by Zain Jaffer
After America successfully elected a new President in early November 2024 with no issues, the business, markets, and finance community can all heave a sigh of relief. Uncertainty is bad for business and economics, and now people can make their needed investments, deals and spending to move forward.
The business and finance communities look forward to a new start. Hopefully the partisan divide can quickly settle down so everyone can work together to rebuild this great country.
Here are some expected improvements that will bring American businesses out of the basement and into fighting shape:
LESS UNNECESSARY REGULATION
Regulation can be a good force to keep business abuses in check. Most employees not just in the US but also in other countries have child labor laws, vacation, overtime, and medical leave, and other benefits. All of these were the result of abuses by some employers who treated their employees like slaves.
However overregulation is also bad for business. Overregulation forces companies to spend time, money, and energy on things that have nothing to do with their core business.
MORE TAX CUTS
Taxes are needed to support government activities that help us with solutions to various common societal problems. But over taxation to fund excess unnecessary government expenditures weakens businesses and our economy and threatens job creation.
One preposterous proposal brought up a few months ago to help lessen the deficit is taxing unrealized gains. Imagine paying capital gains taxes on asset investments that have appreciated in value, but still unrealized in terms of gain. This would have forced many investors to sell their investments just to pay that tax. Imagine what that would do as a disincentive to our markets.
CHEAPER ENERGY
Energy in terms of fuel and electricity are basic inputs to business. The more we force consumers and businesses to absorb higher energy costs just to meet global goals, we will impact our global business growth.
LOWER INTEREST RATES
Although the US Federal Reserve is an independent body, hopefully rates can start to come down this late 2024. Already interest rates for mortgage housing loans, car loans, credit card, and general loans for businesses are still expensive, which curtails new purchases and investments. Societal and technological changes such as Work from Home, telecommuting, Artificial Intelligence (AI) job replacements, and others are already impacting businesses. Real estate, particularly office spaces, have had reduced demand and the high interest rates on project loans are a double whammy for developers.
INNOVATION IN AMERICA
America has sent men to the Moon. We have conquered the heavens, charted the stars, explored the ocean depths, built the best airplanes, cars, microchips, software, pharmaceuticals, AI, and the like. Yet over the past few years we have punished our innovators like Elon Musk, and removed his companies from government contracts even if the alternatives fell far short in terms of cost and technology, just because some powerful parties hated him. There is no room for these types of discrimination if we want to build a great America. We want and need to work with the best people in the world and bring them here.
We should have strong borders but we must admit talented innovators and people from elsewhere to become better.
FINAL THOUGHTS
These past few years have put a drain on many small businesses and innovative companies. We have been caught in environments and regulations that are not optimal for business and innovation.
Let us take these next few months and years as a new chance to build back American businesses and create new jobs and technologies. It is time to leave the past behind, unite as one and march forward.
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