Sunday, November 07, 2004

From a Small Business Owner

A few days before the election, one of my blog’s readers sent me a piece written by his friend, on why he intended to vote for Bush. I found the following excerpts on small businesses particularly interesting:

"Personally, I started three new business ventures in the past three years which have created new jobs for people from low, middle, and upper income classes. The jobs range from fiberglass construction [to] high-tech computer programming. One of the things I have to consider before investing in a new business is the risk, which includes weighing the cost against the profit. In all cases, the largest cost I have, regardless of the venture, is taxes. Taxes cost more than the raw materials and the labor combined. If the tax goes up, the costs go up and the risk is increased.


Further, some of my production is done overseas where the labor is cheaper. If I had it done in the USA, the end-cost of my products would be higher. Kerry wants to appeal to lower and middle class voters, so he campaigns against out-sourcing. Clearly, he has never run a business. He appears to know nothing about real-world economics. But the cost of the goods would rise, and cause a lot more damage to the middle class...not to mention give other countries an advantage in establishing production relationships with developing countries where their own goods and services can be sold. Protectionism was disproved as an economy-buster many decades ago. In today’s world, with communication and transportation even more ubiquitous, it would be economic suicide to turn back the clock.


Kerry’s tax and protectionism plan, announced with pride, will prevent me, as well as other small businesses, from investing in new ventures. Therefore, his plan will not help the middle class who need to find new jobs. It will hurt them. In my opinion, it is nothing more than promoting class envy to the masses who will become more dependent on government as they vote for politicians who promise to take care of them while sticking it to the rich."


We can all be glad that Kerry was defeated – in the meantime this post can give us yet another reason not to support the future Kerrys.

2 Comments:

At 6:09 AM, Blogger Kieran Jadiker-Smith said...

One thing protectionists don't seem to get -- or don't want to get -- is that when you raise the price of a good or service bought by the poor, it takes money out of their pocket just as surely as would a pay cut or a job loss. Outsourcing is all about efficient production of goods and services, which is, in turn, all about keeping prices low, which benefits poor people.

Poor people are the most sensitive to prices because, in general, they have to spend all they earn. On both sides of the equation -- the worker in another country and the consumer in the US -- protectionism makes poor people poorer.

 
At 1:08 PM, Blogger James Howard Shott said...

Both the reader's story and the comment are very good and right on point.

James Shott
jsobservations.blogspot.com

 

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