The man who would usher in an era of ‘hope and change’ with his election in 2008, begins 2012 having practically eliminated any hope for small business owners.
The recent release of the Small Business Optimism Index bears this out, with uncertainty reaching new record highs, even following a first term already marked predominantly by economic and regulatory uncertainties.
From four years past and four years of a future filled with looming taxes, stifling regulations, and the uber-burdensome bill known as Obamacare, the President’s main platform seems to be one of crushing small businesses, and by extension, crushing the American dream.
To start, results from the latest Optimism Index indicate record levels of uncertainty that exceed even the darkest days of the Carter presidency.
A report from Fox Business indicates:
“Uncertainty about the direction of business conditions in six months reached 23% of respondents, easily surpassing a pre-recession record of 15% that was reported during the Jimmy Carter administration.”
Despite the administration’s constant drum-beating of the word ‘recovery’, the optimism index remains at rates more synonymous with another ‘R’ word – recession.
Several factors have created the pessimistic mindset running rampant amongst business owners; the looming fiscal cliff, the constant threat of higher costs, higher taxes, and of course, a downward trend in sales numbers.
“Weak sales remained the primary business concern for 22% of surveyed owners. The net percent, seasonally adjusted, of all small business owners reporting higher nominal sales over the past three months is negative 15%, two points worse than September.”
These factors have a major effect on business hiring which, despite what you will hear from the White House, remains markedly lower than before Barack Obama became President. National employment currently stands at four million fewer workers in this country than were seen during the first quarter of 2008.
Further stagnating the business economy is an unwillingness of small business owners to invest in capital because of these many concerns. One example of this comes from Bill Keith, president of Indiana-based SunRise Solar, who found more hope in investing in loans to other projects than putting further capital into his own business.
“I see the loans as a better investment than myself, which is sad,’ Keith said, adding that his level of optimism dropped after the election. ‘I planned on investing capital if Mitt Romney was going to win, but I stopped short of doing that because that’s no way to run a business.”
Amidst the myriad of concerns, the administration seems to take the opinions of small business owners with little or no regard. In fact, if the President is indeed concerned how small business perceives his policies, he has a strange way of showing it.
For instance, Obama’s fiscal cliff plan for raising taxes on the ‘wealthy’ would directly impact small business owners, with higher taxes being paid by nearly 900,000 businesses making just over $250,000 annually. Despite that fact, administration talks regarding the fiscal cliff have involved labor leaders, congressional leaders, CEO’s of major corporations … but nobody representing small business.
Further eroding the confidence of these business leaders is the economic horror show known as Obamacare. With implementation of the President’s health care overhaul inching ever closer, small business owners are facing record health care costs, and having to cut employee hours in an attempt to avoid even further penalties.
The day after the election, FreedomWorks noted several businesses that were committing to layoffs almost immediately, citing Obamacare taxes as the main reason.
But we also delved into several businesses that were slashing their employee’s hours in an effort to remain compliant with the plan’s requirements for full-time status. According to the New American, Obamacare “requires businesses with 50 or more full-time employees — with ‘full time’ defined as working at least 30 hours per week — to offer ‘affordable’ health insurance to those employees.”
The result? Businesses are trying to drop below the 50 full-time employee level by either eliminating jobs, or eliminating hours. In other words, the whole of Obamacare is a tax-happy prescription for small business disaster.
While larger businesses may be able to absorb all of the negative economic impacts coming from this administration, many smaller ones will end up shutting their doors. The President’s policies have wasted little time in strangling small business, and eliminating any glimmer of hope they may have once had prior to the election.
Cross-posted at FreedomWorks