Saturday, July 28, 2012

It takes a government to raise a business?

You've likely heard news or commentary about President Obama's remarks made during a campaign event in Roanoke, Virginia on 13 July 2012. The uproar centers around his statement "If you've got a business -- you didn't build that."

What did the President actually say? The following two paragraphs were cut and pasted directly off No content has been changed. (I did change some of the HTML to remove spaces and improve paragraph formatting.)
There are a lot of wealthy, successful Americans who agree with me -- because they want to give something back.  They know they didn’t -- look, if you’ve been successful, you didn’t get there on your own.  You didn’t get there on your own.  I’m always struck by people who think, well, it must be because I was just so smart.  There are a lot of smart people out there.  It must be because I worked harder than everybody else.  Let me tell you something -- there are a whole bunch of hardworking people out there.  (Applause.)

If you were successful, somebody along the line gave you some help.  There was a great teacher somewhere in your life.  Somebody helped to create this unbelievable American system that we have that allowed you to thrive.  Somebody invested in roads and bridges.  If you’ve got a business -- you didn’t build that.  Somebody else made that happen.  The Internet didn’t get invented on its own.  Government research created the Internet so that all the companies could make money off the Internet.
Let's defuse a few things first.

I don't believe the President's intent was to insult business owners. I can't imagine him planning that speech and thinking "Geez, I really gotta put those uppity business owners in their place."

Nor do I disagree in general with his premise that "someone along the line gave you some help." Teachers, professors, partners, co-workers, friends, trusted advisers, book authors - they all helped me along the way with knowledge, advice, or motivation.

What does piss me off, however, is his dismissal of individual aptitude and effort in the building of a business. He implies that just about anyone can start and maintain a business. After all, there are a lot of smart and hardworking people out there1. He makes it sound like you pretty much have to just show up each day at your business and the money starts rolling in. (Let's just skip over things like assumption of risk, team building, product and service innovation.)

"It takes a government to raise a business" is the equivalent of "it takes a village to raise a child", a platitude that I find equally appalling as it pertains to parental responsibility.

Obama's thoughts on business remind me of a particularly clueless AT&T representative whose entire sales pitch was that we should buy their business phone system because AT&T invented the phone. Needless to say, he didn't get the sale. The President is using the same lame argument - the government invented the internet and built the interstate highway system. Therefore, we should giddily open our wallets because Uncle Sam is the key component of our success (remember, it's not smarts or hard work).

With business income rolling in, the question is what to do with it. He cites wealthy Americans who want to "give something back", presumably to the federal government and presumably for inventing the internet. Who are these people? Cuz I certainly don't know any of them. Every business owner I know - in fact every person I know - tries to minimize their taxes by every legal means. I don't need to pay even more money to Uncle Sam for super highways, information or asphalt, especially since my taxes (and my business' taxes) have paid for them already. And the notion that the government created the internet "so that all the companies could make money off the Internet" is completely ludicrous.

So while I don't believe the President intended to insult business owners, I believe he did so in practice. According to Obama, business owners as individuals are nothing special - just about anyone can start and run a business, as though the USA were the Lake Wobegon of entrepreneurship where everyone is above average and successful. Business success, according to Obama, is possible because of the beneficence of the government. Therefore, paying more taxes in return is virtually a duty. And when he says "you didn't build that" I agree but point out that my business and I have certainly paid the taxes that funded "that."

Someone else wrote that the core issue here is a chicken and egg perspective. Does the government exist to tolerate business? Or do businesses exist to tolerate government? I'll vote for the latter.

1This is just a politician's avoidance of telling people that some of them just aren't suited for business success. It's just like the housing market. Sure, everyone can own a home. We saw how well that worked out. But God forbid that you tell people that they probably can't have something. Let's keep in mind that all we're promised is the pursuit of happiness, not its achievement.

1 comment:

John said...

Related thoughts from Charles Krauthammer in the Washington Post.