Chattanooga executive T.J. Gentle brainstormed with President Obama's top economic advisors Thursday in an effort to help them dodge the fiscal cliff budget bullet.
The looming cuts could lead to massive job losses and a recession if not resolved, economists say.
It's Gentle's second time at the White House table. The president and CEO of local startup SmartFurniture traveled to Washington, D.C., as part of a group of national small business leaders to meet Obama's team earlier in 2012.
"The real bottom line is that, as a practical matter, the top 2 percent are going to have to incur some kind of rate increase, and we're going to have to significantly cut entitlements including Social Security and Medicare," said Gentle, shortly after Thursday's four-hour meeting ended.
Gentle and other small business execs met with presidential advisor Valerie Jarrett as well as Robert Gordon, executive associate director of the Office of Management and Budget; Alan Krueger, chairman of the Council of Economic Advisors and a handful of other senior officials.
The president's advisors say they need $4 trillion in savings, including $1.5 trillion from tax increases, said the former Miller & Martin attorney who took the helm at SmartFurniture in 2008.
"I don't think they're going to back down on some type of rate increase on people making more than $250,000," he said.
In addition to raising tax rates on top earners, administration officials are also pushing for higher capital gains and dividend taxes, he said, though they seemed willing to compromise on estate taxes -- often called the death tax.
"I came out of this at least hearing the administration side on this realizing they're serious about making something work out, and that was encouraging," he said.
Business executives across the region are worried about the political pickle that has snowballed into a countrywide crisis. The worst part is the uncertainty, said Ralph Boe, CEO of Dalton, Ga.-based carpetmaker Beaulieu of America, in an interview earlier this week.
With no idea of their tax or health care obligations, companies can't take risks on new investments or raises, he said, and simply continue operating in survival mode.
"You can only cut expenses for so long before you start hurting your revenue," Boe said. "We can't operate this way for very long."
Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...