Free Money Doesn’t Fix Broken Processes


Massive monetary bailouts have been ordered and more are promised to follow. A first, and completely valid, first response goes something like this:

So, you’re printing up six trillion dollars, giving 7/8ths to banks and corporations and 1/8th back to us… which we’ll be taxed on… plus, all that money creates a monster deficit that our children be expected to pay back anyway? The honest answer, if it were ever given, would be “yes.” And for this we’re expected to thank them!

So, angry responses are understandable. That said, I want to go deeper, down to the things that cannot be fixed with ever-more money.

Business is a massive coordination of people, materials, information, tools and machines. Money is just something we use to exchange these things efficiently; it doesn’t directly fix any of them when they break.

If a business process is broken, money allows you to thrown more tools and people at it. But if the break in the process doesn’t respond to those things, more money won’t fix it. Here’s an example:

  1. A business finds that they can’t send their goods by cargo ship as usual. The manufacturing of some part was considered non-essential and the boats won’t be sailing for weeks at least.

  2. The business can consider shipping by air, but they’ll also be guaranteed to lose money on the order, since that option is much more expensive.

  3. The new money available to them is a loan, not a gift. If the company takes the free money and sends their goods by air, they’ll be unable to repay the loan, ending their business.

So, free money doesn’t fix this kind of broken process, of which there will be many. (And the longer things are locked down, the more there will be.)

And consider what happens if the manufacturer of the critical part goes bankrupt. No one automatically picks up the slack, and if there’s a file cabinet full of regulations to be conquered before making the missing part, will anyone want to attack that obstacle? Better off to start a new robot company.

So, we’re in for a lot of shortages. Eventually things will limp back to functionality – Europe recovered from World War II, after all – but only after a lot of pain and loss. Politicians don’t let go of regulations until lots of people suffer and/or die. And the corporations who paid for those regulations are likely to fight the whole way.

As I noted recently, politicians understand nothing about business. An economy, to them, is a big, magic box that spits things out. They’ll be the last to understand what’s happening, and they’ll knee-jerk to more and more centralized responses… until they can’t.

**

Paul Rosenberg

freemansperspective.com

The Foolishness of a Consumer Society

Foolishness

Do custom-embroidered powder room towels actually make your life better?

If you think so, and if you’re not of the very few who care about towels as an art form, you’re getting your kicks from other people being impressed by you. You’re buying the approval of others… and you’re all being foolish together.

Quality food makes your life better. A reliable car makes your life better. Good medicine makes your life better. Olive spoons do not.

Sadly, much of the Western world, and America especially, has become addicted to status symbols. This has been going on for generations now. When I was a boy people joked about “keeping up with the Joneses,” but the joke was funny only because it was true.

This is an addiction. Yes, it is a cultured addiction – you can barely escape the promotion of it in the modern world – but it’s an addiction nonetheless.

How This Happened

This is what I’ve been told by men considerably older than myself:

World War I was a major turning point for American business. A large number of businessmen got rich at that time, selling all sorts of war materials to the Allies: uniforms, shovels, saddles, guns, ammunition, even horses.

Many people will not remember this, but the US didn’t enter the war until 1917; it had begun in 1914. But American businessmen were enjoying record sales the whole time.

After the war ended in late 1918, things began winding down (winding down a war takes time). They didn’t return to normal quickly, because of a horrendous flu epidemic in 1918 through 1920, which killed millions and not just the very young or old. Still, the plague eventually wound down, leaving businessmen to cope with seriously declining numbers.

It was at that point, my older friends informed me, that big business decided they had to do something about this and get people to buy more stuff than they’d been buying previously: to squeeze more consumption from the same people. And they embarked upon this course with vigor.

Perhaps no public statement on this subject was clearer than one from Paul Mazur, a senior partner at Lehman Brothers, writing in the Harvard Business Review in 1927:

We must shift America from a needs, to a desires culture. People must be trained to desire, to want new things, even before the old had been entirely consumed. We must shape a new mentality in America. Man’s desires must overshadow his needs.

As is evident from the America of our time, this worked. A huge percentage of things people buy will be sold for pennies on the dollar at their eventual estate sales. They are bought in the hope of imparting some kind of self-esteem, status, or envy, not because they actually improve life.

Now, while I’m picking on things like embroidered towels and olive spoons, we must also acknowledge that a very few people will care about such things for art’s sake… and that’s fine… it is not foolish. But let’s also be honest and admit that such people are few and far between.

Scientific Manipulation

In fairness to American and Western populations, we should add that this change was accomplished with scientific manipulation, which was arising at just this time. One of the major drivers of this was a man named Edward Bernays, who was the nephew of Sigmund Freud. He made a lot of money teaching giant corporations to manipulate the public. Here are two quotes from him:

If we understand the mechanism and motives of the group mind, it is now possible to control and regiment the masses according to our will without them knowing it.

Physical loneliness is a real terror to the gregarious animal, and that association with the herd causes a feeling of security. In man this fear of loneliness creates a desire for identification with the herd in matters of opinion.

There was a concentrated effort to manipulate the minds of millions, to frighten them and to herd them on behalf of the political and financial classes. This was problem enough in the days when people received their news from newspapers, but it was supercharged by television.

So…

Those of us of the West have lived all our lives inside a web of manufactured discontent. We are told to elect political candidates because their opponent is horrible and because things are bad. We are told that we must buy new houses or vacations or a hundred other things, because other people have them and we’ll look bad in comparison. Or that the boy or girl we’re interested in won’t agree to marry us unless we look a certain way, buy a certain ring, or drive a certain type of car. And so on, in hundreds of variations.

All of this is based on the assumption that we are in a deficit position – that the advertised product will somehow fill our deficit.

The fake world – as shown on TV and Facebook – features an endless struggle for empty acquisition and status symbols.

It is foolish to slave away in the service of giant corporations. If we wish to be sensible, we should labor for things that actually make our lives better. And if something is manipulatively advertised, we shouldn’t buy it.

Live for you, not for them.

* * * * *

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* * * * *

Paul Rosenberg
www.freemansperspective.com

I Am Not a Ferengi

ferengiCall me a businessman if you like; an entrepreneur, a capitalist even… but I am not a Ferengi, dedicated to grabbing as much of your money as I can, however I can.

If that was all I wanted, I’d be exploiting Washington and Wall Street, or maybe I’d see if I could wriggle my way into central banking.

And just in case some of you are not familiar with the term, the Ferengi are a fictional race of aliens in the Star Trek universe. They are characterized by a completely amoral obsession with profit. Here, to illustrate, are a few of their Rules of Acquisition:

The best deal is the one that makes the most profit.

Anything worth doing is worth doing for money.

A deal is a deal (is a deal)… until a better one comes along.

Expand or die.

Learn the customer’s weaknesses, so that you can better take advantage of him.

The reason I bring this up is that I have, for too many years, heard people repeating the slogan, “The job of a company’s management is to maximize profit for the stockholders.” If you want to define “profit” more broadly than currency units, the statement is okay, but I’ve very seldom heard it used that way.

If all that matters to you and your company are the Rules of Acquisition, you should be bribing politicians and marketing cocaine. And yes, sadly, there are companies whose managers believe in the Rules of Acquisition but are too slick to admit it.

I happen to think that business is much bigger and much better than that.

“Why Is the Hippie in Crypto?”

I manage a company called Cryptohippie, and this is a question I get from time to time, and I think the answer is illustrative:

The people who run our company decided on this name to make what we think is an important point. This is a humane mission for us and not about the maximization of profits. We all had other careers; we didn’t need to start the company. We did it because it needed to be done and because no one was doing it even remotely well.

We see profits as a tool, not as the sole purpose of our lives. And that’s my point today. There has to be something more to your business than profits alone, or else you may as well exploit human weaknesses, spread enough money around to secure profitable legislation, and pay off whatever enforcers you need to.

I believe the contrary: that business can be a great, creative venture, delivering real benefits to humanity. Businesses feed people; they move them effectively; they house them, clothe them, cure their diseases, and so on.

Businesses bless humanity.

Good businessmen and women are blessings to the world. They are not craven Ferengi, perpetually grasping at everyone else’s wallet.

Yes, Profits Are Important

Indeed they are. And in truth, profits are far more than important; they are no less than essential. And here’s how necessary I believe they are:

Without profits, we go back to slavery.

If you’d like support for that statement, you can find it here.

To portray profit as something dirty is immensely ignorant. Sure, some Ferengi-type operators may be dirty, but as an ancient prophet once wrote, “What is the chaff to the wheat?”

Why I Love Business

If you look carefully through history, one of the things that will jump out at you is that the real good of mankind doesn’t come from governments, but from business: from traders, from the financiers who make trade possible, from hustlers, smugglers, inventors, entrepreneurs, and small business people of all sorts. Governments and other hierarchies just get in the way to a greater or lesser extent. Commerce frees people from poverty and grim lives of bare subsistence.

Think of a poor boy growing up in a small village, living in the same primitive squalor that his great-great-great-grandfather did. Then he gets a chance to work in a condition of market-based trade. He works very hard, lives responsibly, and makes a beautiful life for himself, for his wife, and for his children.

It’s commerce that makes that possible, not rulers.

My Point…

My point is that “businessman” should be a term of honor.

Yes, I know, we’re coming out of a century where Marx ruled the university, ruled half the political dialog, and ruled over a goodly portion of the planet. And I know that even with the sickening death toll attributable to Marxist ideas (or at least Marxist-Leninist ideas), the slander on profit continues. Businesspeople and economists, however, should not be helping such ideas along.

Good businesses bless the world, and if that isn’t what we’re doing, what’s the point?

Business is not a competition to stack up the most game chips and to declare ourselves the monkey with the most… or at least I don’t think it is.

The point of business is to bless ourselves while blessing others. There is virtue and beauty and honor in that. To portray it as anything less is to devalue ourselves.

Paul Rosenberg
www.freemansperspective.com

There Will Never Be Enough Good Jobs Again

goodjobIt’s over. Except for a short moment or a wild and self-exhausting governmental mandate (both of which are doubtful), there will never again be enough “good jobs” to go around. That model is gone and we need to root it out of our imaginations.

Sure, there will be some good jobs, but nowhere near enough.

About half of the Western world is already on the dole in one form or another. 93 million Americans lack a decent job and have no real hope of getting one. And so long as the current hierarchies remain, things won’t get substantially better.

I’m sorry to dump that on you, but it’s better to face it directly.

But please bear in mind that I’m a confirmed optimist. Just because there are no “good jobs” doesn’t mean that we’ll all languish in a meaningless existence. Far from it. Once we get over our addictions to status, hierarchy, and dominance, a glorious future awaits us.

Why It Won’t Get Better

The standard response to what I’ve noted above is to call it “the Luddite fallacy.” That line of argument says that in the past, innovation has not wiped out jobs, that new types of jobs were created and filled the gaps fairly well.

And that statement is true. Individual jobs were wiped out, but new jobs came along and (more or less) picked up the slack.

However, that is not happening this time, and for a very simple reason: Adaptation is now against the law. Previous rises in technology occurred while adaptation was still semi-legal.

Please take a look at this graph and remember a simple truth: Regulation forbids adaptation.

The US government is currently spending $60 billion, every year, to restrain business activity. (And the EU is worse.) On top of that, reasonable estimates show that US government regulations cost businesses nearly $2 trillion per year.

And let’s be honest about this: The primary purpose of regulation is to give the friends of congressmen a business advantage. Why else would they pay millions of dollars to lobbyists?

So, the new jobs that should be spawned, will not be. Mega-corps own Congress and they get the laws they pay for. And mega-corps do not like competition.

Furthermore, the political-corporate-bureaucratic complex will bite and claw to retain every scrap of power they have, and small businesses will be their first victims. (They already are.)

Trapped Between Hammer and Anvil

So, the people who are hoping and waiting for a “good job” to pop up are trapped between hammer and anvil. Robots are starting to roll into the workplace while the job creators (small entrepreneurs) are in regulatory and economic chains. They can’t come to the rescue.

In the 19th century, all sorts of possibilities were open to entrepreneurs. This remained at least partly true, even into the 1970s, when I watched the business heroes of my youth having a gas while making piles of money.

It used to be that a clever person could get ahead, independently, and have a ball doing so.

Those days, alas, are over.

These days, to get rich, one needs to take government as a partner. If one does not, regulation and legislation are likely to destroy your business. At this point, many of us (myself included) have had businesses – good businesses that benefited everyone involved – crushed by legislation.

To avoid being crushed these days, you have to be smarter and fleeter of foot than everyone else. Not many of us can survive in that situation, and as regulations continue to rise, even that number grows smaller and smaller.

For the generation before of mine, independent success required ambition, but it was reachable. For my generation, only those of us blessed with unusual talent had a chance at controlling our economic destinies. For the young generation of today, it’s nearly impossible. These days, if you want to jump ahead, you need to be part of something big… and you need to start as a sycophant.

So…

So, if you’re looking for the proverbial good job, stop waiting for “The Hierarchy That Is” to sort things out and get everything back to normal. Good jobs get fewer and fewer every year, and those that are lost won’t be coming back.

But… if and when you’re ready to change your thinking – to seriously change your thinking – this is good news too: You can reclaim the parts of yourself that you were ready to sacrifice to the “good job.”

You see, the “good job” was nearly as much a curse as it was a blessing. Yes, I know, steady wages and benefits are a very comfortable thing, but they also play right into a ridiculous, predatory script.

You know the one: where you struggle to display your status to all the other worker-bees. You feel like you have to do what the ads tell you: Get the new car, the bigger truck, the video player in the back seat, the gigantic TV, the most “amazing” holiday parties, the expensive shoes, the designer bags, the organic veggies, etc., etc., etc.

I would like you, please, to consider this quote from the boss of Lehman Brothers, just as the World War I production surge was failing:

We must shift America from a needs, to a desires culture. People must be trained to desire, to want new things, even before the old had been entirely consumed. We must shape a new mentality in America. Man’s desires must overshadow his needs.

Would you agree that their plan worked?

As long as you follow their script, you’ll remain in a permanent deficit mentality. No matter how much you have, you’ll always feel like you need more. It’s life on a shiny gerbil wheel. The “good job” kept us from knowing ourselves; it allowed us to sleep-walk through life. We got a “good job” and never developed ourselves any further. Work, retire, die, ho hum.

Then What?

So, if we forget about having a “good job,” what happens?

Well, it might very well mean that you do what you’re already doing, but you stop feeling bad about it. It means that you get over the endless grasping after status… of letting ridiculous ads define what “success” looks like… of letting other people define your self-opinion.

Letting go of the “good job” delusion means that you stop pining for the days when you could blow a third of your money on status crap. It means that you start taking pleasure in growing your own food, developing new ventures, and improving yourself.

It means that rather than begging politicians to ride in on a white horse and fix your world, you ignore them and start paying attention to your actual life.

Fundamentally, this means that we start using our own initiative, without seeking permission, and start building better things.

Rather than going on, I’ll leave you with two quotes, both from Erich Fromm. I think they are worth close consideration:

Our society is run by a managerial bureaucracy, by professional politicians; people are motivated by mass suggestion, their aim is producing more and consuming more, as purposes in themselves. All activities are subordinated to economic goals, means have become ends; man is an automaton – well fed, well clad, but without any ultimate concern for that which is his peculiarly human quality and function.

The quest for certainty blocks the search for meaning. Uncertainty is the very condition to impel man to unfold his powers.

Paul Rosenberg
FreemansPerspective.com

A Report from Middle America

middle americaI was recently involved in a day of meetings with small business owners in the American Midwest. It was both encouraging and sad at the same time.

What I Found First

Overall, I found a large room full of productive human beings. It was uplifting. Most of these people were between thirty and seventy years old, more men than women, and they were all productive people, the kind who get up early every day, make sure that complex systems are producing properly, fix anything that is broken or near breaking, plan for the future, cooperate with large numbers of other people, and then go home at the end of the day and love their families.

If all the world lived like these people, we’d be halfway to a paradise by now. And that was a thought that made me sad.

Why? Because these people – by any standard of decency – should be left alone to create their better world. But instead, they are forcibly tied to wasteful, parasitic, and destructive systems. Half or more of their earnings are taken from them every year. Their actions are restricted by their moral inferiors. They live less than half the rewarding lives they should be enjoying, and for no defensible reason.

The Other Things

Beyond my overall happy/sad impressions, I found quite a few particular things:

  • These people would have preferred to discuss the practical particulars of their businesses – tools, materials, technical obstacles and solutions, and so on. But instead, they were forced to discuss government compliance. Almost every subject discussed from the front of the room dealt with government regulations. Most of the subjects discussed on the sides involved tools, equipment, business strategies and so on.
  • Dealing with employees is a major issue, especially involving the immigration police. These people are justifiably concerned with fines and indictments, just from hiring employees who are clearly long-time Americans. (That is, not Hispanics or other recent immigrants.) A few of the comments I heard:

“Good luck trying to explain that to an ICE agent.”

“Do NOT waive the 72 hour waiting period.”

“Do NOT allow them to enter your facility or inspect anything without authorization from counsel.”

  • Nearly all of these people agreed that government in America is out of control, abusive, and oppositional to their happiness. I think that’s a positive opinion, since it reflects reality, meaning that they have stopped looking at the world through myth-colored glasses. The sad part of that is…
  • These (good) people don’t know what to do about it. The system they grew up believing was their friend has turned against them. They’ve gathered the considerable courage required to face that, but they don’t know what to do next. They are working within the system as they can, trying to avoid its hazards, but don’t see any clear alternative – and no path of escape. They’d like to do other things, but they also need to feed their kids, and don’t know what to do about it all.
  • Bitcoin is spreading everywhere. One of these business owners, in a very rural area, has built a Bitcoin mining operation. And not only Bitcoin, he is also mining for the other cryptocurrencies. And, he’s telling everyone else about it. I was surprised (and pleased) by this, since this meeting had absolutely nothing to do with computers, economics, or anything else that usually connects to cryptocurrencies. This man simply saw a great opportunity and jumped on it.

All In All

All in all, I came away from the day more confident in the future than I had been the day before.

We are exposed to so many horror stories every day. The images thrust upon us show a world filled with danger and discouragement. The reality, however – once you remove yourself from the newsfeed – is that there are a lot of very decent people who are generally doing the right things.

Our job now is to define newer and better ways to live and to spread that information to as many good people as we can. And to remind them they DO have the right to live good, happy, prosperous lives.

Please do everything you can along these lines. Thanks.

Paul Rosenberg
FreemansPerspective.com

A Frank Letter to the Homeless Man Under the Bridge

letter-to-homelessI see you standing here, asking for help, about once a week. You are always polite, and I respect that. I’d like to do something for you… something that would matter long-term. Giving you a few notes or coins now and then may be fine, but I’d really like to improve your situation more permanently.

In other words, I’d like to give you a job.

I used to hire people, and I especially liked hiring people who had been denied breaks. I did that whenever I could. If you and I could be transported back in time, I’d hire you. And I’d feel good about it, because I think having a job would do you a lot of good.

That fact is, however, that I can’t hire you, and I’d like you to know why.

I used to run my own contracting firm. I enjoyed the work and I liked being able to drive past a building and say, “I made that.” Having employees, however, was torture. I liked having them in some ways, of course – I liked the guys and it made me happy to see them take care of their families with paychecks that I signed. That was very gratifying. But it wasn’t enough, and there are three reasons why:

#1: Making Payroll

My first problem was simply cash flow. I was solely responsible for having enough money in the bank every week, and that could be nerve-wracking, especially when customers weren’t paying their bills on time. It’s not fun to think that a family won’t be able to buy groceries if you can’t collect your invoices.

Still, that part didn’t cause me to give up on employees. It was hard, but so long as my employees were working, we were making money, so there was always something coming in at some point. Somehow, I was able to pull it off.

#2: Being Hated

Over time, some of my employees became jerks. This seemed to grow from envy and from stupid ideas about labor versus management. These guys decided that I was getting rich off of them, and demanded I pay them more – more than they deserved and more than the company could afford.

And the really nasty part was this: It was always the guys I had done the most for who hated me most. And as soon as I sat down with them and explained why I couldn’t pay them more, they started stealing from me.

I fired the thieves, of course, but these experiences really soured me on employees. I had not only given these guys a job, but I had legitimately felt good about helping to feed their families. In return, they hated me, called me names, and stole from me.

By itself, that was almost enough to make me swear off employing people, but not quite.

#3: The IRS

What really drove me over the edge was dealing with the government and the IRS in particular. They were abominable.

I had to file forms with every payroll, and if anything on them was wrong, they penalized me – heavily. And if I paid them a single day late, they penalized me – heavily. And if they said I did something wrong – even if I didn’t – there was no way to change their verdict. Reason and evidence simply didn’t matter.

I eventually talked to a tax lawyer who explained the situation to me. He said:

Forget about fighting, Paul. There is no ‘innocent until proven guilty’ in tax court. You’re automatically guilty, and you have to try to prove yourself innocent… which is very hard and very expensive. Just pay them. I know you hate that, but you have no other choice. Fighting them would ruin you.

It wasn’t just the money that got me about this – it was that they were nasty, arrogant, heartless tyrants. Having the facts on my side didn’t matter. Intelligent arguments didn’t matter. Either I paid what they demanded or they would hurt me worse.

In many ways, it wasn’t much different than the local gang of street thugs demanding protection money.

So, that’s why I can’t hire you: Having employees locked me into a single role in life, that of a despised slave. When I finally realized that, I walked away.

I was lucky that I had the ability to move into specialties and to thrive in difficult niches; other guys probably couldn’t have.

So…

What I really want you to know is this:

I’d like to help you. You deserve a chance at a decent job. I’d like to be the guy who gave it to you, but the system demands that I must live as a slave in order to do so. And I won’t do that.

I very much wish that things were different, and I feel sorry every time I drive by that I can’t hire you. But I would never ask anyone to live as a slave, and I won’t live that way myself.

I wish you well, and if life in these parts should ever pull back from the present reign of oppression, I hope to run into you. And on that day, I hope to either hire you or do business with you.

We would both have much to gain from it.

Paul Rosenberg
FreemansPerspective.com

The Economy Can Never Fully Recover as Long as This Remains…

government regulations and businessWhen I was a young man, the older men I admired were the independent businessmen. Being a corporate suit issuing orders to underlings never appealed to me, but being a successful man who controlled his own life and business… that did.

Perhaps as a result, most of my friends are independent business people of one sort or another. Not long ago, I had a notable conversation with one of them, during which he said:

You know, Paul, business used to be fun. I’d take my children around and show them what we were doing, and explain the differences we’d make.

I waited just a beat as he winced and then continued:

Now, I don’t want to drag my kids into my business. Every time I move, there are regulations, permissions, forms to file. It takes up most of my time, for nothing. Business isn’t fun anymore. If I could find something else, I’d get out.

And this is a man who has been in his business since childhood, who loves to tell stories about it, and who used to enjoy his work immensely. If this guy is looking for the exit, the problem is dire.

It’s pretty obvious why

I have limited faith in government statistics, but there are a few informative ones on this subject:

The US Small Business Administration (SBA) recently reported that the annual cost of complying with government regulations is more than one trillion dollars per year and has been since 2005.

It goes on to report that big businesses (500+ employees), pay about $7,550 per employee to comply with the regulations. Small businesses, on the other hand (up to 20 employees) pay about $10,600 for every person they employ. And this is just one reason why small, independent businesses are being swallowed up by giant corporations.

Also bear in mind that this is just the cost of compliance with federal regulations. States also impose regulations on businesses. So do most of the county and city governments, especially large city governments.

New rules are produced constantly, and the cost of compliance rises constantly. In the US (and many other places), the cost of doing business has long since become prohibitive.

The Work-Arounds

Clever folks always find ways to get around this insanity, of course. But those ways are extra work and probably help relatively few people.

#1: They get rid of their employees

They find niches in their fields that allow them to escape the endless paperwork, penalties, and senselessly wasted time that comes with being an employer. (If you’ve ever had employees, you know what I mean.)

And what of the workers? Well, some get hired by the few related-industry employers that remain, while others have to take a mind-numbing mid-level corporate job just to pay the bills or get insurance. The rest are living on food stamps, disability, or a dozen other welfare programs.

#2: They go offshore

If your business is not resident where the regulators are, they usually can’t say anything about it.

Not many business people have moved abroad, but lots of them have set up offshore companies and are conducting business on the Internet. These people get their lives back… if they can find a way to make it work.

That is the dirty little secret of offshore companies, by the way: It’s not about escaping taxes; it’s about escaping all that ridiculous, insulting, pointless paperwork. No more spending days crunching numbers at tax time, no filing new reports every time you do something. You just take care of your customers and deliver good product. (Which ought to be enough.)

#3: They pay politicians for protection

Why would anyone donate thousands of dollars to a politician unless they expected to get something in return?

Big businesses pay politicians so that they can make a phone call to get problems that arise fixed. Small businesses can’t afford that, and most small business owners have moral problems with bribery.

Legit Is Dead

Unfortunately, the old “American way” of working hard, conducting honest business, and succeeding is gone, dead, and buried. It may still happen from time to time, but infrequently and off the beaten path.

Not long ago, I found this sign posted on a streetlight in Chicago:

business and government regulations

The sign is right – the old “legit” way of doing business is dead. If you want to get ahead these days, you either try to play a game that is rigged against you, you pay politicians to bend the rules for you, or you avoid the situation entirely.

It seems that the best and brightest – the would-be drivers of the economy – are choosing the last option.

What does that say about where things are going?

Paul Rosenberg
FreemansPerspective.com

The Fascist’s Guide to Business Success

business successI was downtown last Thursday and ended up with an hour to kill before my train home, so I went down the station’s back stairs and around the corner to Jay’s Bar. It was almost six o’clock, so the crowd was a mix of corporate suits buying expensive vodka, tradesmen enjoying decent beer, and jobless neighborhood guys drinking cheap beer. I ordered something inoffensive and watched to see if any of my old Cypherpunk pals would show up.

But instead, my oldest nemesis showed up, whom I’ll call Jerry. I went to school with Jerry, and whatever I did, he was always desperate to do better. The crazy thing was that we were almost the same guy: We played the same positions in sports; we were both crossing guards; and we were equally skilled at almost everything we did. We should have been buddies, but instead, Jerry was my permanent opponent. I never hated him and he never really hated me, but whatever I did, he had to do better.

I hadn’t run into Jerry in ten years, and the last time I saw him, he was trading coffee futures. We greeted each other; then, he sat down and ordered a better drink than mine. He asked what I was doing lately. I did not mention that I was writing – this job is strange enough without Jerry turning it into a win-lose game. Instead, I said that I was managing a few companies.

“Are they big companies?” he asked.

“Nah, they’re small start-ups.”

He got a disgusted look on his face, and I knew immediately what it was – he was disappointed that beating me wasn’t going to be a challenge.

“That’s for suckers, Paul. You’re smart enough to know that!” He was legitimately disappointed.

“It isn’t just about money, Jerry.”

He looked double-disgusted. And then he looked sympathetic. He was actually sorry that I had lost my edge, and wanted to help me get it back.

“Look, Paul, all that ‘how to get ahead’ stuff we used to read is ancient history. That world ended in 1980. If you want to get ahead now, you have to play the new game.”

I knew what he meant; the old ideal of “work hard, follow the rules, and prosper” is indeed dead. But I said nothing and waited for him to continue.

“You can’t outsmart people anymore; information gets around too fast. They’ll copy what you’re doing in a week. If you want to make real money, you have to have an advantage that will last. And that means you have to get some kind of law or regulation. Then you can rake it in.”

At this point I couldn’t help myself. “I don’t want to whore myself out to politicians, Jerry.” And again he got the disgusted look.

“It’s not whoring, Paul, it’s business. This is how it is now. And the politicians are always looking for smart guys who know how to make money. They’ll be thrilled to write regulations for you! You just have to tell them how, and then take care of them. They’re business expenses, Paul, nothing more!”

At this point I needed to change the subject, at least a little.

“So, is that what you’ve been doing lately?”

“Yes. I work deals between boards of directors and government officials, mostly between New York and DC. I put the deals together and get a piece of the action. I have four homes now Paul, and a fifty four foot boat. And you know what else? I’ve got a dozen ‘get out of jail free cards.’ This is the perfect game for a smart guy, Paul. You need to get busy playing it!”

In his own, thoroughly amoral way, Jerry was looking out for me.

“But what about the people who get screwed on this stuff, Jerry? All those regulations force people to buy things they don’t want.”

“C’mon, Paul, you’re fantasizing that they’re moral, like you. They want laws and regulations. They beg for them! They need politicians to order them around, and they need someone to blame. Otherwise, things might be their own fault.

“The extra money they pay is just a service fee. They want to be ordered around, and they pay the price without complaining. When was the last time you saw someone disobey a government?”

“Not in a while.”

“Right, because they don’t actually mind paying. We’re giving the average schmuck exactly what he wants: orders to follow and someone to blame. And we get paid a lot of money for it.”

Then Jerry looked at his watch and tossed a twenty on the bar.

“Look, I hafta go, but think about what I told you, Paul. You should be doing better.”

And with that, Jerry walked away, probably for another ten years… though more would probably be better. But as unpleasant as the conversation was, he was right. The current situation is that way.

I don’t think I’ve ever heard a better argument for an alternative economy.

Paul Rosenberg
www.FreemansPerspective.com