Business and Government

Business is crucial. As much as they have been derided and excoriated on every level, businesses are exceedingly important to the economic well being of this and every other country. Don’t make that sound like a trivial thing. A country with a healthy economy has jobs, and people with jobs can feed themselves, take care of their families, and even contribute some of that economic health to other countries through charity.

Healthy businesses are a good thing because they focus on making a profit. And business profit is THE VITAL NUTRIENT to a healthy economic diet.

Government does not focus on profits. They focus on elections. An election to a politician is their future, their career, their public approval, and their priority.

Of all of the multitude of reasons why government should NEVER get involved with managing, owning, or running business, the fact that their focus is elections is probably the most important.

Case in point. GM is being run by the government right now. GM management wanted to relocate their headquarters out of the city of Detroit for a multitude of BUSINESS reasons. The government said… NO. In fact President Obama, who has said repeatedly that he does NOT want to run a car company, called up the mayor of Detroit to tell him that he WOULD NOT LET GM move their headquarters out of the city.

Business decision?

Yes.

Made for business reasons?

No.

But this is just the TIP of the ice berg, and quite the berg it will turn out to be. GM announced several closings with its bankruptcy, including a warehouse in New York, where Representative Charlie Rangel is from. Representative Rangel’s constituents didn’t like that at all, after all, who would? So they called up Representative Rangel, who called the CEO of GM to give him a better idea of the “value” of the warehouse. Wouldn’t you know it… the warehouse will stay open!

Get the picture?

GM went into a much needed bankruptcy; something that would finally let them get out from under UAW contracts and onto an even footing with other successful and even profitable car companies like Honda. There is only one problem with the way they did it. The government is their reorganization financer with $50 BILLION dollars of tax payer money. The UAW invested in President Obama’s campaign because he is favorable toward unions. Yes, I said “invested” because they just saw a “return on their investment”. The bankruptcy negotiations left the UAW contracts for current employees in place. It also left GM saddled with under funded pension funds that will cost them tens of BILLIONS of dollars. These are two MAJOR things that they should have been able to get out of in bankruptcy.

So even after going into bankruptcy, will GM be able to get through the recession and come out profitable on the other side?

How can they when the government is making BUSINESS decisions for POLITICAL reasons?

Unfortunately it doesn’t end there. The President has an extensive list of political measures that he would like to fund and he needs money to do it. Specifically, he will need additional tax money from businesses which led him to suggest changing some “tax loopholes” that allowed businesses to reinvest money offshore that was made offshore in order to keep from paying that outrageous 35% tax to bring it back into the US.

So, businesses, making BUSINESS decisions, have announced that if these measures go through, they will have to make the appropriate BUSINESS decision and pull up stakes and go elsewhere. Not little companies with only a few employees, but big companies like, Microsoft.

The problem here is that people don’t think things through. People hear a politician say things like, “I’m going to help families”, “Everyone has a right to healthcare”, “I’m going to punish big businesses that soak up big corporate profits and I’m going to put the money back into the hands of the real owners”, or “Everyone is entitled to a college education.” These all sound real good on their face, but the fact is that the government is not and should NOT be responsible for providing you with healthcare, they should NOT be looking to PUNISH anyone but criminals, they should NOT be responsible for YOUR education, and nobody should be looking to the government to help their family. Freedom does not mean that you get everything for FREE! Freedom means you are free to go out and WORK to provide for your family and determine your OWN educational and economic future. The BEST thing that the government can do is to get out of the way and maintain a fair marketplace with small but effective regulations.

When people start looking to the government for a hand out and to the government as the solution to all of their problems, is when they are working against themselves.