An elderly farmer once told me a story about a set of mules he had long ago. Tractors were not yet on the farming scene, so he relied on his mules to get his crop planted and harvested. The mules were roughly the same in strength and endurance. One, however, was the stubborn type, given to balking and running over the crop. Here’s what he said.
“I figured I needed to get my best work done early in the day, so I used the more cooperative mule in the morning. At lunch, I would switch mules. Some days, the thought of fighting the other mule’s stubborn streak just wore me out and I worked the first mule all day.”
The old man leaned forward as he continued.
“Eventually, the strong mule began to wear down. He still worked as hard as he could, but it wasn’t the same. Problem was, the other mule had gotten even more contrary from not being worked. Though I can’t say I meant to, I eventually killed that first mule with overwork. All because I took the easy way out.”
Small businesses are the strong mules of our economy. Since roughly 1980, there has been a seismic shift in wealth and job creation from the Fortune 500 to small businesses. Their reward for unprecedented success? More taxes! Who’d have thunk it?
The House health care bill now being considered taxes small businesses with payrolls as low as $250,000. By the time payroll hits $400,000, the full 8% tax kicks in. Blue Dog Democrats want to raise those limits to $500,000 and $750,000 respectively. Big whoop. These are still small businesses. Further, the tax will apply to those who already provide insurance to employees if the percentage they contribute is below 72.5% of health-insurance premiums for individual workers and 65% for families.
Like our elderly friend, we are about to work this mule to death.