Ok, so Barack Obama is now our President-Elect. That very thought cringes me to the core. And yes, he is America’s president, or will be as soon as the Constitutional electors meet. I didn’t vote for him, but he does assume the mantle of the American President. The constitutional process was followed.
But, I still wonder how many will be willing to put up with the Senator’s tax hikes?
Considering how much his definition of the ultra-wealthy keeps changing, I can’t help but think that pretty soon all small business owners will be within Senator Barack Obama’s “spread the wealth” philosophy.
For example, take your average small business, the economic engine of America. Let’s assign the business owner a modest $50k salary. Add in three employees to help him run shop, at a modest $25,000 a year salary, and you are already at $125,000 in payroll alone. Then we would need to talk overhead expenses, inventory, insurance and taxes. In short, this small business would easily run well past even the higher of Obama’s numerous tax thresholds of $250,000 a year.
So, how many small businesses, seeing massive tax hikes coming their way, won’t take preventative steps to meet the bottom line?
Consider this: the unemployment rate in this country is spiking.
I can’t help but think that the combined crippling effect of the economic downturn combined with Obama’s tax plans will mean more businesses will need to trim costs to stay afloat. Suddenly one or two of those workers in our example, for instance, are cut to part-time hours. Or maybe the costs in the shop are raised, inventory reduced, or business re-investment curtailed.
There is another drastic proposal as well. Business owners could suddenly go John Galt and decide that cooperating with insane taxes and regulations are no longer worth the incentive to produce.
In our example the business owner, seeing his taxes double and wage requirements drastically increase by mandate of the government, closes his shop and moves on to a new industry where he does not have to hire any help. Three people are automatically out of work to start. Then the manufacturers of the goods he sells in his store would take note. While his shop alone isn’t enough to notice, if enough small business owners participate in a economic protest the result could be a big chill on the economy. Add in the business owner’s accountant, insurance agent, janitorial service- you get the idea- no industry would be spared.
I believe that the economy is floundering because people have lost the incentive to produce. If failure is rewarded with bailouts and profit labeled as greed, the quickest way to prop up the bottom line is to run and inefficient business model. This, of course, requires taking even more from those running successful operations to give those who don’t operate with a sound business plan in mind.
This, ultimately, is why socialism leads to marxism. Eventually the producers will be forced to produce for the betterment of “society”. How short it is from “too big to fail” to “must not fail”. We should all be very concerned, the free market’s very survival is in our hands.


