Anti-tax crusaders like Grover Norquist love to use small business owners as their prop to argue for slashing taxes on the wealthiest of Americas. It’s as if he doesn’t realize that when he says that the vast majority of Americans work for small businesses, he’s correct, but that also means that the vast majority of Americans working for small businesses know that their boss isn’t one of the wealthiest of the wealthiest Americans Norquist is representing.
In the debate the other night Delaware Republican senatorial nominee Christine O’Donnell referred to the illusive pizza shop owner who’s raking in $300,000 a year. Who is this clever pizza shop owner? He or she is one hell of a business owner to crank out $300,000 a year just for themselves from a pizzeria.
The problem with the Republican argument that tax cuts on those making more than $250,000 overwhelmingly benefits small business owners is that it’s a flat-out lie and anyone who owns a small business or works at a small business knows that it’s a lie.
“Expecting high-end tax cuts to trickle down as job creation is about as reasonable as pouring gasoline on your hood and expecting it to fuel your car,” said Lew Prince the owner of Vintage Vinyl, an independent record.
So how do small businesses, or any business, decide when to hire more employees?
Well according to Collins’ story:
Hiring decisions for small business are driven by consumer demand, not tax cuts. “As a fellow businessman once told me,” said Rick Poore, owner of Design Wear, an apparel manufacturer based in Lincoln, Nebraska, “Give me more customers and I’ll be forced to buy equipment and hire people to meet demand. Give me a tax break without more customers and I’ll just go to Aruba.”
And that’s it right there. A tax cut is some extra cash for a someone who’s already well-off. Without new customers it’s not a reason to start hiring more employees, as conservatives claim. The only way tax cuts on the wealthy could result in any new hiring would be if they all used the same travel agency to book their trip to Aruba – even that would be a temporary worker.
And now consider the non-partisan small business organizations Collins writes about in his story.
Collins writes, “In their recent report, ‘Restoring Top Tax Rates Makes Sense for Small Business,‘ they make a business case for allowing the top tax rates to expire.”
What these small businesses want Congress to do is let the tax cuts expire for money earned over $250,000 a year and invest that in teachers, police and the nation’s crumbling infrastructure. This would be an investment that will actually benefit small businesses and local communities, which will create jobs.
“If Congress wants to help small business, they argue, Congress shouldn’t spend $700 billion over the next decade in poorly targeted tax cuts,” Collins reports.
It’s also worth not forgetting that even with the high-end tax cuts expiring, those making over $250,000 a year will still get more than $6,000 a year in tax savings. All we’re talking about is taxes on money earned over $250,000.