149
paged,page-template,page-template-blog-large-image-whole-post,page-template-blog-large-image-whole-post-php,page,page-id-149,paged-5,page-paged-5,stockholm-core-1.0.8,ctct-stockholm,select-child-theme-ver-1.1,select-theme-ver-5.1.5,ajax_fade,page_not_loaded,menu-animation-underline,wpb-js-composer js-comp-ver-6.0.2,vc_responsive

Blogs and Articles

Good Intent Doesn’t Guarantee Good Outcomes

Companies in Delaware may soon reach a breaking point. Recent legislation from Dover has made the First State less favorable for business, through various taxes, regulations, and other “bad business” bills.

These actions have been in the pursuit of a better standard of living for Delawareans, but could they be the ones at risk?

Delaware’s franchise tax, corporation income tax, and taxes on limited liability companies, limited partnerships, and general partnerships can add up to a big problem for businesses, who may owe more than one of these to the state. Add in a minimum wage increase and bottom lines come into question.

Unfortunately, the answer to this has been to replace workers with robots. McDonald’s has order stations, grocery stores feature self-checkouts, and a few Walmart stores in Delaware have brought in autonomous floor cleaners, or “Auto-C’s.” Technology has begun to replace what has become an expensive workforce.

Businesses are not in the wrong to take these actions—in fact, they are doing what is best for business, and therefore best for the employees they are able to retain, as well as the communities they serve. However, it does result in minimum and low-wage workers facing layoffs as companies seek to protect their own operations against the assault from our legislators.

At the end of the day, the decisions from Dover have hurt the people they were intended to help.

Business Haven or Business Has Been?

Delaware has long maintained a reputation as a business haven but that may soon change.

A new study from WalletHub ranked Delaware as the 7th worst state to start a business and in the bottom ten for business climate. This is nothing new.

According to the Federal Reserve Bank of Philadelphia, Delaware’s business conditions recovered from the Great Recession at a noticeably slower pace than the rest of the nation, taking three more years to stabilize than the average. During that recovery period, the state’s real GDP (the change in real GDP from 2009 to 2013) was approximately -2%, while the national average was closer to +8%.

Delaware’s recovery still leaves something to be desired by many. At a Delaware Business Roundtable (DBT) panel in June, former Delaware Economic Director Alan Levin expressed his concern, stating, “I want to get to the point where…people are knocking on our door saying, ‘I want to come to Delaware because we see things are happening here.’ That’s not really happening…Until legislators and the administrators… realize that their most important thing is to serve the people as opposed to getting re-elected…things are not going to change.”

It is time to create this change. At this point, we stand at a critical juncture for our economy. It is time to make decisions with the future in mind instead of putting elections above Delawareans.

As we prepare for the second half of the 150thGeneral Assembly, it is time to demand better practices and legislation in Dover that promote a better business climate and strengthen our economy, such as Governor Carney’s “Rainy Day Fund” included in the FY 2019 and FY 2020 budget appropriations.

Delaware has the industries, bond ratings, and location needed to be business-friendly again and have a robust economy, if legislation from Dover allows it.

The First State can be a leader in business again if we take the right steps forward.