Small business owners on the Buffett Rule
Two small business owners discuss how the proposed Buffett Rule might impact them, if at all.
Kai Ryssdal: On what was effectively the first day of the 2012 general election campaign, President Obama made another pitch for the Buffett Rule: Higher taxes for people making more than a million dollars a year. From the GOP and the Romney camp came criticism that the rule -- were it somehow to pass both Houses of Congress -- would hit small businesses and so slow hiring and hurt the economy.
Small businesses get used as props by politicians from both sides all the time. We picked up the phone and made some calls to check this one out.
Lew Prince: My name is Lew Prince. I am the founder and beloved president for life of Vintage Vinyl, a modest-sized record store in the city of St. Louis. We're about to celebrate our 33-and-a-third anniversary in the business.
Ryssdal: Ba-da-boom. When you say modestly sized, Lew, how big is that?
Prince: We employ 24 people. We're in the very low single-digit millions in growth income.
Ryssdal: If the Buffett Rule passes and people who make a million dollars or more wind up paying 30 percent at least on their taxes, is that going to bite you? Are you making a million a year?
Prince: No. It would actually take about a decade of my income to get even near the Buffett Rule. I actually was talking about this with my accountant. He has, he tells me, 400 small business customers and of them maybe four will be affected by it. That seems to be real consistent. It seems to be about 1 percent of the people who make any income off small business would be affected.
Ryssdal: If it's not tax rates to help you with your business, what do you need then?
Prince: I need educated people. I need the infrastructure to deliver my product. I need really good broadband everywhere so that I can compete with these countries that are moving ahead of us incredibly quickly in those areas. Those who are the most successful really should feel it's their patriotic duty to keep it going for the rest of the people.
Ryssdal: Lew Prince at Vintage Vinyl in St. Louis. Lew, thanks a lot.
Prince: Cool. Thank you, man.
Tom Secor: I'm Tom Secor. I'm the president of of Durable Corporation. We're a small manufacturer in north-central Ohio. We started in 1923. We make loading dock bumpers, wheel chocks, and floor mats.
Ryssdal: Small business, you'd say Mr. Secor?
Secor: Yes, 36 employees.
Ryssdal: As you look around at the political debate that's happening in Washington, and specifically this whole thing about the Buffett Rule and whether or not it would influence small businesses to perhaps not hire as many people as in the past, do you buy that? Is the Buffett Rule and tax policy one of the things that's driving your hiring practices?
Secor: The Buffett Rule specifically probably has little to no effect on me. I don't make a million dollars a year. The corporate tax rate, whatever it is, we don't pay that. For the vast majority of sole proprietorships and partnerships, they tend to run their business and at the end of the year say, 'I don't know, I should probably get money back 'cause I don't think I made anything.' I think in the bigger picture though, it is very indicative of what's going on in that there's this constant battle over picking winner and losers. And when that occurs, there's a general trend as whole to say, 'Wow. Do I really want to invest and grow and do something when I have no idea whether five years from now, when this thing starts to pay off, of all this work, if somebody is going to decide -- well, wait a minute -- they should take something from me.' So why should I do this?
Ryssdal: Tom Secor, he runs the Durable Corporation. It's a manufacturer in Norwalk, Ohio. Mr. Secor, thanks for your time.
Secor: You're very welcome.