TribLIVE

| Opinion/The Review

 
Larger text Larger text Smaller text Smaller text | Order Photo Reprints

Obama's meaningless small-business vow

Email Newsletters

Click here to sign up for one of our email newsletters.

Letters home ...

Traveling abroad for personal, educational or professional reasons?

Why not share your impressions — and those of residents of foreign countries about the United States — with Trib readers in 150 words?

The world's a big place. Bring it home with Letters Home.

Contact Colin McNickle (412-320-7836 or cmcnickle@tribweb.com).

Daily Photo Galleries

'American Coyotes' Series

Traveling by Jeep, boat and foot, Tribune-Review investigative reporter Carl Prine and photojournalist Justin Merriman covered nearly 2,000 miles over two months along the border with Mexico to report on coyotes — the human traffickers who bring illegal immigrants into the United States. Most are Americans working for money and/or drugs. This series reports how their operations have a major impact on life for residents and the environment along the border — and beyond.

Sunday, Dec. 9, 2012, 8:54 p.m.
 

A week after his re-election, President Obama held a news conference to push for a spending and tax agreement — and to talk about small business.

He began by saying, “Our top priority has to be jobs and growth.”

With job creation as a top priority, that puts small business at center stage.

The U.S. Small Business Administration reports that small business “generated 65 percent of net new jobs over the past 17 years.”

The small-business sector of the American economy “employs half of all private-sector employees,” says the federal government's official count, with the Small Business Administration defining a small business as “an independent business having fewer than 500 employees.”

Obama also said he wants a budget deal, “but what I'm not going to do is extend Bush tax cuts for the wealthiest 2 percent” — defined as individuals earning $200,000 or more per year and couples filing jointly making $250,000 or more.

“When it comes to the top 2 percent,” he continued, “what I'm not going to do is extend further a tax cut for folks who don't need it.”

That “need” part is a novel concept, one that puts us on a slippery slope. If politicians get the power to determine how much of our earned income we actually “need,” a Bureau of Asset Counters might be on the way.

If a classic car aficionado owns a dozen Chevy and Ford convertibles from the 1960s, will a government committee be empowered to determine that he doesn't “need” more and raise his taxes?

If a successful businesswoman has three homes, four cars, a yacht and $10 million in the market and wants to expand her retail clothing business, should her taxes go up — and business/job expansion be abandoned — because she doesn't “need” more business, more income or more employees?

In any case, Obama is advocating several things simultaneously that can't be synchronized.

He wants more jobs, a growing small-business sector — the section of the economy that creates the majority of new jobs — and more income redistributed from the “top 2 percent” to the government.

Attempting to show that those positions aren't, in fact, incompatible and represent instead a feasible plan for job creation, Obama injected the same misleading statement into his news conference at four different points.

With tax hikes on incomes of $200,000 and $250,000, “97 percent of small businesses are not going to see their taxes go up a dime,” he repeatedly stated.

That sounds like the vast majority of jobs in small businesses won't be threatened by his proposed tax hikes. But the Treasury Department reports that 30 million of the 35 million small businesses in America employ no workers.

Additionally, just 1.2 million of America's 35 million small businesses earn 91 percent of all small-business income, and that 3 percent of all small businesses “employ a stunning 54 percent of the total private U.S. workforce,” reports Investor's Business Daily. “They are, in short, the nation's job creators.”

And they are directly in the cross hairs of Obama's proposed tax increase.

Ralph R. Reiland is an associate professor of economics at Robert Morris University and a local restaurateur. His email: rrreiland@aol.com

Subscribe today! Click here for our subscription offers.

 

 


Show commenting policy

Most-Read Stories

  1. 4 ejections, benches-clearing scrum mark Pirates’ win over Reds
  2. Pittsburgh airport improvements noted as CEO tries to expand activity
  3. Experts say Pennsylvania is a breeding ground for corruption
  4. Cyclist injured in hit and run in East Liberty, police say
  5. Zimbabwe alleges Murrysville doctor illegally killed lion
  6. Steelers’ Harrison awaits go-ahead from Tomlin before practicing
  7. Freeport’s Morrison strong-arms way to title
  8. Greensburg native runs unique catering service in California
  9. Tax fight brews among Southwest Greensburg business owners, landlords
  10. Work planned for Route 711 in Ligonier
  11. Slot cornerback Boykin should give Steelers options in secondary