We are beginning to hear reports that the economy is turning around. I’m not an economist, though I like to play one in my blog! What I do know is that if you want to see a recovery, then you will find one whether or not it exists.

Many of the claims of a turn around are accompanied by qualifying statements, like “it seems”, “it’s possible”, etc. Let’s hope these predictions are true, but don’t get too euphoric just yet.

Those predictions sound more like a bottoming, or a very slight increase in economic activity. The real anchor on the economy continues to be the Obama policies of taxing the productive members of society and giving freebies to the undeserving. The proposals to pay for a universal health care is just the latest version. Cap and trade, government bail-outs, the stimulus package all create a headwind for the economy that is difficult to overcome.

Spend wisely, plan well, forge ahead and be smart with your business and, like my clients, you can remain profitable.

I’ve been away from the blog for several months.  There are many reasons for this, but I won’t bore you with any of details.  Let’s just say that the economy and demands of business have consumed my time as I’ve been working on a business plan for the next year.

It is a well-used adage of business that you shouldn’t wear your politics on your sleeve.  To do so risks losing customers who don’t share your political views.  I understand this but, in my business, find it terribly difficult to do.  Especially now.

I’d love to hear from anyone with an opinion on posting political opinions on a company blog and their affect on business.

For example, it is irrefutable (just try searching the internet) that when tax rates are reduced, the economy grows and revenues to the government INCREASE.  Look to the Kennedy, Reagan, and W tax rate reductions for proof.  When tax rates are increased, the economy slows and government revenues DECREASE.  How do you explain the Keynsians who refuse to accept the data that disproves their theory of a demand-driven economy?

The economic stimulus package of $786 billion dollars is having little documentable benefit, except perhaps in protecting government jobs.  Had the federal government simply declared a tax holiday, a cessation of all business and personal income taxes, equal to that $786 billion the money would have been pumped directly into the economy through savings, investments, and jobs.  Unfortunately, that option doesn’t give control to the bureaucrats who want to tell us how to live by making spending decisions for us.

This is not a tax issue.  The real issue is personal freedom and liberty.  When the government taxes its citizens for non-essential services, the lefts traditional wealth transfer programs, it is engaging in nothing different than slavery.  US citizens are now obligated to work until mid-April every year turning everything they earn over to the government.  Business owners must step up and get engaged in this debate.  It is high time we let the world know that we will get the economy moving again, if the government would get out of our way and out of wallet.

Yesterday was historic.  The President of the United States fires the CEO of a private corporation, installs his own guy, and demands that the management team put together a business plan that satisfies the Obama vision of the world, including a line-up of vehicles HE believes we should drive.

To make matters worse (as if that was possible), he declared that the United States government is now backing the warranty on a GM vehicle.  Are you kidding me?!?  Did the president just become a used car salesman?  Join me in pledging NEVER to buy a Government Motors vehicle.

We all know the story of the frog in the pot.  Put the frog in a pot of boiling water and the frog will leap out.  But put the frog in cold water slowly turning up the heat and the frog will boil to death.  I’m afraid Americans have become too soft to deal with this nonsense.  This is frightening, folks.  The Venezuelans followed Chavez, Germans followed Hitler.

Americans cannot follow Obama!

The comment I’m hearing most frequently from business owners I talk to is that they don’t know where the economy is going.  Some of that uncertainty comes from the impending change in the federal government and some of it comes from the seeming impotence of the bail-out efforts over the past 6 months.

After all, we’ve been hearing since September that the economy demanded huge capital infusions from the federal government.  Yet despite the $350 billion injected through the TARP program, the billions committed to bailing out companies including AIG, Fanny Mae and Freddie Mac, the auto industry, Bear Stearns and others, economists and business leaders don’t see the end of the current recession.  If anything, they seem to be getting more concerned, not less.

The other “change” that we’ve been told to hang our hat on is the inauguration of the Obama administration.  While we’re told to expect hope, change and transparency, the dearth of specific information coming from the transition team is creating more uncertainty, not less.

So what is a business owner to do?  How do you make plans for the future when you can’t get some degree of certainty about the field on which your business will be playing?  The typical business owner seems to be concluding that the best plan right now is to circle the wagons, make no plans, and react to the evening news.

Nothing could be further from the truth.  I say the “typical business owner” is circling the wagons, and that appears to be true.  The atypical business owner is planning for success.  They know that operating without a plan is the death knell of most businesses large and small.  Without a plan, it is impossible to make decisions, it is impossible to know whether you’re moving forward or falling behind, and without a plan, you can’t adequately react to the changes the economy throws at you.

If you think about it, in terms of planning, the current economy is no different than a booming economy.  Business owners need to look at the environment – the economy, competitors, internal strengths and weaknesses – and make assumptions about what the future holds.  Based on those assumptions, a plan is developed to take advantage of what the future offers.  For the past many years, we’ve had the advantage of a growing economy so our planning was, more often than not, built around assumptions of growth and prosperity.

What has changed is that growth and prosperity are out the window right now.  Your planning assumptions must be built on a weak economy that may be mired in contraction and stagnation for a while.  Planning is not done only in good times.  In fact, planning is far more vital now than in an expanding economy.  When times are good, you’re likely to succeed in spite of yourself.  But when times are tough, the quality of your plan will be the difference between survival and destruction.

For those of you who have developed a well thought out, written plan for your business for this year, congratulations.  You can move forward with the confidence of knowing that even if the economy continues to be challenging, you’ve already decided how you will best adjust your operations to survive.

For the rest of you, get to work and develop a detailed plan of action.  Contact your business advisor and develop the assumptions you believe best represent the climate in which you’ll be operating.  Then make a plan, develop your metrics to measure your performance against your plan, and modify your assumptions if they prove to be erroneous.

If you don’t have a business advisor you are confident can help, drop me a line.