A bitter economic pill
So this is what it feels like to be "collateral damage."
My story is surely nothing short of commonplace these days. In October my company laid off 40 people as a direct consequence of the financial system meltdown. That’s no small thing for a company that was only about 100 people.
I work at a technology startup. When the banks stopped lending money, Wall Street freaked out and the bottom fell out of the stock market.
When that happened, the venture capital firms freaked out and they suddenly got really skittish about making further investments.
It's those investments that allow technology startups to grow and flourish. But when investments that had been promised in the summer were yanked away in the fall, our upper management had no choice but to gnaw off one of the company's legs, as it were, to survive.
I was lucky. I kept my job, but at reduced hours. Everyone who's still here has taken an indefinite pay cut. We miss the friends we no longer see in the halls, people we no longer have lunch with.
But, we're counting our blessings. We're still employed. We have health care. There's plenty of parking spaces to go around, now.
I know that this same scenario and others very much like it must be playing out at tens of thousands of small companies all across America.
We are the collateral damage. We are the unintended consequences of Wall Street bigwigs playing with fire.
One thought I just cannot shake is the gross injustice of it all.
Those who played with fire, got bailed out by the government. Those companies who had grown too big to exist, got help.
Those of us who were doing our level best to behave responsibly and working so hard to create innovation and real economic growth, got burned.
Across America, people are wondering how they're going to pay the bills on reduced wages. Wondering what's going to happen if their barely-surviving companies can't make it. Whether their unemployment benefits will last until they find a job. Whether they'll even be able to find another job.
Wondering if there is enough time, yet, to recover from all this before retirement or before the kids have to go to college.
I know. I'm one of them. You probably are too. Our numbers are legion, making daily trade offs on whether to pay this bill or that bill, whether to buy shoes for our daughters' growing feet, or whether to pay for a prescription.
It leaves a very bitter taste. All of us, watching our financial positions erode like a sandy bluff in a hurricane. It's bad enough for me; I might have to go look for another job if my company doesn't make it. But I've got it easy.
I think about my company's founders, who have poured their lives into this business. They're a lot older than me. This is their shot. Their big chance to make it. And they may well see everything they have built, destroyed.
Washed into the stormy sea, because of a situation they had no hand in creating and that has absolutely nothing to do with the merits of the technology they've worked so hard to contribute to the world.
Now that, is a bitter pill.
And when I stop to consider that the bigwigs who did the playing with fire were already tremendously wealthy men who didn't even need to be playing with fire--when I consider that the amount of money my company would have needed so as not to have to tell those 40 people "hey, don't come to work tomorrow" is basically loose change compared to those bigwigs' personal fortunes.
It's not just a pill. It's the whole damn bottle.
So, Congress and President Obama, when you get around to doing what the reputable economists are saying and bump the stimulus package up to the trillion and a half or so that's probably realistic for pulling out of this national tailspin, let me offer a word of advice:
Figure out a way to help all the small companies like mine who were doing fine before, but who, since we've become collateral damage, need some bailouts of our own.
You've got this thing called the Small Business Administration. Give them a half a trillion dollars to lend to us on favorable terms.
I promise, we'll turn it into real innovation and economic growth. Not into corporate jets and lavish executive retreats.
My story is surely nothing short of commonplace these days. In October my company laid off 40 people as a direct consequence of the financial system meltdown. That’s no small thing for a company that was only about 100 people.
I work at a technology startup. When the banks stopped lending money, Wall Street freaked out and the bottom fell out of the stock market.
When that happened, the venture capital firms freaked out and they suddenly got really skittish about making further investments.
It's those investments that allow technology startups to grow and flourish. But when investments that had been promised in the summer were yanked away in the fall, our upper management had no choice but to gnaw off one of the company's legs, as it were, to survive.
I was lucky. I kept my job, but at reduced hours. Everyone who's still here has taken an indefinite pay cut. We miss the friends we no longer see in the halls, people we no longer have lunch with.
But, we're counting our blessings. We're still employed. We have health care. There's plenty of parking spaces to go around, now.
I know that this same scenario and others very much like it must be playing out at tens of thousands of small companies all across America.
We are the collateral damage. We are the unintended consequences of Wall Street bigwigs playing with fire.
One thought I just cannot shake is the gross injustice of it all.
Those who played with fire, got bailed out by the government. Those companies who had grown too big to exist, got help.
Those of us who were doing our level best to behave responsibly and working so hard to create innovation and real economic growth, got burned.
Across America, people are wondering how they're going to pay the bills on reduced wages. Wondering what's going to happen if their barely-surviving companies can't make it. Whether their unemployment benefits will last until they find a job. Whether they'll even be able to find another job.
Wondering if there is enough time, yet, to recover from all this before retirement or before the kids have to go to college.
I know. I'm one of them. You probably are too. Our numbers are legion, making daily trade offs on whether to pay this bill or that bill, whether to buy shoes for our daughters' growing feet, or whether to pay for a prescription.
It leaves a very bitter taste. All of us, watching our financial positions erode like a sandy bluff in a hurricane. It's bad enough for me; I might have to go look for another job if my company doesn't make it. But I've got it easy.
I think about my company's founders, who have poured their lives into this business. They're a lot older than me. This is their shot. Their big chance to make it. And they may well see everything they have built, destroyed.
Washed into the stormy sea, because of a situation they had no hand in creating and that has absolutely nothing to do with the merits of the technology they've worked so hard to contribute to the world.
Now that, is a bitter pill.
And when I stop to consider that the bigwigs who did the playing with fire were already tremendously wealthy men who didn't even need to be playing with fire--when I consider that the amount of money my company would have needed so as not to have to tell those 40 people "hey, don't come to work tomorrow" is basically loose change compared to those bigwigs' personal fortunes.
It's not just a pill. It's the whole damn bottle.
So, Congress and President Obama, when you get around to doing what the reputable economists are saying and bump the stimulus package up to the trillion and a half or so that's probably realistic for pulling out of this national tailspin, let me offer a word of advice:
Figure out a way to help all the small companies like mine who were doing fine before, but who, since we've become collateral damage, need some bailouts of our own.
You've got this thing called the Small Business Administration. Give them a half a trillion dollars to lend to us on favorable terms.
I promise, we'll turn it into real innovation and economic growth. Not into corporate jets and lavish executive retreats.
# Posted by Jason Black : 9:55 AM
Comments:
Great idea to pay out the stimulus from the bottom up rather than the top down, but I don't trust the SBA any farther than I can throw them. From my own small business experience I'd say they are led by Republican hacks with the same outlook and business sense as the big banks you (rightfully) decry. So, good idea but let's start from somewhere else...
Good point. The SBA may need just as much reform as every other government agency after 8 years of Bush mis-administration.
Still, I think that the philosophy of the SBA is essentially right, and in that context I still support using that as a mechanism to distribute some of the stimulus funds.
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