The Government Is Destroying Small Business Innovation Through Taxes and Regulation
Small businesses are responsible for employing half of all private sector jobs and have created 65% of all jobs over the last two decades. That’s why it is amazing that Obama would alienate such a large part of the American electorate with his now infamous, “You didn’t create that” comment in Roanoke, VA last week.
Looking beyond the biggest campaign misstep of the year, however, it’s clear that President Obama has never been FOR the private sector, especially small business. His promise that we would never cross the 8% unemployment threshold has now been a proven lie for over 3 years straight as over 23 million are unemployed, underemployed, or have just given up looking.
Much of this can be attributed to businesses not sure how to proceed with Obama at the helm. With the Bush tax cuts about to expire, high gas prices, and more government regulation than ever, small business is looking for an advocate in the White House, not another obstacle. They want stability so they can get back to hiring and producing.
House Majority Whip, Rep. Kevin McCarthy recently put out this video which highlights the story of Arnie Kaufman and his Ohio based manufacturing business. Acting as a case study for small business in general, Kaufman explains that as capital is swallowed up by a rise in taxes and an expansion of regulation the growth of his business is directly and adversely affected.
While the Obama administration claims that the expiration of the Bush tax cuts will have minimal effects on the small business community, the numbers paint a different picture. If all Bush tax cuts are allowed to expire, over 80% of people will see their taxes increase. Even if some compromise is reached with only the top brackets losing the tax breaks, small businesses are sure to feel the effects.
Ideally, the tax cuts would be made permanent or given a long-term extension to provide businesses an idea of how to best plan and move forward. Even a one-year extension is obviously better than expiration. As Obama himself has said, “the last thing you want to do is raise taxes during a recession because that would just take more demand out of the economy put businesses in a further hole.” Maybe the President can take his own advice.