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For a small business owner, taxes are the key to their vote

U.S. President Barack Obama delivers his victory speech after being reelected for a second term at McCormick Place Nov. 6, 2012 in Chicago, Ill.

Olalah Njenga is the CEO and Senior Marketing Strategist at Yellow Wood Group in Raleigh, North Carolina.

Last Friday, as part of a series of conversations we were having with small business owners in battleground states ahead of the election, we talked with then-undecided voter and small business owner Olalah Njenga about why she was still unable to choose a candidate to vote for.

"I really need to support something that I understand how it will be implemented and what I can expect as a result," she told us then. "Unfortunately, Mr. Romney has failed that test. I had been holding out hope, and it's taken three debates and a storm...and he still has not given us that information."

Mrs. Njenga told us she was open to a last-minute call from the Romney camp, but instead got an earful from listeners and commentors online who couldn't understand why she was having a tough time deciding.

When we called back, Njenga wasn't willing to discuss her vote -- fearing more backlash -- but she told us that as a small business owner, she's hoping President Obama will reconsider some of his math in his second term.

"One of the things that has consistently bothered me," says Njenga, "is him putting the demark for middle class at $250,000. That $250,000 does not make us feel like we're part of the new rich."

About the author

Kai Ryssdal is the host and senior editor of Marketplace, public radio’s program on business and the economy.

Olalah Njenga is the CEO and Senior Marketing Strategist at Yellow Wood Group in Raleigh, North Carolina.

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One early phase of growing out-of-touch with the middle class is thinking you're undercapitalized if you can't afford to live where you want to. I also have to throw the BS flag on one earlier commenter's notion that home maintenance runs $2,500 a month. You don't have to re-sod your polo field more than once a year, you know.

I, too, was somewhat sickened by the interviews with Ms. Njenga. In her November 2nd interview, I was rather dismayed by her concept that college "guarantees" her daughter an executive-level position immediately upon graduation. (Along with most of my college classmates, I took an entry-level position not my chosen field, in order to develop work skills and experience.) I was also nauseated to hear that this is something Ms. Njenga is willing and able to provide her daughter if the government cannot. (So what's the problem? Should the government "helicopter-parent" your daughter for you?)

Does she realize that there are many people in this nation who are worried about affording a college education for their children in the first place?

But when I heard her second interview - her desire to move the cap for higher earners to $500,000 (in NC, no less!), her plugs for her business, and her refusal to state her choice of candidates in a segment about which candidate she chose from the perspective of a small-business owner - she revealed herself to be the wrong person to be speaking on this issue on-air. Hardship is not requisite, but an understanding and perspective of the serious concerns our nation is facing should be. Ms. Njenga has every right to her opinions and concerns, but can’t you find someone a little less privileged and out of touch to speak on behalf of small-business owners? Ms. Njenga should probably wait for a re-launch of “Lifestyles of the Rich and Famous.”

I had a jaw-dropping moment when I heard that Ms. Njenga wanted the limit on income to be bumped up from 250K to 500K to be considered middle class. I was driving at the time and when I returned home, looked up the US median for 2011. It was $50,054. Median being key here.
Ms. Njenga needs to get out and get a reality check about income in the USA. She sounds like a perfect Romney supporter, totally out of touch.

VOS, Ms. Njenga does not live in Manhattan, she lives in North Carolina. There are whole swaths of the country where nobody makes $500,000 a year. cyberdouglas is onto the apparent fact that MP was seriously scammed by this lady.

I completely agree that 250,000 is way too low a number. Just "do the numbers": if you make 250,000 that means you take home about 11,000/month. A modest family home in New York City, a two bedroom apartment, will give you a mortgage of at least 1,000,000, which works out to over $6000/month. Add to that a maintenance cost of around $2500/month you are left with $2500 month to pay for food and incidentals. No fancy vacations, no private schools for my kids. And I have to pay the AMT. So how am I rich?

Yes, you are (and good for you): the high cost of buying a home in NYC are why most people either rent tiny apartments instead of buying, or live in the outer boroughs or across the Hudson and commute. You've chosen to invest your high income in more convenient (an expensive) real estate; that doesn't make you not rich.

In any case: as others have pointed out, the interviewee lives in NC, not NYC.

On the other hand, it's strange that many commenters seem to think that the interviewee was somehow a closet Republican partisan trying to sneak in as undecided. She was very clear in explaining why she couldn't, as of interview time, commit to voting for Romney: she could see that Romney was failing to demonstrate that he could mathematically achieve all of the mutually-incompatible, vaguely-defined goals of his tax plan, and therefore she couldn't commit to voting for him. That is clearly not the discourse of a partisan plant.

I think the story revealed a dismaying repeating consistent confusion between small business >revenue, which is not subject to income tax, and small business >profit, the component of which is retained by the small business owner and therefore subject to income tax. I fear that Olalah has that confusion! I would cheer if her marketing company had revenue of 1,000,000 and a profit margin of 20% (brava!) but if she kept all the profits to herself she still would be well below the $250K cutoff. Does she understand revenue versus profit from an income tax perspective? Do I?

Many small businesses are not incorporated, and their revenues are treated as personal income for tax purposes.

"One of the things that has consistently bothered me is him putting the demark for middle class at $250,000. That $250,000 does not make us feel like we're part of the new rich, and I'd like to see him move that number to half a million."

Boo hoo hoo. And when she hits the $500,000 mark she will think the demark should be moved to the 1 million dollar mark.

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