network (129)
How the Emergency Economic Stabilization Act of 2008 Affects "Real" Small Businesses
Yesterday, the United States House of Representatives Committee on Financial Services released the text of the Emergency Economic Stabilization Act of 2008. I spent a few hours reading through it and I have some thoughts. In a nutshell, the Act allows the United States Secretary of the Treasury to establish a Troubled Asset Relief Program (TARP) pursuant to which it can purchase the "troubled assets" of certain financial institutions. It also creates a new regulatory body, the Office of Financial Stability, within the Treasury Department, the purpose of which is to implement TARP. You can view a section-by-section summary of the Act here. (PDF)
While I am glad to see that, under the Act, the actions of regulators would be subject to review by federal courts, and also that the Act includes some provisions to help home buyers and (on paper anyway) prevent the corporate elite who started all of these problems from enjoying windfall profits, I can't help but note that this is not really an emergency. An emergency is unforeseen, yet we've been watching this happen for years. And lawmakers have done nothing until now. Calling it am "emergency" does not excuse any of them, or the millionaires who are at the heart of this debacle, from the consequences they should (but will not likely) face. Regardless of whether we "must" act now, and in this way, I am very troubled by this piece of legislation from a policy perspective, particularly as it affects Indie Business owners. Here's why.
Small Business in the United States of America
The US Small Business Administration allows certain businesses to be defined as "small" so that they can take advantage of various set-aside programs and benefits that theoretically ensure that they can get their fair share of government contracts, minority set asides and other opportunities. The amount of revenue a "small" business can generate and still qualify as "small" varies depending on the industry.
A sheep farmer, for example, is "small" if he grosses $750,000 or less a year. That's a lot of money to most people. Other companies can make endless millions of dollars without limit so long as they have only a certain number of employees. In practice, this has amounted to the mis-classifying of "employees" as "independent contractors" by multi-billion dollar companies so they can take advantage of more government contracts.
So you see, "small" is not really small in America.
America's Real Small Businesses
The true definition of small business is represented by an important and growing segment of our economy that is often overlooked. They are what I call "Indie Businesses" and I am proud to be counted among their number. We are making substantial contributions, yet not grossing anywhere near what the US government calls "small."
Indie Business owners are a subset of the larger category of "small" business owners. We are a sort of cross between consumers and business owners. We are consumer business owners if you will.
Many of us maintain traditional jobs as we also own and manage our businesses. Many of us are also the primary home managers and caregivers to our children. Some of us leave the traditional workforce so we can be more accessible to our children while they are young, yet we must continue to make a financial contribution to the family, so we work at home or in a location close to home so we can do both.
There was a time when we were mainly women who were also mothers, but lately, our ranks have swelled to include men who are fathers, and on a larger scale, people in general who seek an alternative to the limitations that come along with pursuing a traditional career path. My educated guess based on nearly 15 years of work in this field leads me to believe that our annual income ranges from $0 and $2 or $3M a year on the high end -- nowhere near the average annual gross receipts of a "small" business as defined by our government.
Now, The Bailout
It is against this backdrop that we must assess the current economic bailout. Let's look at the big picture. The US Department of Treasury's stated mission is to "serve the American people and strengthen national security by managing the US Government's finances effectively, promoting economic growth and stability, and ensuring the safety, soundness, and security of the US and international financial systems." So let's start with that. Buying out failed mortgage brokers because the Secretary of the Treasury thinks it's a good idea does not manage taxpayer money effectively. That's reason enough to vote against this bailout plan.
How the Bailout is Affecting Indie Business Owners
The bailout sends hard working Indie Business owners the wrong policy message. Government exists to support and encourage policies that allow us to live the "American dream," whatever that means to us. But bailing out large companies by simply buying them with our money, after watching their leaders make one poor business decision after another for years, underscores the fact that, in America, you can wisely invest your money in your business all you want, and the government will still find a way to put your assets at risk.
Credit is already nearly impossible to come by for our kind of businesses. Most Indie Businesses are owned by women who, no matter the size of the business they own, already have a hard time procuring business loans and venture capital investments. Our only real option is to bootstrap our ventures with credit cards while holding down a full-time job. We do this for years hoping that the business will eventually support us so we can exit the traditional workforce and continue to pursue our dream full-time.
Some members of the Indie Beauty Network have told me, for example, that their attempts to purchase manufacturing supplies using credit cards through Wachovia (one of the failing financial institutions) are being declined even though they have credit on the card, are not even close to maxing it out and have not missed any payments. I'm sure that will continue. How can they run their manufacturing businesses if they can't purchase supplies?
This bailout plan creates a climate that is decidedly unfriendly to Indie Business owners who are managing our nation's real small businesses. In addition, we are running our homes, trying to find gas (in Charlotte, NC where I live, most stations have none!) and raising children to thrive in a world where business ownership is a necessity and not an option as technology replaces the jobs that are not shipped overseas. We are making significant contributions to our nation's economy, while also working to secure our futures and the futures of our children.
This bailout is demoralizing and distasteful. It sends the message to Indie Business owners that unethical business practices are overlooked and rewarded. We live in a nation where traditional jobs are drying up by the millions. We must have our own businesses to be comfortable and to be empowered to provide a strong launching pad for our children. We are leaving no stone unturned in order to do that. Yet, our credit options are fizzling out as our need to be profitable increases literally by the hour.
This new law is the next chapter in the saga of the incestuous relationship that multi-million dollar business leaders have with lawmakers and regulators. I have nothing against multi-million dollar corporations. I buy from them and benefit from their products and services every day. Big businesses, just like small and Indie ones, have no personality in and of themselves. They do nothing on their own. Their actions are dictated by the leaders who manage them. The problem is not big businesses. The problem is the people who lead them.
And it is these people, along with our representatives in Congress, who have created a framework that is broken and intolerable. It is up to us to rise up and do something about it.
How the Bailout Will Affect Future Indie Business Owners
I have come to the realization that, bad policy though it may be, this bailout is a done deal for one reason and one reason alone.
We simply have no choice in the matter.
The success of American business (both large, small and Indie) rests in large part on our global credibility, and the principle that hard, honest work is rewarded. That if you create a business that generates a profit by behaving ethically and providing valuable products and services, your tenacity and innovation will be recognized and celebrated. That is foundational to our economy.
The government's purchase of worthless financial related assets for years to come, with money it does not have shakes that foundation to its core, makes a mockery of desirable ethical business practices, and discourages average Americans from going to the trouble of taking on any business risk at all. Again, this is devastating in a world where business ownership is not an option. It is a necessity.
And yet, there are no other viable options to this bailout. The alternative of course is to let these big mortgage giants solve their own problems. That's a lousy option considering that the people who would be solving the problems have already proven themselves to be grossly irresponsible and greedy. On the other hand, a bailout proves that deregulation does not work, and that is already a huge problem for Indie Business owners.
Deregulation
Deregulation and lack of effective, honest regulatory oversight at all levels of the financial sector is a large part of the reason why financial institutions are failing. This is recognized by both the Republican and the Democratic party presidential candidates. (Chuck Baldwin, running on the Constitutional Party ticket, favors almost no regulation at all, a position with which I do not agree.)
So what does this mean? Well, the pendulum will probably swing back to -- you guessed it -- unnecessary and burdensome regulation. And more regulation hurts Indie Business owners the most. Even though we do not contribute to the problem, we will be saddled with the red tape, increased fees and overbearing bureaucracy.
This is already happening in the food and cosmetics arenas. The US Committee of Energy & Commerce is now considering new legislation that would force food and cosmetics manufacturers, regardless of size, to pay from $2,000 to $12,000 in annual registration fees and comply with a mountain of paperwork. The FDA Globalization Act of 2008 would put thousands of Indie Business owner in these sectors out of business, and prevent millions more from starting. Those wonderful organic handmade moisturizing soaps you buy? Gone. The tasty holiday cookies you get from your local market? Gone. This is but one example of how increased regulation will hurt all of us. (More on this draft law with a video and a Petition you can sign to oppose the law is here.
Indie Business owners want to do our part to bolster the American economy, and we are doing so by introducing innovative products and services, increasing competition across all sectors of the economy, ramping up American exports and keeping prices for products and services accessible to the vast majority of Americans. Bailing out fat cats is countering our best efforts in all of these areas, including our best efforts to make a contribution while also securing our futures and the futures of our children.
Future Generations
I believe that entrepreneurship is the next great civil and equal rights issue of our time.
We must work to create an environment where our children and their children can launch, own and manage businesses without fear of excessive government bureaucracy, or so little oversight that we find ourselves in a situation like this again.
The states can do a lot to support businesses where they are, but if the federal government does not create an overall framework that allows Indies to flourish, future generations are in big trouble.
The saddest part of the Economic Stabilization Act of 2008 and the unethical practices that gave rise to it, is not that my and your business are adversely affected, but that our children's opportunities to own profitable businesses are adversely affected. It's hard enough to start a business today, even with adequate capital and good credit. What will it be like for the next generation?
Will my children and theirs be saddled with fallout from this week's activities on Capitol Hill? It is inexcusable that the rush to "solve" this problem is going to give rise to another one. That is, that future generations, no matter how hard or smart they work to build a lasting business legacy, will see those legacies constantly at risk of being demolished at worst and undercut at best, by the very government that is duty-bound to protect, defend and support them.
What do you think?
Last week, I touched based with several Indies who are interested in joining me in Washington, DC shortly after the new president is inaugurated to make our position known where it counts: at the White House and on Capitol Hill. I have started the process of obtaining a permit to allow us to congregate in LaFayette Park across the street from the White House so our new president will know that we want to be a part of the political process, and so the media can have an opportunity to hear our stories.
If I get positive feedback in the comments section of this blog post, I will invest the time and my own personal resources to make this happen. What will you do? Join me? Tell your friends? I need to hear from you!
Introducing Four Fabulous Indie Beauties!
I love my Indie Beauty Network members. I call them my Indie Beauties, and they are doing fantastic things. I'd like to introduce you to four of them.
Katie Nguyen of The Conservatorie
Funlayo Alabi of Shea Radiance
Princetta Jones of Princetta's Beauty Secrets
Ellen Lange of Ellen Lange Medi-Spa
Continue reading to find out how these inspirational women pursued their passions to launch businesses that enhance people's lives every day!
Katie Nguyen and her fiance, Thomas, have been members of IBN since June 2007. They purchased their business, The Conservatorie, from a prior owner. The Conservatorie, headquartered in Aguora Hills, California, formulates bulk mineral makeup and wholesales it to spas and other companies that sell it directly to consumers. She and Thomas said that they joined IBN in part because they love Indie Business Radio: "Even though the show is free," they said, "We joined IBN because we are, well, greedy! We thought to ourselves, if the free radio show is this informative, just imagine how great other materials and services are!" Enjoy Katie's Indie Candy feature here.
Funlayo Alabi is a wife and mother of two who hails from Nigeria. She and her husband own Shea Radiance, a supplier of finished products and bulk natural shea butter which they import directly from Africa. They have been IBN members since June 2006. Funlayo and her husband are working on their exit plan from traditional jobs to running Shea Radiance full-time. Their hard work and tenacity are paying off, as you can see from the beautifully packaged shea butter creams and other products at their website. Enjoy Funlayo's Indie Candy feature here. You can follow her Tweets at @shearadiance.
Princetta Jones owns Princetta's Beauty Secrets in Las Vegas, Nevada. In addition, she is a musical performer who travels the world entertaining audiences with her spicy sounds. Check out her Myspace page and enjoy her Indie Candy feature here. Princetta joined IBN in March of this year. Her schedule keeps her so busy that she is not accepting online orders at this time, but if you' in Las Vegas, you can get her goodies at selected Whole Foods Markets there and in Philadelphia at Spa Bavu.
Ellen Lange is a wife, mother and the owner of Ellen Lange Medi-Spa in Highland Park, New Jersey. Ellen also a Retexturizing Peel Kit and a Clear Complexion Kit. Ellen's father is a renowned plastic surgeon, so it's no surprise that she has a wide ranging interest in facial and skin care that includes plastic surgery options. She blogs about her ideas at her recently launched blog. She enjoys helping women look and feel their best. Ellen has been a member of IBN since December 2006. You can follow her Tweets at @ellenlange.
What do you think?
Aren't they amazing?! I could make this a regular blog feature. Should I? Do you enjoy learning about how other women combine their Indie Beauty businesses with their passion for helping women and also managing their homes? Let me know what you think in the comments section below. I'd like to hear if this feature is something you enjoy.
For more Indie Beauties, subscribe to Indie Business Blog today.
If you like Indie Business Blog, please share the home page with your friends using this link: http://tinyurl.com/6l5h79.
You Owe It to Your Business to Enter!
In late 2002, I received a phone call from someone saying they wanted to nominate me as one of the US Small Business Administration's Home-Based Business Advocate of the Year. I had only been leading the Indie Beauty Network for two years at the time, and I wondered why anyone would consider me a worthy candidate for an award. I answered her questions and submitted a package of information by the deadline. A few months later, I was walking (really, waddling since I was several months pregnant at the time) across a stage accepting the award for the SBA Washington, DC office Home-Based Business Advocate of the Year.
Through that experience, I learned that, no matter how unqualified you think you may be for an award or honor, you have nothing to lose by applying for it anyway and putting your best foot forward. In fact, one could say you owe it to your business to give it your best shot. And like they say, there's no time like the present, right?
So, here's your chance. StartupNation is now accepting nominations for their annual Home-Based 100 Competition. Why don't you enter??! There are 10 categories:
- Best Financial Performers
- Most Innovative - you can vote for the Indie Beauty Network for this one if you are so inclined!!
- Boomers Back in Business
- Greenest
- Yummiest
- Grungiest
- Recession Busters
- Most Slacker Friendly
- Most Glamorous
You must submit nominations and votes by midnight on September 30. I know tons of great Indie Business owners out there working from home, and so many of you qualify to win this competition. So why not enter today??!
And if you've already entered, please let us know in the comment section below so we can check out your entry and perhaps vote for you!
I recently discovered a wonderful new tool called Utterz. It allows you to easily record short audio messages to people in your circle of influence. You can also add video. I tried it for the first time this morning and am hoping to make it a regular part of my week. My goal is to provide another way for me to connect with you and let you know what's on the radio show, what's new in the newsletter, where I'll be traveling, etc. Click the orange button with the arrow to enjoy my first Utter!
What do you think? Is this useful? Should I keep uttering?Please post your feedback in the comments section below.
To enjoy more of my Utterz and get Indie business tips, subscribe to Indie Business Blog today. I'd love to get to know you better and know that you're coming back for more!
A Call To Twitter Action
In her book, It Takes A Village and Other Lessons Children Teach Us, Senator Hillary Clinton stressed the importance of a group approach to child rearing. She reminded us that, while a family is a distinct unit, each one forms a part of a whole, and that, when an individual unit is lifted, the entire group rises. While Clinton's message was specific to children and families, it also applies when it comes to Indie Business owners.
This was brought home to me in a real way last Saturday when a member of the Indie Beauty Network emailed me in great distress. She's married and the mother of young children. Tina (not her real name) had emailed me several months ago to share that she and her husband were going through counseling in an effort to save their marriage. Things were on a good track for a while, but as of last Saturday, they had fallen apart.
Touching Through Technology
Tina reached out through email to me, a fellow sojourner, a part of her village. A part of her tribe. I responded to her email immediately: "Call me." She did, and while I could not solve her problems or go through her pain for her, I lifted her up and prayed with her because she was open to that. I also reminded her of her intelligence (she has a master's degree), capabilities (her business is going well and she's also home schooling) and encouraged her as a fellow Indie and mother. I reminded her that she is fully equipped to rear her children as a single mom if that is what she is called upon to do.
Like most other Indies, Tina runs her business from her home. She is also a home schooling mom in a community where separation and divorce are taboo subjects. As Tina put it, "Everything is supposed to be perfect." Tina felt especially isolated because she realized that, for years, she had pretended that everything was perfect. Now that she was accepting the fact that things weren't perfect, she was at a loss, afraid for herself and afraid that her children might be unfairly treated once their friends found out that they no longer lived with their father.
Could Twitter Make a Difference?
As Tina and I talked, I pondered the enormous potential of social media in her situation. I found myself suggesting that she join me at Twitter and meet up with some other home schooling mom Indie Business owners who could encourage her and lift her up. Tina is not ready for that yet. But I have seen the power of Twitter and other social media outlets when it comes to building up the global village of women, men and families who are managing homes and businesses at the same time.
I think Tina is a bit skeptical of Twitter and social media in general. I was too. Weren't you? Did you think that anyone who you didn't already know would care one iota how you answered the question, "What are you doing?" Did you think that your life was boring and that strangers couldn't possibly be intrigued enough to read about how you feel from moment to moment throughout the day as you tend to your home and your family simultanously?
How many of you, like me, just didn't get it at first?
Reach Out And Tweet Someone
Tina doesn't yet know about the women I met a few days ago over at Twittermoms. She doesn't know that there's a huge and growing community of Indie Beauty Network members and other Indie Business owners gathering every moring to start the day, discuss breaking news, take their kids to the dentist and do all the things that must be done in order to manage home and a business, without compromising either.
Each One Tweet One
Each of us can pay our social media successes forward by reaching out to at least one or two new people every week. Will you put Tina on your list today? Will you help me tell her about the power of social media? About people like you who are poised to connect and share?
Will you leave a comment below so Tina can know that you are an Indie Business owner on Twitter. Maybe you even home school. Maybe you can tell her that, divorced or not, she's welcome in our community. Please leave your Twitter link so Tina and all of us can connect with you more easily and perhaps even follow you.
And Tina, if you're reading this, there's a wide world out there ready to embrace you and your family and encourage all of you to be your best.
For more inspiring tips for Indies, home managers and business owners, subscribe to Indie Business Blog today. I'd love to get to know you better and know that you're coming back for more!
I am fascinated by attorneys like me who pursue non-traditional career paths. One such person is Tax Girl. Her blog is funny and interesting. Subscribe to it so you can learn stuff you need to know about taxes. Tax Girl has a category at her blog called Getting To Know You. Since I can't think of a better title for this category at my blog, I'm borrowing Tax Girl's.
In my Getting To Know You column, I'm going to share with you ten interesting things about someone I know personally and professionally. Let's begin. My first Getting To Know You column features Jamila White. That's me and Jamila in a photo taken by fellow Indie and IBN member Anne-Marie Faiola while we were on Capitol Hill earlier this month with Lela Barker and Kayla Fioravanti.
10 Interesting Things About Jamila White
1. Jamila and I Once Lived in the Same Town. Jamila and I lived in the same town (Bowie, Maryland) for years before we met through the Indie Beauty Network in December 2005. At the time, I was head of the Bowie (Maryland) Chamber of Commerce's small business committee, responsible for finding speakers to deliver luncheon presentations on topics of interest to small businesses. We met in person when Jamila accepted my invitation to speak on the topic of e-commerce.
2. Jamila Makes a Good TV Show Guest. After that, Jamila accepted an invitation to be a guest on my local cable television show, the Lifestyle CEO Show. Then, I found out we were sorors, members of Delta Sigma Theta Sorority, Inc. By now, Jamila is getting really cool.
3. Jamila Likes Pizza. When I moved from Bowie to Charlotte in August 2006, Jamila came to my farewell pizza party. My house was empty except for a few tables and chairs. We ate pizza and chatted about what a shame it was that we lived so close for so long and were only just then sharing a pizza.
4. Jamila and I Launched a Blog Together. After talking it over with my brother (who is normally really smart but thought it was a lousy idea), I called Jamila in November 2007 and invited her to join me in launching a blog called Bootstrap Babes. Jamila was skeptical at first, but eventually, decided she was as crazy as I was to take on a new project. Within 3 months, were were interviewed for a feature in Entrepreneur Magazine, which came out this month. Read all about it at Bootstrap Babes.
5. Jamila's Sister is in the Media. Not that Jamila needs any help, but hey, it's nice to know someone with a blood relative who produces television shows. I'm always available, just in case you're wondering.
6. Jamila's Mother Lives in Vermont. I spoke on a panel and produced a promotional video at the Handcrafted Soap Maker's Guild conference in Vermont this past April. It was tons of fun. There is a law in Vermont that makes it a crime to disrobe in public. That's no surprise.
But did you know that, in Vermont, it's not illegal to walk around town naked so long as you leave your house that way? I think Jamila's mom must be at least as interesting as her daughter to live in a state with a law like that.
7. Jamila Has 3,497 and 1/2 Businesses. Well, not really, but you know. She's the E-Commerce Diva, a Bootstrap Babe and the brains behind j.blossom. She's got other stuff going on too, but a blog post can only be so long. Besides, she's hosting a free blogging seminar tonight and you need to go sign up.
(Yes, Jamila is also one of my Media Partners (see all Media Partners listed at left). Yes, this is a shameless plug for her blogging seminar. Yes, it's a good blogging seminar even though this is a shameless plug. Yes, you should attend.)
8. Jamila Has Cool Hair. Natural and un-chemical. Just the way I like it.
9. Jamila Stormed Capitol Hill With Me Earlier This Month. Jamila likes to talk. This was a good thing since we were dealing with politicians while we were there. I think a future career for Jamila includes public service. Isn't it fun to tell your friends what you think they should do?
10. When Jamila Opened Her Store, She Forgot Her Camera. Jamila always forgets her camera, so when she had a grand opening for her j.blossom store in 2006, she didn't have a camera. So if you're going someplace you know Jamila will be, please take your camera, snap a picture of the two of you together and send it to Jamila. You'll have a fun memory, and help a fellow Indie. And Jamila will use the photo to plug your business. Yes, she's that cool.
So, that's 10 interesting things about Jamila.
What about you?
Do you know Jamila? Do you agree that she is as interesting as I think she is? Please tell us something interesting about Jamila in the comments section below.
To get to know more fun people regularly, subscribe to Indie Business Blog today.
