Tag Archive: Small business


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Published on Dec 17, 2013

Abby Martin speaks with president and founder of the Small Business League, Lloyd Chapman, about trillions of dollars in federal contracts that went to fortune 500 companies instead of the small businesses they were mandated for.
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By Michael, on December 13th, 2012

Historically, small businesses have been the primary engine of new job creation in the United States.  If the economy was getting healthy, we would expect to see the number of jobs at new businesses rise.  Instead, we are witnessing just the opposite.  We are told that the economy is supposed to be “recovering”, but the number of “startup jobs” at new businesses has fallen for five years in a row.  According to an analysis of U.S. Department of Labor data performed by economist Tim Kane, there were almost 12 startup jobs per 1000 Americans back in the year 2006.  By 2011, that figure had fallen to less than 8 startup jobs per 1000 Americans.  According to Kane, the number of jobs in the United States at businesses that are less than one year old has fallen from 4.1 million in 1994 to 2.5 million in 2010.  Overall, the number of “new entrepreneurs and business owners” has fallen by more than 50 percent as a percentage of the population since 1977.  The United States was once known as “the land of opportunity”, but now that is fundamentally changing.  At this point we truly do have a “crisis of entrepreneurship” in this country, and that is a huge reason why America is in decline.  We are witnessing the slow death of the small business in America, and that is incredibly bad news for all of us.

Unfortunately, the problems that small businesses are experiencing right now have been building up for decades.  The economic environment for small businesses in America has become incredibly toxic.  Sadly, we can see this in the numbers.  According to Kane, the following is how the decline in the number of startup jobs per 1000 Americans breaks down by presidential administration

Bush Sr.: 11.3

Clinton: 11.2

Bush Jr.: 10.8

Obama: 7.8

Obviously, we are headed very much in the wrong direction.  Kane speculates about why this may be happening in his paper

There is anecdotal evidence that the U.S. policy environment has become inadvertently hostile to entrepreneurial employment. At the federal level, high taxes and higher uncertainty about taxes are undoubtedly inhibiting entrepreneurship, but to what degree is unknown. The dominant factor may be new regulations on labor.  The passage of the Affordable Care Act is creating a sweeping alteration of the regulatory environment that directly changes how employers engage their workforces, and it will be some time until those changes are understood by employers or scholars. Separately, there has been a federal crackdown since 2009 by the Internal Revenue Service on U.S. employers that hire U.S. workers as independent contractors rather than employees, raising the question of mandatory benefits. New firms tend to use part-time and contract staffing rather than full-time employees during the startup stage. According to Labor Department data, the typical American today only takes home 70 percent of compensation as pay, while the rest is absorbed by the spiraling cost of benefits (e.g., health insurance). The dilemma for U.S. policy is that an American entrepreneur has zero tax or regulatory burden when hiring a consultant/contractor who resides abroad. But that same employer is subject to paperwork, taxation, and possible IRS harassment if employing U.S.-based contractors. Finally, there has been a steady barrier erected to entrepreneurs at the local policy level. Brink Lindsey points out in his book Human Capitalism that the rise of occupational licensing is destroying startup opportunities for poor and middle class Americans.

Kane raises some very good points in his analysis.  Without a doubt, small businesses in the United States are being taxed into oblivion.  If you doubt this, just read this article.

And the regulatory environment for small businesses is more suffocating than it has ever been before.  Unfortunately, our politicians never seem to learn that lesson.  During his first term, Obama piled on mountains of new regulations, and now that he has won a second term he is preparing to unleash another massive wave of new regulations.

But many times the worst offenders are politicians on the state and local level.  There are some areas of the country (such as California) that have created absolutely nightmarish conditions for small businesses.  California had the worst “small business failure rate” in the country in 2010.  It was 69 percent higher than the national average.  And in 2011, the state of California ranked 50th out of all 50 states in new business creation.

Yet the politicians in California just continue to pile on even more regulations and even more taxes.

Sadly, this kind of thing is happening from coast to coast and it is killing off hordes of small businesses.  Just consider the following statistics…

-According to the U.S. Census Bureau, the U.S. economy lost more than 220,000 small businesses during the last recession.

-As a share of the population, the percentage of Americans that are self-employed fell by more than 20 percent between 1991 and 2010.

-As a share of the population, the percentage of “new entrepreneurs and business owners” dropped by a staggering 53 percent between 1977 and 2010.

-The average pay for self-employed Americans declined by $3,721 between 2006 and 2010.

So what needs to be done?

 

Read Full Article Here

Politics, Legislation and Economy News

Economic News  :    Rising Costs – Healthcare

Study: Costs will rise on mid-size firms from new healthcare law

By Sam Baker

President Obama’s healthcare law won’t erode employer-based health insurance — but it will raise some companies’ costs by nearly 10 percent, according to a new analysis from the Urban Institute.

Although the law’s critics usually focus on small businesses, the new paper says medium-sized firms will see the biggest cost increase.

Mid-sized businesses — firms that have between 101 and 1,000 employees — would have seen a 9.5 percent jump in their total healthcare costs if the Affordable Care Act had been fully in place this year, the paper says. (Many of the law’s key provisions don’t take effect until 2014.)

Small businesses would have seen their costs fall by 1.4 percent. Firms with more than 1,000 workers would have seen a 4.3 percent increase.

The report confirms one central criticism of the healthcare law — that it will increase employers’ costs — while also undercutting charges that the law will lead employers to quit offering healthcare coverage. Overall, about 4 million more employees would have had healthcare coverage if the ACA had been in place this year, the Urban Institute found.

Higher costs stem largely from expanded coverage, the report says.

“Overall, the evidence simply does not support critics’ arguments that the ACA will burden employers and undermine employer-sponsored health insurance,” the paper says. “On the contrary, except for a cost increase to mid-size employers due largely to enrollment increases, the ACA benefits rather than burdens small employers who want to provide health insurance.”

Small businesses are central to many criticisms of the new law. The National Federation of Independent Business was part of the lawsuit decided by the Supreme Court this summer, and Republican lawmakers argue that the law’s new mandates will crush small employers.

But according to the Urban Institute analysis, tax credits and purchasing efficiencies will help small businesses. New mandates, though, will make coverage more expensive for mid-size and large employers.

Medium-sized companies are less likely to offer health benefits than their larger counterparts, the paper says, and would therefore have to pay more in penalties. The healthcare law charges employers a fine for each worker who receives a government subsidy to buy insurance on his or her own.

Crossroads News : Changes In The World Around Us And Our Place In It

Sustainability / Disaster Preparation and Survival  :   Supplies & Bartering

Published on Apr 9, 2012 by

In this video we show some very important items that can be used in times when Bartering will be the medium of exchange.

R&D: Money / Barter Items (Building a Bug Out Bag)

Uploaded by on May 19, 2011

BUILDING A BUG OUT BAG: Money Compartment
(Research & Development Video)

This video shows the Money / Barter Items Compartment for my bug out bag redesign project. In an emergency, I won’t be able to rely on debit/credit cards for purchasing goods and services. I will need to have cash, and plenty of it. However, there may be an emergency scenario where the US dollar collapses, in which I will want to have a few items on me that have value in a currency free society.

Please feel free to offer any constructive comments to help me refine my system. It would be greatly appreciated. Thanks!