Is honesty the best policy?

Swiderski let out a big skeleton this week: his company Swiderski & Associates, LLC went under. Here's what he said:

"Against the wishes of my campaign committee, I wish to disclose to you my faults. The voters have a right to know the people who want to represent them. I am making it aware to all of you that I, like any other human being, am not perfect. What we normally have in campaigns are people who try to pretend to be perfect in all respects. I, as an average citizen and a Christian, do not believe in pretending to be someone who I am not. Such a feat can only lead to distrust." True but a rather boring statement

"Although 2006 started out well for my firm, it turned out to be a financially terrible year for my business when our area experienced flooding that was not expected. Many small businesses were impacted by this flood and had to close. I lost 43% of my business and had to reorganize. Part of the reorganization plan required that my company file for bankruptcy protection and close the company." OUCH!!! Looks like the Business Doctor needs a prescription for something.

"Any and all existing clients were transferred to a new enterprise owned by me." Smart move. Close the company down start a new one and move forward. Better than going down with the ship and losing everything you own.

"I am letting the truth be known about this event because media spin may try to make me look like an incompetent accountant when this is not the case. Certainly, I know how to pay my bills on time, but when you lose 43% of your business there is no way to keep your company thriving. After losing such business, there just simply wasn’t enough revenue to meet business obligations." OK we get it. An act of God comes through the area and kills your company.

"There are many reasons for filing for bankruptcy other than financial mismanagement. One such reason is to prevent a law suit. Another reason is to allow a small business owner a “fresh start” due to mishandling of money. My situation was due to neither." Yeah we got that from the last paragraph. I have a dead horse you can beat when you're done with this statement.

"I made the mistake of opening a small business out of necessity with very little capital." You and about half of the little guys out there make the same mistake.

"(My wife took ill and I was laid off from my job while taking a leave of absence from work. My employer let me go, and I was denied unemployment. With no money coming in, I had to do something to make money, so I took whatever money I had left - $300 - and advertised that I did tax preparation)." There is a more detailed explanation on his campaign blog:

"Five years ago, when my wife had cancer, I took a leave of absence from work to only be let go shortly thereafter. I was denied unemployment compensation, and with bills piling I knew I had to do something to make ends meet.

"I took all the money I had and paid whatever bills needed to be paid at the time. All I had left was $300. I had no other money coming in and couldn't take on a full-time job at the time. I needed to take care of things at home. Having a one year old daughter at the time made things tougher. I took that $300, put an ad in the paper and spent the rest on some office supplies and a flea market booth to market myself as an accountant specializing in income tax preparation. I prayed that I would make enough money to pay some more bills until I found another job. This was in mid-March with less than 6 weeks left to filing deadline.

"By the end of those six weeks, there was so much money made that I forgot about the job search and decided to pursue the venture with a full-time effort.

As the business grew, I kept investing whatever little money was left over to keep growing the business. After the flood of 2006 came, over half of my receivables became uncollectible. At the same time, my home had flood damage (I don’t live in a flood plain, so I was never required to have flood insurance, and my homeowners’ insurance didn’t cover the damage. I had to spend close to $10,000 replacing appliances, repairing my foundation, and taking care of mold remediation.). A lot of homeowners found out how insurance companies screw them. so what the f*ck are homeowners really paying for? On the other hand, this kid keeps running a business with little or no capital - it seems. the Business Doctor should have known that this would bite him in the *ss later.

"Certainly, my company had financial obligations to meet, but when your revenue drops to the point that you can no longer meet those obligations, you have to cut back on costs to make an honest attempt at making those payments. A loss of 43% of revenue makes it difficult to do so. I had no other choice but to close that business." Thank you for the Small Business Management 101 lecture.

"I live very modestly, so there wasn’t much room to cut back costs. My home is nothing to brag about, my wife and I don’t drive luxury cars, and my only school-age child goes to public school." OK he's not wealthy. We all knew that.

"I am not proud of having to make the decision to close my company, but in order to protect whatever assets I had worked hard to earn I had no other choice. " I don't think that anyone will go out in the streets and brag that the bottom fell out. Looking at the facts according to Swiderski presented I don't see how anyone could have a choice but to do what he did with the business.

"Any small business owner in my position would have made the same choice." There is another option: go down with the ship in flames. Of course there's the hindsight option: raise capital but this is hard to do. Our government and big businesses don't make it easy for the small business owner to succeed. Not everyone can marry into the family business or buy his business from the government. I used to own a business and I can tell you all first hand how the odds are stacked against you.

"A big business, however, can take a big hit and move on." Yeah like Pride's $80,000 medicare fraud settlement.

"Throughout this short period of time – even though money was tight - I still was able to and continue to make my personal monthly obligations on time." Despite the fact that I had a horrible year in 2006, my clients still trust me to manage their books. Two of Donald Trump’s businesses filed for bankruptcy within the last ten years, and people continue to do business with him. Milton Hershey failed at business six times before starting his famous chocolate enterprise. Throughout his bad years, he had investors who believed in his ideas. People still shop at Kmart. The failure of a small business due to uncontrollable circumstances should not deter the owner from representing other small business owners in Congress. Rather, my experience is nothing more than a perfect example of the hardship of small business ownership which relates me more to the common entrepreneur in the 10th congressional district. If anyone should represent small business owners in government, it should be someone who can relate to them." Thanks to a lawyer buddy of mine I was able to see the public record of filing. I am not a CPA but there is nothing in the filing to lead me to believe that there was any mishandling of money or that someone went crazy with credit limits. I have no reason to believe that Swiderski's ability to run a business other than doing so with no capital was a factor.

"I have been open and honest with my clients about this incident, and I feel that the voters deserve to know the truth as well from the source. Part of my decision to run for is so that I can help prevent the loss of other small businesses." Well now the voters know your side of the story but for Godsake do you have to sound like a freakin' crusader?

Now for my take:

Rightwinger put it best:

Paul pretty much came out with what I think is a rather large skeleton in his closet... I can understand him wanting to get this out in the open before someone else could jump on it and put their own personal spin on it. I'm just not sure how I feel about it. Paul, your honesty up front is appreciated. While it's appreciated, I don't know if it was the right decision coming out with it. I'll have to think about this one.

Rightwinger I am torn too. On the one hand Swiderski did the right thing to kill Meuser's hacks (KAR AKA Kevin Reynolds AKA Anonymous and I am lead to believe Westsider is a hack for one of the campaigns too) who were trying to bring this out in the forefront and destroy Swiderski's campaign. On the other hand Swiderski may have put the brakes on his campaign with this statement. Then again maybe not...

Regardless Meuser's campaign is now finished thanks to KAR AKA Kevin Reynolds AKA Anonymous. The only thing I see here is that the big corporate executive is beating up on the struggling small business owner tightening the noose on the little guy while paying off liberal politicians who make the laws that help destroy small business and hinder economic growth. Swiderski never had a chance before this all came out. Meuser could have let Swiderski fall off the radar quietly. Now Meuser gave Swiderski free press while creating more controversy for himself.