One thing that all politicians seem to stand up for is small business.
Lately, because of unemployment, the importance of small business is invoked by all sides in the tug-of-war over control of the House of Representatives and the Senate.
Glib political platitudes are mildly annoying, in general. But small businesses really do supply the majority of jobs. They are often the foundations that perpetuate communities. I’ve spent most of my adult life building, owning and running small businesses, so this particular empty rhetoric annoys me more than most.
That is why I would like every voter to know, and I will state, without fear of contradiction, that there is nothing less relevant, nothing more unimportant to a small business than a federal election.
The most famous small-business activist in the last election, Joe the plumber was after all a fake small businessman.
No matter what a candidate for federal office may tell you, their election will have nothing whatsoever to do with the success or failure of small businesses…except, perhaps, contractors specializing in federal contracts.
That's why I was so amused to hear Linda McMahon, who runs a very large, multi-national business, claim that a desire to help small business was partly behind her decision to run for the Senate.
"I think the best way that you can... incentivize small businesses so that they can grow is to keep money in their pocket... I think you keep money in the pocket of small businesses and entrepreneurs by reducing the tax burden," she said recently.
That's a lovely sentiment, but as far as small businesses are concerned it is local governments, state and municipal governments, that regulate, tax, penalize, zone and strangle small businesses. The federal government has almost nothing to do with it.
So if Linda McMahon wants to help small businesses, she should run for her local city council or, better yet, the zoning board. Because the real regulatory barriers to entry for start-up business are almost all local.
When I raised the capital for and opened my businesses, which happened to be bars, the single greatest expense beyond real estate was the local lawyers and expediters, who helped me navigate the local codes, which were numerous and onerous.
I had to pay these men almost half of my remaining budget, just to tell me what I was allowed to do. New York State dictated where I could be located and how I could purchase liquor, so that it could conveniently tax me at a rate upwards of 30% on every single drink I sold.
The city mandated what types of appliances I could buy, the size and location of my bathrooms, which contractors I was allowed to use, what hours I was allowed to remain open, what type of lighting fixtures were permissible, the fabric on furniture, the finish on the bar… almost every detail was a matter of concern for the City of New York.
And then there were the fines. I once paid $500 and spent 5 hours in court for the crime of failing to post a sign behind the bar that would've informed the bartenders that it's against the law to spit while serving drinks. These types of experiences occurred every couple of months, at random, until my heart-rate rose instinctively every time I received a piece of correspondence from a city or state agency.
So as anyone with a real neighborhood business can tell you, a compassionate fire chief or councilman can do a lot more to ease the burdens on small business than any US Senator.
Linda McMahon may be able to spend $50 million, to defeat Richard Blumenthal, but, as a senator, she won’t be able to do anything to really help small businesses.
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