Déjà vu all over again…with a bad twist

Déjà vu all over again…with a bad twist

Yesterday President Obama reiterated his position that he supports extending the Bush-era tax cuts for the lower 98% of all taxpayers for another year.  Of course, that also means that he supports allowing those same tax cuts for the top 2% of tax payers to revert back to the Clinton-era levels (you remember the 90’s when the economy was soaring and we actually had a budget surplus)—a position shared by most Americans.

Of course the President’s GOP opponents argue that all the Bush-era tax cuts should be extended because to do otherwise would cause the wealthiest to stop creating jobs. 

Sound familiar?  It should.  We’ve been having this debate since 2010 when all the tax cuts were set to end.  The South Carolina Small Business Chamber, the American Sustainable Business Council, Business for Shared Prosperity, the U.S. Women’s Chamber of Commerce and other business groups support allowing the tax cuts for the upper 2% to expire and to use the new revenue for deficit reduction and investment in the nation’s infrastructure, first responders and teachers.

I wrote about this issue in The Hill once in 2010and again in 2011.  The point is pretty simple.  Very few small business owners (less than 3%) fall into the upper 2% tax brackets and many that do have some business income are K Street lobbyists, hedge fund managers, high-powered consultants, Wall Street bond traders and the wealthiest Americans.  They are not your Main Street small business people.

Plus, businesses do not hire workers based on the business-owners income tax rate.  Businesses hire workers when the demand is there for products and services. 

But here is the new twist to this old debate. 

The traditional line against the tax rates going up for the wealthy is that it would hurt the small business job creators.  This argument recognized that small businesses create most new jobs but distorts the reality of the income of small business owners.  As indicated above, very few have incomes that would cause them to see a tax increase if the Bush-era tax credits on the top 2 tax brackets increased.

But yesterday in a radio interview, Presidential candidate Mitt Romney said, “What the president is proposing is therefore a massive tax increase on job creators and on small business.” 

AND???  Is Mr. Romney now making a distinction between “job creators” and “small businesses”? 

I thought maybe he simply misspoke but Romney spokeswoman Andrea Saul also made the distinction yesterday.  “The president’s latest bad idea is to raise taxes on families, job creators and small businesses,” she is quoted as saying.

This is apparently now the official position of the Romney campaign.  Small businesses are now not to be recognized as the same as job creators. 

Why is this important?  Because one of the few things small business has going for it in government is the deserved reputation as job creators.  But even with that we still don’t get the respect we deserve from government which at all levels heaps attention and incentives on big business while giving crumbs to small business.

If there is now an official effort to decouple job creator status from small businesses, we are in deep trouble.  The billionaires and multinational corporations that are trying to buy this election to totally control our economy and government will have driven the final stake into our hearts.