As I have written before and in my recent article Top 10 Middle Market Merger and Acquisition Drivers in 2012 (selected by Vistage International for its 15,000+ global CEO Newsletter). In it I break down the impact of the Fiscal Cliff (as it’s become best known), and its affects on CEOs in the Board Room.
The Fiscal Cliff, is essentially a combination of expiring Bush tax cuts, Obama tax increases, and mandated congressional budget cuts known as Sequestration, from the Budget Control Act, all hitting the books roughly at the same time. A bad time for taxes to be going up on small businesses. And, given the nature of a too-close-to-call upcoming election, no one really knows if this impending fiscal train wreck will be avoided by a new act of Congress or not. One thing is certain, though, nothing will happen before election day, which makes the stakes even higher if something isn’t done. So what should you do next Monday Morning at 9:00am?
I suggest all CEOs call together all significant senior execs and/or Board members to a Special Emergency Planning meeting. In it you will define strategic what-if scenarios and plan for their outcomes just in case. This analysis may result in no action. Or, it could be a call to arms or one to build an economic moat around your business. Counsel from Venable LLC attorneys says to remain or become “transactionally nimble.” Either way, just remember not only are there winners and losers in troubled times, but also hunters and prey…
Link to Venable LLC Fiscal Cliff webinar white paper: