Democrats In Process Of Checkmating Themselves

Great article from Forbes:

Democrats Checkmate Themselves

November 10th, 2009

Liberals are fond of calling Republicans “the stupid party.” That might need revision. It appears to me that Democrats have checkmated themselves. Here is the logic:

If Obamacare makes it through the Senate, American small businesses will continue to shrink their payrolls to avoid the awful choice of paying higher health care insurance premiums or the 8% added payroll tax. Unemployment is sure to rise. The Dems will face the November 2010 elections with 12% unemployment … closer to Depression levels of 20% by the so-called broader measures.

If Obamacare fails to pass, the left-wing base will be so demoralized as to not show up at the polls in 2010. Or they will be so angry that they might start a 1968-like interparty war.

My Checkmate Theory is based on small-business fear of Obama’s signature issues–health care, cap-and-trade and union card check. Health care is at the plate now. The fate of health care in the U.S. Senate will set the passage odds for cap-and-trade and union card check next year. All three of Obama’s signature issues are opposed by most small businesses, including the American Chamber of Commerce.

Here are two revealing stories reporting the economic struggles and political fears of small businesses:

USA Today

Small businesses often lead the nation out of recession. Not this time.

The unemployment rate jumped to 10.2% in October from 9.8% in September, and economists say a big reason is small businesses. With sales weak, they’re still slashing jobs and faring worse than their larger rivals.

“Small business tends to lead the way out, and that’s just not happening here,” says Mark Zandi of Moody’s Economy.com.

The Wall Street Journal

W. Michael Brown has scaled back hiring plans in his Virginia auto-parts stores. Carl Redman halted an expansion project at his Oregon contracting business. Bill Hammack is preparing layoffs at his road-construction company in Georgia.

The economy remains unsteady 22 months after the recession began, with banks restricting credit and consumers hunkering down. For these small businesses, and many others across the country, there’s an additional dark cloud: uncertainty created by Washington’s bid to reorganize a wide swath of the U.S. economy.

If American small businesses stay hunkered down, unemployment will stay up. That’s because small businesses historically have created the majority of net jobs in any economy. They’ve created almost all net jobs in the first two years of a recovery. But not this time. Not yet.

The liberal writer Michael Lind is happy to see government put the screws to small businesses. In Lind’s opinion, small businesses are nothing more than a collection of Scrooges and Marleys. No doubt his opinion of small business is shared by many in the Democratic Party’s activist wing:

The solution may be corporatism or corporate paternalism–by which I mean the mandatory universalization of private employer benefits. If the politics of ethnic diversity makes movement in a universalist, social democratic direction impossible in the U.S., then the alternative might be to mandate that all employers provide certain benefits to all employees, with no exceptions. The costs of such unfunded mandates might drive some small businesses out of existence. But small-business owners are the most vocal opponents of wage and benefit reform in the U.S. The replacement of Scrooge & Marley by a smaller number of bigger private and public employers who treat Bob Cratchit and Tiny Tim better would not necessarily be a tragedy.

Not a tragedy? Don’t be so quick, Democrats. You can’t have it both ways. Stick it to small businesses (through higher payroll taxes, cap-and-trade and union card check) and the assaulted will trim their payrolls until conditions clear, if ever. But if you don’t stick it to small businesses, your party’s activist base will go nuts.

You have checkmated yourselves, Democrats.

I know Democrats thought that pure arrogance and power hunger would be attractive ingredients, but it doesn’t seem to be working out for them.

If ObamaCare passes, small businesses know that they will be forced to pay high costs for every employee on their payroll.  Ergo sum, they aren’t too eager to hire new workers until the coast is clear and Obamacare has finally gone away.

If it doesn’t pass, the Kool-aid liberal base will go even more nuts than they already are and start a war within the Democrat Party.

The horns of a giant dilemma begin to take shape.

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