Monthly Archive for September, 2014

Small business impact on November mid-term elections

Regardless of political party, history informs that the mid-term election in a second term has rarely been fun for any president. Consequently, President Obama’s party isn’t supposed to do well this November.

But with a Republicans House majority and Democrat control of the Senate now in jeopardy, this election cycle is producing a pitch battle with daggers drawn on every front. And not just because control of Congress is at stake for the next two years, but also six years of Democrat policies must be protected or reversed, depending upon to whom you talk.

In a recent online poll we asked our small business audience how they’re leaning in the November election. GOP responses came in at 63%, with Democrat allegiance at only 3%. The independent “I vote for the individual” got 29% and 5% said they “probably won’t vote.” Even if you give half the independents to the Dems, they still don’t rise to one-in-five among our group.

Republicans leading our sample tracks with other polls of the public. But besides the historic second term curse, there are other reasons small business sentiment skews heavily for the out-of-power party this year:

1.  Small business owners do something that’s at once special and difficult: they make between one and four payrolls every month. As a result, this group typically leans toward the GOP as a more business-friendly party. But it should be noted that the spread usually isn’t this great.

2.  Small business owners consider many Democrat policies anti-business. For example:

a.  Obama’s “America needs a raise” campaign to increase minimum wage is unpopular with small business owners.

b.  Recent tax increases have resulted in federal tax revenues at a 40-year record tax pace this year and next. Higher taxes depletes precious small business working capital.

c.  Essentially a stealth tax, regulatory compliance has increased significantly since 2009, according to the Competitive Enterprise Institute.

d.  And the mother of all policy offenses: Obamacare. As a class, small business owners DO NOT like Obamacare.

There isn’t room to list all of the things troubling small business owners this year. But these leaders believe Washington policies have contributed to and prolonged the worst post-recession recovery since the Great Depression. And justified or not, President Obama is the face of the Democrat party, which right now is not good news for many incumbent Democrats needing support from their small business constituents.

Write this on a rock … Counting employees, Small Business USA is the largest voting bloc.

Balancing reality and vision

When working with entrepreneurs, one of the most difficult things consultants, advisors, and mentors must do is tell their hopeful visionaries when an idea does not have a reasonable chance of success, or simply is not viable. Such advice isn’t meant to demotivate or squash the dream, but rather to ground what is likely a rose-colored-glasses perspective in the realities of the marketplace.

The horns on this dilemma, as you might imagine, are reality and vision.  And the challenge for advisors is in knowing how to blend in the right amount of reality so that the vision keeps just enough of a healthy rose tint without blurring the existence of the real challenges ahead.

Reality and convention, delivered effectively by an advisor, combine to create a compelling gravitational pull. The challenge for entrepreneurs is to know when to use this gravity as leverage and when to defy it, thus placing extra pressure on your vision.

Both perspectives — the reality grounded in history and facts, and the vision yet to be made manifest — must be balanced as you strive to create something which may be untried, perhaps even fanciful and often from nothing.

Commenting on his vast and very real entertainment empire, Walt Disney once said, “Always remember, this whole thing started with a mouse.”

Indeed.

RESULTS: What’s your plan for federal candidates?

The Question:
With midterm elections barely two months away, what’s your plan for federal candidates?

3% - I’ll be more inclined to vote Democrat.
63% - I’ll be more inclined to vote  Republican.
29% - I vote for the individual, not any party.
5% - I probably won’t vote.

Jim’s Comments:
The mid-term elections in a second term has rarely been much fun for any U.S. president. Consequently, President Obama’s party isn’t supposed to do well this November. But as you can see, if our recent online poll of small business owners has any general election implications, this is going to be an extraordinarily bad mid-term cycle for the Democrats.  I’m going to have more to say about this response to the upcoming mid-term election in the Feature Article next week.




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