Lis­ten­ing to AM640 here in Toronto today, I heard an excel­lent dis­cus­sion about the let­ter from "The Boss," a truth-be-told debate about the value of tax-cuts, stim­u­lus and tax­a­tion. In the cur­rent cli­mate of gov­ern­ment inter­ven­tion, and neo-socialism, the let­ter is a breath of fresh air for those of us who have made the great­est pro­duc­tive con­tri­bu­tion. Thanks to Charles Adler for post­ing the let­ter at his blog.

To go one step fur­ther, it is rem­i­nis­cent of the world of Ayn Rand's "Atlas Shrugged," in which the story's heroes, the entre­pre­neurs, the inno­va­tors, the cap­tains of indus­try, the prime-movers, decide the best rem­edy is to with­draw, to go on strike, as the world is looted by bureau­crats, social­ists, pseudo-intellectuals, and mys­tics.

Memo to All My Val­ued Employees

Author: The Boss

There have been rum­blings around the office about the future of this com­pany and, more specif­i­cally, your job. As you know, the econ­omy has changed for the worse and presents many chal­lenges. The good news, how­ever, is this: The econ­omy doesn't pose a threat to your job. What does threaten your job, how­ever, is the chang­ing polit­i­cal land­scape in this country.

First, while it's easy to spew rhetoric that casts employ­ers against employ­ees, you have to under­stand that for every busi­ness owner there is a back story. This back story is often neglected and over­shad­owed by what you see and hear. Sure, you see me park my Mer­cedes out­side. You've seen my big home at last year's Christ­mas party. I'm sure all these flashy icons of lux­ury con­jure up ide­al­ized thoughts about my life. But you don't see the back story.

I started this com­pany 12 years ago. At that time, I lived in a 300 square foot stu­dio apart­ment for three years. My entire apart­ment was con­verted into an office so I could put forth 100% effort into build­ing a com­pany, which, by the way, would even­tu­ally employ you. My diet con­sisted of noo­dles because every dol­lar I spent went back into this com­pany. I drove a rusty Toy­ota Corolla with a defec­tive trans­mis­sion. I didn't have time to date. Often times, I stayed home on week­ends, while my friends went out drink­ing and par­ty­ing. In fact, I was mar­ried to my busi­ness — hard work, dis­ci­pline, and sacrifice.

Mean­while, my friends got jobs. They worked 40 hours a week and made a mod­est $50K a year and spent every dime they earned. They drove flashy cars and lived in expen­sive homes and wore fancy designer clothes. Instead of hit­ting Nord­strom for the lat­est fash­ion item, I trolled through the Good­will store extract­ing any cloth­ing item that didn't look like it was birthed in the '70s. My friends refi­nanced their mort­gages and lived lives of lux­ury. I did not. I put my time, my money, and my life into a busi­ness with a vision that, some day, I too, would be able to afford the lux­u­ries my friends had.

So, while you phys­i­cally arrive at the office at 9 a.m., men­tally check in at about noon, and then leave at 5 p..m., I don't. There is no "off" but­ton for me. When you leave the office, you are done and you have a week­end all to your­self. I, unfor­tu­nately, do not have that free­dom. I eat and breathe this com­pany every minute of the day. There is no rest. There is no week­end. There is no happy hour. Every day this busi­ness is attached to my hip like a one-year-old special-needs child. You, of course, only see the fruits of my labor — the nice house, the Mer­cedes, the vaca­tions. You never real­ize the back story and the sac­ri­fices I've made.

Now the econ­omy is falling apart and the guy who made all the right deci­sions and saved his money have to bail out all the peo­ple who didn't. The peo­ple who over­spent their pay­checks sud­denly feel enti­tled to the same lux­u­ries that I earned and sac­ri­ficed a decade of my life for. Yes, busi­ness own­er­ship has its ben­e­fits, but the price I've paid is steep.

Unfor­tu­nately, the cost of run­ning this busi­ness and employ­ing you is start­ing to eclipse the mar­ginal ben­e­fit. Let me tell you why:

I am being taxed to death and the gov­ern­ment thinks I don't pay enough. I have state taxes. Fed­eral taxes. Prop­erty taxes. Sales and use taxes. Pay­roll taxes. Work­ers' com­pen­sa­tion taxes. Unem­ploy­ment taxes. Taxes on taxes. I have to hire a tax man to man­age all these taxes and then, guess what? I have to pay taxes for employ­ing him.

Most of my time is now occu­pied with gov­ern­ment man­dates and reg­u­la­tions and all the account­ing that goes with them. On Octo­ber 15th, I wrote a check to the US Trea­sury for $288,000 for quar­terly taxes. You know what my "stim­u­lus" check was? Zero. Nada. Zilch.

The ques­tion I have is this: Who's stim­u­lat­ing the econ­omy? Me, the guy who has pro­vided 14 peo­ple good-paying jobs and serves more than 2,200,000 peo­ple per year with a flour­ish­ing busi­ness? Or the sin­gle mother sit­ting at home preg­nant with her fourth child wait­ing for her next wel­fare check? Obvi­ously, gov­ern­ment feels the lat­ter is the eco­nomic stim­u­lus of this country.

The fact is, if I deducted (read: stole) 50% of your pay­check, you'd quit and you wouldn't work here. Why should you? That's nuts. Who wants to get rewarded for only 50% of their hard work? Well, I agree, which is why your job is in jeopardy.

Here is what many of you don't under­stand: to stim­u­late the econ­omy you need to stim­u­late what runs the econ­omy. Had sud­denly gov­ern­ment man­dated to me that I didn't need to pay taxes, guess what? Instead of deposit­ing that $288,000 into the Gov­ern­ment black-hole, I would have spent it, hired more employ­ees, and gen­er­ated sub­stan­tial eco­nomic growth. My employ­ees would have enjoyed the wealth of that tax cut in the form of pro­mo­tions and bet­ter salaries. But you can for­get it now.

When you have a comatose man on the verge of death, you don't defib­ril­late by shock­ing his thumb to bring him back to life, do you? No. You defib­ril­late his heart. Busi­ness is at the heart of our econ­omy and always has been. To restart it, you must stim­u­late it, not kill it. Sud­denly, the power bro­kers believe the mud of econ­omy is the essen­tial dri­ver of the eco­nomic engine. Noth­ing could be fur­ther from the truth.

So where am I going with all this? It's quite sim­ple. If any new taxes are levied on me, or my com­pany, my reac­tion will be swift and sim­ple. I'll fire you. I'll fire your co-workers. You can then plead with the gov­ern­ment to pay for your mort­gage, your SUV, and your child's future. Frankly, it isn't my prob­lem anymore.

Then, I will close this com­pany down, move to another coun­try, and retire. You see, I'm done. I'm done with a coun­try that penal­izes the pro­duc­tive and gives to the unpro­duc­tive. My moti­va­tion to work and to pro­vide jobs will be destroyed and, with it, will be my citizenship.

While tax cuts to 95% of the peo­ple sounds great on paper, don't for­get the back story: If there is no job, there is no income to tax. A tax cut on zero dol­lars is zero. Who under­stands the eco­nom­ics of busi­ness own­er­ship and who doesn't? Whose poli­cies will endan­ger your job?

Answer those ques­tions and you should know who might be the one capa­ble of sav­ing your job. While the media wants to tell you "It's the econ­omy, stu­pid," I'm telling you it isn't. If you lose your job, it won't be at the hands of the econ­omy; it will be at the hands of a polit­i­cal hur­ri­cane that swept through this coun­try, steam­rolled the Con­sti­tu­tion, and changed the land­scape for­ever. If that hap­pens, you can find me in South Caribbean sit­ting on a beach, retired, and with no employ­ees to worry about.

Signed,

Your Boss

Who is John Galt?

Read more from the author/contributor here.

Comments

5 Responses to “Memo to All My Valued Employees”

1. Fred Says:
   December 30th, 2008 at 9:32 am

   One has to seri­ously ques­tion the moti­va­tion of a busi­ness owner who would send this to his employ­ees. Essen­tially, this let­ter is sour grapes bitch­ing to those who can do NOTHING to change the sit­u­a­tion. 14 employ­ees are not going to stem the tide of tax law changes about to come in. No way on earth will that hap­pen. Instead, all this fel­low has man­aged to do is to de-moralize his employ­ees and leave them in a state of fear­ful agi­ta­tion for the hol­i­days. This is illus­tra­tive of a cer­tain sort of behav­ior com­mon among very small busi­ness own­ers that serves no good pur­pose and only harms their busi­ness and their cred­i­bil­ity as worth­while lead­ers. The old­est rule in lead­er­ship is that bitch­ing runs uphill (hat tip to Sav­ing Pri­vate Ryan). The mail­room worker com­plains to the mail­room man­ager and he in turn com­plains to the oper­a­tions Vice Pres­i­dent and so on. All this fel­low is doing is show­ing that he is an inept leader and that he wants every­one to know it. Fail­ure of lead­er­ship is really what's killing this coun­try — at all lev­els — and this high­lights that perfectly.

2. Steve Coleman Says:
   December 31st, 2008 at 8:17 am

   Where does it indi­cate that this wasn't a "vent" and was not actu­ally sent anywhere...but like all things landed out here in the inter­net world?

3. GreenLight Advisor Says:
   December 31st, 2008 at 10:03 am

   "From each, accord­ing to his abil­ity.
   To each, accord­ing to his need." — Karl Marx

   Whether or not you agree with this anony­mous let­ter, that prob­a­bly was not actu­ally deliv­ered, and is likely a rant, it makes one point. That those of us in soci­ety who stick their entre­pre­neur­ial necks out to start a busi­ness, and toil within the bounds of risk and sleep­less­ness (often fail­ing) in order to have their place in the sun, are not given a fair shake, nor the incen­tives, to do so, nor are they rewarded by soci­ety for it.

   What price, eco­nomic freedom?

4. peter otoole Says:
   January 2nd, 2009 at 2:34 pm

   Ok, it is a rant. It makes a point. And it is NOT TRUE that the employ­ees can't do any­thing about it. They can vote. They can write to their congressman.

   We can try that for now. IF that con­tin­ues to not work, then we will have to come up with alternatives. :-)

   Ten Ques­tions every US cit­i­zen should ask them­selves in 2009:
   http://www.rfdoc.com
   (and the links in the arti­cle are very insightful)

5. Julie Says:
   March 9th, 2009 at 2:27 pm

   In an effort to pro­vide bal­ance, here's a let­ter pre­sent­ing the other side the coin, from the employ­ees on his staff:

   Dear Val­ued Boss:

   Thanks for the infor­ma­tive and illus­tra­tive let­ter regard­ing why I am los­ing my job, what's wrong with this coun­try, and why the economy's cur­rent con­di­tion may cost not only me my job but every­one else who works for you as well.

   You shared your tid­bits and your back story with us because you didn't want to just spew rhetoric. Yeah, I see you park your Mer­cedes and I've seen your grandil­o­quent house when you were kind enough to invite the lowlifes, er, I mean the employ­ees, to your Christ­mas party. Yes, you're right, those flashy icons of lux­ury do con­jure up some ide­al­ized thoughts about your life-about what it must be like to make it, to finally get to the point in your life where you can afford some of those things.

   So, now that you've shared your back story, here's mine.

   When you were start­ing your com­pany 28 years ago, I was a young teenager just out of high school with no clue what to do with my life. No dis­ci­pline or drive ever pounded into me to single-mindedly seek a goal no mat­ter what the cost, no mat­ter how many late nights worked away from fam­ily and friends. What to do? How do you choose a major or a direc­tion in life when you have no clue what you're good at or what you want to do with your life because you've never had the oppor­tu­nity to be told that you can do it, that you can make it, that you are worth­while? And yet, lo and behold, out of the blue comes the idea that maybe you could have your own busi­ness, if you just worked hard enough. That's what they've always told us: work hard, pull your­self up by your boot­straps, and you can be or do any­thing you want. Except some­times life gets in the way in ways unexpected&.

   I've lived in that same 300-square foot stu­dio apart­ment that you did, but I did it with 2 kids, mak­ing $14/hour, pay­ing $500/month for rent, $800/month for day care, plus util­i­ties, phone, and, oh yeah, I guess I had to fig­ure out some way to feed the kids and myself in all that also. And I worked evenings at home typ­ing after the kids went to bed so I could make ends meet, and swal­lowed my pride enough to go on day­care assis­tance to help pay the long-suffering and long-waiting babysit­ter who lov­ingly cared for my kids while I slaved away at your busi­ness, despite the fact that I was raised to believe that any­one who went on "assis­tance" was lazy and shift­less. Imag­ine try­ing to rec­on­cile that image and those feel­ings when you're try­ing to get money to pay the bills and still feed your kids.

   And I drove a piece of junk that was so used and worn out that I didn't know if it would run from day to day; a car that I had to start with a wire under the hood because I couldn't afford to have the dead sole­noid replaced, so instead a friend showed me how to start it with the wire. I learned how to strip wires real fast when the old one wore out and wouldn't start the car any­more! I barely ever had an extra penny to put away in sav­ings, much less the money to start a busi­ness of my own. Yes, I made my own bed and lay in it when I mar­ried badly, had kids, and ended up divorced, but I worked my fin­gers to the bone just as much as you did just to sur­vive, pro­vide a good home for my kids, and try to put some­thing away for a rainy day in case any­thing hap­pened to me or the kids. The thought of los­ing a job or some­one get­ting hurt was absolutely terrifying.

   As for your friends who went out and got jobs, worked only 40 hours per week, and made a mod­est $50K/year, I would loved to have made that $24/hour that they were mak­ing and in only a mere 40 hours/week! I would have loved to have the extra money to occa­sion­ally buy NEW clothes instead of going to the Good­will or Value Vil­lage to clothe my chil­dren and myself. Luck­ily for me, those kids were never the type who got snobby about their clothes, nor did they become embar­rassed about not wear­ing more expen­sive designer-type clothes as they grew older. I would have loved to have the chance to drive a decent car, have the hope of own­ing a home instead of for­ever liv­ing in Apart­ment Hell, and maybe, just maybe, take an occa­sional REAL vaca­tion and not just time off with the kids that was spent in town because I couldn't afford plane tick­ets to any­where much less a hotel or rental car. And back then, who was going to give a credit card with a decent line of credit to a sin­gle mother of two mak­ing a lousy $14/hour?

   And, where in the world do peo­ple still get to arrive at work at 9 and leave at 5, which makes me think you are giv­ing your employ­ees a paid lunch? I'd kill for a posi­tion like that! I'd love to have the lux­ury of arriv­ing for work at 9 am and sleep in another hour in the morn­ing. Then I might not be so drag-my-butt tired. And while it may seem to you that I arrive at 9, men­tally check in at noon, and then leave at 5 pm, what you don't take the time to see is that I'm doing the best I can to make it through a full day of work for you because I have worked so hard at the other end of the day-when you don't see me-to make ends meet. In all of this, where am I going to have the time to go back to school to get a bet­ter pay­ing job? Oh yeah, and the money for the tuition? As the Sopra­nos liked to say so much, Fuged­d­a­boutit! I've often heard where admin­is­tra­tors go back to school in the evenings to get their mas­ters degrees online. Well, that's nice if you have the extra time that comes with not hav­ing to moon­light and if you have the money to actu­ally do that. Plus there really aren't too many schol­ar­ships for women in my age bracket with two kids mak­ing the "astound­ing" amount of money that I do. Can you imag­ine the idea that some­one who makes only $14/hour makes too much for some scholarships?!

   The other thing you often don't see is that, although this is your com­pany, many of your employ­ees will often feel like it is their com­pany too. Given half the chance, a decent income, and a lit­tle trust, they'd give their left arm for you, work over­time with­out pay, and be just as con­cerned as you about the busi­ness when the econ­omy tanks. All too often, the folks at the top don't see the fact that the folks at the bot­tom con­sider the place they work to be an exten­sion of their LIVES just like the employer does. In that rare align­ment of com­pany, cul­ture, and employ­ees, there can actu­ally be such a thing as con­cern for the com­pany on the part of the employ­ees, with just as much con­cern as the owner has. How­ever, color-blind glasses pre­vent this sim­ple thing from being seen and, there­fore, pre­vent the employ­ers from build­ing that bridge that allows both sides to work together towards the com­mon goal and which allows both sides to worry together and put their heads together to brain­storm ideas for run­ning the com­pany more effi­ciently for less expense.

   So, instead a divide devel­ops. You stand on your side say­ing, "You don't under­stand me and you never will. All you care about is what you can get from me" And the employee stands on the other side, say­ing, "You don't under­stand me and you never will. All you care about is how you can get by with­out me."

   But, where in the grand scheme of your busi­ness do you think you'd be mak­ing even half the money that you are with­out all the peo­ple who do the myr­iad of lit­tle things that you can't do all by your­self? If you've got excess staff on the pay­roll for the amount of income you've got com­ing in, by all means you have to trim down to become more in line with income and out­put; that's just basic busi­ness. But don't blame taxes on the rea­son that you're going to close shop. We'd all love to run away from taxes, but taxes are a fact of life. They pay for your basic infra­struc­ture: the lovely paved streets, the snow­plow­ing in the win­ter­time, those FREE schools that all kids get to go to regard­less of class/parental income/or any other cri­te­ria, unlike many places in the world. Your taxes also pay for fire and police ser­vices, EMT ser­vice for when you are in a car wreck on a slip­pery, snowy day. I could go on and on. In the para­phrased words of Ben­jamin Franklin, in this world noth­ing is cer­tain but death and taxes.

   And some­where along the way to writ­ing your back story, you for­got about the fact that we're all in this together and we have a duty to help our fel­low man. If that means giv­ing them a job that suits your needs as well as theirs and pay­ing taxes along the way to pay for all the basic ser­vices that make your mod­ern life more, well, mod­ern and com­fort­able, so be it.

   And, just for the record, yes, in a rare align­ment of luck and hope, I was briefly self-employed when I tried to have a go of run­ning my own busi­ness and yes, at the time I paid what seemed like the god-awful high taxes that were required of me, includ­ing the self-employment por­tion of my tax-the part that most employ­ees don't fully under­stand or ever see. But you know what killed me? I was too cheap to hire some­one to help me out! Because, like you, that busi­ness was attached to my hip like a 1-year old spe­cial needs child whom I thought no one else could care for besides me. So, instead I ran it myself and ran myself into the ground because I failed to real­ize the one essen­tial thing: just how impor­tant employ­ees are in the flour­ish­ing of many businesses.

   So, why not just agree to dis­agree and con­tinue liv­ing in the host/symbiont rela­tion­ship in which we both need each other for dif­fer­ing rea­sons in order to get what we want and need. You might also say we're both like light and dark­ness, we can't have one with­out the other and we need each other to be com­plete and run this busi­ness together. You can run off, stick your head in the sand, and close your busi­ness if you really are tired of it all, but I'll tell you what, no mat­ter where you go, you'll run into taxes and you'll run into the host/symbiont rela­tion­ship no mat­ter where you go, even if you're retired; it'll just present itself in a new form.

   And clos­ing your busi­ness won't solve any prob­lems; it'll only allow the prob­lem to con­tinue spi­ral­ing down. Now clos­ing a busi­ness because it is fail­ing and is not viable is one thing. But clos­ing a busi­ness because you're tired of pay­ing taxes, some­thing which we all must do whether we're the employer or the employee, is just plain non­sense and, in the end, is rather self­ish. All you're doing is con­tribut­ing to the myth that you seem to think your employ­ees have cre­ated about you: that you were born rich and have never cared about a soul except your­self. And thus begins anew the rea­son for this whole debate.

   Signed,

   Your hum­ble and worth­less employee