Bless Your Heart! What Government Doesn’t Understand About Business (at least some of it)

One of the most amazing phenomena of our time is governments understanding (or lack thereof) of business and free enterprise. While some of government sees business as a cash cow to fund societal goals, other parts of government view business as deserving a free ride from taxes so that they locate in our country, our state, or our community. Some view business as a bad player that must be regulated and controlled to uphold community values, while still others view business as a public good that should receive every public benefit.

All the above is false, wrong, misleading and not true. Business and free enterprise is neither good nor bad. Factually, it has very few thoughts about any of the opinions above. Doubt me? Name one business owner that you know whose first thought when starting a business related to government in any way. Business owners thought about their business, the dream of bringing a product or a service to reality to do one thing. MAKE PROFIT. Any freshman that has taken an economics course learns this but somewhere along the way we have forgotten the principle. Business initially is worried about the product, marketing, profitability and a hundred other things, but it spends little time worrying about the enigmatic goals of politicians that constantly think about how to extract money from them or shape them to their will.

I wonder what George Washington would have said about all of this or any of a number of our founding fathers? Well, we really don’t have to guess as they were quite clear on the role of government related to business. Here are a few of my favorites:

“A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement and shall not take from the mouth of labor the bread it has earned—this is the sum of good government.” — Thomas Jefferson

“No nation was ever ruined by trade, even seemingly the most disadvantageous.” — Benjamin Franklin

“System in all things is the soul of business. To deliberate maturely & execute promptly is the way to conduct it to advantage. With me, it has always been a maxim, rather to let my designs appear from my works, than by my expressions.” — George Washington

It’s pretty clear they were not worried about business’ behavior, but they were incessantly worried about the behavior of government related to business. They knew that prosperity and free enterprise were keys to the success of America. Who could have guessed that almost 250 years later regulations and taxes would be one of the primary reasons for business failure and startups not actually starting.

As business folks you have it coming at you from all directions nowadays. Government entities are constantly changing and in flux offering that they are only changing a little or only upping costs nominally. Perhaps that’s true, but by the time the rules and fees are piled on from your community to the federal level the burden gets big! Let’s be clear, your Chamber of Commerce and Chambers all over this nation are not against a fair and balanced tax system that adequately funds roads, education, and a quality community, but the flux that business experiences from ego-bloated elected officials that believe they know how to spend your money better than you do is a problem.

Some facts to consider! Generally, the best way to raise revenue for government is to lower taxes, fees and costs. Let me say that again, the best way to raise revenue for government is to lower taxes, fees and costs. This is the great Reagan belief system. Doubt it? There are some other great leaders that had pretty strong words for those who would like to lighten the wallets of business. A great quote on the topic is,

“We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.” — Winston Churchill

I hear some of you opining that we live in Wyoming, and we have some of the lowest taxes in the nation. Hmm… but is that really true? Well sort of. While its true we have no state income tax, and our sales taxes are not exorbitant, other fees end up being quite steep, especially for business. How is this explained? The tax foundation that ranks us as the most business-friendly state in the union offers this warning,

“The four percent statewide sales tax rate is nationally competitive, even after accounting for local sales taxes. The tax base is broad, but includes a disproportionate share of business inputs, which can lead to tax pyramiding and make it more expensive to produce or conduct business in the state.”

The lesson is this, if you want to help our state thrive figure out how to lessen burdens at all levels. You can take it to the bank that your chamber of commerce spends a lot of time on this issue and that our bottom half ranking of best places to do business needs to be fixed. Finally, for those decision makers who refuse to heed this truth or just don’t want to listen well…….…Bless your little pea pickn’ heart!

Onward and upward,

Dale Steenbergen, President & CEO