An Open Letter to Small Business Owners
by Stephen Fairfax
owners everywhere should know that Ron Paul is by far the best candidate
for president that you are likely to see in your lifetime.
for over 30 years, but in all that time I have never had the opportunity
to vote FOR a major-party candidate. I was always voting against
someone, in a futile attempt to protect myself and my property.
Eventually I realized that voting for the lesser of two evils is
still voting for evil, and I had given up voting entirely for several
candidacy has turned me from disgust and contempt of politicians
and all things political to a political junkie who canít stop reading
or talking about the ideas, accomplishments, and courageous campaign
of the greatest statesman of our time.
Ron Paul understands
the vital role small businesses play in our national economy and
civil society unlike any other politician. He is a genuine scholar
who has studied and written about free-market economics for decades.
He ran his own private medical practice for many years and delivered
over 4,000 babies. He understands the day-to-day reality of running
any small business and has first-hand knowledge of the destructive
effects of federal government meddling in the free market.
proposals would revitalize the nationís economy and particularly
small businesses. Take a look at his Prescription
for Prosperity, a comprehensive economic revitalization plan.
The first item on the list, tax reform, should be enough to convince
any small business owner.
Ron Paul wants
to abolish the IRS, eliminate the income tax, and replace it with
nothing. Everyone can understand the appeal of having more
money, but small business owners will appreciate the enormous burden
this lifts from their shoulders more than most. All small business
owners serve as unpaid accountants for a federal tax code whose
complexity and inconsistency grows without limit. Nearly all of
us hire expensive accountants and/or tax attorneys to assist in
the preparation of the massive amounts of paper, the collection
and sorting of endless bits of information, receipts, and forms
that are required by law. All of us risk fines and the threat of
prison for any mistake.
Take a minute
to think how much simpler your business would be if you werenít
a slave to government accounting requirements. You no longer have
to make minute classifications of ordinary expenses as tax-deductible,
partially deductible, or non-deductible. You, not some desk-bound
tax official, could decide how long a piece of capital equipment
will be useful, and how to account for its depreciation so that
you can save enough to replace it when it wears out.
need a pension plan, and all the accounting and bonding and means
testing and auditing that goes with it. Youíd be free to offer savings
plans to your employees as a way to attract and retain the best
possible talent. Todayís 401(k), IRA, Section 125 and so on are
all necessary to protect the employeeís earnings from taxation,
at least for a little while. No income tax, no special plans required.
The same goes
for other benefits and the elaborate accounting, forms, and regulations
that go with them. You could offer whatever benefits you wish without
incurring an enormous penalty in "compliance" for each
importantly, you would no longer find yourself acting as tax collector
for the federal government. This is the part of my job I hate the
most. My business gets money from free market customers. They pay
us for our services, because they determine that our help is more
valuable to them than the fees we charge. But a huge chunk of those
funds never reach me or my employees. The customerís check goes
to our bank, and several very large deductions go straight to the
Try this simple
accounting experiment: You probably know your revenues for last
year to the penny. Now add up the payments to government. Not just
your personal taxes. Add up all the money you sent to all governments,
all the money you collected but never got to send to employees or
contractors or suppliers. Monies you withheld for income, sales,
Social Security, Medicare. Your "share" of the Social
Security and Medicare taxes is a big one. Add in the sales taxes,
telephone taxes, licensing fees, unemployment taxes, permit fees,
the property taxes included in your lease. Be sure to include accounting
fees you pay to do all the tax paperwork, legal advice you get in
an attempt to stay in compliance with regulations, outsourced HR
services required to comply with affirmative action and other mandates,
bond fees and compliance testing you pay for in order to qualify
for a pension plan, estate planning fees that are required to preserve
some of your hard-earned wealth from the death tax. Add in the value
of the time you and your back office spend trying to keep up with
all the paperwork. Add in everything you can think of that you do
because the government tells you to, not because itís necessary
to run your business.
Just the exercise
of looking at your expenses in this light is educational. I expect
you will find the total dismaying. Divide it by your revenues, and
there is your average tax rate. Whatever it is, Iím quite confident
it will be a lot higher than 35%.
I was depressed
for months the first time I did this. I realized that I am a slave,
working my tail off to send enormous sums to the government. I knew
when I went into business that I would only get to keep a small
fraction of revenues, but seeing just how much I was sending to
governments that use the money to do things that horrify me was
a real shocker.
Ron Paul would
begin to end this madness. It might take him some time to dismantle
the income tax, but his proposal to stop taxing tips has political
appeal that will be very hard to deny, especially as the country
sinks into what looks from my vantage point like a major recession.
Collecting the tax on tips that are "estimated" by government
tax collectors is another burden that will be lifted from small
Paul also wants to repeal the death tax, that particularly evil
form of double taxation that routinely destroys small businesses
and family farms when their owners die. He would end the tax on
capital gains, on investment and savings, and on social security
benefits. That last change, also certain to be very popular, would
allow millions of senior citizens to re-enter the workforce part
time, increasing their income rather than having benefits cut because
they made "too much." Small businesses would benefit enormously
from the newly available job seekers, who would expand the labor
pool with talented, experienced people.
All small business
owners know they must live within their means. We donít have access
to capital and stock markets to raise large sums. A single large
loss can put us out of business forever. When our revenues drop,
we must take immediate action.
knows about living within his means. He returns part of his congressional
office budget to the US Treasury every year. He has never voted
for a tax hike, a pay raise, or taken a junket. He wants to eliminate
the Federal Reserve, that fountain of phony money that enables endless
government deficits. He wants to shrink the size of government,
not by little nips here and there, but by a whopping 40% or more.
His proposal to bring home all the troops, everywhere, could ultimately
save a cool trillion dollars a year.
policies on trade are also particularly attractive to small businesses.
If youíve ever tried to import or export a product, you know how
complex and expensive the so-called "free trade agreements"
truly are. You may know about the absurd risks that you take by
even buying imported goods after they reach US shores. Abuses like
case, where 4 businessmen were sentenced to long prison sentences
for importing or buying and re-selling frozen lobster tails in plastic
bags instead of cardboard boxes. These atrocities are a clear warning
to small business to stay away from the complex regulations of international
trade. Only big business, with lots of lawyers and compliance specialists
and close working relationships with the multitude of government
agencies they must placate can afford the risks, and reap the profits,
from international trade.
Ron Paul sees
through the talk. He charges that free trade agreements are really
managed trade, and that true free trade requires only low, uniform
tariffs fairly applied. Imagine being able to expand the potential
customers for your business to 300 million middle-class Chinese,
or 800 million Europeans, a billion Indians, or hundreds of millions
of Asians or South Americans.
The other candidates
for president talk endlessly of all the things "they"
will do to help American workers, American families, American consumers,
and American children. You know all too well that most or all of
that "help" will mean more taxes, more paperwork, more
regulations, more opportunities for civil or even criminal liability
for new laws you never heard about.
benefits are extended, your unemployment taxes must go up. A "fair
tax" means you must keep detailed records of every single transaction.
Itís fair only to those who donít have to collect it. If health
care benefits have to be provided to everyone, as they do in Massachusetts
thanks to a dreadful new law that Mitt Romney likes to take credit
for, it falls to small business to do the work, pay the new bills,
and fill out the endless forms. This is true even if your business
is so small, as mine is, so that it doesnít officially have to comply
(yet), but we must still spend endless hours filing forms to prove
Congressman knows that it is not his job to run the economy, or
our lives, or the world. He knows that hard-working men and women
are the only means to true wealth and prosperity. Ron Paul also
understands how well-intentioned but misguided efforts to help the
handicapped, various races, sexual orientations, women, and other
favored groups backfire. He knows that a small business hardly dares
to offer employment to someone in a wheelchair, when the ADA then
requires the employer to make unlimited accommodations, at your
expense. He realizes that placing a "help wanted" advertisement
risks the entire business, because should you choose not to hire
an applicant from a favored group, you may find yourself defending
your actions in court or in a regulatory "hearing," where
your adversary has the limitless time and funds available only to
from Texas proposes to disband entire departments of the federal
government. His ideas are radical, but timely and necessary, and
contrast sharply with the platitudes and "more of the same"
proposals of his rivals. He is fighting a battle of ideas against
Ron Paul understands
the extraordinary limits to growth that burdensome government regulations
place on small business, and how those regulations give competitive
advantage to the military-industrial complex and other mega-firms.
He also understands that small businesses create the majority of
new jobs despite the best efforts of government to regulate us to
death. The last time I checked, there were new regulations that
would kick in when I had 5, 6, 10, 11, 15, 20, and 25 employees.
Iím sure I missed some, and that others have changed. Hiring every
single new employee adds regulatory burdens, compliance costs, and
disproportionate risks to small business. Remove even some of those
obstacles and firms will grow, unemployment will shrink, and our
economy will prosper.
There is much
more about Ron Paulís ideas that are vital to small business interests.
Ending war and a trillion-dollar-year overseas empire will bring
peace and prosperity back to our shores. Revamping our foreign policy
from swaggering bully to neutral colossus will enable tourists and
business people to become the face of America overseas, rather than
American soldiers and bombs. Ron Paul will work to restore privacy
and liberty to our nation, to allow free adults to make contracts
agreeable to them, to get the federal government off our backs and
out of our lives.
Dr. Paul understands
the pernicious effects of inflation on society in general and business
in particular. Our fraudulent money system creates bubbles and business
cycles, sending false signals to business about faux prosperity
and fake money in the hands of eager buyers. He wants to start a
gradual return to sound money. This will particularly benefit small
businesses, that donít have access to the fiat money capital markets
that give huge firms huge advantages. When we are able to calculate
our investments, costs, and profits accurately without future inflation
wrecking the results, our businesses will prosper. When we can borrow
money at rates set by the free market instead of unaccountable academics
and bureaucrats we will have regained an important signal of the
savings and desires of consumers and investors.
There are those
who say that Ron Paul canít win. This should be of little concern
to small business owners. Each of us has heard the endless stream
of statistics, "90% of small businesses fail in 10 years,"
etc. Each of us knows what it is like to work without a net, against
long odds. We know that having better ideas and being nimble and
quick can be just as important as being well-established with deep
pockets. We know that being the little guy, the long shot, can sometimes
be a powerful advantage. We know that new ideas and new strategies
can work very well indeed even when most people think they are crazy.
has clearly threatened and angered those who control the media empires
and huge businesses. They know he cannot be bought. Despite a near
total media blackout, he has raised tens of millions of dollars,
most from individual donors. Iíve never contributed to any major
party candidate before, but Iím giving generously to Ron
Paulís campaign, and I urge all small business owners to do
likewise. Better still, educate
yourself about Dr. Paul, put some signs in your windows and
literature on your counters. Talk to your customers about Ron Paul.
Spread the word.
supporters are the most varied and motivated of any candidate. Google
"Ron Paul Revolution." Check out the amazing videos on
YouTube. I particularly like "Stop
Dreaming" and "Land
of the Free," (be sure to read the surprising comments
by the creator) but there are literally thousands more. His
supporters have organized a series of "money bombs," online
events that raise millions of dollars, more money in a single day
than any other candidate in history. Nearly all contributions are
small, averaging about $100. Theyíve even hired a blimp!
All this is done without direction or control from the official
campaign. Small businesses canít bundle contributions, hire lawyers,
and buy favors the way megafirms can and do, but we can still pool
our resources to support a man who will make a difference.
You may find
that you donít agree with every one of Ron Paulís positions. I donít.
But heís been in Congress over 20 years, and you can read his speeches,
his bills, and his
writings over that time. There is a remarkable consistency that
comes from extensive study, deep thought, and unwavering commitment
to principle. Even if you disagree on something, you can be absolutely
confident that President Paul will obey and enforce the long-ignored
limits placed on our government by the Constitution. "Dr. No"
will begin the Herculean task of lifting federal boots off of American
Ron Paul offers
more than tax cuts and simplified regulations to small business
owners. He offers the most precious commodity of all: time. Time
presently spent working as unpaid accountant and regulatory enforcer
for a government that has forgotten its limits. Time to grow your
business, to spend with your family, to live your life.
Ron Paul offers hope. Hope for a better future, in a world where
small businesses can dream of becoming large ones without automatically
enlarging government. Where hiring the 20th employee,
or the 100th, doesnít put you afoul of some regulation
youíve never heard of. A world where being successful doesnít torture
your conscience with the knowledge that your success is buying weapons
used to kill innocents in far corners of the globe.
small business owners know all too well that when opportunity presents
itself it must be seized with both hands, for it may never come
again. Ron Paul is literally a once-in-a-lifetime chance to change
how America thinks and acts, both around the globe and right here
at home. His proposals and influence will be enormously beneficial
for small business in particular and for peace and prosperity in
general. Please join me in supporting Ron Paulís candidacy in any
and every way you possibly can.
[send him mail] is
owner and president of MTechnology,
Inc. consulting engineers specializing in power engineering
for the 21st century.
© 2008 LewRockwell.com