Small Business: The Source of the Vast Majority of Job Losses

Print
Thursday, 22 July 2010 04:34

Politicians routinely praise small business as the source of all good. In reality, small businesses, just like large businesses, are a mixed bag. While they can be a source of economic dynamism and good jobs, many small business owners rip off their workers and their customers, cheat on their taxes, and contribute little of value to the economy before they fail.

It is the job of the media to report on small business with clear eyes, not just repeat happy-talk nonsense from politicians. Therefore, it was disappointing to read a NYT article on a package of special loans and tax breaks for small businesses that began:

"Perhaps the last best hope of Democrats to pass legislation aimed at creating jobs before the November elections seemed to be crumbling in the Senate on Wednesday as Republicans signaled that they would block a bill to expand government lending programs and grant an array of tax breaks to small businesses."

Why would the article assume that the bill is "aimed at creating jobs?" Yes, this is what the politicians said about the bill. But --- hold onto your hats boys and girls -- politicians sometimes say things that are not true.

An alternative explanation is that politicians want to give money to small businesses, a constituency that can be very influential in many upcoming congressional races. Many of the features of this package, such as tax breaks that apply to past actions, look more like measures to give businesses money than to create jobs.

Rather than attributing motives, it would be more appropriate to simply report the bill's contents and what various parties say about it.