A Reality Check For The Limousine Industry

Posted on May 14, 2012 by LCT Magazine

MARTIN ROMJUE: I had the privilege last week of attending the Limousine Associations of New Jersey annual meeting and auction in West Orange, N.J., where I heard one of the best summaries to date of the key political issues limousine operators must grasp and reconcile with during this pivotal election year.

LANJ is among one of the most legislatively active and politically astute industry groups, and I have found the messages it circulates among its members should be heeded by the chauffeured transportation industry overall.

With its straight-talk, common sense Governor, Chris Christie (R), the politically purple state of New Jersey has emerged as a template for government problem-solving and the types of policies needed to clean up state government fiscal messes and harmful regulations against small- to medium-sized businesses.

The keynote speaker, State Sen. Robert Singer, R-30th District (Monmouth/Ocean), touched upon several key themes relevant to the chauffeured transportation industry. While he may be oriented mostly to New Jersey, his refreshing straight talk easily could serve as political primer for limousine operators nationwide.

Singer outlined approaches to help resolve challenges on energy, health care, taxes, minimum wage, unemployment, and union aggression —battlegrounds where policy outcomes will directly affect the future health of America’s small to medium sized businesses. The vast majority of limousine businesses and their supporting vendors fall into this category.

Energy: Fresh from a trade mission with Gov. Christie, Singer touched upon the inherent inefficiencies in forms of energy that are misleadingly called renewable: solar and wind. Solar and wind have proven inefficient for the long-term, with solar proving impractical (read: not enough heat) in climates outside of the sunny Southwest, such as New Jersey’s, and wind farms actually generate what Singer called “heat fields.” As a result, large wind farms might have a warming effect on the local climate, casting a shadow over the long-term sustainability of wind power, according to recent research. Solar and wind energy are subsidized by tax dollars, Singer warned, which means taxpayers and businesses are paying for the inefficiency. Such findings prove traditional fossil fuels still pack the most energy output to date, and are readily available worldwide.

Health care: Singer called for reigning in costs via more choice and competition, as is the case among federal workers. Federal employees pay 30% of their health care costs and may choose from 270 health plans. State employees, such as those in New Jersey, are simply given “Rolls-Royce” level health plans no matter what their pay or position and contribute only minimally. Gov. Christie hopes to set up a state system where employees can choose from among 100 different health plans based on varying needs and demands, so that the government, for example, doesn’t waste taxpayer dollars on a gold-plated plan for younger employees who are healthy and don’t need many health care services at that stage of life. Singer, who said he hopes the U.S. Supreme Court “does the right thing” in invalidating the Obama-care purchase mandates, favors health care exchanges that require employees to choose, participate and make their own decisions.

Taxes: Before Gov. Christie was sworn in as Governor in January 2010, the New Jersey state government had approved 120 new taxes in preceding years, Singer said, adding he voted against all of them. These taxes were burdensome and unnecessary, leading to the current fight in the state house to give money back to taxpayers, Singer said. He urged the LANJ audience to not get deceived by calls for a “millionaires’ tax,” which falls unduly on small businesses and partnerships that are categorized in the same income category with individual millionaire earners. “The millionaire tax affects many businesses. . . We are vilifying successful people in this country,” Singer said. “The American Dream is about success, working hard, and trying to get out there and do something.” Singer pointed out that half of Americans either pay no federal income tax, no state income tax in some states, and actually may receive a subsidy or rebate via credits.

The deceptive reasoning behind the millionaires’ tax is that the threshold eventually works its way down, to $750,000, to $500,000, etc. “It’s never enough and doesn’t change anything,” Singer said. “Taxes never make sense in hard times when businesses are trying to invest in [jobs and capital].”

Minimum wage: The minimum wage was never designed to be a “livable wage,” Singer asserted, and the relentless drive to raise the minimum wage ultimately makes the concept of a living wage subjective and illusive as it drives up labor costs for businesses and destroys jobs. “When the minimum wage goes up, then everyone [already working] wants to be above the minimum,” Singer said. He acknowledged that opposing minimum wages comes with a political cost in a hyper-charged atmosphere of class warfare, where such opposition is portrayed as not caring about working people. The challenge is to get across a message of how the minimum wage kills jobs and positions for young people who are living at home with parents and need the experience and income to someday get self-sufficient jobs, Singer said.

Unemployment: With near-two years of unemployment benefits now available, jobless citizens are not encouraged to as actively look for work and they are choosier about job opportunities that come along, Singer said. You find plenty of unemployed people at the beach, at the gym, and other places unmotivated to take a new job because they reason that the pay and commuting costs are comparatively not much better income-wise than unemployment benefits, Singer said. “My generation looked at unemployment as a failure. . . No one is ashamed about it. . . Unemployment [benefits] are meant to be a safety net [only], and we’ve borrowed money to pay for it. It’s not free, and comes from the federal government that has to be paid back."

Singer pointed out that New Jersey now has 750,000 undocumented workers in a population of eight million, and they mostly are “unashamed” to take jobs that many unemployed citizens and younger workers don’t want. Unfortunately, “many parents don’t care.”

Unions: Singer referred to unions as “500 pound gorillas that produce money and votes” to aggressively fight any attempts at state pension reform. Taxpayer-funded public-sector workers in many states earn more and receive better benefits than their counterparts in the private sector, he said. With unions trying to grease the political skids to protect their gravy trains, they turn nasty against any politicians who want to reform the compensation system to reduce deficits and wasteful spending. “Unions don’t forget. You cross them and you pay the piper,” Singer said.

Martin Romjue, LCT editor

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