Your turn — Small business survival at the heart of inflation concerns

Published 1:00 pm Wednesday, July 27, 2022

Last week, I wrote about the reality of inflation being higher than the government statistics report for those items that people most frequently purchase. This is challenging every family, particularly those of modest income. Raises from their jobs or Social Security checks cannot rise to the level needed for a household to keep themselves above water.

The other big losers are small businesses. Larger businesses can cope because they have the buying power to get better prices. This leaves the small businesses who are left to compete for what is left of the supply line. They are, therefore, forced to pay more for the remaining inventory on the market if there is any. This will make it more difficult to continue their business. This has been the trend for the last generation or so. However, the limited supply of goods has amplified the problem.

If I were a conspiracy theory believer, I would suspect that the mega-retailers of the world would be delighted to have fewer options for consumers. As more small businesses close, that translates into more sales and higher profits for those that survive.

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If that was not bad enough, consider the actions in Richmond last year and Washington as some push for the use of electric vehicles. Each of us can decide, for now at least, what we want to drive and how it is powered. Eventually, however, many will become tired of paying taxes to the state and federal government to subsidize the purchase price of other people’s vehicles. At the same time, all the manufacturers are using resources on producing electric cars and trucks.

This creates the next headache of small retail businesses. Throughout our communities, there are stores that sell us gas and assorted pick up items. With plans to install vehicle charging stations all over the country, the government will be making decisions that will break many of these retailers. We do not know what decision making process will be used. How many charging stations will be selected in a community? Will they install them in new locations rather than picking winners and losers? Will they join forces with the bigger corporate stations? Will they use a lottery to pick winners and losers? Will they trust the free enterprise system to work, allowing the fastest to take action to get this business?

Whatever method used, there will be far more losers than there will be winners. The losers will most likely be the most marginal stores. The cost of bringing in new power lines and the charging equipment will be too much of an investment for many stores. They might be able to hang on to provide fuel for a dwindling number of gas powered vehicles, however, as those vehicles wear out and are replaced with electric vehicles, most will have no future.

FRANK RUFF JR. serves as the 15th District senator in Virginia. He can be reached at Sen., (434) 374-5129 or P.O. Box 332, Clarksville, VA 23927.