Business

Georgetowner • September 7, 2011

Town Hall Moving to Replace Blue Ridge
Town Hall, formerly of 2340 Wisconsin Ave., will move in to the Blue Ridge space at 2218 Wisconsin Ave. in the coming weeks, according to the Glover Park Gazette. The owners of Town Hall will acquire the building, which includes a large patio space and bar, and the property’s liquor license. According to the Gazette, the owners of Blue Ridge, Eli Hengst and Jared Rager, were unable to complete their plans for opening a coffeehouse and diner in the space because of ongoing complications with Mendocino Bar & Grill. Hengst and Rager subleased the M Street property to the Grill, which was forced to close last spring due to back taxes.

‘Uncommon Furnishings’ Comes to Town
Local and international designer, artist and furniture maker, Jan Marfyak has set up shop, Uncommon Furnishings, at 35th and N Streets. “It’s got a different buzz,” says Marfyak approvingly of today’s Georgetown. He has been around D.C. for years as well as the New York and L.A. arts scene and has worked with Krupsaw’s, Antony Childs, Miller & Armey and Muleh.

Displaying decorative objects for homes – polished petrified wood, calcium slabs and mill stones, to name a few intriguing pieces – Marfyak pulls from his warehouse in Montgomery County and his world travels. His designs involve unusual textures, forms and colors with residential and commercial applications. If you are looking for unique framings or yet-to-be-authenticated petrified crocodiles from China – or not – stop by and say hello to Marfyak. Each of his art pieces tells a story, and he can tell quite a few of his own. He is well worth the trip. Uncommon Furnishings is at 1301 35th St., NW, 202.422.6695.

Liquor Store Hours Extended to Midnight
Neighborhood liquor stores can now stay open until midnight instead of 10 p.m. D.C.’s new law which raises alcohol taxes – from nine to 10 percent – also includes extending hours for retail liquor sales to offset losses for the businesses involved. Already, liquor stores such as Wagner’s and Dixie Liquor, are open until midnight Thursday through Saturday.

Georgetowner • August 25, 2011

ANC Votes for Co-Chairs’ Redistricting Plan; 8th District Added
In response to population growth, the Georgetown Advisory Neighborhood Commission’s working group to redraw ANC 2E, which represents Georgetown, Burleith and Hillandale, voted in favor of a plan advanced by working group’s co-chairs – commissioner Ron Lewis of ANC2E and his co-chairs, Jennifer Altemus of the Citizen’s Association of Georgetown and Lenore Rubino of the Burleith Citizen’s Association. The proposal adds a new single-member district (SMD) by increasing the number of Georgetown University student districts from one to two, bringing Georgetown’s ANC districts to a total of eight (each accounting for roughly more than 2,000 individuals).

The approved plan splits SMD04 into two, creating a totally new SMD08. (The student districts would account for about 2,500 individuals.) Burleith remains SMD01, and a few blocks are added north on Wisconsin Avenue to SMD05. Voting in favor of the co-chairs’ plan, commissioner Bill Starrels said, “I think it was thought-through, well laid-out and addressed the concerns and all aspects of the community.”

An opposing view, advocated by John Flanagan, a student on the ANC 16-member working group, called for three student-dominated zones, folding parts of the west side of Georgetown into the university districts. Flanagan had cited the principle of “one man, one vote,” arguing that increased student population warranted three districts. The co-chairs’ proposal answered back, in part, with a call for continued “community cohesiveness,” where traditional borders between several blocks had naturally developed.

The plan will be discussed at the next week ANC meeting with any changes requested by Sept. 7, then passed to the Ward 2 re-districting team and onto Council member Jack Evans. The re-districting changes must be voted on by the D.C. Council by the end of 2011 and will become effective November 2012.
Next ANC 2E meeting: Monday, Aug. 29, 6:30p.m. at Georgetown Visitation Preparatory School, 35th Street and Volta Place.

Evans’s Use of $135K of Service Funds over a Decade to Buy Sports Tickets Questioned
Taking money from a D.C. Council member’s citizen service fund to purchase tickets to local baseball, basketball, hockey or tennis games – while perfectly legal – was been called into question because of an investigation by the Washington Post.

According to the Washington Post, “D.C. Council member Jack Evans has paid $135,897 for professional sports tickets over the past decade using money from his constituent services fund, renewing calls for tighter restrictions on the accounts, which are meant to help city residents. A Washington Post review of Office of Campaign Finance records shows that Evans (D-Ward 2) has spent $437,720 since January 2002 under the program, which allows District politicians to raise money to help constituents and spend the funds largely unfettered.”

“I think it’s appropriate to support those teams and give [tickets] to constituents who otherwise may not be able to get to a game,” Evans told the Post. The newspaper added, “When the fund is examined back to 1991, when Evans was elected to the council, he notes that only 13 percent of the $1 million he has spent has gone toward sporting tickets. He said that 20-year period provided a more accurate picture of his spending.”

Under D.C. law, constituent services funds may be set up to offer “charitable, scientific, educational, medical, recreational and other services” and improve residents’ “general welfare.” Any other restrictions – save for political campaigning – are not outlined.

Nevertheless, the money can add up quickly over the years for tickets to sporting events. The Post went on further: “On March 1, for example, Evans wrote a check for $4,681 for a season ticket to the Capitals. Two days later, he paid the Wizards $7,644. His two 2011 season tickets at Nationals Park, which he said are behind first base, cost him $10,945 last fall, the records show.”
At least one council member – Tommy Wells (D-Ward 6) – told the Post, “I think it’s inappropriate.” A few community leaders did not really wish to comment, and a few others wondered where their tickets were. For the kids, of course.

Georgetown Waterfront Park’s Grand Opening Set for Sept. 13
Yet another win for Georgetown. After years of fundraising, designing and construction, the transformation from old parking lots on the Potomac to an urban park, inviting the public to play along the waterfront, is complete. On Sept. 13, Georgetown Waterfront Park becomes the largest national park created in the Nation’s Capital in 35 years since Constitution Gardens was finished on the National Mall in 1976.

Thanks to the National Park Service, the Georgetown Waterfront Park Commission, architects Wallace Roberts & Todd as well as donations by MRP Realty (the owners of Washington Harbour), Pepco, the Georgetown BID, and the District of Columbia, a 10-acre park stretches out at the foot of Wisconsin Avenue on the Potomac River.

Once the land of old Georgetown’s wharves and then factories, the riverside deteriorated into parking lots and empty land. In 1985, the District of Columbia transferred the waterfront land to the National Park Service. In the late 1990s, the Georgetown Waterfront Commission made the final, long push for completion, bringing together volunteers, residents, the rowing community, local leaders and the National Park Service as it highlighted the Potomac’s signature sport: rowing.

The Georgetown Waterfront Park provides a green space for visitor recreation and contemplation, the commission is proud to point out. Cyclists, skaters, and pedestrians have their own car-free pathways with views of individual boaters, kayakers and competitive crews as well as of Roosevelt Island and Key Bridge. The park curves along 10 acres from the Washington Harbour complex at 31st Street to Key Bridge, a vital last link in 225 miles of parkland from Mount Vernon, Va., to Cumberland, Md. The park will have Wi-Fi, the commission reports, and it adds:
“The Wisconsin Avenue part of the park will greet the visitor with a low arcing fountain lined with benches, while the riverfront will have steps laddering down to the river at the site of the finish line for the regattas. A wide walkway will be continued along the river with an area with benches and a pergola for river viewing. In this section of the park, crowds can gather to watch rowing regattas or just look at the river from the sheltered pergola. The interactive fountain will add a playful aquatic feature to attract visitors to the river from Wisconsin Avenue. An arbor above the benches will invite visitors to relax by the water. The arbor will support flowering vines, filtering the sunlight over seating areas. Below the arbor, river stairs will descend to the water, forming an amphitheater where people can view activities in the park and watch the finish line of the boat races.”

Chain Bridge Weekend Closures Begin
The District Department of Transportation (DDOT) announced it will be closing the Chain Bridge on weekends to conduct structural repair work activities under the bridge deck. The majority of the repairs on Chain Bridge completed last spring were conducted on the bridge deck. Now through Dec. 23, weather permitting, DDOT will be conducting an additional series of repair related activities that will be concentrated under the bridge. Weekend closures will be necessary to perform this work.
During the following weekends, Chain Bridge will close starting at 8 p.m. on Friday and will reopen at 5 a.m. the following Monday: Aug. 19 to 21; Sept. 9 to 11; Sept. 16 to 18; Sept. 30 to Oct. 2; Oct. 7 to 9; Oct. 21 to 23; Oct. 28 to 30; November 18 to 20; Dec. 2 to 4; Dec. 16 to 18.

There will be no access to the bridge from either the District or Arlington. That includes cyclists and pedestrians because the sidewalk will also be closed. Through traffic on Canal Road will not be obstructed, but motorists will not be able to turn onto Chain Bridge. Motorists are advised to use alternate routes and river crossings including the American Legion, Key, Roosevelt, Memorial and 14th Street Bridges. For additional traffic advisories, visit DDOT’s Traffic Alerts page or visit goDCgo.com for more information on transportation options in the District.

Happy 90th Birthday, Ben
Best known for the Washington Post’s Watergate investigations, former Post executive editor Ben Bradlee turns 90 on Aug. 26. But don’t look around town for Bradlee and his wife Sally Quinn. They are in France – on the Ile de Ré, an island in the Atlantic off its west coast, as well regarded as Martha’s Vineyard or Nantucket here. Dozens of guests at the birthday party, planned by Quinn, include family members along with friends, such as Christiane Amanpour and her husband, James Rubin, Bob Woodward and Carl Bernstein.

National Jewel Center at Old Georgetown Theater Site to Empty by Aug. 31
The classic neon “Georgetown” sign is what everyone cares about, but the stalls in the National Jewel Center are leaving the old site of the Georgetown Theater on Wisconsin Avenue at O Street. The property – owned by the Heon family, which also owns the Serendipity 3 building (Nathans) at Wisconsin and M and the Philly Cheese Steak place (Cellar Door) at 34th and M – is renewing its sales pitch, as reported in the Prince of Petworth blog. The building went on the market two years ago for almost $5 million; most figure it will go for half that amount. Here is what one real estate entry discloses: 1351 Wisconsin Ave. consists of 6,086 square feet, including street and mezzanine; the lot is 6,569 square feet. It has the famous landmark “Georgetown” sign marking the entrance of the building. The retail space can be increased by up to 3,767 square feet at the rear of the building which now has seven parking spaces and an out building. Zoned C-2-A, it is currently the largest lot in Georgetown for sale.

Foggy Bottom Whole Foods Opens Sept. 6
The Foggy Bottom Whole Foods Market holds its grand opening on Tuesday, Sept. 6, at 10 a.m. With an entrance at the corner of 22th and Eye Streets and near the Foggy Bottom Metro stop, the food company’s newest store in D.C. is part of the building complex, known as “The Avenue,” at 2200 Pennsylvania Ave., N.W., with offices, banks and a Sweetgreen eatery. Just east of Georgetown at Washington Circle, the store is set to serve Foggy Bottom and George Washington University, but you can go, too. Hours: Monday through Sunday, 8 a.m. to 10 p.m. Phone: 202-296-1660.

Chris Furin: ‘Making Your Memories Sweeter’
While Furin’s the place may be gone, its beautiful cakes live on with Chris Furin, “a self-taught cake designer who has perfected his skills over the past decade working at his family owned and operated gourmet bakery and cafe, Furin’s of Georgetown,” he writes. The owners’ son created Cakes by Chris Furin, he added, “In response to the growing requests from his customers seeking extraordinary quality and detail in their special event custom cakes, cupcakes and cookies at an affordable price.” Visit CakesbyChrisFurin.com for the delicious details – or call 301-775-0799.

HMX Group to Open ‘The Streets of Georgetown’
The boys are trying to catch up with the girls in terms of fashionable clothing stores. New York-based HMX Group, which features men’s brands such as Hickey Freeman, Hart Schaffner Marx and Bobby Jones, will premiere a store at 1254 Wisconsin Ave. next month, called “The Streets of Georgetown,” reports the business section of the Washington Post. The other town, outside New York City, for HMX’s new “Streets” stores is Beverly Hills. “There is definitely more pronounced interest from men’s fashion retailers for the first time that I can remember in my 25 years in business in D.C.,” retail space expert and Georgetown Business Improvement District board member John Asadoorian told the Post. HMX’s mix of clothing labels sell at different price points and the company hopes to serve a variety of men’s fashion customers.

Where to Park? They’re Back: Freshmen Arrive Aug. 27; Classes Begin Aug. 31
Will we see a parking snafu next week? Already Georgetown University students are setting up for new student orientation, and some students are moving in. Freshmen officially arrive on Saturday, Aug. 27, with other undergraduates to follow, as registration begins and then classes start on Wednesday, Aug. 31. Residents who park their cars on 35th Street and adjacent streets, near the university, should expect double the effort to find spaces. As work at Nevils dormitory continues on N Street and road construction expands along O and P Streets, entire blocks have lost their parking spaces. The streets are alive with dump trucks throughout the day. How difficult it gets to find a space remains to be seen. We will know soon enough.

Lara Mitra •

Home to Congress, Washington D.C. is the center of social movements that sweep our nation. Innovative and inspiring ideas are brought before our nation’s leaders, are debated and refined, and often transformed into legislation. Recently, the hype has been about “going green” and making changes at home and at work to lower one’s carbon footprint. It’s now fashionable to wear “organic” clothing and to find a blue recycling bin to put aluminum cans instead of throwing them away.
In 2009, the House passed a historic climate change bill that requires 20% of electricity to come from renewable sources by 2020. The bill also increases electricity prices by $175 a year per household by 2020. Yet, even with congressional pressure to improve energy efficiency, why aren’t more local businesses following the trend of “going green?” The high cost of installing renewable energy systems and the significant time commitment required to explore greener resources are just two challenges that business owners face when making the switch to a greener business model.
One local businessman, John Hays, has managed to overcome such setbacks and convert his Georgetown store, The Phoenix, into an environmentally friendly business. For years, Hays has demonstrated a commitment to sustainability through recycling, selling renewable bags, and buying products with “fair trade” certification.
About a year ago, Hays wanted to make his commitment to the environment even stronger and signed up to install 30 solar panels on the roof of The Phoenix. Hays recognizes the significant cost of installing solar panels and how many might find the numbers daunting, but has managed to take advantage of numerous local and federal incentives that make the transition more affordable. “One-third of the cost of the panels is funded by the DC government,” Hays explains, “and I will also receive a 30% tax cut from the federal government.” In addition, Hays can exchange some of the energy produced by the solar panels in the form of solar Renewable Energy Credits (sRECSs) for cash from local electricity distributors such as PEPCO. With financial help from the D.C. government, the federal government, and sRECs, Hays saw little stopping him from converting to solar energy.
The solar panels are expected to generate over 7,000 kilowatts of power each year, which will amount to 60% of The Phoenix’s total power usage. After five years, the total energy produced by the panels will make up for their cost.
Hays hopes that other local businesses will follow in his footsteps and install solar panels or make other changes to promote the environment. “All the economic incentives in place make using renewable energy possible,” Hays says. “With rising energy prices, companies might be paying more for power if they don’t make the switch.” An investment in solar energy today might even be profitable in the long-term.
Next week, the installation process will be complete and the solar panels will be up and running, generating energy for The Phoenix while simultaneously helping Georgetown become a greener neighborhood. Who will be next?
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Samantha Hungerford • July 26, 2011

Small businesses throughout Georgetown are feeling the strain of the shaky economy. High business taxes and swelling rents, when added to a sluggish retail market, are forcing many businesses to close their doors for good.

Georgetown will sorely miss Griffin Market, long a central part of the community. Owners Riccardo and Laura Bonino could not afford to continue producing their homemade Italian cuisine and selling their specialty groceries after their rent increased by a jump of 40 percent.

Although the business was successful – the shop regularly ran out of Laura’s daily dinners – customer loyalty was not enough to compensate for the enormous rent-hike. Their doors at 1425 28 Street NW officially closed their doors Feb. 20.

Poppy, a jewelry store which also opened in 2008, will be closing its 3235 P Street NW location and moving its business online. After Feb. 26, the official closing date, renovations will be made for a chocolate shop to move into the space.

Mendocino Grille and Wine Bar at 2917 M Street closed after the Office of Tax and Revenue revoked the restaurant’s sales tax and liquor licenses for their failure to pay about $80,000 in sales taxes. The restaurant, which serves Californian food and wine, may reopen if it can repay its debt in full.

When his lease runs out at the end of March, Mike Johnson, the owner of Sixteen Fifty Nine, a mid-century furniture retailer on Wisconsin Avenue, will close up shop. If he can sell all his merchandise before then with the help of a blow-out sale, he’ll move out earlier. Johnson’s business has been suffering for the past two years due to the tough economy and a dip in his number of customers.

And the late-night haven and breakfast eatery Georgetown Café, 1623 Wisconsin Ave., will also be closing shop, putting many a young man and woman in a tight spot after bars close.

Yet the closing of these stores and the harshness of the economy has not deterred several new, entrepreneurial businesses from setting up shop in Georgetown. Retailers and restaurants from across the country are moving into the spaces that local businesses are leaving behind.

Rag & Bone, a chic, modern sportswear store for men and women will be moving in early this summer, taking the place of what is currently MAC at 3067 M Street.

“Rag & Bone is contemporary and meets the needs of our urban environment,” says Anthony Lanier, president of EastBanc, a D.C.-based commercial and residential investment firm. “Rag & Bone has a great reputation in New York and will do extremely well with Washingtonians and visitors alike to Georgetown.”

Another well-known name from New York, Serendipity 3, will be expanding into the Georgetown neighborhood. The restaurant, famous for its ice cream and multiple appearances on the silver screen, will reportedly open its new location late next month at 3150 M Street NW.

One more sweets shop, this one from California, is putting a Georgetown link in its national chain. Beverly Hills’ Sprinkles Cupcakes will be opening its newest location just three blocks from Georgetown Cupcakes at 3015 M Street NW. If all goes well, the shop will open sometime next month.

Finally, CB2, a modern furniture and home accessory store, will open its doors on 3307 M Street NW this April. A branch of Crate and Barrel, CB2 offers modern décor that’s creative, simple and clever.
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Georgetowner •

Eat & Joy, a pizzeria and Mediterranean cuisine restaurant, recently opened at 1204 34th St. With free delivery, this new hot spot is bound to tantalize your taste buds with a full menu featuring a wide range of pizzas including the kebab pizza with gyro meat, mushrooms, feta cheese, black olives and pizza sauce and the BBQ chicken pizza. Prices are moderate, all salads run at $6.95 and include a fresh mozzarella salad, Caesar salad, Greek salad and house salad. Also on the menu are Turkish specialties such as eggplant pide and lahmacun, a round pizza made with thin crust. To order, call 202-618-4533.

CB2, a modern destination from Crate and Barrel, opened April 30th at 3307 M St. The brand carries affordable modern furnishings for the apartment, loft and home. To celebrate, they gave away a total of $10,000 in shop cards with a fun scavenger hunt, placing thousands of orange CB2 Ping Pong balls throughout Georgetown, Dupont Circle and Logan Circle. CB2 ambassadors in bright orange T-shirts also hit the streets handing out Ping Pong balls.

Want a new place to eat? Bookhill Bistro, a full service restaurant featuring globally influenced cuisine, has two levels of dining as well as a private room for parties and a back patio. Executive chef Matthew Mohler brings his experience growing up in a small Indiana farming community, where his family only used fresh ingredients from their farm. The dinner menu features entres ranging from $19 to $36, including rack of lamb, slow braised chicken, poached cobia and broiled lobster. Located at 1639 Wisconsin Ave., you can make reservations by calling 202-338-0001.

Georgetown’s 78h Annual French Market came to life on April 29 and 30 on Wisconsin Ave. in the Book Hill neighborhood with discounts up to 70% at over 30 shops and an outdoor market featuring French breads, pastries, grilled merguez and kids activities. The event was a big success, drawing attendees from neighborhoods all over the District.
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Lisa Gillespie •

Comer & Co., an independently-run antique and furniture store, is coming to Georgetown. The Wisconsin Avenue storefront, once held by Sixteen Fifty Nine, a modern furniture, lighting, and art store, opened after a slow two years for the former store. Owners Fred Comer and Mark Manoff jumped on the opportunity after hearing that Sixteen Fifty Nine was closing. Comer & Co. opened on Monday and showcases antiques that can be integrated into a modern home.

On June 1, Fuel Pilates on Wisconsin Avenue will relocate to 3214 O Street to a bigger and more flexible space. Open for only a year, the studio saw a hike in demand for classes in its 1,000 square foot studio. It’s new location will include 2,000 square feet of space, though there will still only be 20 people or less in each class.

Rag & Bone, a New York-based boutique, is expanding to Georgetown, replacing Mac Cosmetics. With 1,500 square feet, the store will feature the signature men’s and women’s clothing items designed by Marcus Wainwright and David Neville. The store isn’t due to open until early-fall. In the meantime, they’re giving students, philanthropists and business leaders pieces to wear from their winter 2011 collection to wear and to describe the way the clothes make them feel. The photos will be displayed at the store’s grand opening in the fall.

After five years in Canal Square Cross MacKenzie Gallery at 1054 31st St. NW is moving to 2026 R St. NW in Dupont Circle. The current show featuring a ceramic sculpture exhibition by David Hicks, runs through the end the end of the month and is the last show at the current location. The new space will be open for private receptions in July and will launch their first solo artist show to the public in September featuring Michael Fujita.

Mid-Town Cafe is now Book Hill Bistro. Located at 1639 Wisconsin Avenue, executive chef Matthew Mohler brings experience from a small Indiana farming community, where his family used only fresh ingredients for meals. The restaurant also features a beautiful patio and a full bar. With a quiet atmosphere, this new restaurant is sure to draw those looking for a casual dining experience.

Sangaree, the boutique clothing store on M Street closed at the end of April after losing their lease. Merchandise was sold at discounts beginning at 30 percent and the lights are now off in the space. No word yet what will open next in the space. [gallery ids="99683,99684" nav="thumbs"]

David Post •

My company is a small business. I think. We have approximately 25 employees. Even in our hometown Salisbury, North Carolina most people have never heard of us.

I’m not sure what the word “small” means, but compared to most companies in the US, we may be considered big. The IRS reports that approximately 6 million corporations, 3 million partnerships, and over 20 million proprietorships file tax returns. Corporations make the most money, have the best stats, and hire the most people.

Of the 6 million corporations, only 160,000, or 7%, have more assets than we have, and only 35,000, or 1.5%, have more sales than we do. Are we a small business? I certainly think so. Our employees think so. I wake up every day wondering if CVS or Walgreens or Walmart or all those other huge pharmacies are going to squash us.

So, I feel pretty much in the middle of this tax debate that is using small businesses as the bait for two hot tax issues. First, should taxes go up by 3% for people making over $250,000? Second, should employers have a payroll tax holiday if they hire new employees? Clearly, those tax breaks would increase my profits a little, but would they encourage me to invest and hire more employees? Absolutely not. Will it affect the 2012 election? Probably.

“Small businesses are the engine of job growth,” we’re told. Talking heads say that there are 700,000 small businesses earning over $250,000. On average, every county in the country has 200 small businesses earning that amount. In Virginia, Maryland, and DC, that’s reasonable, but drive 75 miles in any direction to an “average” county. Butch Cassidy was equally perplexed: “Who are those guys?” Most of those 700,000 small businesses earning over $250,000 are doctors and lawyers. Are they the engines for job growth?

Perhaps a brief tax history might help. In the early 1970s, Congress passed a 10% income tax surcharge to pay for the Vietnam War. Back then, both political parties were fiscally responsible, cooperative, and voted for that tax. It was pretty simple: compute your tax and add 10%. (Did you know that North Carolina has an add-on tax now?) If your tax bill was $1,000 and you had paid in $1,300, you would have gotten a $300 refund. But with 10% added to your tax bill, making it $1,100, your refund was only $200.

Over the next 20 years, taxes were cut on the idea that deficits would go down because economic growth would more than offset the revenue loss. Indeed, there was economic growth but deficits went up. President Reagan criticized President Carter’s $50 billion deficits, but his budgets (the President, not Congress, makes out the budget) were above $300 billion.

In 1988, the first President Bush, said, “Read my lips. No new taxes,” but knowing he had to be fiscally responsible, he raised taxes. In 1993, President Clinton raised tax rates at the top of the income scale about 3%. Over the next eight years, the economy grew like never before, tax receipts increased, and deficits disappeared. Microsoft, Apple, Coke, and many new and old companies grew like weeds despite higher taxes. The stock market tripled.

In 2001, the second President Bush passed a 10 year tax cut that is scheduled to expire at the end of this month. Today, compared to 10 years ago, the stock market is the same and unemployment is double.

Consequently, the United States now faces a huge and growing deficit problem. We spend $3 for every $2 we collect in taxes. There is waste, for sure, but not that much. Those dreaded “earmarks” are less than 1/10 of 1% of the entire budget. Contrary to popular belief, Congress cannot eliminate earmarks to balance the budget. In fact, just walking out of our wars and then eliminating the entire defense department completely wouldn’t balance the budget. Nor would eliminating Social Security completely. This is a really big problem.

Like students waiting until the last moment to prepare for exams, Congress has waited until the last moment to deal with the expiring tax cuts. (Frankly, this tax debate should be part of a larger debate about the entire budget.) President Obama is arguing that the Bush tax cuts should be kept for those making under $250,000. That will increase borrowing and the deficit by $2.7 trillion. The Republicans and some Democrats want to extend the tax cuts permanently which will increase borrowing and the deficit $3.7 trillion. So, this argument is about whether to borrow another $2.7 trillion or $3.7 trillion. Eliminating those pesky earmarks saves about $30 billion, or .001% of those amounts.

Why borrow these extra trillions? To help small businesses — like ours — hire people and grow. If my company earns an extra $10,000, these tax cuts save us $300. If Congress also passes a payroll tax holiday and we hire another employee for, say, $25,000, it will save us another $1,200. I’m not fond of taxes, but if the government cuts my company’s taxes $1,500, is that why my company is going to hire another employee? Not at all. We hire new employees when she or he is going to help our business, not to save $1,500 in tax.

Growing a business is about growing a business, not taxes. (Of course, we could move to the Bahamas or Ireland and reduce our taxes, but small businesses can’t do that.) No business decides to grow or not grow because of taxes. No business decides to hire a new employee or not because of taxes. Why doesn’t Congress understand that?

US Senator Everett Dirksen once said, “A billion here, a billion there, pretty soon it adds up to real money.” No more. Now, we talk trillions.

This debate is silly. Ignore the rhetoric. It’s about how much more are we going to borrow and increase the deficit. It is not about reducing the deficit by a dime.

David Post is the owner of a small business that was founded in Washington, DC and is on Inc. Magazines list of the fastest growing companies in the US. He was a professor at American University and Georgetown for 10 years. Contact him at: editorial@Georgetowner.com

David Post •

A one-mile high stack of dollar bills is about $1.4 million. A billion dollars would be about 70 miles high.

The first thing Congress did after the election was cut taxes by almost $900 billion. That stack of dollar bills would be 60,000 miles high – enough to go around the earth twice, and then go from Washington, DC to Moscow. And back.

That was my best Christmas present: lower taxes for two years. PLUS a cut in social security taxes, which will make my paycheck go up about $150 per month this year. (Of course, if I don’t get a raise at the end of this year, my paycheck will go down next January.)

Voters like tax cuts. And Congress loves to please the voters.

Voters are also screaming for budget cuts. Congress knows how to talk the talk. But it hates the walk because taking money away pleases very few voters.

Government math is hard to understand. Maybe big numbers are just hard to understand.

The new Congress is now wrestling with budget cuts. The Republicans’ “Pledge to America” promised $100 billion in spending cuts. But after a week of facing the realities of the budget, they have reduced their target to $50 billion with some whispers that even $35 billion is going to be hard to reach.

How much is $100 billion? A stack of dollar bills about 700 miles long – about the distance from Washington, DC to Chicago.

The federal government spends about $275 billion per month and brings in about $175 billion per month, leaving a monthly deficit of $100 billion per month. So $100 billion in spending cuts would be the equivalent of the federal deficit for one month.

These are huge numbers and the math is very difficult. It reminds me of a situation I was in about thirty years ago when a client of mine refinanced a $2 million loan. I took the $2 million check from the new lender to the bank and asked that it be deposited immediately so that we could write a check for $2 million to repay the old loan. The teller told me that we would have to wait three days.

I asked for an exception. The teller talked to a vice president and we were able to repay the old loan immediately. The teller apologized and said, “I don’t handle $2 billion deposits that often.”

“That’s $2 Million,” I said, “Not $2 Billion.”

The next thing I heard was the budget lesson of a lifetime: “Million, billion? What’s the difference?”

Maybe that teller was right. Is there a difference? Can we understand what this is all about? Maybe this is the new math.

Last month, Congress reduced revenues by almost $900 billion and this month, promised to cut spending by $100 billion, and now hopes to squeeze at least $35 billion out of budget expenses.

Think about it this way: The next time your income goes down $9, tell your family that that you are going to reduce the family expenses by $1. Then actually cut expenses by 35 cents. That’s the new congress. Declare the family victorious for being fiscally responsible. That’s the new math. That’s the new Congress.

David Post is the owner of a small business that was founded in Washington, DC and is on Inc. Magazines list of the fastest growing companies in the US. He was a professor at American University and Georgetown for 10 years. Contact him at: editorial@Georgetowner.com