Small Business Tax Cut

The lack of resources at the Small Business Administration, combined with the 0.6% growth rate for the First Quarter, contains an element of Risk. The greatest loss cited of the lack of personnel was Small Business inability to attain Federal Contracts. The Administrative Transmitter is not there, or not trained for the Job. The large Corporations getting the Federal Contracts gain little Profit from Contract fulfillment, which constitutes only a minute fraction of their Turnover. Loss of an avenue to these Federal Contracts for Small Business, in the light of a shrinking network for their Goods and Services from the Private Sector, means they are pushed closer to a Shutdown of Production; all within the context of reduced Credit sourcing, and then only at higher Interest rates.

Most Economists realize that the real Employment levels reside in the small Business industry. Large Corporate structure is excellent venue for Capital for economic growth, but a poor engine for Employment generation. Cutbacks in the SBA Budget rendered Government Spending relatively helpless to aid Small Business to maintain Employment levels through the mechanism of Federal Contract awards. I will tell you the Reader, contrary perhaps to some Economists, that another Round of heavy Layoffs is not what this Economy needs at the moment. The Housing market stays down, though All proclaim a Light at the end of the Tunnel; this meaning that the Construction sector remains threatened. Retail Consumption heralded as up by Economists, remains dark and dank fueled by massive increase in Credit Card debt. American Households are strapped for Cash, and this is not the time for any major loss of Jobs.

I hold a position directly opposed to the Bush Tax Cuts, and to Tax Cuts in general; fundamentally believing properly-set Tax rates without any Exceptions of any kind would serve better as a growth generator, than any specific in nature reductions of Tax. This, though, is a long-run goal, with implementation following a complete removal of all such Tax depletions. This is not the time to allow the Economy to falter, simply because the Congress will not labor to rationalize the Tax structure. Therefore, I would advocate a Tax Rebate for Small Businesses (less than 500 employees) of $500 per employee for each Employee employed throughout 2007. This fulfills two criteria: they will already have had to be employed since January 1st, and they must be retained in Employment for the rest of the Year. lgl