A month ago President Obama promised pain relief for small businesses getting pounded by the recession. Inside his economic black bag is a sort of wonder drug: business stabilization loans from the SBA. The new program offers ailing small businesses up to $35,000 to pay down their existing debts. The loans don’t come straight from the SBA. The agency promises banks that, if you default, it will pay back 100 percent of your loan (a first for the SBA). The loans are interest free, no payments are due for a year and full payment is not due for five years. Sounds too good to be true. And so far it is. The SBA recently said the program is behind schedule and won’t be ready to go till June. Till then…well, there’s always your credit card. Or a fistful of ibuprofen.
Brother, can you spare a dog? The “Depression sandwich” is back. The Wall Street Journal reports more and more enterprising Americans are staving off pocket pangs by launching hot dog stands. WSJ says sales of hot dog carts (which start at $2,000) are way up. Why hot dogs? Partly because you buy wieners precooked, which means you face fewer hurdles at the health department. And partly because they make a cheap meal. The term Depression sandwich was coined in Chicago in the late ’20s, when a hot dog was a gutful for a nickel. Those were the days. And now they’re these days too.
America’s wurst university. A lot of college graduates are discovering the B.S. they spent years on isn’t worth much in the current job market. But that’s not a problem for grads of Hot Dog U, who get their diplomas in just two days and leave school to enter the booming tube-steak business (see above). Based in Chicago, Hot Dog U offers two degree paths: Art of the Cart and Hot Dog Stand. We’re not sure what the difference is–because we don’t have rich parents sending us off to some hoity-toity hot dog college. We have to work for a living.
Best states for doing business? Upon graduation from Hot Dog U, you might want to think about plying your wieners in South Dakota. That’s according to the Small Business & Entrepreneurship Council, whose just-published Business Tax Index 2009 claims the Coyote State has the best tax system for small business. Other states “need to take note,” warns SBE Council CEO Karen Kerrigan, because high taxes can drive businesses to “tax-friendly” places like SD. Well, we’ve been to South Dakota and it’s an OK place. But we doubt businesses will be flocking there anytime soon. Too many coyotes.
The tea party’s over. In the SBE Council press release announcing its Business Tax Index, Kerrigan goes on to inveigh against taxes in general, invoking the specter of revolution and tea parties. We didn’t attend one of those bitter little gatherings on April 15 (as noted earlier, we have work to do) but we do have a few observations.
*Apparently these tea parties were not a grassroots uprising but “astroturf” events orchestrated by an outfit called FreedomWorks and its leader, Dick Armey. Armey is an ex-Texas congressman and longtime lobbyist for large corporations (i.e. not for taxpayers like you).
*All the beefing about taxes ignores reality. Longtime conservative policy analyst Bruce Bartlett points out at Forbes.com that, actually, the U.S. is a low-tax country. In 2007, American workers paid 11.8 of their income in taxes. The average rate paid by workers in member nations of the Organization for Economic Cooperation and Development (also known as the developed world) was 21 percent.
*Finally, circling back to Kerrigan, turns out she’s not the champion of the little guy she’d have you believe. Organizations she’s involved with are funded by the likes of Exxon and R.J. Reynolds. And her Small Business & Entrepreneurship Council shares Washington, D.C., office space with Grover Norquist, the flaming anti-tax campaigner famous for once saying that his goal is to “cut government down to the size where we can drown it in the bathtub.” Lucky for Norquist, he lives inside the Beltway, not someplace where a funded, functioning government actually keeps real people from drowning. Like, on occasion, South Dakota.