American Thinker Blog: Why Obama's tax incentives for small business will backfire

American Thinker Blog: Why Obama's tax incentives for small business will backfire:

President Obama proposed to give tax incentives to small businesses to hire more people. This sounds like a generally good idea, unless you happen to have any practical experience which is sorely lacking in this administration.

Suppose you are a business that has held on to valuable employees for the last year at a great financial cost. You are now supposed to compete with a startup that has preferential tax treatment because he is hiring new employees. Or perhaps you must now compete with an existing competitor that was less financially sound and thus had to lay off workers. He may now get a tax break to hire them back. You must then compete with more expensive workers than your competition. Instead of creating an incentive to hire you may have created an incentive to lay off workers."