Thursday, December 11, 2008

Further Evidence Of The Cause

I suggested a couple days ago (echoing a number of really, really smart people) that part of the rising unemployment is simply a precautionary measure of businesses cutting back now, before the Obama-Reid-Pelosi trifecta takes office in January. Looks like that suggestion is right:
When the jobs report for November came out last week, many so-called "experts" were shocked at the massive loss of an estimated 533 thousand jobs. Even a Time /CNN organization called "The Curious Capitalists" were at a loss to explain it.

Let me attempt to help out these "curious capitalists" (though I am still skeptical that anyone working for CNN or Time is either curious or a capitalist). I caused part of this job loss and I know precisely why; the election. The results portend big trouble for small business.

The job destruction process has started. We are about 20% of the way through our ramp down process and on schedule to complete the shut down by spring 2009. Watch the financial news and you will see continued job cuts each month. We are not alone in our strategy. Far from it. Atlas has shrugged all over the country.

Like many business owners, we are no longer willing to take all of the financial and legal risks and put up with all of the aggrevation of owning and running a business. Not with the prospects of even higher taxes, more regulation, more litigation and more emboldened bureaurcrats on the horizon. Like others we know, we are getting out while the getting is, well, tolerable. Many who aren't getting out are scaling back.

We learned just this week that getting out of business is harder than we thought. Take Republic Windows & Doors of Chicago, where being out of money and out of paying customers apparently does not give a business the right to shut down. Nor does it give that business' bank the right to withold credit. According to the unions, Jesse Jackson and the Governor of Illinois (yes, THAT governor), this company must continue to pay its employees salaries and benefits.

But pay them with WHAT? Liberals seem to be clueless as to where "the money" comes from. They love to tax, regulate and redistribute wealth -- all the while decrying the very profit motive that created it -- something they do not understand. If they did, they would not naively insist that a business that is out of money, out of customers and out of credit stay open so as to pay employees.

And that is but one example of why the lay-offs of November 2008 - which will be part of George W. Bush's statistical record - fall in reality on the Obama election. Business owners understand that the election of 2008 just gave a lot more power to people who think like these liberals in Illinois. For crying out loud, an Illinois liberal is now "President elect" and he chose another one for his Chief of Staff. He chose Michigan liberals for his economic team. Illinois and Michigan are broke!

It is no secret that owners circulated endless emails leading up to election day discussing lay off plans were Obama to win. Entrepreneurs instinctively understand the danger posed by larger liberal majorities in power. The risk-reward equation and fierce independence spirit of start up businesses are anathema to the class warfare, equality of outcome and spread the wealth mentality of the left.

We have very little appetite to have our lives run by elected or un-elected officials like Barney Frank and Jamie Gorelick. We have no appetite to be taxed even more by the likes of Charlie Rangel. These clowns destroyed Fannie Mae, Freddie Mac and our entire economy as a result. Congress, by their own admission, cannot even run their own damned dining room with a captive customer base! Some of them refuse to pay their own tax burden. Why in the world would we subject ourselves to their ilk armed with the unchecked powers of the Oval Office and both houses of congress and a massive army of bureaucrats?

We got into business to be independent. We will get out for the same reason.

The fact that Obama is not in office yet is irrelevant. Businesses must see "around the corner" and plan accordingly. Rightly or wrongly, business owners see a huge anti-business shift in motion and they are making preparations NOW. We do not want to have business illiterates like Chris Dodd dictate our decisions from the comfort of his home made possible by a quid pro quo Countrywide mortgage.

(As the owners of Republic Windows are finding out, government will nose their way into your business even if you are not thriving.)

Most of the kind of people who start and run businesses are by definition trying to opt out of depending on anyone else -- be it a large corporation or government -- for their welfare. We take on tremendous risks and responsibilities. We do so expecting a better than average return. Since we require nothing from government, most of us deeply resent and resist being pestered by government.

For nearly 30 years, I have been one of these business people. It was an amazing journey and literally involved blood, sweat and tears. But now I am done. This election screams that we are going to see a deterioration of the risk-reward equation and the ability to be left alone. Apparently, any appreciation of our crucial place in the economy is lost on over 50% of the voters as well as those they elected.

So, like many business owners, I will "stay home" so to speak. Others more brave than I are opting to try and stay in business by cutting way back on purchases and payroll. They have already started. They are not waiting for the little sign on Obama's lecturn to be updated to the official Presidential seal. November 2008 job losses belong to "The Office of the President Elect." I know. I caused some of them, and I know why.
Okay, so this is just one guy and one business...but what if this one guy and this one business are representative of millions of people and millions of businesses?

Obama's policies are almost identical to those of Jimmy Carter, and when he put them into practice we saw soaring unemployment, tax hikes, rampant government intervention and regulation, and shortages of critical necessities due to price fixing. Why would anyone with a quarter of a working brain think it would work any differently this time around just because the Obamessiah is speaking pretty words?

That's the problem here. All of those people who exceed the above-mentioned brain function understand what Obama's policies will do, and they understand that he'll start hosing them from his first day in office with the full approval of an ironclad Democrat majority in Congress. All of those smart people in business are cutting their losses and getting out -- or going into a hibernation-like survival mode -- before the trifecta comes knocking on their fiscal door. It's everyone who lacks the above-mentioned brain function that thinks Obama's going to fix
anything with his tax-and-spend madness.

This is no rocket science; it's basic economics and political realism. Just brace yourself, because it's going to get ugly. And, the truth is that the ugliness is precisely because of the Obamessiah and his promised actions.

The good news is that Americans will see liberalism on full display, and will quickly and forcefully revolt against it. The bad news is that we have to suffer through at least two years of it before any substantive changes can be made. It's going to be a loooooong two years.


There's my two cents.

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