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Author: ShelbyBoy Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 14985  
Subject: Crippling job creators Date: 3/30/2004 10:01 AM
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Note: After an experience at an office supply store yesterday, I had planned to put up a post about yet another reason why I try to structure my various enterprises so that I don't have to hire employees. I might still write that post, but this article seems to sum up the bigger picture.


http://www.nationalreview.com/comment/meyer200403290851.asp

Excerpt:

There is one more reason we aren't creating jobs fast enough, but saying it out loud would be so unpopular, and so politically toxic, that none of our leaders — including those few who actually understand it — seem willing to take the risk. So, here goes: We aren't creating jobs fast enough because we have crippled the people who do the creating, and turned them from the heroes and heroines they are into villains. Read the last sentence again, then say it aloud to whoever happens to be nearby. This is the core of the problem — no, it is the problem — and until we fix it we aren't going to start creating new jobs fast enough. And yes, it really is this simple.

People who create jobs are entrepreneurs, which Webster's defines as "a person who organizes and manages a business undertaking, assuming the risk for the sake of the profit." Sometimes these are people who invent new products or services, then launch companies that become billion-dollar enterprises that in turn spawn new industries. Think of Apple computers, or Starbucks. And sometimes these entrepreneurs launch smaller enterprises, such as neighborhood shops or a local business that specializes in making windows for new homes or in remodeling kitchens. Anyone who launches a new venture is by definition an entrepreneur, and these are the people whose efforts create work for everyone else. They are the only people who create work, which is why entrepreneurs are vital to the economic health of any free society.

The jobs that entrepreneurs create — keep in mind that 80 percent of all new jobs are created by small businesses — provide incomes to the people they hire, who in turn spend their money on the products and services they need and want. This is what allows the big manufacturers, such as the automakers, to rev up their own production lines and by doing so to expand their own workforces. And all this activity, over time, generates enough economic activity to enable still more entrepreneurs to launch or expand their own ventures and thus to keep the economy — think of it as one huge "jobs machine" — humming.

Common sense suggests that a country whose people want jobs would do everything possible to help entrepreneurs to succeed — to encourage them, or at the very least to get out of their way. Alas, nothing is so rare today as common sense. And in the last decade or so we Americans have been making it less attractive for entrepreneurs to do what they do — and less likely they will succeed when they do give it a shot. Through a combination of high taxes and onerous regulation, we have discouraged entrepreneurs from doing the one thing they must do for everyone else's sake — namely, create new jobs.

More precisely, unlike their predecessors, today's entrepreneurs struggle to expand without creating jobs, because the cost of doing so — both financial and emotional — just isn't worth it. This is the big shift in attitude that no one wants to talk about. Even in my own tiny, home-based publishing business, we are killing ourselves to grow — and terrified that if we grow to the point when we need to hire someone, we will be crippled by local, state, and federal taxes on our employee's salary, and made miserable by regulations that might force us to rip out the flower bed for a wheelchair-access ramp or even be sued by someone who never applied for the job we created but somehow feels that he or she is the victim of discrimination.
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