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ColonelGirdles Blog (About)

Edwin Girdle is a veteran of America’s class and cultural wars, peruser of generally anomalous thoughts, purveyor of widely unpopular opinions, and owner of sometimes odd experiences. He lives with his soul-mate, Myrtle, in the ruins of what was once one of the nation’s premier industrial cities.

One Response to “Edwin Girdle (The Colonel)”

Edwin Girdle Says:

Yes, please do post my essay(s) if they are of interest, and thank you for your kind remarks. I read your “Triumph of the Money Party” and thought, “Ain’t it the truth!”

Restore the safety net. This should have been his priority from day one. Instead he wasted over a trillion dollars on banks which should have been shut down. The bankers could have turned to the soup kitchens and used food stamps like everyone else if the administration had devoted government resources to helping people, not megabanks, pharmaceuticals, and health insurance companies.

Colonel Girdle's story tells of a small business collapse that is feeding on itself, dragging down gas stations, beauty salons, accountants, restaurants, clothing stores, lawyers, building contractors, even ministers and their churches. The comments to his article on The Smirking Chimp tell the same story again and again by different people.

I certainly don't read this story in the business press. On Wall Street, everything is good news. Jobs are about to be created according to Bondad (this month or next for sure), industrial production is up, the housing market has bottomed, prices are stable along with wages, exports are booming, the recession ended months ago. Big businesses are doing splendidly because they were able to cut costs savagely to survive, and they can rely on cheap overseas workers.

We seem to have parallel universes and realities underway in our economy. Wall Street and the government are confident boom times are just around the corner. It sure doesn't sound like it, though, reading about small businesses collapsing and so many individuals flirting with bankruptcy and desperation.

and even in all of the posters miseries there is still hope for each other. I agree with the guy to put your money in the community(local banks and credit unions) - lets starve the big banks

... but knowing first hand how badly affected Ohio is I doubt that a $75,000 loan could have saved his business. I think chances are that it simply would have prolonged the inevitable and saddled him with additional debt.

latimes.com

With credit tight and consumers still pinching their pennies, many business owners find they can't go on.
By Nathan Olivarez-Giles

December 22, 2009

The Obama administration's new plan to give a boost to small businesses reflects continued trouble in that sector, which is facing new failures even as much of the nation's economy is stabilizing.

As credit lines have shrunk and consumers have cut back on spending, thousands of small businesses have closed their doors over the last year. The plight of struggling firms has been aggravated by the reluctance of banks to lend money, said Brian Headd, an economist at the Small Business Administration's office of advocacy.

"While bankruptcies are up, overall, small-business closures are up even more," Headd said.

California has been particularly hard hit. The latest data show small-business bankruptcies up 81% in the state for the 12 months ended Sept. 30, compared with the previous year. Filings nationwide were up 44%, according to the credit analysis firm Equifax Inc.

The actual number of small businesses in trouble is probably higher, experts said, because many owners file for personal bankruptcy rather than seek protection for the business.

Dennis McGoldrick, a bankruptcy lawyer in Torrance, said his clients are all stuck in similar situations -- capital is hard to come by, customers are tough to attract and debt is piling up.

"We can't keep up," McGoldrick said. "There's more people that want to come in every day than I can see."

Cecily McAlpine, who filed for bankruptcy protection for her Cold Stone Creamery franchise this spring, said the experience was humiliating but she had no choice.

Receipts at the fledgling Compton ice cream shop plunged dramatically during the recession, and by late 2008 she was paying her employees out of her pocket.

"When the refrigerator died, that was it; I'd just had it," McAlpine said. "That was the day I broke. I just started throwing stuff away."

McAlpine recently withdrew her bankruptcy filing after selling all the store equipment and paying off her creditors. She is slowly paying off some back-rent and utility debt, and will officially dissolve her business in the next couple of weeks, she said.

"I still feel scarred and like a loser," she said. "Even though I'm not in it anymore, it's still there."

Recognizing the problems of business owners like McAlpine, the Obama administration has proposed using federal stimulus money to help funnel more loans to small businesses. The White House has also asked Congress to eliminate capital gains taxes for one year on new investments in small-business stock, and called for a new tax incentive to encourage small businesses to hire more employees.

On Dec. 14, Obama called a meeting of executives of Wells Fargo & Co., Citigroup Inc., Bank of America Corp. and nine other large banks, and told them that they owed it to the nation to make more loans to small businesses and help rebuild the economy.

In California, the need is great.

Over the last year, the Los Angeles, Riverside/San Bernardino and Sacramento metropolitan areas have led the nation in small-business bankruptcy filings, said Tim Klein, a spokesman for Equifax.

About 19,000 small businesses filed for bankruptcy in California during the 12 months ended Sept. 2009, up from 10,500 the previous year.

During September alone, 2,229 small businesses filed for protection, up from 1,503 filings in September 2008, the firm reported.

Kathleen March, a bankruptcy lawyer in Los Angeles, said she often pushes her clients to file for personal bankruptcy instead of a business filing because it's easier.

Many people also close down their businesses thinking that will solve their problems, only to find their companies' debt lives on, March said.

"The norm is if you're running a small business, you will have to either cosign or personally guarantee the significant debts," she said. "The business itself can shut down, but the people cosigned all the debts. So, the individuals are then saddled with these huge debts."

A client who owned a surf shop was paying for business expenses from the client's own funds long before filing for personal bankruptcy, she said.

"In this economy, anything that isn't a necessity is a tough business to be in," March said. "And the majority of my clients have waited too long to file for bankruptcy and in the process made things worse on themselves financially as a result."

All participating agents should realize that they can be financially ruined at any time. One problem is that the culture reflected by shows such as "The Apprentice" pushes people to believe that if they REALLY give it all they can make it. Of course, for each one who "makes it" there are many many "losers", those who "did not have what it takes". But those are the unavoidable casualties of "free market competition", so that the "cream can rise to the top".