Thursday, May 15, 2014

Small Business - Backbone of the Country

Small business is the backbone of our Country. We know that, Washington's actors acknowledge that and now we have to look at where we are and where we are going.

I talked to a friend of mine that just got back from Panama. The pictures or the gantry cranes, the new construction going on and the "hustle and bustle" of this tiny country was impressive.

His counterpart is an international dealer of eyeglass frames. She travels throughout the Latin Countries, selling at wholesale the eyeglass frames that she imports from China. Here is the "for real" lesson in economics for all of us. Not influenced by political parties nor with any profit in mind. The plain simple fact is that this person imports from China, eyeglass frames for (lets guess) $7.50. They mark them up to $10.00 and here is where the "rubber hits the road", in Panama these eyeglass frames sell for $25.00. But, if you were to buy the same eyeglass frames in Chicago or Miami you would pay well over $150,00 JUST FOR THE FRAMES.

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I was curious about this and discussed this with my friend. He remarked, " Regis in the US if you were to create a product for resale, the levels of bureaucracy that exist would impact the cost of the product so much that it would never hit the market. Example. Lets say that a product costs $1.00 before if hits the market. The bureaucratic permits, costs, taxes and everything else might (estimate) equate to 55% so that the product has a government cost of fifty-five cents before it is even manufactured and ready to be shipped.

The products coming from China have a bureaucratic cost of less than.05%. So when you equate the two, you can see why it is impossible for the US as a country and an economy compete. What is the answer?

We have to "swallow our pride" and let the politicians know that we as business people truly understand costs, inventory control, cost of production and all of that. We DON"T need amateurs in Washington, that have never run a company, nor ever had a position of management in the private sector tell us how to make money.

We have to begin "chipping away" at the high level of regulations, taxes and idiotic government controls. We have to be able to compete. We have the game plan. We know what to do. We just need "Washington" to step aside and let us do "our thing".

We do know that what we presently have in Washington is this big, hungry un-tamed animal that keeps telling us what to do with our hard earned money and unless we keep feeding this "untamed animal" we won't be able to work. That is preposterous.

Here is what has to be done. We have to wire the mouth of this big animal "shut". Yes, I mean "shut". We have to quit feed this animal and eliminate or reduce the cost of bringing a product to market. We have too many government jobs and too much bureaucracy. What in the world do we need "czars" for? Why should someone in Washington, without any knowledge of the project have any input as to "whether or not" a new pedestrian walk-way in Boise, Idaho will impact the environment and require Federal permits? That is "crap". We know it and unless we reduce the size of government and bring this "big mouth" untamed animal to reality, we can kiss our economy "good-bye".

Regis Sauger

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