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Saturday, July 11, 2009

A Needed Stitch In Time

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A Needed Stitch in Time.

Michigan is losing jobs and people. Some say the best jobs and the brightest people.

The bulwark or dam if you will that keeps jobs and likewise people in Michigan has been jobs. When most people think of jobs in Michigan, they think of jobs in the “Big Three” auto companies. The majority of the job holders however in Michigan were not directly employed by Ford or Chrysler or GM. The majority were employed by all the various parts dealers and manufacturers of those parts, and all the other small businesses of Michigan.

Across all sectors of the Michigan economy it is small business that hires the majority of people in Michigan. Small business is the dam that helps keep people and jobs in the state. That dam has been falling apart lately; and the politicians just seem to talk about big solutions that take big money, big politics, big government and bigger regulations.

That talking may be all well and good; however people are getting the idea that government is incapable of pulling off such all encompassing solutions. However, Goeff Hansen a Michigan legislator from the 100th state House District has formulated a piece of legislation that he will be introducing this coming week; a piece of legislation that he hopes will immediately address some of the reasons small business’ in this state fail. Namely taxes.

Below is a link I set up with an overview of the proposed legislation.


Next for your information is a word document in linkable form that has the guts of the proposed legislation.


At “Bottom Up Politics” my favorite saying is “Make Do, Make It Now, Make it Work”. In other words use what you have on hand and make it work so you have the time and you get the experience needed to fix the problem.

Representative Hansen gets my “Two Bottom Ups” award, for putting something out there that will immediately do something about our problem.

This bill does a couple of positive things. First it would help people that actually want to start a small business in Michigan do it. The bill also defines small business along with focusing on the business and not the geographic location. Secondly this legislation would send a message to the business community that the Michigan government is serious about attracting business from within and from outside of Michigan. Enactment of this bill will add credibility to the states effort to attract and support new business on a larger scale. It would start to prove we are serious about it.

While some will claim that this is only a band aid type of approach to our problems, I would assume Rep. Hansen who once served as a first responder would agree. He would also agree I assume that band aids and other emergency measures are exactly what we need to keep Michigan alive while we work out the details of our broader solutions.

I’ve constantly made the case that we learn best from doing. Free enterprise lets us do that. Free enterprise is the mechanism that allows people to try as many and as varied solutions as they are able to dream them up and are willing to work and take risks for. This also will allow more people who are willing to try different out of the box solutions. You never know when another crack pot like Bill Gates, or a Steve Jobs or maybe a Larry Page and Sergey Brin will show up.

I’m talking about three businesses respectively; Microsoft, Apple and Google, that started in garages with few if any paid employees, and little or no money.

Is this a panacea Mr. Hansen is offering? No it isn’t, will it solve our unemployment problem? Not a lot perhaps.

Will entrepreneurs flock from around the world to Mi? Probably not.

But before we dismiss this effort, try asking questions about the other side of the coin; the side of the coin that people live on and not the special interests.

Will unemployment go up because of this? Absolutely not.

Will people starting a small business have a better chance to survive the first 3-5 years when most fail? Absolutely they will.

Will this bill stop people from coming to Mi. to start up a business or will it hinder people already here from starting up their dream business? Absolutely not.

There are only two downsides that I can see and the first is the loss of tax revenue. This however deals with future tax revenue from a business that is not in business yet. Remember these tax breaks are only for new start ups, not new chain branch start ups or a new division of a large company. Keep in mind also that although this is a five year program, it is only tax free for the first two years then they would pay 25% of their tax the third year and on up another the fourth and then 75% the fifth year.

I would make the case that without the tax breaks in these early years some new companies would not even start, and some of those who did would fail due to not getting the tax breaks.

The only other drawback would be centered on the idea that giving tax breaks to start ups would not be fair to those existing companies that didn’t get any.

To that I simply say that I believe the tax structure in Michigan is unfair. Next I ask where outside of taxes do we continue to not right a wrong because other people in the past have suffered because of that wrong. We should be holding up the hardships start ups suffer due to over tax and regulation as reasons to change the status quo; to give an alternative a chance.

Representative Goeff Hansen is term limited out of the 100th District and is running for the 34th Dist. State Senate Seat in 2010. I hope we can find someone with the common sense Mr. Hansen has shown in this bill to fill his shoes.

Regards, Live Dangerously Be A Conservative.

8 comments: said...

Heaven knows we could use a little fresh sanity with the tax structure.

Rep. Hansen is a really hard worker. A lot of folks from Lansing took the last few weeks off (because, apparently, the budget mess isn't important enough to work on these days) but he was out beating the pavement. Seemed like he was popping up everywhere.

That sort of juice is exactly what we need behind some serious policy changes, too. Right guy for the job.


live dangerously said...

As you once put in your post, the best way to influence politics is to research then get behind and volunteer to help a candidate. Rep. Hansen is my pick this time around for the reasons you said, plus it helps that I like the guy.

Regards, Live Dangerously Be A Conservative

Goeff Hansen said...

Thank you Nick. As a local family business owner, I’ve created jobs for hundreds of local families. I know what works and what doesn’t. I’m a proponent of entrepreneurial revitalization and believe that our current economic condition presents opportunity.

This legislation encourages and supports small and start-up businesses by incentivizing innovation and creativity.

The time for half-measures and tinkering at the edges is over!

Unknown said...

As an entrepreneur, I have just started a new west Michigan business in the last month. I would like to know....where are my stimulus dollars? :) When is the governor coming to say thanks? :)

If I'm this committed to Michigan to start something in this economy...why doesn't Michigan help me? It has been a battle the whole way.

Good start Geoff, I applaud you, but we need more help.

live dangerously said...

Thanks for weighing in Goeff.
Hey Over the Edge, with a Republican Governor, if we get Goeff in the Senate, maybe this tax and kill system we have will become a thing of the past.

Regards, Live Dangerously Be A Conservative

Unknown said...

Perhaps, live dangerously. But I am not so naive to think it a quick fix of one person's brief term in office. We are at the precipice of great opportunity. The world, our state, is changing and we need to work to understand how to keep abreast, better yet, ahead of change. I hope Geoff understands that he needs to be planting tree seeds at the same time he is working on cash crops (to borrow farmer's terminology)
It seems as though everyone has their head down hoping for this storm to blow isn't a storm, it is an environment change and is here to stay. I say we all get our heads up, take responsibility and make some decisions for ourselves rather than hope for quick fixes from government or the auto industry. Not just Geoff, if we each made our stitch in time, think of the quantum leap forward we would make.

live dangerously said...

That's what I'm trying to do with this blog. Highlight the stitches that do get made however small and sometimes naively.

We get plenty of people telling us what doesn't work and why.

I wish you luck with your business. I'm just guessing but I think in your case the help you need is for the government to get out of your way, and not a bailout.

Regards, Live Dangerously Be A Conservative

Unknown said...

Too true. Need an open road, not obstacles. :) I won't argue with that point!!