This article is talking about how Barack Obama’s proposed policies will impact those who run law firms, but the impact of those policies will effect business owners as well.

You don’t have to be a lawyer, or run a law firm, to feel the crunch from hiked taxes and expanded government spending.

We all know that Obama wants to end the Bush tax cuts. That is a 3% bump across the board to the bad old days when associates faced a marginal federal tax rate of 36%.

But the real hidden tax is that Obama plans to end the social-security tax cap. Right now, you may notice, sometime during the summer or early fall, your take-home pay suddenly goes up because they stop deducting FICA. Current law caps social security taxes: in 2008, the cap is at $102,000. Obama proposes to abolish this. That mid-summer bump will be no more: add about several thousand dollars to your annual tax bill.

But social-security taxes are not only on employees. The government also charges 6.2% to employers that you never see on your W-2s. But rest assured the partners see this, and will notice that the expense of keeping an associate has risen several thousand dollars a year when FICA taxes double and triple. Will they swallow that additional expense, or take it out of your bonus?

Read the whole thing.

I think a lot of people who want to see government increase spending and take on new projects forget that someone has to pay for it, and the people who do pay for it are usually the ones who sign our paychecks.  When government begins burdening businesses and, yes, “the rich” with excessive taxation that money still comes out of our bottom line.  It means less money available to hire new employees or give new raises/benefits to existing employees.

The liberal solution to that problem is to mandate higher wages and benefits (minimum wage laws, etc.), but ultimately that just makes things worse.

The real solution is to downsize government to only its most basic and necessary functions so that businesses are free to grow.  Which, in turn, means more jobs and more pay for the rest of us.