Now Multiply That By A Million

I saw this little story via Insty, and it made me not just sad, but furious.  Read it first.

They didn’t lose a fortune, because they never had the opportunity to earn one. Nothing happened. There they sit. And there they’ll stay.

And that’s where the writer is wrong.  You see, economists and accountants have a terms for this phenomenon, and it’s called “opportunity cost” — in other words, the financial cost of a lost opportunity.  Because when people open up their own business and it’s even moderately successful, they have to hire other people to work for them.  Those workers in turn become successful, and pay taxes, and perhaps use the learning to open their own businesses.

The aggregate opportunity cost of this ripple effect, just for this little case study, is potentially millions of dollars.  The Toni & Guy chain of hair salons started in precisely this fashion with a single outlet in the 1960s, as did the JiffyLube chain, back in 1979 — and I chose these two businesses deliberately, because those are the two types of business that the above story deals with.  Who’s to say that Kaitlyn and her husband wouldn’t have had a success story similar to Tony&Guy and JiffyLube?  But we’ll never know, will we, because the heavy hand of government regulation reached into their lives and killed their adventure before it could get started.

So when Donald Trump’s first action as POTUS was to decree that all government departments had to delete multiple regulations for every new one they wanted to promulgate, it was to free people to get going with their businesses and dreams.

Lest we forget, the fucking Democrats are the party of massive regulation and government intrusiveness — and remember that if you’re toying with a “protest” vote against Trump (or a quixotic vote for a third-party no-hoper) in the mid-term elections later this year.  (If you’re a lifetime Democrat voter and want socialism, then you’re at the wrong website and, if I may say, in the wrong country.)

It’s all very well for the economy to grow when manufacturing opens new plants and what have you (which is what Trump has also been making happen) — but that growth is finite.  Individuals starting their own businesses and becoming successful isn’t finite:  that is where America is at its strongest, and that is what will create true economic success for the whole country.  And Donald Trump understands this, and because of it he deserves our unflagging support, if for no other reason.

8 comments

  1. And the sad thing about it is that it’s mostly local regulation blocking these new businesses (e.g., kid’s lemonade stands being shut down due to not having the right permits). Trump’s reduction of federal regulations is only a start – we need to do the same with state, county, and city regulations as well. I think it was Jerry Pournelle who had an interesting take on this – size doubling. Basically, take every regulation that applies to a business with at least X employees, and change it so that it applies to businesses with at least 2X employees. That would reduce the regulatory load on the smaller businesses, even if it’s not as useful as eliminating the useless regulations entirely.

  2. Oh, Bullshit.

    If “Mr. and Mrs. Kaitlyn” were so ambitious and talented, they’d roll up their sleeves and get the job done. All the talk about inspections and red tape is just an excuse for them to sit in their double wide and eat pork rinds instead of pursuing their dreams.

    You can’t deal with a little government red tape? The same government red tape that every other business in the community has to deal with?

    Well, if you can’t deal with government rules, what are you going to do when a flood destroys your building? What are you going to do when the economy crashes and you have to claw for every sale? What are you going to do when the insurance company jacks up its rates by 500% because of the aforementioned flooding? What are you going to do when some shyster lawyer wants to take you to the cleaners because an employee slipped and fell on the floor during work hours?

    I have nothing but respect for those who are brave enough to hang a shingle or go into business for themselves. It’s not for the faint of heart, or the weak of spirit, or those who are easily deflected from their dreams.

    To me, Kaitlyn and her husband don’t sound like potential millionaires who are being kept down and oppressed by “the man.” They sound like perfectly content employees who like to indulge in a fantasy of owning a business but who don’t have the constitution to actually make the sacrifices necessary to do it.

    I’m not throwing stones at Kaitlyn and her husband here – I’m an employee too, and perfectly content to be one. I’m rolling my eyes at the ridiculous notion that “but for” government regulation, Kaitlyn and her husband would have thriving businesses.

    Winners don’t make excuses, they get shit done, DESPITE the red tape, the bureaucracy, and all the other obstacles that are in their way.

    1. That’s the problem- excess red tape is making it harder for normal, ordinary people from stepping into their own business. Now, the super achievers can and will flourish, even in a system like the Soviet union. But, over regulated government makes it impossible for the regular people to step out on their own and make their own business.

    2. Nah, you’re wrong.

      When the red tape causes your maximum real income per hour to drop below what you could get as an employee, you quit fighting city hall, at least if you’re sane.

      The people we’re talking about are not trying to start Apple or Microsoft, they’re trying to open barber shops and hair dressers and very small trucking operations.

      That points out one of the huge problems with hyper-regulation: Only the established, large and moneyed have the resources of cash, time and energy to comply with or bribe their way through the regulations. Power and wealth are further centralized.

  3. By the way, did anybody catch this part:

    Kaitlyn (not her real name) just moved here from Georgia. Her husband is an auto mechanic. “He can fix anything with four wheels! Well, except my car – it runs like crap!” She went on at some length about how good he was at fixing things

    Anybody can TALK about “being good at fixing things.” But Kaitlyn’s husband can’t even fix her car?

    Is it possible – just possible – that maybe Kaitlyn is exaggerating just a wee bit about how great of a mechanic her husband is?

    Maybe he’s better off working at the county shops where the biggest thing he can screw up is a lawn mower.

    1. That the car doesn’t run properly is no surprise. It’s an old saying that the carpenter’s house squeaks, and the plumber’s house leaks.
      Some mechanics often just do the bare minimum on their own vehicles because it cost them time and money… unless they’re trying to sell it.

  4. “Bullshit”- “I’m an employee too and perfectly happy to be one”-
    I suggest, Sir, you are in no position to make an evaluation of the myriad difficulties of running a small business and dealing with the regulatory state.
    There has been a marked decrease in startups over the last few years- Warren Meyer has a few words linked below, they may be informative.)
    Making a full time job of regulatory compliance has little appeal for people who want to make things – if they wanted to be compliance freaks, they would be shuffling papers for the Gov. They want to BUILD stuff, create solutions, and make things better and make some money. And startups don’t have vast departments filled with Lawyers and accountants etc to make sure every regulation is observed, and every License obtained. This stuff can’t be delegated when the cash flow is tight-everything must be done by YOU, and every time a new regulation or permit or fee or license has to be dealt with, it eats time away from actually running the business.
    so simple, huh? Just follow the rules. Just buck up and do it…You don’t have a vestige of a clue.

    http://www.coyoteblog.com/coyote_blog/2013/02/california-regulatory-burden.html
    https://www.forbes.com/sites/warrenmeyer/2012/05/10/when-julia-tried-to-start-a-business/#30e0fd1e3d3f

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