A Failure to Govern…

Those of you who know me in person or via social media know that I have some strong leanings about the role government should play in our lives-I’ll make no bones about that.   However, as I read the wall-to-wall coverage about the impending “fiscal cliff” – mandatory budget cuts and a possible tax increase all to take effect within roughly 60 days, it makes me angry at Washington D.C. politicians from BOTH sides of the aisle.

Perhaps oversimplifying, here’s how it SHOULD work:  Politicians govern, and businesspeople conduct business according to the rules created by the government.  Businesspeople take a look at the playing field set by the politicians, and in light of those conditions they make decisions regarding what risks they are willing to take in pursuit of profits.

When you are a businessperson trying to plan for the future, there is only ONE thing worse than bad policy, and that is NO POLICY.

Did you ever play Monopoly®* when you were a kid?  Most of us did at one time or another.  It’s a strategy game that can last hours, and a reasonably good simulation of the real business world.  Picture yourself as a kid playing Monopoly® with your favorite uncle.  You’ve acquired some major properties and you’re winning handily, and all of a sudden Uncle Sam changes the rules so that you get less rent from those major properties.  You adjust, and eventually gain the upper hand again, and once again Uncle Sam changes the rules.  This happens over, and over, and over, and each time the “new rules” become more complex.

At some point, would you decide that the game was no longer worth playing?  In my humble opinion, that’s exactly the problem in our economy today.  If you wonder why you, your brother, or your neighbor can’t find a good job, you might want to look to Washington, D.C.  Uncle Sam is changing the rules so frequently and making them so complicated that some business owners are deciding that they don’t want to play the game any longer.

Whomever gets your vote next week, or in future elections – we all need to send a message with that vote that states that “business as usual” in Washington is no longer OK.  Politicians need to get back to the work of governing, and spend less time preparing for their next election.

Thanks for reading, as always, happy to hear your opinions via twitter at @jpgriffard, or via email.

 

Joseph P. Griffard, CFP®

*Hat tip to Hasbro. No intent to shamelessly exploit your brand.  If you want me to remove this reference, just shoot me an email.

The opinions expressed in this material do not necessarily reflect the views of LPL Financial