Friday, October 17, 2008

Joe the Plumber

Does any small business owner -- Joe the Plumber, or not -- think that the government can do anything to help them? Seriously? What are they going to do, hand you money?

Most of the damage to businesses will be done long before any programs come into effect.

Listen to John Thain, CEO of Merrill Lynch, talking about that 750 billion dollar bonus: " least for the next quarter, it's just going to be a cushion."

Did anyone think that wasn't going to happen?

As angry as the government bank handout made me, I figured that the overall economy needed to stabilize to do my store any good. That is, everyday people coming in and spending money because they're not afraid we are going into the Great Depression II.

Never thought they'd do anything to help me directly, and still don't think they'll do anything to help me directly, nor any of the people struggling with their house payments.

Discretionary spending is....well, discretionary. I'm seeing some of the same ups and downs that you see in the stock market. No one in the door for a couple of hours, then a rush of business...

So, I'm not expecting the candidates or the government to do much but try to stabilize the situation.

Joe the Plumber is an idiot.


RDC said...

Direct impact on business usually fits into the categories of taxes, regulation, and services.

The governments actions as far as the banks are concered are designed to accomplish exactly waht you mentioned to restore some degree of stability to the banking system and to provide a foundation that restores confidence and lets normal business activities resume.

The other issues that are direct impact come in are taxes going up or down for the individual or business. Is regulation requirements and the direct impacts of their costs going to go up or down. Are the services that the government provides and their costs (taxes) going to go up or down.

Duncan McGeary said...

All of which would come due post recession, unless I miss my guess.

With Apologies To Henry David said...

Small businesses aren't looking for a handout but rather a positive business environment. Raising taxes -- whether it's an increase of payroll tax or the host of others in this climate would be challenging.

Joe The Plumber may be an idiot but how the parties have used him to represent their position is shameful. Most American's, including small business owners, want to work, pay their fair taxes, feel good about and live in a safe community while earning/saving for the future among other wants and desires. Joe is simply an American that is having a difficult time and looks at the government as the problem while not providing many options for betterment. Joe's not looking for a handout. Raising Taxes for individuals or businesses in the near future is moving, in my opinion, the wrong direction.

Your comment: Never thought they'd do anything to help me directly, and still don't think they'll do anything to help me directly


If the two businesses on each side of you failed today and closed their doors due to the recent small business credit criss how would that impact your business?

Do you think that the two businesses next to you are dependent on their HELOC or other personal lines of credit? What would happen if those lines became frozen?

What if your largest vendor that provides your best selling items went belly up?

We can argue if these impacts are direct or indirect but I don't think you would disagree that it would impact your business.

I did not agree with the bailout for a number of reasons but mostly due to a fear of poor management and oversight. But there were not a lot of options a couple weeks ago.

Warren has an interesting Op-Ed on the NYT site:

Duncan McGeary said...

Other than taxes, I don't think we're in disagreement. (I don't make so much money that McCain's plan would help, or Obama's hurt; or vice versa.)

That's it exactly. The 'positive business climate.

RDC said...

In my case the direction taken on taxes will make a significant impact on what I will be doing next year. If taxes go up, especially if the txes go up in conjunction with significant wealth transfer (as in Obama's plan to tax higher incomes and write checks for those that don't even pay income taxes) then I will retire again. If they stay about where they are, or if the tax increases are for items such as infrastructure improvements or for debt reduction then I will probably stay in the work force.

While you can get short term bounces in the economy from handing out money, long term gains are from increases in productivity and I have not seen a single study that indicates that handing someone a check, for doing nothing other than being low income, encourages improvements in productivity. The studies I have seen say the opposite that the more money you hand out, the higher the percentage of people will decide that they do not need to do anything. It is a demotivator, not a motivator.

Construct programs that create opportunity or put people to work, yes. Send them checks, no.