Friday, May 4, 2012

Being Julia

This week the Obama Campaign created a fictional character named "Julia" to showcase the President's initiatives on behalf of women.  The purpose of this interactive campaign is to allow Americans to "Take a look at how President Obama's policies help one woman over her lifetime—and how Mitt Romney would change her story."  To visit the page with Julia's story visit

The interactive slides take us from Julia at 3 years old when she enters headstart to the her retirement at age 67 when she begins drawing a comfortable Social Security.  Julia is able to get her education and then go to work as a web designer.   She is able to postpone having children until she is ready and when she does have a child--no mention of marriage at all--her maternity bills are covered under Obama care. She gets a loan to start her own business through the SBA and lives happily ever after until she is ready to retire.

Yesterday I received an award from the regional SBA as the Minority Small Business Champion of the Year for 2012 because of my work with the El Paso Hispanic Chamber of Commerce. The awards luncheon was part of national small business week, which has been recognized by every president since 1963. We heard a lot of speeches about how the President is committed to the growth of small business.  When I received my award, I mentioned in my speech that I have been in business for just over fourteen years.  What I did not say, is that thanks to the regulations of the Obama Administration, our mortgage company  is now weeks away from closure. For that reason, I decided to take a look at the "The Life of Julia" if she had chosen a different profession--say financial services or real estate.

If Julia had chosen to become a mortgage broker or loan originator--as many women did since these professions required attention to detail and solid customer service skills, which are areas where women tend to excel--she would now be losing her business.  Since 2009, she would have been required to meet increasing regulatory requirements, including passing a state and federal test and a criminal background check--requirements that her brothers and sisters employed by banks would not have to comply with.  She would have been required to sign restrictive contracts with the lenders she worked with which would not allow her to compete against banks for business since she would not have the ability to negotiate her fees.  And now, she would be weeks away from having her income cut off totally as the Consumer Financial Protection Bureau is about to regulate that all total fees on qualified mortgages cannot exceed 3% of the loan amount--leaving Julia no ability to get paid.  Julia would be in the process of closing her business and looking for a job in an environment where actual unemployment and underemployment is rumored to be about 19% of the population.

If Julia had chosen to make her living as a real estate agent--another profession which typically appeals to women--she would be trying to work in an environment of continuing declining home values.  Home ownership has now reached its lowest point in 15 years.  Restrictive lending guidelines mean that she would show houses to families who do not qualify to purchase because they have too much debt or or they have credit issues or they cannot get get together the downpayment.  And when the qualified mortgages are put into place, she would find that the already small pool of eligible buyers will further shrink until she too needs to seek other employment. (As an aside, I notice that there is no point in "The Life of Julia" where she decides to purchase her own home--probably because her chances of qualifying for a home of her own will be next to zero in the new environment.)

If Julia had decided to be an independent securities broker, she would probably be looking at closing her firm rather than trying to navigate the difficult regulatory environment created by Dodd Frank. Independent securities brokers are a declining breed--according to Investor News, 93 broker-dealer firms closed their doors in the first quarter of 2012.  The average net loss of broker-dealer firms is 10 per month and as strict new regulations raise the cost of doing business, more and more small firms are expected to disappear. Investor News quotes David Alsup,  national director of business development with the Compliance Department, “I don't see an end to the steady downtick. And I don't see an uptick for a while. You just can't be a two-man shop and hire a $70,000-per-year compliance officer and stay in business.”

If Julia had chosen any of these professions, she would be drowning in a sea of regulations which would eat up her savings and any cash that came into the business.  These business-killing regulations hurt women--either directly as the owners, or indirectly as the wives of owners--because, of course, in real life many women are married and depend on both incomes.  Or, in the case of the fictional Julia, they hurt women peripherally--as businesses lose all of their cash to regulations and taxes and are ultimately forced to close their doors, the real life web-designing Julia cannot find enough paying customers to keep her own doors open.

"The Life of Julia" implies that all women are needy nit-wits who want a nanny state and need only to be assured that the government is going to support us.  As a single woman who has been self-employed for fourteen years, I find that pretty insulting.   I chose to work for myself because I believed that I could make a better future for myself than any corporation was going to give me.  I needed neither a hand out nor a hand up--I just needed for the government to leave me alone and let me work.  Instead, my business has been crushed under a mountain of regulations designed to favor large corporations while destroying small players. 

If Obama wanted to help women, he would take the shackles off of business.  By allowing small businesses to prosper, he would create an environment in which men and women can succeed on their own merits.  A capitalist free market is the only answer for women, men and the society at large.  Mitt Romney has promised us that, and personally I am hoping that he can change my story and the story of millions of other small business owners across the nation.

Alexandra Swann is the author of No Regrets: How Homeschooling Earned me a Master's Degree at Age Sixteen. For more information, visit her website at Frontier 2000

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