McCain Best For Small Business

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Wednesday - October 22, 2008

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During last week’s presidential debate, I couldn’t help but reflect on my life as a small-business person. Over the course of 12 years, my companies employed literally hundreds of employees here in Hawaii, in California, Japan and Indonesia.

Small-business entrepreneurs represent the very life blood of our American (and Hawaii’s) economy. The “dreamers,” like I was, think anything’s possible if they can just keep their costs low enough to rent a good space, hire some employees and develop an idea into something that will make a profit, so they can not only feed their family, but also grow and hire more people. The more taxes imposed, the less likely the dream will be more than just that - a dream.

John McCain’s economic plan cuts taxes on all Americans to benefit small businesses and individuals. Barack Obama says he’ll cut taxes on the middle class and raise taxes only on the “rich,” earning more than $250,000.

Governor Lingle, in an Oct. 11 speech, said that here in Hawaii, Obama’s “rich” includes 22,000 small businesses that register as sole proprietorships and earn $250,000-plus, because their personal family and business income is combined.

Business owners will suffer under Obama’s plan, which the Wall Street Journal refers to as “Smoke and Mirrors.”

Though Obama states that his tax increases only affect 5 percent of the wealthiest Americans, each of us will feel the bite. Like dominos falling, businesses must cut jobs, unemployment payouts increase, businesses close (such as Hilo Hattie), office spaces go unleased, consumer spending decreases, businesses declare Chapter 11, venders don’t get paid, jobs are cut and prices rise because of more demand on less supply.

In Democrat tradition, when tax revenue goes down, more taxes usually follow - often to fulfill campaign promises to special interests.

While there’s much still to learn about the Fannie Mae and Freddie Mac sub-prime lending debacle responsible for the current financial meltdown, it’s curious that in Obama’s short tenure in the Senate, $125,000 has gone into his campaign war chest from the two now-failed lending giants. Only Banking chairman Sen. Chris Dodd, D-Connecticut, received more, $165,000, over many years in office.

For a candidate who promises to “change” the way Washington works, Obama’s record reflects a pattern of special interest-driven politics as usual. His votes to raise taxes 94 times in his first term in Congress underscore this.

On taxing the “rich,” according to the Congressional Budget Office, the wealthiest 1 percent of taxpayers already pay almost 40 percent of all federal income taxes, about as much as the entire 95 percent of people Obama “won’t raise taxes on.” But more than 40 million of the 95 percent pay no federal income tax anyway, thanks to President Bush’s tax cuts. More than 20 million families pay no federal income taxes but still get a tax refund per the Clinton-backed “Earned Income Tax Credit.”

According to the Tax Foundation, more than $1 trillion in tax payouts came in from the “rich” and were passed on to lower-income earners, who, yes, still have to pay payroll taxes. Nonetheless, the top 20 percent of income earners pay 44 percent of payroll taxes (source CBO).

“Sharing the wealth,” as Obama believes in, is socialism, the system in Cuba, North Korea, Venezuela, Syria, China and Vietnam. Sweden has abandoned its failed socialist experiment, now boasting steady economic growth, while the Democratic U.S. Congress is embracing socialism.

Barack Obama thinks the “rich” like 22,000 small-business owners in Hawaii owe those down the income ladder more of their money when they’re already paying a lion’s share. Since businesses in the U.S. are taxed 35 percent, the second highest in the world (as pointed out by McCain), imagine how many new jobs would be created if it were only 11 percent, like in Ireland.

The vast majority of the “rich” (exceptions are greedy corporate executives who harm investors) manufacture things, create jobs, buy from small businesses, build buildings, start magazines, make movies and create cool software and hardware we all use to be more successful.

If Obama had ever had to make a payroll, he’d know that tax increases stall economic growth. Donald Trump told Wolf Blitzer on CNN last week that his candidate John McCain understands the fundamental economic principle that “you can’t raise taxes and expect the economy to grow.”

I might venture into business again if McCain gets elected.

I still have my dreams.