Government Burden on Small Business

Discussion in 'Economy' started by BillSPrestonEsq, Nov 3, 2012.

  1. BillSPrestonEsq
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    BillSPrestonEsq Rookie

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    I think this article sums it up nicely.

    Red Tape Is Strangling the Recovery


    By John Allison
    October 19, 2012 RSS Feed Print



    John Allison is the CEO of the Cato Institute and author of The Financial Crisis & the Free Market Cure, and is also a leader of the Job Creator's Alliance.

    For years politicians have bickered about the best prescriptions for the economy. From the right, it's lower taxes; from the left, the remedy is stimulus spending and government programs. Lost in the cacophony is one solution to our economic challenges about which both Republicans and Democrats claim to agree: rolling back the rising tide of red tape strangling small businesses.

    The ever-growing thicket of regulations businesses must contend with is a hidden tax that is stifling economic growth. Washington's bureaucratic machine costs the American economy somewhere in the neighborhood of $1.75 trillion each year according to a recent study commissioned by the Small Business Administration's Office of Advocacy. That is more than the federal government takes in corporate and individual income taxes combined.



    Along with the billions spent on stimulus programs have come hundreds of new regulations that make it harder for businesses to grow and propel economic recovery. As one hand gives, the other takes away; and recently, it's taking a lot more. The trouble with regulation is that more is added every year, but very few government mandates are ever repealed. The combined weight of all the rules that have accumulated are crushing the economy—a death by a thousand cuts.

    Last year alone, federal agencies issued 3,807 final rules according to data compiled by Wayne Crews of the Competitive Enterprise Institute. A good way to measure the extent and complexity of the regulatory environment is how many pages it takes to explain what all the regulations mean. Last year, for example, the Federal Register spanned more than 81,000 pages. That's enough to make a stack of paper as high as a three-story building and each year, the number grows. Today, the Federal Register spans 54 percent more pages than it did in the 1980s.





    More disturbing is the explosion of economically significant rules, those with an impact of more than $100 million. Over the last three years the average number of economically significant rules completed annually has risen by 75 percent.



    Washington has lost sight of the consequences that regulations have on businesses, but the public seems to understand. A poll conducted earlier this year for the Job Creator's Alliance found that 60 percent of adults believe that we are putting too much of a tax and regulatory burden on businesses and discouraging job creation as a result. Regulation hits small businesses the hardest. Small businesses cannot afford the legal and consultant teams used by big businesses to navigate complex regulations. That same SBA study found that small businesses face 36 percent higher regulatory costs per employee than large businesses. Hurting small businesses, which create two out of every three net new jobs, is the quickest way to stifle job creation.



    Large companies' ability to absorb these costs relative to small businesses gives them a significant competitive advantage. By hindering small business growth, overregulation results in a less dynamic and innovative economy. In the long run, it's not government stimulus, but our ability to create and innovate that leads to prosperity.

    We've only just hit the tip of the iceberg. Regulators are still working on dozens of new multibillion dollar regulations due out in the next year or two. Those pending rules will worsen our regulatory climate and further cripple economic growth and job creation. Lifting the regulatory burden on small businesses is essential to any credible program to get the economy back on track.

    (There were charts that I was unable to post in the original article)
     
  2. Katzndogz
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    Katzndogz Diamond Member

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    Small business owners spend about 400 hours a year just complying with the forms that need to be filled out. Next year if obama is reelected that burden will be increased by mandated health reporting. Not only for business, but even as individuals, extra IRS forms will be necessary to report the state of the individual tax payer's health.
     
  3. Moonglow
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    Moonglow Diamond Member

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    I can remeber that the right gave out a stimulus program also under Bush, and that regulatins were not decreased under Bush. In fact he raised alot of fees, even on immigration applications.I am not saying that the left or the right are right or wrong, but something needs to be done to rmedy the burden put upon business. I did a state govt job in 2008, it was the last time, why, not just the paerwork to get all materials and work certified by the company that was the contractor, but the fed and state level of payroll paperwork involved. It does exist at the state level also, it is not just a federal delimma.
     
  4. BillSPrestonEsq
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    BillSPrestonEsq Rookie

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    It really is terrible to watch. I know that as long as the philisophy exists that government will solve our social problems, we will continue to see a decline in our overall well being as a society. I wonder though, are Republicans going to fix this problem?
     
  5. Grandma
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    Not a chance. Republicans tend to favor VERY big businesses, as in nationwide chains of superstores.

    A big factory going into a town will not have to pay local or state taxes. The mom & pop restaurant across the street will get no tax breaks. Hardly seems fair. The factory can better afford the taxes, why don't they have to pay?

    As for regulations, the big businesses can afford attorneys that can tie things up in court until the cows come home. If they are eventually found guilty all they have to do is pay a chump change fine. The very small businesss simply get shut down. The playing field needs leveling.
     
  6. BillSPrestonEsq
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    BillSPrestonEsq Rookie

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    I know how to solve the problem..Don't tax either one of them. As for regulations and leveling the playing field..Get rid of them, that will completely level the playing field. Get rid of all the subsidies, taxes (and tax breaks as a result), regulations and you have effectively leveled the playing field. There are laws that business must follow of course. Fraud and say illegal dumping of toxic chemicals is still illegal. I would like the government to actually prosecute those that commit crimes, another thing they are not very good at it seems.
     
  7. EdwardBaiamonte
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    EdwardBaiamonte Gold Member

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    That is 100% idiotic liberal thinking!! The factory is locked in life and death international competition to have the best price and highest quality in the entire world. Every single penny counts.

    I guess the liberal has not heard that American factories are an endangered species thanks to liberal fools!!
     
  8. EdwardBaiamonte
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    EdwardBaiamonte Gold Member

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    too stupid but 100% perfectly libera!! Consumers tend to favor nationwide superstores because they have huge economies of scale that yield lower prices!!! Republicans favor consumers not the stores you liberal so and so!!
     
  9. EdwardBaiamonte
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    EdwardBaiamonte Gold Member

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    of course that's purely idiotic and liberal. If it was true the liberal would not be so afraid to present her most substantive example!!
     
  10. Rshermr
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    Rshermr VIP Member

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    Wow, a thread started out by a cut and paste effort from a Cato dogma piece. Can you imagine a more prejudiced source?? Do cons live in a bat shit crazy world of con dogma sites? Yes, of course they do. But if any con out there can show when either: 1. When a bad economy has been helped by a reduction in income taxes, or 2. When a tax increase during a bad economy has made the economy worse. Don't let it hurt your heads. I know you believe you are capable of doing this little exercise. But I am certain you are not.

    I should, I suppose, go to move on, get you a quote or two, and start threads with them. But I will not, because as opposed to cons, I have some level of integrity.
     

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