Hinckley: Why Progressives Hate Entrepreneurs + Business Owners
Saturday, April 19, 2014
In fact, American industry has created more wealth and paid more taxes than any country in the history of the world. By a long shot.
Coincidently, while all this wealth creation was happening and private sector American workers were achieving a quality of life never before experienced by workers anywhere in the world, the government got jealous and thus was born the Progressive. Progressive politicians are essentially people who would love to start a successful company and be the CEO but lack the understanding, discipline and skill required and thus decided the next best thing to starting a company and creating wealth would be to control the companies and take their wealth through a progressive tax code. And this is where we are today. And this is why building a business in America is next to impossible. Trust me I know, I’ve done it.
Entrepreneurs with a dream take risks and start companies. The employees in these companies make products and in turn make money to support their families and pay taxes to support the government and its’ employees. America needs a constant stream of new businesses being formed to ensure the next generation of companies will come to flourish, thus creating the jobs and tax revenues needed to support the aforementioned government and it’s employees. That’s how it works.
All businesses pass through four stages, Development, Growth, Maturity and Decline. The only question is, what stage are you in and for how long? America needs a healthy component of businesses in all stages of development in order to ensure continued prosperity. Unfortunately, I believe today, with the rise in power of the Progressive Politician, the people making the rules of business, and controlling the tax code, lack the basic understanding needed to produce an environment where new businesses can start and existing businesses can grow and thrive.
The entrepreneurial mind and body is exclusively different from most. It believes it can do what everyone says can’t be done and dedicates its efforts, through much pain and suffering, to that end. Unfortunately, much of that pain and suffering is dealt by the hand of our progressive government and its’ punishing and confiscatory tax code.
As you will recall from my previous articles, “innovation” in Progressive Speak is another term for figuring out new ways to take money from productive people and transferring it to unproductive people. Therefore you’d think they would be smart enough to “nurture” the geese that lay the golden eggs that they then redistribute, but in fact they’re not. All you have to do is look at Rhode Island and America’s manufacturing landscape, which has been eaten alive by 70 years of progressive politics.
In order for America and Rhode Island, to get back on track, we need to fashion a business-building environment where entrepreneurs are nurtured rather than tortured. A main way to accomplish this is through eliminating the income tax, for businesses and families, and replacing it with a code that rewards risk and work, while making compliance quick and easy. In other words, April 15th should be just another day.
Today our income tax code, is tens of thousands of productivity punishing pages, essentially a giant stick in the spokes of industry, slowing down our entrepreneurs and companies while driving up cost and driving down competitiveness. The compliance cost alone are in the hundreds of billions of dollars, including hundreds of thousands of man hours that could be spent innovating, building or with the family, but instead is spent “complying”. Furthermore, it incrementally punishes hard work and success, while rewarding the well connected with loopholes and carve-outs.
As much as the Progressives hate to admit it, states like Rhode Island must compete with other states on the national level and we as a country must compete with other countries on the international playing field. Our income tax code, State and Federal, today is essentially like asking a running back to walk on the playing field wearing a 50-pound lead vest and compete against un-weighted adversaries.
A pro-growth tax code could be written in a couple pages and should be a simple consumption tax across all goods and services, like the Fair Tax Solution. As consumers we are already paying these consumption taxes, because as Milton Friedman said, “Companies don’t pay taxes, they simply collect them”. Meaning they build these massive compliance and tax costs into the goods they sell you. The larger companies have adapted to this oppressive tax environment and can afford Lobbyists to buy favors and political carve-outs. However the aspiring entrepreneur has no advocate on Smith Hill like CVS does or in Washington like General Electric. Instead she gets pulled away from producing and inventing to service these massive government costs and demands, thus lowering her time spent growing the company, diminishing her available capital and in turn increasing her chances of failure.
Unfortunately, in the current progressively dominated political environment, pro-growth tax reform will never happen for one simple reason: Control. Progressives feel they need to control Americans and the businesses they start and run. They have justified this “Needed Control” by vilifying entrepreneurs with words like “extremist” and “radical” for believing in things like true tax reform and balanced budgets. In fact I was called both by Senator Whitehouse for supporting these very things.
Mitt Romney was lambasted for honestly revealing his tax return and the fact that he “only paid about 15 million dollars in taxes a year”. Personally, I think we need more people starting businesses like Mitt Romney and paying millions in taxes, not to mention the thousands of people he employed, who in turn paid millions more in taxes. Yet on the Progressive Left we have people like Senator Whitehouse who sponsored the largest piece of tax hiking legislation in 2012, the so-called “Buffet Rule”, yet he would not reveal his own tax returns. Doesn’t this seem a bit odd to you?
It does to me, but in fact; remember that in the face of the most anti-business and divisive political leadership since Castro took over Cuba or Chavez, Venezuela, the end always justifies the means. Government control over industry through demonization allows the Progressives to keep the very people, entrepreneurs and business leaders, who deep down, they really want to be, under their thumb and on a short leash…they then, in their own minds, are the masters…the Enablers of Progress!!!
Sorry, there will be no pro-growth tax overhaul until we enact term limits and throw the bums out! Referendum anyone?
Former U.S. Senate candidate Barry Hinckley is an entrepreneur, most recently founding and building Bullhorn, Inc. into a leader in staffing and recruiting software. Bullhorn was sold in 2012 to Vista Equity Partners. Hinckley, a free market libertarian, lives in Newport where he is working on his next business venture.
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