An annual tradition, since my childhood, has been to watch the 1951 film classic A Christmas Carol starring Alastair Sim. In the film Ebenezer Scrooge, played by Sim, is taken back by the Ghost of Christmas past to review events in his life. What always brings tears to this writer’s eyes is when Scrooge sees how his former employer Fezziwig conducted his business. The scene at Fezziwig and Co’s Christmas party brought joy to Scrooge, as everyone danced and reveled to celebrate the holiday spirit. Things then fast forward to when Fezziwig refused to sellout to the ‘ New Interests’ who wish to modernize, forerunners of today’s corporate interests. Scrooge finally leaves Fezziwig and Co. to take a better paying job with the competitors, forever cutting his ties to the old ways.
The days of the ‘ Mom and Pop’ family run small businesses is quickly disintegrating in front of our eyes. Between the corporate Box Stores and the online Amazons and others, it strangles Mom and Pops. How can they compete with much lower pricing for, in many cases, the same items? On top of that is the outrageous rents that Mom and Pops must pay to private landlords, in most cases, huge corporate ones.
This writer was partnered in a Mom and Pop cafe business a few years ago. We were somewhat lucky in that we owned our building. Yet, the mortgage and insurance payments, compounded with all the fees we had to pay, were just as bad as if we were renting space. We only had a few employees, and our overhead was so much that we had to only hire P/T to save on paying benefits etc. Still, it was difficult for a new venture to make payroll. Eventually we had to take a huge loss and sell out for a song.
Wal-Mart and other mega business monsters get all kinds of perks and allowances from localities. One of the biggest con jobs with Wal-Mart was the PR bullcrap that ‘ They use our local banks for their receipts’. What actually transpires, in many cases, is that the day’s receipts are deposited in a local bank and then, overnight the funds are transferred by wire to the Arkansas Wal-Mart bank. Meanwhile, Wal-Mart and all the other big boxes cause our local Fezziwigs to go under when it comes to retail sales or consumer products. I used a Mom and Pop drinking water delivery service for over 23 years in my residence. Then, just like that Culligan Corp bought him out. For all those years we had ‘ Just a phone call away’ customer service and actually better prices. We knew they were coming once every two weeks and handled any complaints etc. Now, we can only get delivery once a month, and they are changing the dates whenever it suits them. Our delivery guy is just as nice as our former guy, but he has no say as to how things get done.
Here is what has to be done to save Mom and Pop American Business:
* Local communities should use eminent domain and replace the private absentee landlord system with community owned strip malls. The rents charged should be as non profit, thus lowering them drastically. The tenants allowed in these malls should be Mom and Pop only, with NO corporate chains, franchises or satellites.
* Former Labor Sec. Robert Reich had a great idea. He proposed a Payroll Tax Forgiveness Plan, whereupon the 7.75% Payroll Tax contribution for both the employee and the business owner was forgiven for earnings up to $20k a year. I would add that this forgiveness should be only for the first 50 employees per business, regardless of being full or part time. Do the math and see how much, TAX FREE, the employee and owner will save. A Mom and Pop business could use those savings to upgrade or give bonuses to their employees. This is one way for a Mom and Pop to compete with the big boxes. Plus, the employee earning let us say at least $20k a year could use the $ 1550 TAX FREE for whatever is needed. Not a great deal of money but…
* If we finally had Medicare for All the onus of having to cover employee health benefits would be eliminated for ALL business owners. Between this and the aforementioned Payroll Tax Forgiveness Plan, No small business owner would EVER hire workers ‘ Off the books’, which would erase much of the underground economy, bringing more tax revenue to Uncle Sam.
Being a Socialist this writer would like to see many more changes to our current system. For now, though, let’s stand behind the ideas presented here.