The Back Story
About a week ago, I received an email that was basically a letter from a small business owner to his employees. Didn’t really think much of it so I threw it in to my bacn folder to read later.
[FYI: Got the term "bacn" from Wired magazine, which is basically email you asked to receive but isn't all that important. Could be jokes, newsletters, etc.]
Once I had time to read it, some thoughts came to mind. I did a search online as to the source of this email and found many sites listing the exact same letter, many of them with different names at the end for THE BOSS. This could be a real letter. Then again it could be just a clever way to get a point across. I don’t really know. Either way, it’s interesting to say the least:
To All My Valued Employees,
There have been some rumblings around the office about the future of this company, and more specifically, your job. As you know, the economy has changed for the worse and presents many challenges. However, the good news is this: The economy doesn’t pose a threat to your job. What does threaten your job however, is the changing political landscape in this country.
However, let me tell you some little tidbits of fact which might help you decide what is in your best interests.
First, while it is easy to spew rhetoric that casts employers against employees, you have to understand that for every business owner there is a Back Story. This back story is often neglected and overshadowed by what you see and hear. Sure, you see me park my Mercedes outside. You’ve seen my big home at last years Christmas party. I’m sure all these flashy icons of luxury conjure up some idealized thoughts about my life.
However, what you don’t see is the BACK STORY:
I started this company 28 years ago. At that time, I lived in a 300 square foot studio apartment for 3 years. My entire living apartment was converted into an office so I could put forth 100% effort into building a company, which by the way, would eventually employ you.
My diet consisted of Ramen Pride noodles because every dollar I spent went back into this company. I drove a rusty Toyota Corolla with a defective transmission. I didn’t have time to date. Often times, I stayed home on weekends, while my friends went out drinking and partying. In fact, I was married to my business — hard work, discipline, and sacrifice.
Meanwhile, my friends got jobs. They worked 40 hours a week and made a modest $50K a year and spent every dime they earned. They drove flashy cars and lived in expensive homes and wore fancy designer clothes. Instead of hitting the Nordstrom’s for the latest hot fashion item, I was trolling through the discount store extracting any clothing item that didn’t look like it was birthed in the 70’s. My friends refinanced their mortgages and lived a life of luxury. I, however, did not. I put my time, my money, and my life into a business with a vision that eventually, some day, I too, will be able to afford these luxuries my friends supposedly had.
So, while you physically arrive at the office at 9am , mentally check in at about noon , and then leave at 5pm , I don’t. There is no “off” button for me. When you leave the office, you are done and you have a weekend all to yourself. I unfortunately do not have the freedom. I eat, and breathe this company every minute of the day. There is no rest. There is no weekend. There is no happy hour. Every day this business is attached to my hip like a 1 year old special-needs child. You, of course, only see the fruits of that garden — the nice house, the Mercedes, the vacations… you never realize the Back Story and the sacrifices I’ve made.
Now, the economy is falling apart and I, the guy that made all the right decisions and saved his money, have to bail-out all the people who didn’t. The people that overspent their paychecks suddenly feel entitled to the same luxuries that I earned and sacrificed a decade of my life for.
Yes, business ownership has its benefits but the price I’ve paid is steep and not without wounds.
Unfortunately, the cost of running this business, and employing you, is starting to eclipse the threshold of marginal benefit and let me tell you why:
I am being taxed to death and the government thinks I don’t pay enough. I have state taxes. Federal taxes. Property taxes. Sales and use taxes. Payroll taxes. Workers compensation taxes. Unemployment taxes. Taxes on taxes. I have to hire a tax man to manage all these taxes and then guess what? I have to pay taxes for employing him. Government mandates and regulations and all the accounting that goes with it, now occupy most of my time. On Oct 15th, I wrote a check to the US Treasury for $288,000 for quarterly taxes. You know what my “stimulus” check was? Zero.. Nada. Zilch.
The question I have is this: Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,200,000 people per year with a flourishing business? Or, the single mother sitting at home pregnant with her fourth child waiting for her next welfare check? Obviously, government feels the latter is the economic stimulus of this country.
The fact is, if I deducted (Read: Stole) 50% of your paycheck you’d quit and you wouldn’t work here. I mean, why should you? That’s nuts. Who wants to get rewarded only 50% of their hard work? Well, I agree which is why your job is in jeopardy.
Here is what many of you don’t understand … to stimulate the economy you need to stimulate what runs the economy. Had suddenly government mandated to me that I didn’t need to pay taxes, guess what? Instead of depositing that $288,000 into the Washington black-hole, I would have spent it, hired more employees, and generated substantial economic growth. My employees would have enjoyed the wealth of that tax cut in the form of promotions and better salaries. But you can forget it now.
When you have a comatose man on the verge of death, you don’t defibrillate and shock his thumb thinking that will bring him back to life, do you? Or, do you defibrillate his heart? Business is at the heart of America and always has been. To restart it, you must stimulate it, not kill it. Suddenly, the power brokers in Washington believe the poor of America are the essential drivers of the American economic engine. Nothing could be further from the truth and this is the type of change you can keep.
So where am I going with all this?
It’s quite simple.
If any new taxes are levied on me, or my company, my reaction will be swift and simple. I’ll fire you. I’ll fire your co-workers. You can then plead with the government to pay for your mortgage, your SUV, and your child’s future. Frankly, it isn’t my problem any more.
Then, I will close this company down, move to another country, and retire. You see, I’m done. I’m done with a country that penalizes the productive and gives to the unproductive. My motivation to work and to provide jobs will be destroyed, and with it, will be my citizenship.
So, if you lose your job, it won’t be at the hands of the economy; it will be at the hands of a political hurricane that swept through this country, steamrolled the constitution, and will have changed its landscape forever. If that happens, you can find me sitting on a beach, retired, and with no employees to worry about….
Signed, THE BOSS
While I agree that business owners should not have to deal with unnecessary tax hikes that could cause them to have to consider cutbacks, I’m not sure if I agree that this will happen. For starters, if this business owner were a real guy, it’s not clear exactly how much the guy makes, how big his company is, and how much annual revenue his company generates. Frankly, it doesn’t really matter.
Chances are your independent business owner running a company that isn’t a corporation and isn’t publicly traded probably won’t see a hit on their taxes. My guess is that either their taxes won’t change or they’ll be given incentives that can potentially lower their taxes. Imagine if payroll taxes were lowered by even 1%. That’s a savings that could very well allow smaller businesses the extra elbow room they need to expand a little bit and even give existing employees raises.
Taxes are just a fact of life and an unfortunate necessity. Without them our government would not be able to run. Period. Nobody likes to pay them but they are necessary if we expect our government to do anything at all. But the problem isn’t with taxes. It doesn’t really matter how much taxes this guy or any other business is paying. While lowering taxes can almost certainly have a positive impact on our economy it isn’t the only solution.
The real problem lies with how part of our economy has been running for the past 20 years or so. In my view most of it has a lot to do with how things work on Wallstreet. No one can deny that corporations that are publicly traded on the stock market can have a strong impact on our economy. The problem is that much of this trading, for all intents and purposes, is artificial.
Stock values go up and down for a variety of reasons, mostly due to supply and demand as well as changes in the profitability of a company. But lately we’ve seen companies that have pulled some fast ones by injecting bogus capital into the value of their companies. Most of the companies that did this are (you guessed it!) banks! With literally no oversight and regulation, banks were allowed to run rampant and allow thousands of home buyers to take out mortgages on homes in the form of subprime mortgages, many of which had variable interest rates. This allowed banks to artificially boost their capital which in turn allowed them to buy and/or sell portfolios of mortgages. The end result was that they were able to elevate their stock price thanks to a somewhat artificial increase in revenue.
I could be wrong here but that’s kind of how I saw it play out these past months since the whole mortgage crisis began. While other companies are in a similar boat, banks just happen to be enemy number one when it comes to the problems with our economy. And the problems don’t stop with how they’ve handled mortgages either. There are a slew of other issues that are just now coming to light.
Do you know what really ticks me off about this? CEO’s and executives of banks get paid insane amounts of money to begin with and get paid even more through bonuses. Right now, even with a government bailout hovering over them, some executives continue to be over-compensated. Seriously, do we really need to reward these guys for failures?
Insane, ludicrous amounts of money are getting passed around like poker chips among executives of large banks and corporations thanks in part by a very lucrative stock market system. And we’re worried about tax increases? Although it would be nice to pay less taxes, what needs to change isn’t our taxes.
Ask yourself whether you think anyone should be rewarded for their failures. Would you allow someone to get paid even if they did a really shitty job? Of course not. What really needs to change is the level of accountability we expect from our government officials, from banks, and from corporate executives. Call it a socialist point of view but I simply do not understand how our government can continue to allow executives to receive millions upon millions of dollars in compensation for no other reason than a stock ticker going up a few points. Makes no sense to me. That’s not accountability. That’s theft.
