No, the Economy Is Not Turning Around

The Obama Administration wants Americans to believe the economy is beginning to turn around and that President Barack Obama’s efforts are starting to result in more and more “saved and created jobs.” Ask Rick Misch for his assessment of the economy, however, and you’ll find the economic picture he sees daily isn’t as pretty as the one painted by politicians.

“I know there simply isn’t any real ‘job creation’ taking place,” said Misch, president of Ohio-based Phoenix Research Inc., during a recent phone interview. And he should know.

Phoenix Research is a courthouse research company Misch and business partner Bill Brown launched in November 1997. The company provides on-site criminal records checks for some 750 employment screening companies across the United States by way of a network of approximately 1,500 subcontractors working in almost every county in the nation.

A look at his company’s growth is revealing:

• By April-May 1998, Misch said, the company had hit its stride;

• By 2000, the partners had paid off all of the company’s start-up costs and relocated from Cincinnati to Mt. Orab, 60 miles due east in Brown County; and

• By 2001, Phoenix Research employed nine people, including Misch and Brown, and was handling approximately 3,000 individual criminal history searches per day — including 250 to 350 in Los Angeles County alone.

In addition to providing a decent living for its owners and employees, the enterprise provides Misch a great deal of insight about the state of the economy.

“One thing that was consistent from basically 1998 to 2008 (was that) I could accurately predict within one-tenth of a percentage point what the unemployment rate was going to be the following month,” he said. “I knew it before anybody in the media did.”

In May 2009, however, Misch said his numbers and those coming out of Washington, D.C., began, inexplicably, to diverge, though he had not changed the way he calculated his predictions.

Misch alluded to having suspicions about reasons behind the government’s variance, but opted not to pursue them. Instead, he simply explained how his numbers paint a terrible economic picture of actual unemployment “north of 20 percent.”

“We were a multi-million-dollar-a-year business just 36 months ago,” said Misch. Now, Phoenix Research employs only five people and is now only a few months from bankruptcy, largely due to the fact that the company is handling only 150 criminal history searches — or five percent of normal — on a daily basis.

“We made money under Clinton,” he said. “We made money under Bush. We are being KILLED under Obama!

“As a small business owner and as veteran, I’ve never looked to the government to do anything for me; I’ve never asked the government to do anything for me,” he said, “but I can tell you this, this Congress and this administration hasn’t done a thing that can help me.

Even with the so-called “hiring incentives” in place?

Misch explained why business owners are not taking advantage of the tax credits being offered by the Obama Administration.

“They want to give me a $3,000 tax credit if I go out and buy all new computers. But why would I go out and buy all new computers when my computers work fine and I own all my own file servers, but I don’t have the business to support the expenditures in the first place.”

The same thing goes for job creation, he explained, citing the government’s offer of tax credits for companies that hire individuals who’ve been unemployed for some lengthy period of time.

“Why on earth would I fill a job that’s going to cost me $25,000 a year minimum to get a $6,000 tax credit and have a person sitting around with nothing to do because we don’t have the business? It doesn’t make any sense!

“It they want to help people like me, they need to cut taxes across the board and get the venture capital back in the game,” he said. “There’s no incentive for small businesses to hire.”

Of course, the Obama Administration would accuse Misch and Brown of being greedy. But nothing could be further from reality.

“My business partner and I have cut our salaries six times during the last 18 months,” Misch said.