“A Commitment to Strengthening Small Business”

State Sen. Cecil Staton of the 18th Senate District recently penned a few thoughts as part of a GA GOP “grassroots” newsletter which went out a few days ago. His topic: economic recovery through small business.

There is no hiding the fact that permanent job creation is the main catalyst for Georgia’s economic recovery. A clear focus is needed on improving the tools and resources that businesses across this state have to invest in new jobs and grow their companies. In our state over 97 percent of businesses are classified as small businesses (under 500 employees). Small firms make up half the state workforce and created 80 percent of new Georgia jobs from 1990-2003 (GA Dept. of Economic Development). These entrepreneurs and owners are vital to providing hard-working Georgians new opportunities and for the state to prosper and grow as a whole.

As a business owner and state Senator, I understand the importance for less regulation, lower taxes and free-market principles. Simply put, government needs to get out of the way and let these small businesses operate without interference. I believe that a firm and steadfast commitment to strengthening the small business community will be the quickest and most effective method for getting people back to work and Georgia’s economy back on track. The right business climate and state leadership is in place for this to take place.

Georgia certainly has the right environment for long-term growth and job creation. I was extremely encouraged by a CNBC report earlier this year ranking Georgia as the 10th best state overall to do business in. Georgia was named having the number-one rated workforce, which is based on the educational level of the workforce and the number of qualified workers available. We also ranked number-three in both transportation and cost of living. These indicators clearly show Georgia is primed and ready to do business, create new jobs and help our state continue its growth and prosperity for years to come.

I will encourage my fellow legislators to join with me and seek out policies to take advantage of all the momentum Georgia’s business environment has going. Last year, I joined the General Assembly in passing economic pro-growth legislation to help small businesses. Our bills gave small businesses tax credits and incentives for getting new start-ups off the ground and for existing businesses that hire new employees. History has proven time and time again that tax cuts produce jobs, not increased spending by the Federal government. I will continue to fight for these pro-business ideas in the Senate and make sure legislation like this is passed. It will be the key to bringing us out of this recession and lead to future prosperity.

I am confident when revenues begin to rebound, the efforts we have made to cut waste in government, reduce spending, and avoid tax increases will benefit our state and pay great dividends. Georgia is the economic force of the south and stands to gain the most during the eventual economic recovery. We must continue to stay true to our conservative Georgia values and make strategic investments for our future. Supporting and strengthening our small business community is vital to bring permanent jobs and long-term growth to our great state. I am committed to empower Georgia’s small business community to reach its full potential. They are the driving force in our economy and I will do all I can to support their continued success.

27 comments

  1. John Konop says:

    The choke hold on small business is the lack of debt capital ie banks are not lending. The problem is a catch 22 we should not force banks to lend to business and or consumers who cannot pay it back especially with tax payers on the hook. Yet with the lack of liquidity in the market expansion is very difficult.

    I would suggest instead of giving out tax credits and or abatements why not use the same capital exposure and guarantee that portion to help small business get loans. The exposure is the same and the business is than showing a real commitment by putting up more money and getting a loan.

    Also a business getting a loan leverages the money by at least 5 times helping to create more jobs via hires and or buying products. This is a better investment than hoping that a tax cut will result in job expansion. A growing business would take the ability to bower money for expansion over tax cut most times.

  2. Rick Day says:

    I have come to believe that all Republicans fear and detest any ‘change’.

    As a small business owner I agree 100% with John. We need access to credit in order to consolidate debt, especially credit card debt, sometimes the only source of funds for us small guys.

    Tax breaks only benefit large business, to the point it can ‘create a job’. If Republicans REALLY want to help, waive all licensing fees for one year. Abolish Sunday closing laws and what the small business entertainment sector flourish and gush forth taxable revenue.

    Fund the equivalent of a State level Small Business Association/Lender, step back and watch how THAT helps.

    Tax breaks…. Jesus, you guys are NEVER EVER going to change.

    • Rick Day says:

      Aaaaaaaand yet you conveniently ignored the other 95% of my post. Look, it is not just about TAX revenues, it is about PROFIT. Without profit there is no growth.
      Without no growth there are no new jobs.

      You have never owned a business big enough to have at least 4 employees, have you?

  3. Mad Dog says:

    John,

    Let’s create jobs. Doing what? Really think the problem is that banks aren’t willing to loan money?

    Or that consumers aren’t buying stuff?

    • ByteMe says:

      Let’s say you get an order for 100,000 widgets to be delivered to a distribution warehouse for later distribution to stores in 14 states. You, the manufacturer, do not get paid until 30-60 days after delivery of the order. That’s the reality of manufacturing. Normally, you use a line of credit from your bank to float your cash flow so you can pay your bills today — like your payroll — while you wait for the customer to pay your invoice.

      Those lines of credit — like credit card limits — are being squeezed hard right now, which means even if there are customers for your product, you — the manufacturer — do not have adequate cash flow to fill the order without help from somewhere else.

      Most businesses cannot create new jobs without a cash float.

      • John Konop says:

        Another example a company gets a big long term order and does have the money to fulfill. A company comes up with a new product and has no money for a real roll-out plan………

        • Lawton Sack says:

          Or you work in the construction industry, like I do. Just about all of the work going on now is commercial work. On commercial projects they hold 10% (retainage) of your contract until the work is completed. You also (normally) bill on the 20th/25th of one month and then get paid the 20th/25th of the following month.

          Simple breakdown:

          From October 26 to November 25, you perform $100,000 worth of work on a project. You will get paid (hopefully) on December 25 in the amount of $90,000. They will hold that $10,000 until 2-3 months after the project is finished. While you wait on your $90,000 check, you still have to pay your employees, your suppliers, and your taxes. Not to mention overhead, repairs, utilities, etc.

          The main ways to do that are: 1. Deplete savings/capital 2. Lines of credit or loans 3. Take on outside investors (who are few and far between at the moment)

          Without credit, savings/capital get depleted quickly. No credit and no savings = No employees

          • Mad Dog says:

            Hmmm, what happened to my posted comment? Did I lose it somewhere in the wash?

            Going to let Goldwater say it best.

            But it sounds like the ‘business owners’ on here are doing the upstream financing to get business. I wouldn’t loan those guys any money either.

            If ya want to be a banker to your customers, start a bank.

  4. Goldwater Conservative says:

    I am too old to bother with points.

    Fact is, ideologies do not explain the real world. Conservatives are wrong, liberals are wrong, supply-siders are wrong.

    Things need fixed and nobody should care about how “conservative” the methods are so long as the government is not taking possession of these companies (with certain exceptions I might add). The POTUS is not the CEO of GM and does not want to be the CEO of any insurance company. Get over the right wing rhetoric.

    Banks are not going to lend to small businesses because of tax breaks or because the economy needs it. It doesn’t. In fact, the economy gets along pretty well just the 15000 publicly traded companies that exist in the US.

    There are some lessons to learn from your life times. One is that, just like people, no business responds to tax “incentives.” The only businesses that do are those that pay lobbiest to get the tax provisions passed into law. Secondly, upwards of 15% of all small businesses go out of business every year. Sure, many of these are stupid endeavors taken on by losers, but as far a bank is concerned…most all of you small business owners are the same. You are high risk for lending.

    It is a vicious cycle. I think everybody thus far has figured that out…at least those who have posted above have.

    Rick Day, there is an exception to the no-profit, no-growth thing and this is where I have found most small businesses struggling. Do not expect profit for a while. In fact, mitigate. What “profit” you have should be reinvested directly into your company. New equipment and personell, along with no tax burden, grows companies, not profits. Screw profits for a while. By creating economies of scale you can make much more profit a few years down the road that the cumulative sums to that date.

    • Mad Dog says:

      Gold,

      Some good points as always. When I was in commercial banking, way back when dirt was still fresh, we said that 80% of new businesses are gone within 5 years. Most fail, some get bought [by Microsoft and Warren Buffett. j/k], and some merge in some mannger.

      There are huge downsides to ‘tax cuts’ that modern Republicans just don’t get. IT’S SPENDING BY ANOTHER NAME!

      Actually tax cuts are unfunded government spending. The government borrows and gives money to a specific group. It’s become economic principal. Tax cuts are government spending.

      Then the question becomes how much of today’s tax cut should be ‘saved’ for when the ‘debt’ comes due? The real answer is none of it gets ‘saved.’

      Then how much of the ‘debt busting tax cut’ becomes purchasing power for consumers? Real world? Damn little.

      The general rule for individual tax cuts is that far less than 50% will become consumer spending.

      I can cite good sources by private and public economists.

      I thought new business owners didn’t expect any profits? Basic accounting. Allow for all losses. Anticipate no profits.

      And those guys using their lines of credit as profit need to go out of business.

  5. ieee says:

    Staton: Forget the pro-business legislation, just please pass some more “Sex Offender” laws. Now that is a real growth business in Georgia. Creates lots of jobs. Law enforcement, incarceration, and corrections is a huge and growing “enterprise” in Georgia. When you guys were passing Criminal Jerry Keen’s POS HB 1059 in 2006, remember how it was projected to be costing over a billion dollars within just a few years? Just to handle the “Sex Offender” laws. That’s got to be a lot of jobs.

    In case people have forgotten, Staton is the legislator who gave us the brilliant “Sex Offender” e-mail address, username, etc. Registration law here in Georgia. But Georgia’s law took the brilliance one step further in that it also requires Registered people to give the Criminal State their passwords as well. Is there anyone who would like to step forward and state that they believe this law has or will do a single damn thing that is beneficial? Anyone?

    These days we’ve got people who have to visit their local branch of criminal government very often just to give the people a new, useless password. I know you don’t want to run into those people the days they are doing that because they are taking it out on everyone all day long. Talk about being at the wrong place at the wrong time.

    What the geniuses who support this law apparently can’t seem to grasp is that you can give someone your e-mail password (for example) and that person wouldn’t even be able to access your e-mail at all, and if they could, you could have plenty of e-mail there that they couldn’t begin to be able to read. And that is just for starters and just for the people who follow the law. Do you think the people who are trying to do something nefarious ever care about Registering their nefarious e-mail addresses? Call me naive, but I just can’t see it.

    No, Staton’s law “works” just like the rest of the “Sex Offender” laws. They harass and punish the vast majority of Registered people, their spouses, and their children, who are doing nothing more than just trying to live normal, law-abiding lives like anyone else. In the meantime, they do absolutely nothing to even slightly hinder anyone else with any other intentions. AND, the laws additionally do constantly and seriously exacerbate almost all of the major factors that have been factually correlated to increased sexual offending.

    The Criminal State of Georgia has been sued in federal court for Staton’s law. They are going to lose (and pay). I’m waiting to see how badly before I decide when/where/if to file another suit.

    Staton said, “I am confident when revenues begin to rebound, the efforts we have made to cut waste in government, reduce spending, and avoid tax increases will benefit our state and pay great dividends.” Wow, that’s funny. It has been a very long time since the Georgia legislature has let a session go by without passing some new, pandering, awesome “Sex Offender” jobs laws. The upcoming session will be no different.

    One last thing: decent Americans never supported the “password” requirement and never will.

        • ieee says:

          My post was on-topic for several reasons:

          1) Georgia’s “Sex Offender” laws impact a huge number of jobs and have a huge economic impact.

          2) Law enforcement, incarceration, courts, probation, etc., etc., etc., etc., is a huge and growing industry in Georgia. The State and other governments pay a fortune for it. It certainly affects everything the state budgets. I personally think the Georgia legislature might care more about its prison industry than it does education. Sure appears to be the case, Georgia is at the bottom of both.

          3) Understanding what these legislators have done regarding issues such as “Sex Offender” laws gives us very good insight into just exactly what type of person a legislator truly is. For example, Jerry Keen likes to tell us he is a Christian. Knowing what he has done with “Sex Offender” laws gives us final knowledge that he is not and is therefore a liar.

          Take a look at what Staton did. He thinks it is fine that the State of Georgia can come along decades after someone has completed a legal sentence for a crime and say that it is now okay for the State to begin monitoring the person’s communications (apparently even with doctors and attorneys). You know, just in case. And even more offensively, he violated basic, simple American principles (and laws, it will be ruled) in a way that anyone with half a brain knows is totally useless. That part is almost as offensive as any of it. If the law had been even somewhat useful, a person could almost see a flicker of rationale.

          So, why did he do it? Because he doesn’t think it’s any big deal to sell yourself, Georgia, or the United States out as long as the people you are harassing/punishing are people who are hated (idiotically, I’ll add) by most people. Basically, it is okay to endorse and support the tyranny of the majority onto hated minorities. No matter what.

          To me, that shows what Staton is about and I think I’ll just go ahead and ignore any boasting, self-supporting memos that aim to tell me what he is about.

          Decent Americans don’t support Georgia’s “Sex Offender” laws. And for us taxpayers (maybe actually even more than 50% of the people who read this forum!), our legislators have signed us up to pay for a huge, steaming pile of bunk. And one that puts us in more danger than we were before.

          There are people in Georgia in prison right now who have sentences of incarceration of over 5 years because they forgot/neglected/whatever to give the criminal government a new/changed e-mail address within 3 days. I guess we should feel safe because surely those people were just about to do something dangerous. Maybe even something that could not have been easily thwarted by any parent who is even just barely responsible. At least they will be reformed in prison, come to understand their crimes, and overcome their understandable rage before they are released. Otherwise, they might actually commit a crime.

          The laws are not acceptable.

        • Mad Dog says:

          Doesn’t the US have the largest prison system in the world?

          LOL … we create the problem and the solution all from the same philosophy.

          • ieee says:

            The US has the most prisoners and the most per capita, by a long shot. A lot of people like to say that that just reflects good law enforcement, etc. but our crime rates don’t support that idea. I don’t know much about sociology but I think it’s pretty clear that our culture is fairly messed up. I think the “Sex Offender” witch hunt reflects that as much as anything else does. And then we moralize to the world about how great we are and how we should police them. The “Sex Offender” laws are inconsistent with a great country.

            “Sex Offender” laws are great for politicians because they are a “solution” that causes the problem.. The laws increase recidivism of sexual offenses, other crimes, and anti-social behavior in general. Georgia’s politicians can run their propaganda campaigns, pass new idiotic laws continually, and then inevitably when some Registered people re-offend or don’t report an e-mail address quickly enough, they can say, “See, told you.”

            Among people who know anything about sexual offending, it is well known that the laws are counter-productive. It’s too bad that they don’t do anything beneficial. It’s also too bad Georgia’s legislators don’t care.

          • John Konop says:

            Ieee

            YOU SAID:

            ….“Sex Offender” laws are great for politicians because they are a “solution” that causes the problem.. The laws increase recidivism of sexual offenses, other crimes, and anti-social behavior in general….

            THE TRUTH:

            This is BS!!!!!!! The truth is we have no cure for real sex offenders and they are a mistake waiting to happen that cause tremendous damage on society. I have a very close friend who has a brother that was a child victim from a Priest and he has had a ton of issues.

            I have been very out-spoken how politicians have overreached on classifying teenage inappropriate behavior as criminal sex crimes. But real sex offenders are a major problem which creates havoc on society.

            It is sad that this is an uncontrollable disease. Yet for the greater good of society we must throw away the key until we find a cure. The damage relative to the exception of the rule is a no brainer!

      • ieee says:

        I’ll respond at your level so that you might be able to understand: GFY.

        Apparently it’s just way too much effort for you to skip over and not read things which you find offensive and can only handle emotionally. You should try it though, I guarantee it will help keep you blissfully ignorant and happy. Only read what you can agree with.

  6. LoyaltyIsMyHonor says:

    “In our state over 97 percent of businesses are classified as small businesses (under 500 employees).”

    Wow, a business employing 499 people doesn’t sound small to me. Maybe we need more adjectives when classifying businesses? Humongous, Gigantic, Big, Intermediate, Small, and Minuscule. I would think that 499 would fall into the Intermediate classification.

    • Ken in Eastman says:

      The definition of small business varies with the industry but 500 is the general cutoff for manufacturing. For wholesalers 100 employees is the cutoff.

      Overlooked? The large number of small businesses who have never had any employees but grow as measured by sales increases.

      • Ken in Eastman says:

        I wish we had an edit button.

        I forgot to include that for some manufacturing industries a small business can have up to 1,500 employees.

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