How Elizabeth Warren’s anti-business sentiment hurts the economy

(This column originally appeared on The Hill)

(Sen. Elizabeth Warren (D-Mass.) is smart, hardworking, passionate and dedicated. But wow — she’s really not a fan of the business community, is she? When I say not a fan, I mean Not. A. Fan. She criticizes the Federal Reserve. She likes to paint the wealthy, big corporations, chains and banks as the biggest problems in this country. So, is she really that anti-business? I’m sure she supports small businesses, but that’s a no-brainer because what politician doesn’t?

She is as anti-business as she seems. But her messaging hurts our economy — and the very workers she’s trying to help. Don’t believe me? Let’s dig into a few of her most recent tweets.

Here’s what she says about the Federal Reserve:

“Fed Chair Powell seems determined to push the economy over a cliff-even after he admitted rate hikes won’t lower key prices. Destroying jobs and crushing wages of millions of workers is reckless and dangerous. Recession is not the solution to inflation.”

This is not good for business. Less demand (as painful as that seems) in a low-supply economy means less pressure on prices. Even corporate layoffs (as painful as that also seems) could help the majority of small businesses that are looking to hire. Excessive government spending and fiscal mismanagement is a big reason why inflation is so high. Federal Reserve Chairman Jerome Powell, although late to the game, is trying to fix that. It’s better medicine, but every business supporter knows it’s necessary to right the economy.

Next, there’s Big Tech. She writes:

“Big Tech companies continue to misclassify workers as independent contractors, excluding them from accessing abortion-related benefits. @RepCori and I are fighting to ensure big corporations can’t get away with exploiting this loophole any longer.”

This is very anti-business, because having failed to pass the PRO Act in 2021, Warren is supporting more restrictions on using independent contractors, which means that millions of small businesses may be forced in future to re-classify these workers as employees at great cost. Many will opt not to, which will hurt those independent entrepreneurs and is why so many freelancers are opposed to these changes.

She supports raising taxes on corporations:

“For the first time in 30 years, we are going to raise taxes for billionaire corporations. This action will help fix our broken tax system, and Democrats got it done.”

Every businessperson will agree that raising taxes takes capital away from the very organizations that invest and hire and reallocates these funds to the government. Ask any business owner whom they trust more to spend their money for the better good, Elizabeth Warren or Elon Musk, and the answer will be unanimous.

She’s also not a fan of the big banks:

“Today I questioned Big Bank CEOs about their failure to protect consumers from being defrauded via @Zelle. I asked who would commit to refunding customers who’ve been defrauded. Not a single CEO raised their hand.”

It seems like any excuse to attack the banks is a good excuse for Warren. Should banks babysit customers who have been duped? Last year I was duped on Zelle into paying a fraudulent seller for concert tickets and lost my money. Guess whose fault that was? Mine. Every business owner knows it’s better to learn from our mistakes. At what point do people (like me) take responsibility for our own stupidity?

She often accuses some of our greatest companies of workplace mismanagement. Like Starbucks:

“Congratulations to the Starbucks workers in Boston, Massachusetts for winning their strike! I visited the picket line last month to stand in solidarity with them in their fight for a safe and equitable workplace. Their victory reminds us that when we organize, we win.”

Starbucks is widely considered one of the best places in the country to work, with benefits that include generous health care and free tuition. Its reward is to be the target of unionization and attacks by political leaders like Warren.

She loves student love forgiveness:

“President Biden’s cancelling up to $20K in federal student loans for Pell Grant recipients. Over 90% of these Americans come from families with incomes less than $60K. This is direct relief for working people.”

Senator Warren supports enabling the higher education system by forgiving debt without recourse or more cost controls. Meanwhile, the government will spend $400 billion while allowing colleges to continue their excessive spending, poor management, inflated tuition and — most hurtful to the business community — the spitting out of unqualified graduates who must then be trained by their employers at a significant cost.

And, finally, she’s a big fan of enlarging the IRS:

“Right now, Americans spend 13 hours and $200 on average to file their taxes. And now thanks to the Inflation Reduction Act, the IRS can invest in tools to make filing fast and free for Americans filing their taxes every year. Let’s get it done.”

With $80 billion more to spend, many small businesses are bracing for more IRS audits. Not that they have anything to hide. But they’ll have to bear the cost of dealing with questions and information requests.

Warren’s got her base, and she’s leaning into it. Good for her. But when political leaders behave like this, the business community reacts — negatively. When our leaders are pro-business, companies take more risks, invest more capital, hire more people, expand and prosper. When they hear anti-business sentiment like Warren’s, those same companies circle the wagons, cut back on spending, hoard their money and wait out the storm. That is what we’re seeing now.

Senator Warren is right to be wary and critical of corporations, banks and chains. But you can’t be a national leader of the world’s largest free-market and capitalistic economy with her kind of sentiment. Her demeanor (intended or not) comes off as very anti-business, and that frustrates and offends moderate business owners.

Companies big and small are grappling with inflation, supply chain problems, labor shortages and a worldwide economic slowdown. Warren’s anti-business rhetoric is only making those problems worse.

Gene Marks is founder of The Marks Group, a small-business consulting firm. He frequently appears on CNBC, Fox Business and MSNBC.

Originally published at https://thehill.com on September 29, 2022.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Gene Marks

Columnist on smallbiz, economy, public policy, tech for The Guardian, The Hill, Philly Inquirer, Wash Times, Forbes, Entrepreneur. Small Business owner and CPA