There is a scene in the second movie of the Lord of the Rings trilogy where we meet the King of Rohan, a man who had been known throughout the land for his bravery and strength. But when we first see him, he appears almost completely incapacitated by disease and extreme old age. He cannot respond to the threat on his country’s borders; indeed, he can barely respond to simple questions.
We discover that he has been systematically weakened, and finally even his great vitality has been overcome.
Welcome to the status of small business in America.
Small businesses have been the mainstay of our economy for decades, with the vast plurality of Americans working for local, family-owned businesses. Those companies have built the communities of our nation. They have developed long-standing and productive relationships with their employees, in which both sides of the management-labor connection are invested in the business and in each other. In many cases, that relationship has been generational, with sons and daughters joining their fathers and mothers in the "family business".
Those businesses offered employment opportunities to the youth of their area which included mentoring and guidance along with a paycheck. And since the owners and supervisors usually knew about difficult family situations, they often opened doors for second chances for those who needed extra support.
They not only paid their taxes, they contributed to the communities that contained their customers. They supported local charities, sponsored children’s sports, and participated in development funding drives. They encouraged their employees to do the same, both financially and personally.
It was an ideal partnership between family and business, and everyone benefited.
But in the past several decades the vitality of America’s small businesses has been under assault. It’s not just the ever increasing burden of taxes.
Sometimes it’s the myriad of contradictory regulations from all levels of government. Just completing the paperwork to prove compliance with each new mandate takes hundreds of employee hours. Hours that can no longer be billed to any client, or contribute to the profitable production of the business. So the regulations just increase the costs. A small business cannot always pass those additional costs along to its customers, so they must find other ways to cope with the lower profit margins.
Sometimes it’s the failure of the same government that passes those regulations to act as an advocate for American businesses in the international marketplace. While the largest, multi-national corporations can relocate production facilities in other countries to avoid government mandates and take advantage of lower labor and overhead costs, the local manufacturer cannot relocate his plant. So he watches as imports, entering the American market from countries that do not shackle their businesses, cut into his customer base. Once again, America’s small business owner must deal with smaller, or no, profits.
American business has tried to adapt. Owners and managers have cut all possible costs. They have tried to take advantage of the most modern technologies and practices. They have streamlined every possible operation.
They are still being slowly strangled, just like the King ofRohan. And the families who rely on those businesses for their livelihood as well as the communities that have counted on their civic contributions are suffering right along with them.
In the movie, the agent of strangulation was expelled and the king restored to health in one dramatic moment. In this election year, we have the opportunity to create our own dramatic moment – a moment when we too can expel those intent on strangling American business and allow the men and women who built our prosperity to restore it. It all depends on us.