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MANUFACTURING ECONOMIC BASE vs. SERVICE ORIENTED BASE

The elimination of inventory assessment tax is another way of government to create opportunity for business. To encourage growth in the local and state economy it is necessary for government to create expendable income. Expendable income creates demand for product at the foundation of our economic system the consumer, and though sole proprietorship may not order in great volume, if the amount of average purchase orders is multiplied by the number of small businesses, approximately 927,369, small businesses create the high volume orders required to sustain high volume manufacturing.

Large corporate manufacturing cannot be simply primed with tax incentives and kicked started. These large corporations must be maintained by a consistent flow of orders to generate enough profit to justify hiring more employees.

Before the American economic strategy changed from a manufacturing base to a service base; small businesses were the apple of corporate eye. Now that corporate retail chain outlet has become the dominating influence to our economy and small business has become the enemy.

Formerly large corporate manufacturing viewed small retail, service and production companies as another source to sell their product. A manufacturing company could exist in any state and make contract with thousands of businesses throughout the country. It was not necessary to maintain a direct contact to make sales so a manufacturer was not limited by regional limitations.

In a manufacturing based economy small business was an asset not a competition. When the economy slows small business can maintain because they have low overhead. The tenacity of small business and the ability of high volume manufacturing are able to continue to generate income to sustain them through recession by slowing production to accommodate the lack of work and sales without massive lay offs. Companies with reasonable reserve resources are ready to bounce back when the opportunity prevails – usually when government deregulates and cuts taxes.

The structure of mortar and brick retail and service oriented industry is geography limited. Retail depends mostly on direct consumer purchases and their success is dependent on the consumers willing to travel to the point of purchase.

Corporate franchise operational tactics tend to over saturate an area to attract as much of the local consumer base as possible. Modern retail and service oriented industries view the sole proprietorship as a competitor that needs to be snuffed out. Any sale a small company does is profit taken from the larger retail and service businesses. This perspective of chain store retailers has caused a reduction in sole proprietorship that have decimated local shopping districts.

It is a fact that government has partnered with large corporate retail because of the amounts of sale tax they collect on behave of the state. For this reason government has ignored, encouraged and have assisted by legislation these large corporate piranhas to violate anti-trust laws.

The destruction of small business has in effect sent the economy into a plunge downwards by destroying the very tax base and consumer base retail/services both depend on. The result is government trending to over taxing the existing businesses to the point of extermination and corporate retail further injure themselves by eroding to a policy of seasonal product dumping to avoid paying inventory assessment taxes.

The affect this service oriented economy has perpetrated against the local communities is devastating to local communities that have created more unemployment than they have created. They have also reduced wages and benefits and caused cultural loss to many small towns and neighborhoods.

Presently government bureaucracy suggest to accommodate the lost of high paid jobs and tax base, the remedy is to take low paying entry level jobs and bring the minimum starting wage up to $15.00 an hour. This is nothing less than a back door attempt at raising more tax revenue for government. The device of minimum wage in speculation will raise the taxable income collected but in actuality will reduce the current employment as service and retail industries will turn to mechanical and electronic upgrades to eliminate the wage burden. At best this plan will remain the same at worse this plan will cause the cost of all labor to increase in every industry.

Unions are all for this because their negotiating arguments for their membership pay increase is the minimum wage for inexperienced labor vs. the semi skilled and skilled workers they represent. Business and industry argue against this because to balance the burden of an across the board wage increase for unskilled labor would cause the need to reduce personnel and small business to simple shut down. This reduces the purchasing power of the consumer and shrinks the tax base further. The minimum wage over indulgence is actually a government endorsed attack on privately owned business. This overbearing burden is beyond reasonable legislation as it not only destroys the economy but directly challenges the protected right to self sustain.

A dysfunctional bureaucracy will then fall face first into the perpetual trap of reoccurring stupidity and raise taxes again. A service oriented
economy is a no win situation.

RAISING THE MINIMUM WAGE vs. LOWERING TAXES

The idea of raising minimum wage is just a scheme to create more tax revenue. The same effect can be accomplished by lowering income tax giving the current wage rate more purchasing value. Raising taxes is more often the problem and not the solution. Creating expendable income creates jobs and expands the tax base, not only with increasing employment that generates more state and federal income tax but also by increasing retail/services generating more sales tax. Instead of spreading the wealth by confiscating as much wealth, wage and riches from the private sector – lowering the taxes and building a tax base shares the burden over a larger portion of population.

Across the board raises mandated by government discourage investors from speculating their money. It runs businesses into bankruptcy and causes unemployment. The ability of American industry to freely move beyond United States boundaries has encouraged American enterprise to escape the bureaucracies’ policy of pillaging the treasury and raping industry and burning the people to make up for governments mistakes..

This country has been in economic depression for more than ten years due mostly to NAFTA and the EU common market agreement. Instead of our representatives enforce the terms and conditions of the free trade agreement created by foreign governments. Our representatives continually apply higher taxes and more regulations against American domestic industries already at a disadvantage. Free trade is not fair trade under international treaty.

The only fair free trade organization is the treaty between the states of America in common union where all the laws are equally applied. Disbanding or placing a moratorium on both NAFTA and the EU common market treaty agreement is not the end of free trade. This we have our own and any country that wishes to apply to be part of it can submit application under Article IV.

Filed Under: Economic Points

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