Some people think they know some things about us job creators. The guy whose job it is supposed to be to represent me in the U.S. House of Representatives, Rep. Fred Upton (R-MI), whom I've written about before, more than once, even, thinks he knows some things about us job creators. He sent me an email the other day, like he likes to do sometimes, to make sure I didn't miss his latest op-ed, which ran August 30 in his favorite small-town, low-circulation weekly, which apparently lets him publish whatever disingenuous propaganda he thinks his corporate overlords might want to read. The title of his latest is "Survey Highlights Top Concerns of U.S. Job Creators," and you can read it in its entirety here.

For openers, Rep. Upton observes that "small business owners continue to lead the way for our economic recovery here in Michigan and throughout the United States." He adds that "They not only embody the entrepreneurial spirit of our free market economy, but play a vitally important role when it comes to job creation, innovation, and local growth." It's true. The stopped clock is right this time. Not to worry, though. It doesn't last. The rest of the column is more of the usual BS we have come to expect from Rep. Upton, God love him.

His response to concerns about energy costs cited by the "job creators" in the survey is to go on about some ditch-digging jobs that he says will save the U.S. economy. He addresses concerns about healthcare costs by announcing that the Affordable Care Act (ACA) hurts small businesses because it "does nothing to actually address the cost side of the equation." You'd think a member of Congress who spends so much time obsessing about health care in general and the ACA in particular would be aware of factual information about legislation that passed his chamber while he was in office, such as that the ACA contains no requirement that actual small businesses (as in the kind with 50 or fewer employees) provide insurance for their employees, that it includes no penalty for those who decline to do so, and that it actually offers incentives in the form of tax credits for small businesses who opt (yes opt, as in do something voluntarily) to provide coverage for their employees. You'd think Rep. Upton would know about that. [1]

And you are probably as surprised as I am to learn that the generous flow of profits to the job-creating healthcare industry, i.e. the "cost side of the equation," which as Rep. Upton rightly notes, the ACA unfortunately does little to correct, is somehow not something that he can get behind. As Richard S. Levick put it in an article in Fast Company in July, "5 Ways Insurers Can Position Themselves To Win Under The ACA":

It's not every day that an industry has as many as 46 million new customers delivered to its doorstep. But when the U.S. Supreme Court voted 5-4 to uphold the Affordable Care Act (ACA) and the controversial individual mandate last week, that's precisely what happened for health insurance companies across the country.

Somehow this is not good enough for Rep. Upton, whose congressional career functions effectively as a wholly owned subsidiary of the industry? OK, I exaggerate. "Wholly owned" probably isn't fair. I mean, it isn't fair to the oil and gas, electric utilities, and mining industries who are also major stakeholders in the Upton enterprise.

But we were talking about job creators, weren't we? All right. Here's my story:

In 2007, I invested $23,000 in a small-business start-up. That was all the money I had in the world. It was actually more than all the money I had in the world, because $15,000 of it was a cash advance I took out on my Visa card, which because it was 2007 I could do at a rate of 3.9%. The business was an automotive repair shop that Mr. Alevei was starting. He would run the business and fix the cars. I would keep my day job, help with the books, and do some web design. There was no question in my mind but that this would be a good investment. (Spoiler alert: It has been.) Once Mr. Alevei decided to go for it, we got to work on researching and writing his business plan, looking for a location for what would be his new shop, and trying to figure out how we were going to pay for everything that needed to happen to get him up and running. Writing the business plan was a project that turned out to be an excellent fit for many of the skills I have acquired over the years, not in business but in academia. A business plan is like scholarly research. It makes an argument and supports it with evidence. It requires a ton of research and a compelling narrative. Basic English-major stuff. It has to make the case to lenders and other potential investors that the proposed business will be a solid investment. In order to make our case, we had to conduct a market analysis, develop viable sales and marketing strategies, articulate both a mission and a vision (not the same thing, it turns out), analyze our position in relation to the shops and dealerships who would be our competitors, develop and articulate a brand identity, and of course spell out our projected start-up costs, operating costs, and revenue assumptions, all of which then had to be connected to the overall market and presented – and justified – in excruciating and itemized detail.

Our start-up costs included things like capital purchases (the equipment and supplies Mr. Alevei would need to start working on cars initially and projections for additional capital investments over time), real estate costs, insurance, permits and inspections, and personnel, although at the beginning it was just Mr. Alevei on the clock something like 80 hours a week and me making a hash of the books on Saturdays. I handled a lot of the research and analysis and wrote the narrative. Mr. Alevei created the spreadsheets that outlined our cost and revenue assumptions and projections, producing multiple versions that explored and applied several possible cost and revenue permutations and contingencies and made predictions about cashflow and about profit and loss through the first twelve months. He drew up balance sheets and we prepared personal financial statements. We estimated labor costs, average sales, profit margins for parts, taxes and fees. I was happier to be finished with the business plan than I was when I finished my doctoral dissertation five years earlier. In other words, we totally built that.

And in the process, we were very fortunate to have access to quite a few publicly funded resources, including our local library, which offers seminars and mentoring opportunities for people interested in starting new businesses and also has a large collection of relevant books and other media. Mr. Alevei took a course on business planning and was in every way the brains behind our many spreadsheets. We met with a mentor from SCORE, a nonprofit association funded by the Small Business Administration to support entrepreneurship. On a completely volunteer basis, our SCORE mentor took the time read our business plan and give us feedback. Our biggest break of all came in the summer of 2007, when Mr. Alevei called the Michigan Small Business and Technology Development Center (MI-SBTDC), which is also supported by federal (SBA) funding to help new and growing businesses. The MI-SBTDC set us up with a mentor, although guardian angel might be a better description. Our mentor provided numerous hours of hands-on support, including extensive assistance as Mr. Alevei wrangled with those spreadsheets, as well as moral support, helping to keep our spirits up during some difficult times, such as when we were worried that we would not get financing, could not find an appropriate and affordable location for the shop, did not see how we were ever going to be able to make it happen. That mentor has become a dear and beloved friend, and he is still an invaluable source of knowledge and support to Mr. Alevei. All the services and support he provided to us were available at zero cost to us.

So yeah, we built it. But we did not do it by ourselves. We couldn’t have.

Mr. Alevei opened his shop on November 1, 2007. We are really looking forward to celebrating his five years in business two months from now. I could not be more proud of Mr. Alevei, who over the past five years has worked until 2 a.m. more times than I can count, sometimes coming home and sleeping only three hours before getting up to do it all over again. He deserves all the credit for the thriving and still-growing business he has built. No one could have worked harder or been smarter, more resourceful, or more determined. And today, in addition to himself, he also employs two full-time technicians, a full-time service manager, a part-time accountant, and a part-time support staffer. Mr. Alevei created those jobs. And as he would be the first to agree, so did I. Yes, my $23,000 investment in the company is part of it, and my work on that excruciating business plan is too. And yes, there was also the labor I contributed for the first six months, when I kept the books. Sure, I did this work badly, but I would point out here that (a.) I did it badly for free, and (b.) sucking at it made the it even more difficult and unpleasant. (On the plus side, the experience was heartening for me in its clear affirmation of my decision at age 18 not to major in accounting.)

But here’s the part they really don’t teach you in school or anywhere else when you’re trying to start a business (and I mean the kind business that requires significant outlays of capital, the kind that really does create jobs): Even if you are ridiculously fortunate and your business does well right out of the gate (alevei!), it is still almost certainly going to take some time before it generates enough profit for you to take home a paycheck at all, let alone before you can take home a paycheck that's anywhere near enough to live on. So if you don’t have a lot of savings that you can live on and that somehow does not have to go into the business, or if you can’t get the kind of business loan and line of credit (which Mr. Alevei and I can tell you can be very hard to get at start-up) that makes it possible for you to survive for as long as it takes for the business to establish itself and start earning you a living, you're going to be looking at the possibility of some very hard times. [2]

And so it is the case that sometimes even businesses that are doing OK, even businesses that are doing well, don’t make it. They don't make it for no other reason than that their owners aren't making it. It's not because they aren't working hard enough and it doesn't necessarily mean they aren't doing it right. But if an individual's livelihood or a family's livelihood has to be staked entirely on the business, it is going to be very, very difficult for the individual or the family to buy itself the time that any new business is going to need to start making a living for anyone.

And that’s where this New York Times-subscribing, NPR-listening, Hillary Clinton-loving, foreign-car-driving, Obama-supporting, state employee public sector union professor comes in. Because it was my paycheck (the one some people don’t think I deserve) and my health insurance (which some people criticize as overly generous) that made it possible for my family to keep a roof over our heads, food on our table, and clothes on our backs (not to mention keeping the student-loan kneecap-busting brigade away from our door while I kept up the outrageous monthly payments that will add up to triple what I borrowed before it’s all over).

It was my paycheck – my below-market state employee’s paycheck – that bought the shop the time it needed, bought Mr. Alevei and me the time we needed so that he could have the chance to put everything he had into making his business the success it is today. There is simply no way that we could have survived long enough without my paycheck for the shop to succeed and to create those five good-paying, secure jobs that did not exist in 2007. And even with this level of success, I still could not possibly consider quitting my day job any time soon.

So let’s hear it for the job-creators, all of them, not just those lucky few who are well connected and/or amply capitalized and/or create jobs only if they absolutely have to and/or don't actually create any jobs, not just the "job creators" who really do seem to believe that they built that all by themselves.

And anyone who thinks that state employees are a drain on the system, that we don’t deserve the middle-class existence we are fortunate to enjoy (for the time being, anyway), that our below-market salaries are still somehow a bad investment of public funds should know this: The percentage of state university budgets that actually comes from state appropriations is at an all-time low nationwide as state legislatures increasingly divert public money away from public education.

So, not only do I work my ass off for those (semi-)state-funded paychecks in a demanding full-time job that I am actually pretty damn good at, but the contributions to actual, tangible job creation that this public-sector union-member has made have not depended on any government grants or loans or contracts. This is in contrast to every single "I built that" bullshit artist who took the stage at the Republican National Convention or to the airwaves to support Mitt Romney's campaign and proclaim their collective self-righteous, rugged-individualist, free-market, all-by-myself bootstrap delusion to anyone delusional enough to fall for it.

Rep. Upton concludes his op-ed thusly:

A responsible general would never lead an army into battle without the weapons and resources needed for victory. In the fight for our economic recovery, we can no less give our employers the certainty and resources they need to succeed.

I wonder if he is talking about "employers" like Mr. Alevei and me. But given that the federal tax rate we pay here in the Alevei household is twice the "job creator" rate that GOP presidential candidate Mitt Romney says he pays, and I don't see Rep. Upton, his party, or their presidential nominee making a case that Mr. Alevei and I deserve a big tax break or really any kind of break at all, I have to say I doubt it.

Notes:

[1] See "Employer Responsibility Under the Affordable Care Act," an analysis and report by the Henry J. Kaiser Family Foundation. You might as well take a look at it, because there's a good chance that your House representative hasn't.

[2] And don’t forget that you are somehow going to have to start making the payments on those loans and lines of credit right out of the gate. And so although it left us pretty significantly undercapitalized, we ultimately decided against taking out a start-up loan or line of credit, and instead decided to make a go of it on my $15,000 cash advance, Mr. Alevei's cashed-in 401K, and $8,000 that I inherited from my grandma, for the following reasons:

a. No bank would consider lending us less than $40,000 and most preferred to make loans larger than even that.

b. The interest rates quoted to us even during those pre-crash halcyon days of summer 2007 were astronomical – double digits. Those were the rates reserved for people like us, i.e. people without a lot of savings or family money, just starting out in business.

c. Repayment of the start-up loan would be tied to the length of our commercial property lease, which was three years.

d. The monthly payment on a $40,000 loan at 12% to be paid back within three years was more than our monthly mortgage payment. A lot more. We knew there would be no way we could possibly make those payments, living as we would be on a single paycheck.