Make all elected officials Independent Contractors

Here is a radical idea to help elected officials understand small business: Make them ALL Independent Contractors and pay them based on performance and contracts.

I was reading this article at BusinessWeek. It is about credit card reform, but leaves out small business credit cards. In short, credit card companies would be free to “recoup” the revenues lost on consumers by jacking around with the small business credit cards. Some examples what what they are likely to do is to shrink the billing cycle from 21-28 days to 10 or bill us for paying off the entire balance or increasing the interest rate to 100% more than we are paying, etc, etc, etc. In short, micro-loans that small business relies on now (or just simply payment convenience) will cost a heck of a lot more.

Oh, but we can pass the cost of this onto our customers, so that really isn’t an increase in the cost of doing business. Only we can’t pass the cost along because most of our customers are folks in our own neighborhoods. They will just buy less and keep that cycle spinning downward.

So, here is my idea: Senators and Representatives do not understand business because they do not have to live with the pain they are causing. Instead of making them employees of the Federal, State and Local Government, make any ELECTED official an Independent Contractor. They would have to pay their own taxes, sub-contract their staff, pay for their own insurance, hire an accountant, pay for their own medical insurance, etc, etc. In short, their “small business” would have to live with the same crap rules and laws they are shoving at us.

What they will find out is health insurance is expensive (especially the 3% S-corp ownership rule that makes premiums W2 compensation) and is not so easy to get as a small business. Telemarketers can call you any time, day or night because small business was exempt from the DO NOT CALL list, credit would be hard to get without a personal guarantee, banks would be reluctant to lend you money for a house, and the IRS and state/local revenue departments makes you a target when their budgets get tight.

Oh, and your invoice you’ll submit monthly to the Federal government? Yeah, when they are running short of funds, you don’t mind if they unilaterally adjust terms from 30 days to 120, do you?

Naw, didn’t think so. You can just recoup the costs from your customers.

*I am not an accountant, I don’t offer tax advice here or anywhere. Get your own accountant and tax professional if you have any questions.

4 Replies to “Make all elected officials Independent Contractors”

  1. Charlie, this is a brilliant insight. I’ve always thought it would be ideal to go back to the days of “part-time” legislators, but recognize that’s naive. Your idea would slap them with reality good and hard.

    Run for elective office–you’ve got my vote!

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