The demise of small business is not greatly exaggerated


    In October, I attended the Small Business Association of Michigan’s annual planning retreat. Over lunch, a bright young lady from Traverse City came up with the idea of delivering a casket to the governor, symbolizing the fate of small business in Michigan.

    I immediately began to picture the obituary:

    “It was announced today by the Michigan Department of Natural Resources that the last small business had been extirpated from Michigan. Small business joins the woodland caribou, the eastern mountain lion and the passenger pigeon in extinction. While there have been cases, such as the Kirtland’s warbler and the gray wolf, where the threatened were brought back from the brink of extinction by state policy, state authorities explained they could not justify such an effort to save small business because there was no economic payback if such efforts were put forth.

    “The Small Business Association of Michigan often had questioned the wisdom of promoting the extinction. SBAM is to small business what the Sierra Club is to wildlife. Upon publishing their displeasure over the events that led to small business’s extinction, various players in the destruction expressed their opinions as to the cause and consequences of these events.

    “The governor’s immediate response was to blame John Engler and George Bush. She stated that many small businesses had migrated south and would return as soon as she could reverse her predecessor’s policy. Higher taxes, more militant unions, better unemployment benefits and easier workers comp have never attracted small businesses in the past, but she was convinced that what had not worked in fact in the past absolutely would work in theory in the future.

    “Republicans were asked what they felt had been the cause of the sudden unexpected drop in the number of small businesses. Their opinion was that small business had been infested with a variety of parasites over the past 50 years that had simply overwhelmed its systems.

    “Small business showed a remarkable capacity to survive over the past 5,000 years, but the burden of providing secure, high-paying government jobs with womb-to-tomb, Bentley-class benefits was, in the end, too much. It was observed that some small businesses suffered emotional distress watching the well employed live a life free of economic concern, while they struggled just to survive.

    “Republicans said they would have liked to help, but too many Michiganians failed to understand their dependence on tax revenue from small business and therefore were not supportive of preserving their existence.

    “Democrats were asked about their feelings and explained their ambivalence: ‘As small businesses weakened, they failed to continue to fund the programs for non-productive people. As soon as we kill them off, our supreme leader in Washington will flood our state with free money from heaven through the Big Three, and we won’t have to tolerate the bitching of all these little people. Michigan does not need small business. The Big Three, with divine funds, will solve all our problems. Small business makes a few people rich while providing modest paying jobs for millions of people. Big business and big government make everybody rich in the Big Three and government with little effort.’

    “The education community felt the demise of small businesses was their own fault. Their expectations of the education system were too high. ‘If small business would have provided more funds for public education, we might have provided the discipline and curriculum needed. We recognize they needed money for health care and retirement, but they should have thought of that before they located here. They can move to South Carolina if they don’t like it. Jennifer and Barack will make sure we get our stuff, even if they all leave.’

    “In the past, small business provided community leaders who transformed communities with their donations of wisdom and leadership. These leaders will be replaced by community organizers who will be paid by the state. Their job will be to see that the old way of personal responsibility and personal risk for personal gain does not sneak back into the community.

    “Small business exiles in other states have the potential to spread dissatisfaction among Michigan residents about the nobility of working for a living. If the powers that be can keep Michigan inhospitable to small business, big government can rule.”

    There is wonderful news from the Michigan Department of Natural Resources: There have been three confirmed mountain lion tracks in the U.P. this fall. The last wild Michigan mountain lion was killed in 1906.

    Maybe a hundred years from now, small business can begin to return to Michigan. Your great-grandkids will be thrilled.

    Opportunity is to entrepreneurs as deer are to mountain lions. The deer population brought back the mountain lions. Small business will return when opportunity returns.

    Paul A. Hense, CPA, is president of Hense & Associates, a local accounting firm. He is also past chairman of the National Small Business Association and the Small Business Association of Michigan.

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