9/01/2010

Small businesses are getting significantly worse

A video on this survey is available here. For those interested in reading the mess that is the "Small Business Jobs Bill" see this.

Both the loans and the tax cuts micro-manage how companies should be run. Take the "bonus depreciation," which provides a 50 percent first year depreciation. Among the lucky assets that are eligible: "Single purpose agricultural (livestock) or horticultural structures," "Storage facilities (except buildings and their structural components) used in connection with distributing petroleum or any primary product of petroleum." "sewage disposal services," and "off-the-self computer software."

What brilliant Obama administration officials and Democratic congressional leaders decided that if you build an agricultural building that does just one purpose, you get a deduction. If it does two or more things, you are out of luck. So a farmer who would have built one building will now build two buildings so that they can get the huge depreciation. What sense does that make? Or that you can quickly write-off certain types of computer software and not others. Why does "sewage disposal services" deserve such special treatment?

The loans are no different. The Obama administration and Democrats are picking what type of firms will get loans and what they can get loans for. "Brick and mortar" operations get a loan "to acquire major fixed assets for expansion or modernization." Why are those particular operations singled out in the CDC/504 loan program? Why can't those loans be used to for marketing? Similarly, if you export certain products, you can get a special loan.

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