Rock Island business reacts to fiscal cliff deal

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The fiscal cliff deal hits close to home for local businesses. That's especially true for a Rock Island firm that works closely with the military.

For the Mandus Group, the deal is more of a cease-fire than a solution. But it does soften significant cuts that could have hit all at once.

On Wednesday, workers represent the front lines in Rock Island. They're building hydraulic repair units for the military.

"Companies that rely just on government are going to be in trouble," said Fred Smith, who co-owns the company.

The fiscal cliff actually reached Mandus Group in September 2012. That's when defense cuts forced the company to downsize, slicing its payroll from 60 to 40 local workers.

"As a small business owner, you're always concerned when you have employees, trying to maintain the workload and to keep those employees," Smith said. "The last thing you want to do is to have to let people go."

Favorable reaction on Wall Street sent stock prices soaring on Wednesday morning. As financial advisor John Miller monitors the numbers, he calls the fiscal cliff deal extremely critical.

"It gives us some certainty, at least near term, of tax rates and things of this nature both for individuals and for businesses," he said.

Like other employees, Mandus Group workers will have 2% restored to payroll Social Security taxes. Still, this deal will delay severe cuts that would slice deeply into the economy.

"There's going to be more cuts coming," Smith continued. "At least hopefully now, they can find a way to do it more intelligently."

At Mandus Group, a lot of good local jobs are depending on it.

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