So Pres. Obama has been getting some flak for recently saying, “If you’ve got a business, you didn’t build that. Somebody else made that happen.” So let’s look at how somebody else – say, somebody in government – made it happen. First up is a report from Georgia.
Police in Georgia have shut down a lemonade stand run by three girls trying to save up for a trip to a water park, saying they didn’t have a business license or the required permits.
Midway Police Chief Kelly Morningstar says police also didn’t know how the lemonade was made, who made it or what was in it….
The girls needed a business license, peddler’s permit and food permit to operate, even on residential property. The permits cost $50 a day or $180 per year.
This is not an isolated event. Reason.TV awarded lemonade stand crackdowns the Nanny of the Month for June 2011.
And did you hear about 13-year-old Nathan Duszynski’s entrepreneurial efforts?
This summer, 13-year-old Nathan Duszynski wanted to make some money to help out his disabled parents—his mom has epilepsy and his dad has multiple sclerosis. So he decided to open a hot dog stand. He saved $1,200, mostly money made by mowing lawns and shoveling snow. He checked with the city to make sure he didn’t need any licenses or permits, even going to city hall in person with his mom. And then he bought a cart….
He arrived to set up shop on his first day and 10 minutes later, a zoning official arrived to shut him down. The problem: The cart, which is in the parking lot of a sporting goods store, is on the edge of official downtown commercial district of Holland, Michigan. The city bans food carts in that area in order to minimize competition for the eight tax-paying restaurants a couple of blocks away.
The Mackinac Center produced the following 4 minute video about this story.
Which brings me to the garbage strike. My garbage didn’t get picked up this week, thanks to a strike in my area:
Garbage, recycling and yard-waste pickup for most of Waste Management’s 220,000 customers in King and South Snohomish counties stopped Wednesday when Teamsters went on strike against the region’s largest refuse service over wage and benefits issues.
Teamsters Local 117, which represents 153 recycling-route drivers, walked off the job at 10 a.m. and was joined by Local 174, the garbage-truck drivers, who signed a contract with Waste Management a few months ago.
So 153 pissed-off drivers have affected hundreds of thousands of people, and our trash now sits, uncollected, in the hot Northwest sun. Thankfully, the Northwest sun isn’t all that hot, even in July. We’re barely hitting the low 70s, so it’s not as bad as it could be, but given an extra week, local trash is going to start smelling really special.
A lot of people are complaining about the strike, but think about it: this could be a prime opportunity for an entrepreneur. Once I realized that trash wasn’t going to be picked up, I could have printed up some flyers and hit all the houses in the neighborhood. The local dump charges $20 for a car to drop off garbage, so that would be the price I’d set per can for my trash-removal service. If my neighbors don’t want to wait for the striking collectors to pick up the trash next week (or possibly the week after that, depending on how long this strike drags on), I’d be there to do it for them at the same price it would cost them to do it themselves. But they’d get to skip the bother of carting it to the dump, and I would add the additional service of power spraying out their garbage cans to sweeten the deal. That’s a service Waste Management doesn’t offer.
I’m guessing a friend and I could do a good Saturday’s worth of work helping out the neighborhood, and I could pay a local kid to do the power spraying. But I’m not going to do this. First, I don’t have a truck, nor do I know someone who has one. But even if I did have a truck, I’d not do this because I know local government would try to stop me at every turn. I’d probably make multiple trips to the local dump, and that many visits would most certainly attract the attention of the “helpful” people at city hall. They’d want to see my business license, and who knows what else. I’ve dealt with the joys of obtaining a local business license before, and I have no desire to repeat the process. I might discover that there’s a local ordinance against individuals collecting other people’s garbage and taking it to the dump. Government will make sure that this attempt to make a little money becomes a huge headache, a bother, and more trouble than it’s worth. Consequently, this potential service will die before it even gets off the ground.
And that’s the point. Our local, state, and federal governments have gone from encouraging small businesses to actively discouraging them with punitive regulations and fees. It’s not because the government doesn’t want people to make money. After all, people who make money pay taxes. The government specifically discourages entrepreneurship and subtly encourages working for big business, partially because of the way governments collect taxes. When you start working for someone else, you sign a W-4 form stating that your boss will withhold taxes from every one of your paychecks and duly send it off to Uncle Sam. You cannot opt out of this automatic taxation, even if you would be scrupulous in paying all your taxes every April 15. The government wants a steady influx of tax money. But if you opt to start a small business, you get the thrill of paying your own income tax four times a year, plus the increased likelihood of an IRS proctology exam. Bureaucrats aren’t stupid. They’d rather receive sure, steady tax revenues, collected automatically and painlessly from docile workers who aren’t even sure how much they’re being milked, than wrestle with uppity entrepreneurs who know exactly how much they’re being taxed, who hate punitive taxation and who will fight to keep more of the money they make.
President Obama has no personal experience starting a small business or reaping the rewards of his efforts. In fact, throughout his life he’s been surrounded and supported by people who helped “make it happen” for him, so perhaps his outlook is understandable. But those of us who have always had to work for a living, who pay taxes to support the very infrastructure that gives us a measure of success, may be excused for questioning the President’s judgment. And those of us who have struggled to start a small business and grow it to any measure of success recognize President Obama’s speech for what it really is: a load of garbage.