Is the economy up … or down? Are business conditions improving … or deteriorating? Different economic indicators tell different stories, but here’s a fact to chew on:
Our current so-called economic “recovery” is officially the weakest in U.S. history. Since the recession ended in June of 2009, the economy has sputtered along at an average annual growth rate of just 2.2 percent — far slower than past recoveries.
Here’s another fact: The National Federation of Independent Business Owners’ Small Business Optimism Index recently hit a two-year low, falling in February to 92.9. In 2015, it averaged 96.1.
This indicates that small business owners, for their part, aren’t falling for the economic rah-rah we hear from the Obama administration. These owners, the lifeblood of the U. S. economy, are clearly worried about and lack confidence in the future of our economy.
Why might this be? Let’s start with the regulatory quagmire that has been created over the past seven years. In 2015 alone, 3,300 new federal regulations were issued, according to the U.S. Chamber of Commerce. And another 3,000 are in the pipeline for this year.
Regulations suffocate businesses, stunt growth, discourage hiring, boost uncertainty and ding owners’ confidence and optimism. More regulation equals less business activity and lower economic growth.
The granddaddy of all regulations created by this administration, of course, is Obamacare. It is an ongoing burden to business owners due to the myriad filing, paperwork and accounting requirements.
And it has cost jobs due to businesses striving not to grow above 50 employees so they aren’t subject to many of Obamacare’s mandates.
Imagine that: A law that encourages small businesses not to grow!
But Washington isn’t the only source of growth-killing government meddling in the economy. Just last year, Sacramento passed laws mandating a higher minimum wage, mandatory paid sick leave, immigration-related protections, and increased liability for employers that contract for labor. California now has legislation in place to ensure that by 2022 it will have the highest minimum wage in the country.
In Los Angeles, there is the costly and burdensome city business tax. This tax, which ranges from $1.01 to $5.07 per $1,000 in gross receipts, is applied to the revenues of most businesses located in Los Angeles.
Local real estate developers have been fed up with the city’s costly and cumbersome permitting process for years, and the county recently added another layer of approvals for obtaining conditional use permits. The city won’t even leave food trucks alone, passing laws restricting what and how they can serve food.