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Small businesses need political leadership that’s good enough to be true

Dan Danner

Dan Danner

Most of us were taught as children that if something looks too good to be true, it probably is.

Those who own and run their own businesses are particularly mindful of this age-old truth. That’s why many small business owners and economists alike expressed skepticism when the federal government announced the U.S. unemployment rate had declined to 7.8 percent in September, in part due to the sudden creation of nearly 1 million new jobs.

Economists have called the surge in employment a statistical anomaly, pointing out that the less than 2 percent pace of growth in the current economy would not generate 800,000 new jobs.  

Moreover, the rosy numbers are belied by all sorts of conflicting reports, including the National Federation of Independent Business (NFIB) Small Business Optimism Index.

The September index results reflected what small business owners know to be true: In the current tenuous political and economic atmosphere, there’s little incentive to increase employment.

Bill Dunkelberg, chief economist for the NFIB, noted that a majority of new jobs tallied by the government were part-time positions — “a hollow way to reduce the unemployment rate.”

Debatable numbers aside, there’s no avoiding the truth the economy simply isn’t doing well. At what point did 7.8 percent unemployment become a good thing? That number is too high and shouldn’t be touted as a victory for anyone. 

It’s past time that Washington, D.C., take notice that the normally optimistic view and expectations of the small business community continues to stagnate and even slide.

The September NFIB Index remained at a recession-level reading — where it’s been throughout the duration of the “recovery.” Job creation plans plunged six points, job openings fell a point and more firms cut employment than boosted it. 

Customers also know the truth. The unfortunate but truly bad economy is keeping their spirits low while raising doubts about the ability of the federal government to restore it. A University of Michigan and Reuters survey found that nearly half of consumers — 46 percent —think the Barack Obama administration is doing a poor job of putting things back on track. 

The dysfunctional political climate in Washington is chilling for small business owners, who continue to operate in maintenance mode: spending only when necessary, while not hiring, expanding or ordering inventories until the future appears more certain.

Small business owners have a lot at stake in the upcoming election and worry the outcome could send their tax and regulatory burden flying in the wrong direction. 

Tax-and-regulation-happy politicians have wasted no time claiming the recent too-good-to-be-true employment bounce as evidence their flawed policies have launched a recovery. But don’t put much faith in their  pop-up data. No real action to boost the economy has been made. 

What America’s economy needs is political leadership that’s actually good enough to be true. That will restore small business owners’ faith in government and, in turn, give them the confidence to rebuild our economy.

Dan Danner is president and chief executive officer of the National Federation of Independent Business. Reach Danner through the Web site at www.NFIB.com.
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Posted by on Oct 23 2012. Filed under Opinion. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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