to normal by 9/11.

But, I am thinking we still have to learn our lesson a little longer, with a Carter Squared POTUS, Senate and House in charge ... Nore and more folks are seeing the light, and the light is RED for STOP!!

Posted by Walter_E_Wallis, a resident of ,
on Mar 5, 2010 at 7:14 am

Walter_E_Wallis is a registered user.

About 15 years ago I replaced 3 employees with two computers.

Posted by Alice in Wonderland, a resident of ,
on Mar 5, 2010 at 6:12 pm

Wow, the W "revisionists" are out in full force on this one!
Careful folks, as we go down the rabbit hole!

Posted by Merrill Inman Roe, a resident of ,
on Mar 6, 2010 at 9:29 am

I agree with R Wray's comment: "If you were an advocate of limited government and free markets, I would have sympathy for you."

Re Obama: he was an adjunct professor, and thus never subject to the review process that a professor on a tenure track would be.

Also, nothing in BHO's bio shows that he ever worked in a for-profit business in his life. It's all alien to him.

Posted by maguro_01, a resident of ,
on Mar 6, 2010 at 2:46 pm

Most of these posts show that many Americans need badly to see the US as one country among many and not floating in splendid, shining isolation in outer space.

The current stimulus spending has only recently passed a single year's worth of US trade deficits through most of this decade. Where do people think that money went? It's not with all the missing socks.

Americans in the coming decade will have to take perhaps a one third cut in income either through simple reduction or inflation. During the Bush years the US took a dive in the economic wars and was defeated, as simple as that. The transfer of wealth and technology out of the US is historic in scope. But Bush still thinks Sun Tzu is a fancy dessert. Oil imports are not paid for with exports either.

With the bubbles and distortion of the import economy on the tab the labor market is distorted and not flexible enough partly due to the tie of jobs and medical insurance. That tie also helps to cause pervasive age discrimination in the labor market - there are millions of people who are unlikely to work again even if they get realistic and try to get jobs as floor sweepers and servants.

If currencies aren't free traded, nothing else is. The artificial low prices lulled the voters who assumed the government minded the store somewhat. The Bush government quietly borrowed it back to finance tax cuts and checks for the favored, wars, and an oddly ineffectual, bloated government. It also financed new heights in US arrogance and unilateralism often directed at the people lending the US the money to operate who are serious adversaries anyway. What brilliance. Republicans are now saying essentially that the world will continue to bankroll the US because we are so very nice and the pinnacle of human civilization. Clearly they drove real Conservatives out years ago. They have no use for them.

Little or nothing can be changed in Washington or Sacramento unless our pay-to-play system of financing politics is changed. It's called corruption everywhere but here and countries like Indonesia and Russia have cracked and been administered by the IMF because of it. We are not too big to fail but are too big to rescue. Unfortunately it's a Constitutional defect - there's no Jefferson's Wall between politics and money. The Supreme Court graciously reminded us of this a few months ago. By the way - if Bush killed off American Exceptionalism, the Court dug a hole and buried it. Fortunately the current President and Sec'y of State seem to have figured that out.

One of the serious effects of our pay-to-play system is that medical care and finance together will eat around 1/4 US GDP this year and growing. That's unsustainable and is stifling US development and recovery. That large banks make too much, and too risky,
money elsewhere to be bothered doing commercial banking in the US is stifling development and recovery. So is their 'carry trade' and shorting of the US dollar. Main Street and Wall Street have few common interests now. Stimulus payments are partly shipped offshore immediately by the import economy, probably back to where they were borrowed from leaving the principal and interest to be paid off. Another effect of pay-to-play is that tech companies around here have bought programs to help move themselves offshore at taxpayer's expense.

Anyway, we know that California needs to simplify and cut the expense of starting businesses. It needs a new Constitution. It needs to reset many of the Propositions. But without reforming pay-to-play it's all nearly futile. The unstable derivatives world can sink us at any time. Unfunded obligations from Washington are a hemorrhage. None of the great strengths of California are mentioned above. There's no space, but the point is that old formulas now, good or bad, have become almost nit-picking.

Posted by maguro_01, a resident of ,
on Mar 6, 2010 at 3:25 pm

"When it comes to the race for California Governor, only Steve Poizer comes close to understanding what a small business experiences. Meg Whitman, for all that she has accomplished in her business career, has been part of corporate environments from the time she started at Procer and Gamble and left EBay. Jerry Brown is hopeless when it comes to experience in this realm."

Don't know enough about Poizner(sp?) at this point, but a solid part of Whitman's business plan must have been to move as much offshore as possible. That wouldn't help California much. Brown's recent experience as mayor of Oakland might well have given him different and more viable views about Main Street than ex-corporate executives would have. And Main Street is where jobs come from in California as well as Oakland. Most companies weren't started/funded by a Silicon Valley VC firm.

IMO, we need to listen to all of them and try to see through the advertising fog of the campaign process. The current office of Governor of California is not that strong though.

Posted by Pythagorus, a resident of ,
on Mar 7, 2010 at 12:26 am

Wray is Ayn Rand fan. Hopeless. Limited government? Free markets? Wray, you're living in tour head, a pure ideologue. Wray, tell us what we should have done with steel, auto, and financial sectors. What is your opinion of what should have been done? btw, Rand

Posted by R Wray, a resident of ,
on Mar 7, 2010 at 9:22 am

Ideas are what separate us from animals.
There should be separation of economics and government just as there should be separation of church and state (and for the same reasons). We (the government) should have removed regulations and subsidies. We should not use government funds to bailout labor unions or anyone else. A free market would have corrected long ago.

Posted by Agree with Wray, a resident of ,
on Mar 7, 2010 at 3:04 pm

Yes. Millions of people voting with their wallets for which companies survive and which don't correct markets faster and with greater precision than a guy behind a desk making the decisions..who neither spends his own money on the products nor invests his own money on the companies being bailed out.

Posted by Paul, a resident of ,
on Mar 8, 2010 at 5:11 pm

"A free market would have corrected long ago."

It did, in 1929. Nobody's been brave(?) enough to let it do it again.

Posted by maguro_01, a resident of ,
on Mar 8, 2010 at 9:30 pm

"Ideas are what separate us from animals."

If you don't say 'other animals' you have already stacked the deck in favor of the one-dimensional 'qua-man' model of people necessary to Rand's economics. Anyway, we also have more history than just the one passed by our genes. We have culture also, though other animals pass on learned behavior on a much smaller scale.

Our adventures with derivatives have shown yet again that Libertarianism is a failed idea; historically it appears to be a doppelganger for Communism another failure in its respective way. Rand's biography makes this plain enough. Why would anyone think that markets/Capitalism, a human activity for human purposes and motives, could be self correcting and governing? We don't have to believe that and not think that people would not corrupt their workings politically and otherwise.

In the late 1800's until the Depression was a time of booms, busts, crashes, bank runs, and so on. When we had the period of financial 'reforms' around when Glass-Steagall was eliminated, one act was called the Financial Modernization act. What was done was to not only do the needed updates but to discard the wisdom of the regulations directed to human behavior which doesn't change.

Now the resulting financial monsters can easily buy Congress thanks to our political pay-to-play system, an old problem from our beginnings. Bailing out the big banks without breaking them up means they can now play even riskier games effectively insured by us. The banks are becoming not too big to fail, just too big to rescue. Just like the United States.

Remember when Greenspan confessed to Congress that he didn't understand why the banks didn't take better care of themselves? He apparently confused the Corporate Person with a real one. Of course the real ones behind the corporate facade did very well indeed. Greenspan turned out to be a Rand fan; deregulation worked until it didn't, as always.

Posted by agree with R Wray, a resident of ,
on Mar 9, 2010 at 5:47 am

"deregulation worked until it didn't, as always."

witness Russia, China, Cuba, Venezuela,all NAZI ( National Socialist Party, recall) countries, and every other small and large socialist and communist country, and please recite after me

"regulation never always"

You can point to one year here and there as "proof" of the failures of min regs, but if you connect the dots across history, you see that leaving slumps alone self-correct much faster and don't dive as much as when our "govt" tries to fix them.

Note the Great Depression of 1920 that nobody ever talks about, ..look it up! Why don't you know about it? Because we left it alone except to lower taxes and regs,..and we ended up with the roaring 20s. Why do we know so much about the 1929 crash? Because our knee jerk reaction, then as now, was to panic and beg Govt to step in..which made it worse,for longer.

Again, I trust the vote of millions of wallets to pick our winners and losers, over a few bureacrats with agendae.

Leave "the economy" alone, and it corrects itself with the wisdom of millions.

Please read the local SJ Merc News Editorial by SJ State Asst Prof of Econ if you are interested in a nicely written, short and easy to grasp lesson in econ

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