It's often said by politicians in both parties that small businesses are the heart of the US economy -- so it's no minor side note that optimism among the owners of said businesses has shot up dramatically during the Trump presidency. Setting aside the recent gyrations of the stock market, the fundamentals of America's economy are looking robust amid a climate of determined deregulation and tax relief. This data point, via Bloomberg, is significant because the historically positive outlook it measures translates into expanded operations, more jobs, and more pay:
Optimism among small companies in the U.S. rose more than forecast in January, fueled by a record number of owners who said now was a good time to expand, according to a National Federation of Independent Business survey released Tuesday. Six of the 10 components that make up the small-business optimism index increased in January, producing one of the strongest readings in the 45-year history of the survey. The figures show sustained, sturdy business sentiment since the November 2016 election. A measure of plans to boost capital spending in coming months increased by 2 points to 29 percent, consistent with other data indicating robust outlays for equipment. One in five small companies said they plan to boost hiring...The new tax law “produced the most recent boost to small-business optimism,” NFIB’s William Dunkelberg and Holly Wade said in a report. “And federal government-related cost pressures continue to abate, offering a more supportive business climate for small firms...
This chart tells the story:
Federal policy, and the party in power's attitude toward businesses (supportive vs. demonizing and suffocating) can really make a tremendous difference. This isn't theoretical. Even those who've sharply criticized this president on any number of fronts -- including yours truly -- must concede that this is very much a Trump economic surge. Meanwhile, the GOP-passed tax overhaul continues to pay dividends for workers, more than 3.5 million of whom have now received bonuses thanks to the new law. That's a lot of "crumbs" for a lot of people, not to mention the wage hikes and benefit enhancements that an ever-growing number of companies have announced -- oh, and 80 to 90 percent of all taxpayers are getting a tax cut on the individual and family side of things. I've been persistently reminding Republicans that in spite of a major recovery in the law's approval ratings over a matter of weeks, the plan will not simply sell itself. To that end, here's Senate Majority Leader Mitch McConnell promoting various news accounts about reductions to many Americans' energy bills as a result of the law:
He's also attacked Democrats' tone-deaf and elitist "crumbs" talking point, too: "Already, millions of workers have received a tax reform bonus, pay increase, or other benefit," he said. "I understand that a 1,000-dollar, 2,000-dollar, or 3,000-dollar bonus might not seem like much to my colleagues from New York or San Francisco. I understand why people who are already very wealthy might agree with my friends the House and Senate Democratic Leaders, who’ve said that these bonuses and benefits are merely, quote, ‘crumbs.’ But I can assure them -- the working families I represent do not see a permanent raise or a multi-thousand-dollar bonus as ‘crumbs’ to sweep off their table. In millions of households, thanks to tax reform, paying the bills has already gotten a little less painful. Planning for the future has already gotten a little easier.” McConnell invoked Nancy Pelosi's "armageddon" hyperventilation, juxtaposing Democrats' ludicrous rhetoric with actual outcomes, crucially driving home the point that every single Democrat in Congress voted against a law that is succeeding and helping people. House Speaker Paul Ryan appeared on Maria Bartiromo's morning show today to continue the hard sell:
The rhetoric is so over the top that I don't think people know what to believe. But guess what? The good news is: The law occurred. Reality is setting in. People are opening up their paychecks and seeing bigger checks, they are seeing bonuses from employers, they are seeing a raise in their minimum wages. That is real, that is occurring...We are now getting into real growth, real wage growth, real take-home pay. That is exciting, that is good, and I can't imagine why someone would be against that...People are getting wage increases, bonuses, and tax cuts. Ninety percent of American workers this month will see bigger paychecks because their withholding tables will go down."
To her credit, Bartiromo pressed Ryan on the debt, as well -- and to his credit, he said many of the right things (and has taken a political risk by walking the walk in the past). The concern is that his party, led by the president, does not remotely share his conviction about doing the hard thing, even if the hard thing is absolutely necessary. It's hard to take Ryan's rhetoric seriously after (a) Congress just passed a budget cap-busting deal that puts the nation on a path to spend $1.5 trillion more over the next decade, (b) the president put out a budget proposal that includes a giant new spending program, and looks like this:
Obama in 8 years - $7.2 trillion in deficits— Jamie Dupree (@jamiedupree) February 13, 2018
White House estimate for 8 years of Trump - $7 trillion in deficitshttps://t.co/0wkmL7L0v2
President Obama was, by far, the undisputed king of debt in US history. It's not close. But looks like his Republican successor is going to give him a run for his money -- and is preparing to do so in a strong and stable economic environment. It's extremely irresponsible, the tax cuts notwithstanding.