DON’T

I suppose I should qualify my words word.  You are an owner/machinist and the reason you hold that title is because you are not a graphic designer/web developer.  Sure you’d probably save yourself a few grand by going the DIY route, but a bad website will risk losing tens of thousands of dollars of potential new work because it can portray the wrong image about your company.  This is especially true if you’re part of an online community like MFG.com.

For that reason, make sure you have three professionals in your corner – a programmer, a graphic designer and a professional photographer.  Let me repeat that last one – a PROFESSIONAL photographer.  Yes, hiring a pro shooter will have the biggest impact on your website.  Great websites don’t exist without great photos.

Don’t get tempted to go with a single person that does both the designing and programming.  Look for a company with these two specialists under the same roof.  It is rare to find an individual that has creative vision that can also thrive in the structured environment of website coding.

Ok, stop reading and instead check out how Sohacki Industries got it right by hiring Snakebird Studios to create their great company website.

It used to be that 20 years ago was a significant amount. Not so much now. Haul someone from 1992 to 2012 and there wouldn’t be the same amount of future shock that bringing someone forward from 1930 to 1950 would have. Maybe we’ve become more sophisticated, more technically savvy. But, a 20 year span isn’t as shocking as it once was.

Take things back 35 years and the details of life were much different. Cable TV was strictly for rural folks who couldn’t get broadcast signals. Computers were room-sized hulks that only big businesses could afford. There were still pay phones, and they only cost a dime.

Technically things changed, but in the political / economic life, things haven’t changed that much. We still don’t know how to effectively control inflation, avoid recessions, or the complex relationships between economic growth and interest rates.

Back when Gerald Ford was president, the US was going through an inflationary period. Banks CDs were paying 10 percent and home mortgage rates were in the 13 and 14 percent range. Ford, and his administration, had no idea how to address inflation. In a move that only politicians could call “brilliant,” the president started wearing “WIN” buttons: Whip Inflation Now. As if the normal shop guy could go to a vendor and tell him to drop his price.

That kind of ineffectual blah-blah was called jaw-boning. If those in power would only say that the economic hard times were over, then through some magic fairy-dust, the hard times would disappear. Things haven’t changed much.

The current administration and it’s sycophants in the press keep trying to tell us that the Great Recession is over and that we’re on the road to recovery. It’s jawboning from down here in the trenches. Unemployment figures released in mid-May are up again, and that’s just those applying for unemployment benefits. There are millions of us out here who have burned through those benefits and are still jobless. And, it is jobs that make the economy roll.

We’re a consumer culture. The old saying “Nothing gets done until someone sells something,” is an economic fact. Without jobs and incomes, nothing gets sold because nothing can be bought.

Pumping printing-press money into the economy, in the guise of “economic stimulus” isn’t going to bring us out of recession. All it does is mortgage the future to higher taxes to pay off the loans the government is incurring.

If governments at all levels really want to get the economy back on its feet, it’s time they stopped making it harder for the small- and medium-sized business to get back to business. Lower taxes, less senseless regulation, and fewer “entitlements” will allow the guys with small businesses to get back to making things rather than filling out forms.

Pete Nofel

This year, because of the BP accident, President Obama has declared a drilling moritorium. Bang! A .44 magnum shot to the back of the head. Add to that the growing liabilities of the health-care bill which contained 2,000+ pages and is still being defined, and the threat of rising taxes and the future for business seems confusing and uncertain.

Businesses hate uncertainty. If they can’t make an educated guess as to what may happen in the next six months or year, most will hunker down and take a wait-and-see attitude. That’s not the way to keep an economy going.

Take for instance the proposed Small Business Jobs Act our Beloved President proposed. According to the Wall Street Journal, “The bill contains $12 billion in targeted tax cuts, such as a 100% exclusion of capital gains income for certain small start-ups, expensing for certain capital purchases, and new deductions for start-up expenses…”

As Yogi Bera is reputed as saying, “it’s deja vu all over again.” Some of its provisions sound almost Reaganesque in their aid to small business, but there are poison pills to go along with the candy. Some small businesses are delaying capital purchases in hopes of the bill’s passage. The bill may sound like a way to get the economy rolling again, businesses are putting off purchases now in the hope of a tax cut in the future. Actually, this “wait-for-the-break” purchasing strategy is unnecessary for most small businesses since they can currently expense 100% of machinery purchases up to $250,000 per year or opt to depreciate the amount over seven years… a policy the Bush administration put in place. Without this crucial piece of information, it may be a case of “jam yesterday and jam tomorrow, but never jam today.” With that attitude we can keep our fingers crossed for a “spring of recovery” since this summer seemed to be a bust.

It’s another case of uncertainty and doubt that’s keeping businesses in the bunkers. The administration offers these anemic carrots, but bundles them with a load of sticks: new 1099 reporting requirements for purchases of $600 or more; Executive Orders 13496 and 13502 which require compulsory unionism for government contractors and federal construction projects; a boost in the inheritance tax to 55 percent; the appointment of a consumer finance “czar” accountable not to the senate, but only to the president himself; and the list goes on.

Parenthetically, I heard of a case where the owner of shop died and left the business to his children. Sounds like something every parent would wish to bequeath. Then the government stepped in. Because the owner had spent more time developing the business instead of finding tax loopholes, the kids had to take out loans against the business in order to pay the inheritance tax. The alternative was to sell the business to pay the death tax. So, what was a debt-free, independent business is now partially owned by a bank. A fine way to keep the economy rolling.

Adding to the fear and loathing is the Beloved President’s constant campaigning. It seems that at every one of his whistle stops he takes a shot at business, banks, and Wall Street. Now, many of these organizations deserve some flogging, but the constant haraging projects a distinct anti-business attitude that drains confidence.

It’s not like any of this was unexpected. During his campaign, one of the president’s off-Teleprompter comments to “Joe the Plumber” was his goal to “share the wealth.” That’s a wonderful platitude, but in practicality it means taking away from those who have worked hard for their success and giving it to those who have not. I’m sure many shop owners out there are doing better than I. I expect that after you finish reading this, you’ll get out your checkbook and send me my “fair share” of your profits. Oh, wait, why don’t we just call that “taxes.”

Despite signing the American Recovery and Reinvestment Act in February 2009, unemployment has remained high.

One of the basic tenants of a successful horror movie is to never let the audience get too good a look at the monster. People always imagine something worse than can be displayed on the screen. Take the original version of “The Thing from Outer Space.” It isn’t until the heroic humans fry the Thing — James Arness [Marshall Dillon] — that we get a long look at the monster.

A bit more recently, the alien in “Alien” is never fully seen until Ripley dumps him — it? — into space. That’s in the last 10 minutes of the film.

It’s the uncertainty of what is after people that makes the films so scary. That’s part of what is keeping the Great Recession going: uncertainty, especially in small businesses. Business owners are worried about not only what the economy may hold in store, but also how the government is going to stick it to them.

How will new EPA carbon emission regs affect a business? What will be the intended and unintended consequences of a 2,000+ page healthcare bill do to employee and employer costs? What will be the result of new taxes?

These, and other, uncertainties cause shop owners to take a look at their balance sheets and see a government-fueled Thing or Alien ready to kill the business. What owner, in his or her, right mind would step off that cliff of uncertainty without knowing if the fall is going to be six inches or sixty feet?

In the August 9, 2010, Wall Street Journal, a business owner writes about his uncertainty in “Why I’m Not Hiring” – http://online.wsj.com/article/SB10001424052748704017904575409733776372738.html.

This New Jersey business owner estimates that a 12-year employee with a nominal salary of $59,000 cost him $74,000 in taxes and benefits, yet she only nets $44,000. Where does the other 40.5 percent go? It goes to federal, state, and local taxes paid by both the employee and employer, along with each’s share of healthcare coverage.

Grossing 74k per year in pay and bennies means the employee is worth $6,166 per month. If taxes and benefits eats $30,000, that means she’s working almost five months of the year for nothing but support of governments and payments of benefits.

There’s also the confirmation that the uncertainty factor for employers is growing. The article’s author states that his healthcare provider jacked up rates by 28 percent for lesser coverage, where in the past, increases were less than 10 percent per year.

In this kind of economicly punishing environment it’s no wonder that small businesses aren’t hiring and that unemployment remains at a stubborn 9.5 percent.

The irony is that even sucking $18,000 away in taxes from both the employee and employer, cities and states are crying about how broke they are and the federal government has conveined a commission to figure out how to reduce the deficit [I'll be betting they'll be recommending new taxes rather than cutting expenses].

So, with an unknowable monster breathing down the neck of business, it’s little wonder there’s no hiring and not much prospect for a recovery. It’s time to shed some light on the hidden monster of government rapaciousness and let business know what’s in store by telling government to stop reaching into our pockets with both hands.

England used to be the world leader in manufacturing, beginning in the 1850s, thanks largely to the industrial revolution. It took the championship away from China due to Britain’s ability to automate production instead of producing goods by hand.

Then, along came that upstart United States in the late 1890s and took the crown away from the Brits. We’ve held it ever since. But, that’s coming to an end. According to a prediction by IHS Global Insight, a US-based economics consulting company, as reported by the Financial Times, the sun is going to set on US manufacturing leadership by 2011. Big surprise, huh?

For years, economist wonks have been prophesying the coming age of the service economy; we’re not going to be dirtying our hands anymore by making stuff, we’ll all get rich by the metaphysical equivalent of selling each other hamburgers or taking in each other’s laundry. I’ll leave it as an exercise to the reader to determine how well that’s worked out so far – I’ll just be keeping my fingers crossed that I find a paying gig before I run out of unemployment benefits and become a 99er*.

In 2009, the US created 19.9 percent of world manufacturing output, compared with 18.6 per cent for China, according to HIS as reported in the Financial times. We won’t maintain that lead. The reason is simple enough, according to the Times report, the US can’t compete with a country that has four times its population and pays a tenth of US wages.

Underlying this, too, to a certain extent is the idea that taking a job making stuff – what used to be called “blue-collar work” – is beneath us. We should all go to college and study obscure 12th Century French Poets and get fulfilling green jobs tending Delta Smelt** at high altitudes.

My mother’s relatives were from a small town in Kansas. I remember an aunt’s visit to Cleveland in the 1950s when it was the 11th largest city in the US. Driving over the Detroit-Superior bridge back then, across the city’s industrial heart, she saw the chimney’s from the steel mills pumping out smoke and she felt compelled to comment.

“That’s prosperity coming out of those smokestacks,” she said.

Today the mills are closed, the chimneys idle, the sky is clear, and the city ranked 33rd largest in the 2000 census. Delaying the Chinese leadership in manufacturing are the thousands of machine shops across the US. We’ve been able to stay ahead of the offshore manufacturers due to our better accuracy, tighter tolerances, and quality machines, but don’t expect that to last much longer.

As a child of the baby boom, I looked with bright eyes toward America’s future, never expecting to see the decline of the US during my lifetime. As author Jerry Pournelle said, “when I was a teen I expected to see America put the first man on the moon. I never expected to live to see the last one.”

*a 99er is someone unemployed who was dropped from the unemployment benefits roll because they used up all of their allotment.

** The Delta Smelt is a two-inch endangered fish that the government is using as an excuse to deny water to central California orchards and farms.