Posted By RichC on October 4, 2012
I started a post on the Presidential Debate last night, but figured if I’m tired of tweeting, reading and hearing about it, others may be too … so will pass on opining. I will say that Mitt Romney looked well prepared and was able to comfortably manhandle President Obama on the subject of the economy, banking and jobs, the subject of last night’s debate. Who knows if Romney’s obvious experience and competence registers as “important” with the majority of voters?
Instead of rehashing who is better for the economy, I’ll share my thoughts on some changes I’ve seen for those who believe small business is key to our economic recovery. Much of my concern has to do with excessive regulation hindering small businesses and entrepreneurs.
I was fortunate that in the 1980’s a young ambitious person could pitch a simple 10-page business plan to a local banker and realistically pursue a the dream of building a business. It was great when a bank manager knew you personally, took and interest in your success, offered guidance and was for the most part the final say on lending; he monitored cash flow and extended additional capital as one’s small business track-record improved. His goal was to see you succeed, which in turn generated income for his bank. That was their business model … in the good ol’ days.
Initially, I needed $25,000 in capital to move a part-time small business (one that I built – cough, cough) from my basement and garage in our house (high risk in today’s regulated world) to a commercial location. For me, it was time to either go full time with more “reliable” equipment and employees or hang it up and move to where my “day job” required (a move of my family from Akron, Ohio to Miami, Florida). The worries were simple: “Would my sales efforts offset salary requirements, capital expenses and monthly bills?” If so, I would succeed, if I couldn’t sell and manage, I would fail.
Fortunately, we weren’t overly hounded by licensing, permits, OSHA, multiple recycling contracts, storage of inventory, health insurance requirements, managing payroll and today’s complexity of withholding taxes, sales taxes, city, state and federal taxes and all of the filings and dates — all that now hammer small business with penalties if mistakes or an oversight is made. We didn’t initially have tax reporting of purchases to and from suppliers, vendors and freelancers or concerns over inspections and investigations (although I did have a stressful ulcer inducing IRS audit!)
There wasn’t the frustration and challenge of tracking waste with special bins, pickups and paperwork filings, or concern over too much inventory of certain chemicals. We really never feared being fined or sued over infractions based on missing a filed any one of any number of reports … like a rag in the wrong bin or the number of inches between the wall or ceiling and a piece of equipment. It’s no wonder small business start-ups are at a 30 year low and companies move or expand overseas.
Knowing these potholes are all part of a new business today, on top of struggling with a slow economy, it is hard to imagine anyone taking a risk … if you can even attract the capital in the first place! If America is going to be prosperous once again and is to be the place where one’s ambitions and dreams can be achieved, we need change … and in my opinion, not Obama’s kind of redistribution “hope and change.” I’m not saying Mitt Romney is perfect, but under his leadership our country has a much better chance of bringing back the American dream and the promise of prosperity that comes from helping, not hindering, small business succeed.
Click for larger images of the CPP Edison Street building in 1987