No one fights a good fight with one hand tied behind his back. But that’s the fight that businesses must wage every day to stay alive. It’s a heavy burden for a business to open its doors each morning and fight not only the competition across town, but rule-happy governments too.
Business owners have become the true heroes of our society because they create jobs, even as they risk their capital, and they bring the tax base and quality of life to their communities. Yet they must do pitched battle with governments imposing havoc and damage. What havoc, you ask? Destructive regulations, smothering taxes, and something else not so obvious: laws that obliterate our ability to compete.
South Florida business leaders have fought the good fight for a long time to attract financial industry headquarters to our area. It’s “clean” industry, no toxic waste, enviro-friendly. As the gateway to Latin America, South Florida is a natural for international companies to establish more headquarters here. But the effort has lagged, and we must ask why.
Two major reasons: First, Congresses past and present have mucked up the opportunities for Florida and all other states to be competitive on the global stage. Second, most local governments are not friendly to business: geometric tax hikes, excessive regulations, and zoning/permitting red tape.
In my life, I have never been an American declinist. I have always believed that American ingenuity, innovation and inventiveness (the “Three I’s”) would rise and bail us out. I had hoped we wouldn’t reach this point where “progressive” politics would kill our American exceptionalism.
However, we now find ourselves in great danger of spiraling into a permanent tailspin. The dollar is in the toilet. It has become enormously difficult to establish businesses here that require extensive capital. America is no longer the world leader in capital formation, research & development, IPOs and underwriting. We have tumbled to fifth place in global competitiveness, below Singapore, Switzerland and others.
America’s decline in competitiveness is due to huge public deficits and increasing government debt, declining faith in political leaders, and compliance with crippling regulatory laws like Dodd-Frank and Sarbanes-Oxley. These cause significant competitive disadvantages for US companies operating worldwide. Other disincentives abound: the U.S. corporate tax rate is now the highest in the world except for Japan. And if state taxes are included, we are the highest. Finally, the U.S. patent office has become a “corporate inhibitor”.
Start-up companies that require capital to make products can’t raise money because safety laws, “fugitive dust” rules, ozone and environmental regulations make it too expensive.
Local leaders know the truth of these matters. Dale Hedrick of Hedrick Brothers Construction says “We have significantly too much regulation, to the point it interferes and obstructs creativity and process.” “You can either live in a world of ‘political correctness’ or you can live in a world of being a fierce competitor….. Pick”, says Balfour Beatty’s Clint Glass. “Government is killing the economy”, states Bill Martin of W.C. Martin & Associates. A Tallahassee CEO says “With the European Union offering a permanent R&D tax credit, many American companies, or companies that do business in America, are going to conduct their R&D in Europe instead of here.”
Long story made short, as a citizen, your life is better and you pay less in the long run if the businesses you deal with operate in a competitive environment. And small businesses often rely on big businesses to buy their products and services, which makes it important that big businesses grow from the health that competitiveness brings.
Let’s have no more economic decisions governed by politics, because the core of the problem is economic activity controlled by government. What we need are decisions governed by free market economics, not by politicians spouting discredited Keynesian economic theories.