Jobs outlook for small businesses may be getting bleaker

[Gaspar]

LA Times article touches on the problem, but doesn't address the 300lb gorilla.  Every business owner knows that his/her tax burden increases significantly in January, and on top of that, it is becoming increasingly more expensive to hire new employees.  Add that to the uncertainty of how much Obamacare is going to cost the small business person, and you have the perfect storm.  The risk of hiring a single employee is not worth taking.

http://www.latimes.com/business/la-fi-0709-smallbiz-slowdown-20100709,0,1513075.story

Anyone for a 10% across the board tax cut yet?   

And from the Washington Post today:

President Obama may be about to repeat Franklin D. Roosevelt's mistakes -- but not the ones captured in this narrow discussion.

By fixating on the debt and stimulus plans, Obama and Congress are overlooking challenges to the economy from taxes, employment and the entrepreneurial environment. President Roosevelt's great error was to ignore such factors -- and the result was that sickening double dip.

Taxation is an obvious area the Obama administration ought to reconsider. Income taxes, the dividend tax and capital gains taxes are all set to rise as the Bush tax cuts expire. The Obama administration portrays these increases as necessary for budgetary and social reasons. A society in which the wealthy pay their share, the message goes, has a stronger economy. The administration and congressional Democrats are also striving to ensure that businesses pony up. The carried-interest provision in the tax extender bill seeks to raise rates on gains by private equity and hedge funds. If that were not enough, a so-called enterprise value tax would be levied on partnerships that sought to elude the new high taxes by selling their companies.

Roosevelt, too, pursued the dual purposes of revenue and social good. In 1935 he signed legislation known as the "soak the rich" law. FDR, more radical than Obama in his class hostility, spoke explicitly of the need for "very high taxes." Roosevelt's tax trap was the undistributed-profits tax, which hit businesses that chose not to disgorge their cash as dividends or wages. The idea was to goad companies into action.
http://www.washingtonpost.com/wp-dyn/content/article/2010/07/08/AR2010070804272.html

[heironymouspasparagus]

That is pretty much exactly what I have been bitching about all along.  I would love a 10% cut.  I would also like to see all those rich CEO's get to pay even half of the rate we have to pay!  There would be no more deficit.  The debt would start to disappear.  And since they really do very little comparatively to add jobs in the small business sector, it would be a huge win/win.

And if it is that big a risk - an unacceptable risk - to add an employee for your company, then don't.  But you WILL completely miss that opportunity that led you to think about that hiring in the first place.  Oh, well; if you can't stand the heat, then get out of the kitchen.

Through indecision, many an opportunity is lost.
- Chinese fortune cookie.

[nathanm]

President Roosevelt's great error was to ignore such factors -- and the result was that sickening double dip.

If a person can't even get the basic undisputed (aside from herself) facts correct, I'm not too interested in reading the rest of their screed.

We already got a big tax cut, as was noted in another thread recently.

Also, the LA Times is apparently not aware that it's still difficult for many small businesses to get credit, which makes it hard for them to add expense. There's still a lot of hoarding of cash going on at the moment. Banks can get better returns doing prop trading than lending to small business and big companies are afraid the banks will shut off their lines of credit again.

The traditional ideological views completely ignore these facts. Stimulus alone won't help, although it eases the effects. Tax cuts won't do a damn thing except give the hoarders more money to hoard, so that's a net loss to the economy. Where does that leave us?

[Cats Cats Cats]

Every business owner knows that his/her tax burden increases significantly in January. 

I am a small business owner and my taxes will increase 0% in January if Obama's plan passes.  You must sell a lot of bbq sauce.

[waterboy]

This is getting tiresome.

I see you've replaced FOTD as the daily harbinger of inflammatory, cynical, doomsday movie plots.  Only yours come from the far right instead of the far left. You and Guido, among others, have turned this forum into "all anti-Obama....all the time". I have done my best to ignore them, but it occurred to me this morning, people might actually believe there is a basis to this hogwash and join in the downword cynical commentary whose main purpose is to make sure the midterms are secured for conservatives and Republicans.

Please, folks. Much of this stuff is derived from the same brain trusts who idolize the Michael Douglas character in "Wall Street". They would have you believe that this lovely hangover we're all enjoying from the financial meltdown is Obama's fault. Or FDR or Johnson or Clinton. But certainly not either of the Bushes. They believe in tax cuts, tax cuts, tax cuts as the solution to all problems. They fail to note that before the "Bush tax cuts" we had just left a decade of the most steady business and job growth the country had ever seen. Under Clinton. And budgets that were balanced or close to it. It was a decade of affluence and growth for the middle class. But of course, we needed tax cuts.

Take note, this same crowd has now zeroed in on the Interior and Justice dept.'s failures to effectively regulate and control oil drilling as yet another Obama failure in leadership. Like his administration had staffed these depts back in the Bush era. The fantasies are never ending and the rewrites ever imaginative.

But your latest one, Gas, reminds me of listening to David on KRMG a couple weeks ago. He sounded pretty normal and level headed till someone inadvertantly hit one of his "crazy" buttons. Then I was assaulted with the weirdest re-writes of history I have ever heard. Turns out FDR was a communist and a traitor to his country!! The guy who re-instilled confidence in our country, who actually tried to analyze and battle the factors of the depression (and had some success), the guy who successfully lead us in battle against the greatest evil of his time and who was so popular he could have won a fourth term had he lived.....WAS A FAILURE, A COMMUNIST AND A TRAITOR!! Yeah, that makes sense. Cause he didn't favor tax cuts.

You as well as anyone Gas, know the power of self talk. Of self perpetuation. Of a lack of confidence in our country's ability to transcend petty politics and systemic problems. If you continue to paint our president like David interprets FDR, it is likely you will get the depression and failed presidency you seem to desire. We'll all suffer, but you guys will get your Libertarians and "true" Conservatives and the corporate elites will once again ascend to their dominant positions.

As for me, I prefer to look for positive solutions and people who offer them.

[Cats Cats Cats]

Please, folks. Much of this stuff is derived from the same brain trusts who idolize the Michael Douglas character in "Wall Street".

Now wait a minute, #1 Greed is Good, and #2 I idolize Gordon Gekko and he wouldn't pay these taxes.

[Townsend]

Kudos waterboy.

Btw, he did win a 4th term in '44.  He died soon after and Truman took over.

[Gaspar]

I am a small business owner and my taxes will increase 0% in January if Obama's plan passes.  You must sell a lot of bbq sauce.

Bush tax cuts expire.
Business Taxes. In addition, various business taxes will change including the payroll tax credit and section 179 expense deduction.

The current six rate brackets of 10%, 15%, 25%, 28%, 33% and 35% will be replaced by five new brackets with the higher rates of 15%, 28%, 31%, 36% and 39.6%.  

This means if you are an LLC and your rate is 28%, you will start paying 33% - 36%.
Even if you are a very small business, you will see a 5% increase in taxes.

That would buy a lot of sauce!

[Gaspar]

This is getting tiresome.



As for me, I prefer to look for positive solutions and people who offer them.

Come on, it's got to be getting harder and harder to be an apologist for Obama, but I'll give you this one. 

Provide a concise list of the positive economic solutions that the administration has provided.  We can take the debate that way.  Set em up!

[nathanm]

You must sell a lot of bbq sauce.

Perhaps, but he's (probably) been counting what would be to the rest of us wages as unearned income to avoid self employment tax, and he's pissed that his loophole of choice might be closed.

The thing I find most galling is the constant harping on the budget deficit, followed by loud complaints when something is done about it.

Edited to add: And based on the later posts, that he will actually have to amortize capital expenditures rather than taking the entire deduction at once. And the Bush tax cuts expire. And I can't figure out what he's talking about re: payroll tax.

[Conan71]

This is getting tiresome.

I see you've replaced FOTD as the daily harbinger of inflammatory, cynical, doomsday movie plots.  Only yours come from the far right instead of the far left. You and Guido, among others, have turned this forum into "all anti-Obama....all the time". I have done my best to ignore them, but it occurred to me this morning, people might actually believe there is a basis to this hogwash and join in the downword cynical commentary whose main purpose is to make sure the midterms are secured for conservatives and Republicans.

Please, folks. Much of this stuff is derived from the same brain trusts who idolize the Michael Douglas character in "Wall Street". They would have you believe that this lovely hangover we're all enjoying from the financial meltdown is Obama's fault. Or FDR or Johnson or Clinton. But certainly not either of the Bushes. They believe in tax cuts, tax cuts, tax cuts as the solution to all problems. They fail to note that before the "Bush tax cuts" we had just left a decade of the most steady business and job growth the country had ever seen. Under Clinton. And budgets that were balanced or close to it. It was a decade of affluence and growth for the middle class. But of course, we needed tax cuts.

Take note, this same crowd has now zeroed in on the Interior and Justice dept.'s failures to effectively regulate and control oil drilling as yet another Obama failure in leadership. Like his administration had staffed these depts back in the Bush era. The fantasies are never ending and the rewrites ever imaginative.

But your latest one, Gas, reminds me of listening to David on KRMG a couple weeks ago. He sounded pretty normal and level headed till someone inadvertantly hit one of his "crazy" buttons. Then I was assaulted with the weirdest re-writes of history I have ever heard. Turns out FDR was a communist and a traitor to his country!! The guy who re-instilled confidence in our country, who actually tried to analyze and battle the factors of the depression (and had some success), the guy who successfully lead us in battle against the greatest evil of his time and who was so popular he could have won a fourth term had he lived.....WAS A FAILURE, A COMMUNIST AND A TRAITOR!! Yeah, that makes sense. Cause he didn't favor tax cuts.

You as well as anyone Gas, know the power of self talk. Of self perpetuation. Of a lack of confidence in our country's ability to transcend petty politics and systemic problems. If you continue to paint our president like David interprets FDR, it is likely you will get the depression and failed presidency you seem to desire. We'll all suffer, but you guys will get your Libertarians and "true" Conservatives and the corporate elites will once again ascend to their dominant positions.

As for me, I prefer to look for positive solutions and people who offer them.

You are correct, we did have great growth under President Clinton.  But, why did that segue toward a recession at the end of his second term with thousands of very high paying jobs being lost?  I suspect mainly because much of that growth was on borrowed funds for companies jumping into rapidly over-crowded frontier technologies like the .coms, telecom, and bio-tech.  Lax financial regulations?  I dunno, but I'd like to at least hear from you something other than President Bush managed to cause the start of a downturn before he even came into office.  The events which rapidly followed like 9/11 didn't help, but the downturn was on prior to his innauguration.

I give President Clinton his due.  His fiscal policy was very good.  He reduced government employment by over 300K (might have been closer to 400K I don't remember), and worked toward a balanced budget.  Aside from his personal foibles, I think history will be kind to him.

If you don't like the topics coming up on the national politics part of TNF then don't click on it, it's that simple.  You've participated in GOP bashing for as long as I've been coming on here.  When President Bush was still in office the forum topic headers read like anti Bush all the time.  Epithets like "Baby Bush" or "Shrub", calling Senator McCain "Cotton" and "McCaint" during the 2008 race.  I hope you'll note even though I don't think he's doing a great job and many of his initiatives are mis-guided, I still respect the office and I still respect what a challenge President Obama walked into. 

It's obvioulsy irritating you that President Obama can't seem to catch a break on here but even admitted libs are starting to turn on him.  He became President at one of the more challenging junctures in American History but he's still playing idealist when pragmatist is called for.

[Conan71]

The thing I find most galling is the constant harping on the budget deficit, followed by loud complaints when something is done about it.

Why?  Do you think the ever-increasing deficit is good?  Do you think using poor fiscal restraint by the previous administration as an excuse for even poorer restraint is a sound excuse for this behavior?

[nathanm]

Why?  Do you think the ever-increasing deficit is good?  Do you think using poor fiscal restraint by the previous administration as an excuse for even poorer restraint is a sound excuse for this behavior?

No, I don't think it's a good thing, and that's why I find it annoying when those who profess to be so concerned with it complain about increases in revenue.

Also, no. The business cycle peaked, and thus the recession began, in March 2001 (it ended in November of that same year).

[custosnox]

No, I don't think it's a good thing, and that's why I find it annoying when those who profess to be so concerned with it complain about increases in revenue.

Also, no. The business cycle peaked, and thus the recession began, in March 2001 (it ended in November of that same year).

It is possible to reduce the deficit without shifting the burden to the tax payers.  Instead of increasing revenue, what is wrong with decreasing spending?  Too bad that comes down to who's toast oaties are we going to piss in and reduce what they think is important. 

[Conan71]

It is possible to reduce the deficit without shifting the burden to the tax payers.  Instead of increasing revenue, what is wrong with decreasing spending?  Too bad that comes down to who's toast oaties are we going to piss in and reduce what they think is important. 

And that honestly is the most pallatable solution of all- cutting spending.  Of course that comes with a price as well because government buys from private enterprize, puts people on the payroll etc.  Of course if those are essential jobs the government is providing, then it seems those jobs would be needed on the "outside" world.

No one wants to go through their department and voluntarily look for waste and redundant jobs because it means they will have less money to spend the following year and beyond.  The government needs to find a way to reward those who can find ways to reduce spending within their ranks as I think that's the only way to get tangible results.  I don't like the idea of paying a "ransom" to get people to respond, but let's say they offered 5 or 10% of the total savings to an individual who identifies waste it would be a good investment.