Hitting the hiring class only hurts workers
Recently, President Obama transmitted his budget proposal for fis- cal 2013 to Congress. While political documents are to be expected in an election year, this budget was still widely panned from the left and the right as being devoid of any real solutions to our nation’s problems and simply a perpetuation of the status quo that has gotten us into quite a mess as a nation. Even worse, for a country that desperately needs job creation, it does nothing to empower entrepreneurs or encourage small-business owners, the real engine of a free-enterprise economy.
Businesses and working families also set budgets. Budgets should not only set priorities but reflect reality as well. Mr. Obama’s budget does neither.
It proposes to spend $3.8 trillion in fiscal 2013 alone, running a deficit of $1.3 trillion. This is set to be the fourth straight year of deficits of more than $1 trillion, the first time this has happened in the history of our nation. In the past few years, spending has exceeded 24 percent of the overall economy, the highest federal spending as a percentage of gross domestic product since 1946.
The unsustainable level of federal spending is nearly universally acknowledged as a real problem, not just for government priorities today, but more importantly, for future generations. For the job creator, watching Washington spend taxpayer dollars it doesn’t have raises concerns that taxes will have to be raised on society’s most productive in an attempt to slow the growth of our nation’s debt.
That is what this budget does. Instead of prioritizing spending, it proposes raising taxes by $1.9 trillion on working families, small businesses and job creators to enable – you guessed it – more spending. In my nearly three decades in business, I’ve never heard of a single job that was created by taking more money from the hiring class.
Just as important as what this budget does is what it doesn’t do: propose any solutions for entitlement programs that are well on their way to insolvency or do anything to mitigate the onslaught of regulations that are crushing our small businesses, startups and innovators.
Instead of unshackling the free-enterprise system that made America’s economy the most prosperous in history, it’s clear that this administration is intent on doubling down on a failed status quo of bigger government, higher taxes and no fiscal discipline. Job creators across this nation – many of whom I work with as a venture capitalist – are looking to Washington for less regulation; a simpler, flatter tax code and the kind of policy certainty that will provide incentives for investment and hiring. Unfortunately, with this budget, we still haven’t found what we’re looking for.
Tom Stemberg, founder and former CEO of Staples Inc., is managing general partner of the Highland Consumer Fund and a member of the Job Creators Alliance (jobcreatorsalliance.org).