In 1979 after six years, Investment Rarities made its first profit. I was shocked when we had to give 40% of it to the IRS and the state. That was our cushion that could help us survive future bad years. To this day, I believe many companies that failed would still be in business if taxes were lower. High taxes kill business. They penalize progress. That’s just one of the many things government does that’s destroying our economy.
Every time the government lays down a new law or regulation, it has the potential for serious damage. Business invests enormous energy in complying with new rules. Regulators are a police force intent on tripping up errant businesses, levying fines or worse. A single regulation can exterminate an entire industry. Management’s attention to regulations detracts from a company’s efficiency.
Nowadays people sue corporations at the drop of a hat. U.S. businesses spend time and money defending against litigation. Suits emanating from the government can paralyze a company for years. America desperately needs tort reform.
Welfare, unemployment benefits and other subsidies weaken the work force. Some workers will sluff off, report late, miss work or abuse chemicals if they know a government check will replace their paycheck. The government provides incentives to goof off. People would also save more if it weren’t for these programs. Low savings means we spend more and invest less. Our social safety net helps kill savings.
Our industries lose ground to foreign competitors who undersell us. The main expense of any business is labor. Foreign competition enjoys lower labor costs. Our unions may crow about raising wages, but they also price companies out of the market and cause job loss.
Government subsidies to certain businesses favor their success against competitors. Legal barriers to starting a business such as permits, bonds, licenses or regulations help big companies fend off competitors. Government intervention stifles competition.
Government sponsored inflation, extreme currency fluctuations, the boom and bust cycle, and dollar devaluations all make doing business more difficult. Government attempts to improve the economy waste capital. They distort pricing and interest rates.
The government has fostered a national ethic of getting something for nothing. This burdens business with phony lawsuits, employee theft, trumped up medical claims, insurance fraud and poor character.
Business pays for all or part of health care costs, unemployment benefits, workers’ compensation insurance, product liability insurance, Social Security and Medicare. When you add non-productive legal costs, licensing fees, property taxes, sales tax, income tax, excise taxes and the world’s highest corporate tax, you have a thoroughbred carrying a 300-pound jockey. In other parts of the world they don’t have to carry this much weight.
The sentiments of most government employees and the bureaucrats who enforce the rules are fiercely anti-business. They have little or no knowledge of how the market system works. They see business as greed driven and profits as an evil that government should control.
An anti-business attitude proliferates in the media. Both T.V. and cinema portray business leaders as criminals. The press, magazine, and book publishers are infested with writers expressing a dislike of capitalism. Church leaders reflect these same sentiments. Professors and teachers sneer at the system that has given them the highest living standard in history. The deck is stacked against free enterprise.
So that is how our great country is committing hari-kari. These trends aren’t going to end until they ruin us. Nothing will stop the government from taxing and spending until the dollar is destroyed. Nothing will keep them from sending out checks to the subsidized but national bankruptcy. It’s all downhill from here and I’m afraid to know what’s at the bottom.