Government And Business

Posted: November 13, 2009 in business, politics
Tags: , ,

Government and business have always had a symbiotic relationship. Government benefits from the tax revenues of businesses and business benefits from the protection of government, bankruptcy protection being one example. Until recently.

The relationship has turned into a parasite/host one. But who’s the parasite and who’s the host? That’s the real question and one I hope to answer here.

Let’s start by defining what a parasite is. A parasite is an organism that feeds off another without regard for the other’s health. In light of recent actions by the government, inspired by FDR’s New Deal, the government has become parasitic. With the second highest corporate tax rate in the world, the U.S. government has increasingly become dependent on corporate tax revenues while imposing increasingly stricter regulations hampering their ability to freely conduct their business.

But not all businesses suffer under these conditions. The ones who can afford it hire lobbyists to protect their interests against the government by lobbying for special favors. This does nothing but give the government the power to pick winners and losers. It becomes an endless cycle.

This brings up another question: how do you end an endless cycle? The first step should be to ban lobbyists. This needs to start on the business end. If businesses want to improve their public image, they need to end their lobbying practices. Once they’ve shown they’re serious about ending this practice, the government, in order to prove they have the public’s interest at heart, should ban lobbyists altogether.

While this would be a good start, it won’t eliminate the problem. The government would still be able to raise corporate taxes. My solution? Cap corporate taxes at 25%. This way businesses would be able to plan their budgets knowing the maximum they would pay in taxes. That would also help them when deciding on expanding and/or hiring new employees. This would give employers the protection they need while possibly increasing tax revenues for the government.

While this two step solution is far from perfect, it could go far in bringing business and government back to a symbiotic instead of parasite/host relationship. If anyone else has other suggestion I’m open to them.

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