It's ironic that at a time of year when people are traditionally focused on compassion and doing good for one another, our leaders in Washington remain far apart on addressing something that hurts every American business and their employees. Today, while President Obama and Congress once again engage in a game of chicken on the fiscal cliff, private companies are unable to make crucial investments in people and equipment.
Washington has once again, through poisonous dialogue and stubbornness, created a stalemate. We saw this same dynamic with the healthcare debacle. Urgent policy decisions are dragged through the muck of partisan politics for interminable time periods, leaving businesses with no time to plan for what lies ahead. The uncertainty surrounding whether and how the U.S. will avoid automatic spending cuts and tax hikes scheduled to take effect at year end has added to the risk that the 27 million privately held business owners already face daily. The political environment in Washington is so rancid right now that businesses are taking steps to prepare for the worst. They should. You can't expect them to plan for their 2013 and 2014 operations when you throw new policies at them on Dec. 31.
Private companies operate in extremely risky environments that most of us would not accept. If, in the best case scenario, fiscal and public policies were static, the volatile nature of running a business would remain. In this case, Washington adds even more variability to the equation. Business owners already have enough to worry about, and now they're further burdened with how new policies are going to affect their bottom line and discretionary income.
Take, for example, Larry Imeson, who owns and operates the Blowing Rock Grille in the N.C. mountain tourist town of Blowing Rock. He cut back hours for wait staff, cooks and dishwashers in the last month as customer traffic during an already seasonally slow period worsened. "It all comes down to consumer confidence," Imeson says, noting that many customers have expressed doubt Congress will get anything done. "I'm just afraid of what's going to happen in the first quarter."
Robert Baird owns ExhaustCLEAN, an eight-employee firm in Raleigh, N.C., providing commercial kitchen exhaust-system maintenance. In the last six months, he laid off a 14-year employee amid the economic uncertainty and a pullback by restaurants. Baird wants to fill the post again. "It's not going to change the economy, but every little bit helps."
But he cannot hire until Washington resolves the uncertainty, because he cannot plan. "My first priority, really even more than the company making a profit, is taking care of the people who work for me," he says. "At the end of the day, the company has to survive for all of the other employees to maintain [their jobs]."
While Imeson and Baird each have strong feelings about which side should yield more, they mostly want Congress and President Obama to get something worked out. "I hope they come to some agreement, but they seem to be at totally distant ends of the spectrum," Imeson says.