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Small Raleigh business questions Obama jobs plan

Posted September 8, 2011

Economy
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— The owners of a Raleigh business that has slashed staff and changed its operations to stay afloat said Thursday that President Obama needs to shift away from spending to revive the sluggish U.S. economy.

Schulz Iron Works, which designs steel for commercial construction projects around the Triangle, has cut its payroll by a quarter since 2009 because fewer buildings are going up and the contracts the company wins are smaller than in the past.

"The industry just went flipsy-flopsy," said David Schulz, who owns the company with his wife, Cindy.

The company used to finance jobs. Those days, they say, disappeared when credit markets dried up in late 2008.

"It's like someone has a death grip on the money. There is no more money flowing," David Schulz said. "If we agree to do a job, we have to literally say, 'Look, it can't be like it used to be – pay when you get paid. I need you to pay me the minute I get there.'"

Although Obama was proposing at least $300 billion in tax cuts, construction spending, unemployment aid and money for states, the Schulzes said other tactics could produce better results.

Schulz Iron Works in Raleigh Business owners want less regulation, not tax credits

"Tax credits? That's a joke," David Schulz said. "I lost a quarter-million dollars last year. By the time I write that off, how much credit do I get?"

Cindy Schulz said there are too many regulations and too much economic uncertainty. She said the president needs to provide a reason to be optimistic.

"Make it possible for us to do more projects and get more people back to work," she said. "I would like to hear that the access to lending would be easier."

10 Comments

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  • dave17 Sep 13, 2011

    Well tell billo. that if other compines would have paid them and or did not file bankrupcey they would have made money.

  • stripe01 Sep 9, 2011

    No demand = no sales = no money.
    All the rhetoric about credit, obamacare, and regulations are poor excuses.

  • TheAdmiral Sep 9, 2011

    kcollier - not only that - but you are facing an uphill battle even with good credit to get finance. Plain and simple, those who are on unemployment are on the verge of bankruptcy, and those who aren't are loosing everything they have.

    Some of these folks who deferred their payments are finding that the credit originators will not bother with them because they don't have a chance of obtaining a payment. So they are sending them directly into collections just as soon as the person calls in and they say they lost their job.

    So the credit markets are cutting their own throats when it comes to credit - and they have made it difficult for themselves to loan more money out because of the drunken credit handouts they have done previously. Plus - rather than putting the stimulating money toward the credit defaults - they believe they can get blood out of a rock - they put it into their books to give the CEO's the bump they don't deserve.

  • momnay Sep 9, 2011

    held off judgement of "the new plan" until I heard it, but it was a rehashing of the same old ideas that haven't worked. Small businesses are shriviling up and dying due to little or no work, tightened lending and heavy regulations (including taxes) combined with general increase in the cost of goods. So many small businesses have cut salaries and delayed purchases of equipment to help them survive, but the cash is running out. Scary times and the president is NOT helping.

  • kcollier39 Sep 9, 2011

    money is not flowing because so many people now dont have good credit.places who finance and banks who loan money are shy now.if you dont have perfect credit you cant finance anything.so take a look at how many people got behind on payments and people who went bankrupt,all these people thousands if not millions have bad credit now.so until places lightened up on these kind of people its going to be hard to get things going again.and alot of these people now are back on there feet again but cant finance.

  • Mr. Middle of the Road Sep 9, 2011

    I think it has more to do with the way developers were given open access to funds from banks with little or no security to back them up. And most of them escaped the consequences that affected many after the crisis.

  • IceCreamMan Sep 9, 2011

    Obama has no clue how to create jobs, because his answer for everything is government intervention. The government can't create any long-term jobs that don't suck more blood from taxpayers. We need a federal government that will loosen regulations, lessen corporate taxes, and get out of the way!

  • fayncmike Sep 9, 2011

    ""when credit markets dried up" That is the key statement in this article and to the whole fiasco. Until credit is thawed for good people, this will go on and on and on and on and on....
    veyor"

    Could that have something to do with the "give everyone a mortgage no matter if they qualify or not" that ended in 2008?

  • veyor Sep 9, 2011

    "when credit markets dried up" That is the key statement in this article and to the whole fiasco. Until credit is thawed for good people, this will go on and on and on and on and on....

  • bill0 Sep 9, 2011

    ""Tax credits? That's a joke," David Schulz said. "I lost a quarter-million dollars last year. By the time I write that off, how much credit do I get?""

    So, just because this guy isn't running a profitable business, we shouldn't do anything to encourage hiring by companies that are profitable? Nonsense.

    Really WRAL - would it really be that hard to find a small business owner who wants a cut in the taxes they have to pay on payroll? I know a lot of small business owners and ALL of them would be thrilled if that gets passed. It immediately cuts their expenses and they get the benefit whether they are actually making a lot of money or not.