WASHINGTON, D.C. | July 28, 2010 -
President Obama traveled to New Jersey today to raise support for his economic policies among small business leaders. It makes sense to hear from small business owners about their ideas to promote a strong and stable economic recovery. After all, they are the nation’s primary source for job creation. Let’s hope this time the president did less talking and more listening because a look at just a few of the his administration’s top priorities since taking office reveals an agenda that threatens serious damage to America’s job creators.
Record Deficit Spending
Yesterday, the non-partisan Congressional Budget Office issued a disturbing analysis concerning the fiscal crisis looming over the country. In its report, CBO declared “growing budget deficits will cause debt to rise to unsupportable levels…” This follows a report by the Obama administration that projects its economic policies will lead to a record $1.47 trillion budget deficit for this fiscal year and more than $8.4 trillion in budget deficits over the next 10 years. Such massive borrowing and debt is an unsustainable drag on the American economy. The CBO noted a number of options that may help reverse our present course – massive tax increases, inflation, and higher interest rates – but all options will have a negative impact on the economy and many small business owners.
William Dunkelberg, chief economist for the nation’s leading small business federation, recently noted the “U.S. economy faces hurricane force headwinds and the government is at the center of the storm, making an economic recovery very difficult.” Dunkelberg’s comments came in response to an economic survey that revealed small business confidence dropped in the month of June. Dunkelberg went on to say, “Small business owners are not happy about the future of the economy being painted by the administration or economic events. Confidence is lacking and the news out of Washington is discouraging. Until this changes, don’t expect small businesses to start hiring.”
Tax Hikes and Government Mandates
For more than a year Democrats in Washington fought for a government takeover of health care while unemployment, deficits, spending, and debt were on the rise. Under ObamaCare, businesses – including many small businesses – are forced to provide their employees government-approved health care or pay a fine. While the president may tout a temporary “tax credit” as a credible lifeline for small businesses, we have already learned the design of this temporary credit will actually penalize small businesses for hiring more workers or raising wages.
ObamaCare also forces small businesses, starting in 2012, to file additional tax forms for every business-to-business transaction of $600 or more for both services and property. This will create a tremendous new paperwork burden on small business owners at a time when they should be focused on growing their company and hiring more workers. As a new release by Republicans on the Joint Economic Committee suggests, this is just one piece of the massive regulatory maze Democrats crafted in their health care scheme.
Future Tax Hikes
Despite the damage we have already seen since Democrats took control of Washington in January of 2009, it appears they are just getting warmed up. This week congressional Democrats will leave town for six weeks without any plan to prevent a $3.8 trillion tax increase from hitting the nation on January 1, 2011. Speaker Pelosi and President Obama have made clear their intent to raise taxes on the so-called wealthy – earners making at least $200,000 annually – at the beginning of the new year. Unfortunately, according to data from the IRS, this includes a majority of small business owners. With many economists now expecting the economy to remain sluggish throughout next year, hitting small businesses with even more tax hikes will hurt the economy, workers, and the unemployed.
It is time for President Obama to start listening to the voices of small business owners who continue to express their concerns with the direction of our economy and the policies of his administration. Small businesses don’t want a federal government handout – they want the federal government to shelve its job-killing policies and get out of their way.