What Government Can Do to Stop Screwing Small Business

In my last post I gave two reasons why the government is not a friend to small business (and yes, there are many more than two). So here is the simple, but not easy, way for government to stop turning to us to raise their revenue: cut spending. Yup, that’s it. If governments cut spending, they won’t need to consider businesses and business owners the place to turn to for more cash. Now I am not advocating a big cut in necessary services like education and law enforcement, etc. I am talking about hunkering down. Allow me to provide some food-for-thought.

If you were like most businesses this year, you cut expenses. You trimmed where you could and then you went back and cut some more. It was painful. Some people were let go. Some resources were eliminated and people worked harder. But most of us survived.

Government spends billions of dollars each year. And we know there is plenty of fat. The number of government agencies that are well-run and lean can be counted on one hand.

Now, I am not saying it will be easy. For starters, we need politicians that are willing to take some risks because the unions and other advocacy groups are going to fight the cutbacks (and they can fight better than anyone). But if our governments don’t take action, two things will happen that no one wants: 1) our governments will run out of cash and services will stop and 2) they will continue to go after small businesses for money and that will inhibit economic growth.

Bonus suggestion: in addition to cuts, let’s not create any more work for the government to do (like government-run health care). As Norm Brodsky says, “When was the last time that government did anything right?”

NY Report contributor John R. Rathgeber, president and chief executive officer of the Connecticut Business & Industry Association (CBIA), explains how to get more involved in government in a recent “Buck Stops Here” article.

 

Comments

[Bobby Casey]

I agree that cutting expenses is the right thing, but I doubt it is likely to happen. Obama's first year budget was 30% higher than Bush's budget and I see that trend continuing. He is advised by a bunch of Keynsian economists that think we can spend out way out of this hole, but the piper must be paid. Our real problem is fundamentally our method of taxation. You always get less of what is taxed and we tax more on productition and less on consumption. We tax productive activities like income and investing and we incentivize consumption by offering tax credits and low interest rates. In order to have economic growth, we need to completely overturn this policy and tax consumption and incentivize production.

[joel]

with 55% of the federal budget going to the military and costs associated with the military the goverment is paralyzed unless military spending is cut.

"When was the last time that government did anything right?"

that's just a stupid statement from someone who should know better. the last time just one example - the murder rate is the lowest in NYC since records were kept (1962). So the answer to the question is NOW. like business government makes a lot of mistakes. deregulating the banking industry - well that was a big one. Getting rid of certain meat inspections there's another one. the current wars - But private industry makes at least the same number of mistakes.

[DT]

"In order to have economic growth, we need to completely overturn this policy and tax consumption and incentivize production."

Right, let's focus on increasing production while decreasing consumption.

Ever notice what happens when supply exceeds demand?

Great idea.

And I'm with Joel. This business of bashing "the government" is stupid beyond words.

"Less government" got us into the mess we're in with allowing insane leveraging of inane packaging and reselling of insanely sold types of mortgages.

Greed, improperly regulated, just screwed us all.

Sure, let's have more foxes guarding the hen house, it worked so well before!

- Small Business Owner