Matters Column

Get involved to keep future bright for small businesses

December 22, 2012
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We are a right to work state. That follows on the elimination of the Michigan Business Tax and a phase-out of the personal property tax.

In the 35 years I spent in small business advocacy, I never really believed this could happen. Thanks to the efforts of the Small Business Association of Michigan and the Grand Rapids and state chambers of commerce, Michigan is open for business.

The most damaging aspect of Michigan's union shops was the effect on education. The funds provided to the Democratic party by the Michigan Education Association almost guaranteed that Michigan education would continue to function in favor of our least capable educators. Education is one of the most important small business issues in the state. We must provide quality employees for our established businesses and to attract new employers.

Shutting off the MEA cash cow in politics may allow school boards to take back control of our schools. Good teachers are our state’s greatest hope for the future. Maybe now we can work toward rewarding our excellent teachers with the compensation they deserve while removing the incompetents.

I grew up in Flint. My father was general superintendent of the Buick plants. My maternal grandfather went to work on the line for Buick in 1918. From my father I heard the horror stories about union abuses on the factory floor. My Dad thought GM would eventually fail. He misjudged the time it would take and he thought Volkswagen would be the competitor that buried our Big Three.

My grandfather told us about life before the UAW. My father one time stated that GM got the union they deserved. When management had no union, they abused the employees. When the union had the upper hand, they abused their power. I guess it is human nature.

What we need is a balance that serves management, the employees and the customer. Here's hoping.

So here we are. We got what we asked for. Gov. Snyder, a CPA, has delivered for the people of Michigan. I believe we are blessed with a governor who wants a healthy economy for all of Michigan's citizens. He has a business background, but I do not believe he is blind to the fact that labor has to do well along with business in order for Michigan to thrive.

Hopefully, we can reach that balance.

We have a job to do. Our governor and legislatures have given Michigan's business community an opportunity to prove ourselves. The purpose of business is first to make a profit. Serving the customer well contributes to the bottom line. There are short-sighted capitalists who believe that paying the lowest possible wages and minimal benefits is the method to enrichment. This may be true in the short run, but in the long run, long-term employees who feel they are being treated properly should give stability and quality to a company.

If Michigan becomes a state of minimum wage employers, then union bosses were right. For all their hypocrisy and propaganda, they will have success in their resurgence. If Michigan employees become the envy of the nation because of working under enlightened management that treats them fairly, we will not have a recurrence of radical unionism that nearly destroyed our auto industry and education system.

There is a term that has been used extensively by the Small Business Association of Michigan: economic gardening. Gov. Snyder used the term in his State of the State speech. Former governor Jennifer Granholm's philosophy was “economic hunting.” She tried to bring new business to Michigan. Actually, it was more like sheepherding. She tried to lure new business to Michigan so her party could fleece them. I digress.

In economic gardening, you grow your own businesses with their accompanying profits and jobs. Put your effort toward the people who are already here and committed to our state’s economy. Look at Flint and Grand Rapids. Grand Rapids’ major employers have roots in the community because they were planted here. GM abandoned Flint because it no longer fit into GM's plans. Militant, irrational unionism in Flint didn't help.

The people in charge in Lansing have removed two of the biggest impediments to job creation in Michigan in the last two years. Washington, under its current regime, will continue to impede job growth.

Look at it this way. If a small business owner were a mountain climber, Gov. Snyder's view would be that the support team’s (employees’) mission is to help the mountain climber reach the top. President Obama's view would be that the mountain climber should carry his team to the top of the mountain on his back.

If Washington's excesses don't bury the national economy, Michigan's future for small business looks bright. The anti-small-business forces are going to fight hard to get back their control of the state. Support the people who opened these opportunities. They are going to need our support in the struggle to maintain our gains. The anti-business elements in our state have suffered an unthinkable loss. They are going to be energized at a maximum level to return us to the past status. Get involved. We have made great strides. It will all be lost if we are complacent.

An afterthought. There are three ways to get money out of a business and into the hands of consumers: wages, dividends (profits distributed) and taxes. Wages are paid for labor provided. Dividends are paid for your investment and risk in the enterprise. Taxes are extorted by government and paid to whoever the politicians decide to give it to. The politicians’ motivations are generally based on controlling a voting constituency. How do you think your business cash flow should be used in a healthy economy?

Paul Hense is the retired president of local accounting firm Hense & Associates. He also is past chairman of the Small Business Association of Michigan.

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