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Producers

Why We Need a Third Party

November 17th, 2012 // 10:36 am @

by Oliver DeMille

In the aftermath of the 2012 election, there have been numerous emails, posts, articles and blogs by business owners who say they are planning to sell or close their businesses, or just lay off enough workers that they can afford Obamacare for the employees who remain.

One summary listed the following announced layoffs—all attempts to deal with the new costs of Obamacare:

  • Welch Allyn, 275 layoffs
  • Stryker, 1170 layoffs
  • Boston Scientific, between 1200 and 1400 layoffs
  • Medtronic, 1000 layoffs
  • Smith and Nephew, 770 layoffs
  • Hill Rom, 200 layoffs
  • Kinetic Concepts, 427 layoffs
  • Coviden, 595 layoffs
  • Abbot Labs, 427 layoffs
  • St. June Medical, 300 layoffs

There are many, many others.

One email dated November 7, the day after the election, read:

“Time to sell our business. We can no longer afford to provide a living for 14 employees as soon we’re forced to pay for their healthcare. So sad, too bad. On to new ventures.”

After responses about how sad this is and others pointedly blaming the Obama Administration, the same person continued:

“We are all Americans and need to find common ground and make this country great together. I’m not mad at anyone for voting different than me. They love their president, don’t lose friends over calling him a dictator. I’m excited to sell our business. We are adventurous!”

That’s the entrepreneurial spirit that made America great.

Not: “Oh no, we’re losing our job. Will the government help us?”

But rather: “Hey, change happens. We’re excited. This is going to be an adventure!”

That’s the American spirit.

And while rumors abound about how much Obamacare will cost each small business and which won’t have to make any changes at all, there are a lot of employers right now who are very concerned.

Those with under 50 employees aren’t supposed to be hurt, but smaller employers are still worried about exactly how the new laws will be enforced.

Sadly, we will likely see a lot of change in small business in the months and years just ahead.

More regulation, higher taxes and drastically increased costs of employing people will make things more difficult.

An exception may be in network marketing companies or compensated communities.

I’ve long considered them among the top entrepreneurial opportunities in free nations, and with the current changes and policies this is even more true.

“My son is a doctor,” Marge said proudly.

“Wow,” Betty said with a concerned voice. “How is your son dealing with the new regulations coming into effect under Obamacare?” she asked.

Marge nodded and her face grew serious. “He’s very concerned, to tell the truth.”

“Fortunately, my son is building a huge network marketing company, and the regulations aren’t hurting him much,” Betty said. “Maybe your son would like to meet with mine about an opportunity?”

This kind of conversation is taking place a lot right now, and all indications are that it will increase.

Some parents are recommending that their college children put school on hold and start a network business, and I know two medical doctors who have gotten out of the profession in order to build networking businesses.

One of them talked two of his sons into quitting college and doing the same, though the three of them all ended up building networking organizations with entirely different companies.

 

II. The Party of Small Business

All of this got me thinking today, and as I pondered I realized something. Something big.

Something we really need right now in America.

We need a third party.

Actually, we need a new party that becomes more popular than the Republican Party and the Democratic Party.

There are more independents than members of either big party, so this shouldn’t be too much of a stretch.

Here’s the problem: The Democratic Party is now the unabashed party of big government, the welfare state, rule from Washington D.C., and everything that goes with these values.

The Republican Party touts itself as the party of freedom, limited government, free markets and business, but in fact it is the party of big business and a big-spending government at the same or just slightly lower levels than Democrats.

We have a party of Big Government (with big business as its co-pilot), and another party that emphasizes Big Business (with big government as its co-pilot).

The first is the Democratic Party, the second the GOP.

Neither is now effectively serving the needs of our nation.

As a result, we get bigger government regardless of who gets elected, and big business grows (to the frequent detriment of small businesses) regardless of who is in power in Washington.

In all of this, small businesses, families, communities and the middle class are the losers.

The solution? We need a party of small business.

We need a party whose top priority is the needs of families and small businesses.

This new party needs to reject the big-government and anti-free enterprise values of the Democrats and simultaneously the big-business and anti-immigrant attitudes of Republicans.

It needs to embrace toleration, diversity, reduced government regulations, lower taxes, decreased government spending, incentives for entrepreneurship, a charitable safety net, and incentives for more immigrants to bring their capital, businesses, labor and families to America.

It needs to get rid of the barriers to hiring (such as the increasing required health care costs) and drastically reduce government red tape for small businesses.

It needs to allow more innovation, shrink requirements on licenses and permits and other unnecessary costs that decrease entrepreneurship and growth, and create an environment of seamless partnerships between schools and businesses.

It needs to promote, encourage and incentive a lot more initiative, innovation and entrepreneurialism.

It also needs to push for more creative and independent thinking in the schools and less that is rote, conveyor-belt, and pre-scripted.

It should change the way schools are run, replacing an environment where administrators and bureaucrats feel comfortable to one led by proven innovators and others who have been successful in the real economy, the FOR-profit economy.

Forget teacher certification and unions—if we want to compete in the global economy we need innovators leading our classrooms.

As an example, principals and teachers should be hired who have excelled at implementing successful business plans rather than writing resumes.

And funding should flow to schools that excel in a true free market.

To ensure to that no child is left behind (for example in less-advantaged neighborhoods), even larger premiums should go to innovators who successfully turn dumpy schools into flourishing institutions whose graduates thrive.

The new party should apply similar principles to other kinds of organizations, from health care and community governments to every other sector of the economy.

Small businesses bring the large majority of growth in the economy, and the new party needs to begin with the specific needs of small businesses in mind.

It needs to identify things that hurt small business and repeal them, and find out what helps small businesses succeed and introduce more policies that encourage these things.

It needs to rewrite the commercial and legal code to create an environment where innovation is the norm, along with the values of growth, calculated risk, leadership, creativity, and entrepreneurialism.

It needs to be not the party of jobs, but the party of successful business ownership—and the jobs they naturally create.

 

III. A Bright Future?

We need a third party. The party of Big Government (with big business as co-pilot) and the party of Big Business (with big government as co-pilot) simply aren’t doing what our nation needs anymore.

It’s time for new thinking and new leadership.

There is an old saying that you can’t pour new wine into old bottles, because the residue of past wine always taints the new.

This is where we are in America.

The current parties, as much good as both have done at times, have peaked and are in decline.

New leadership is needed, along new values untainted by the baggage of two parties whose time has come and gone.

It is perhaps possible to reform one of the parties to get better results, but it is likely that only a new party with an entirely new focus and fresh thinking is going to take America where it needs to go.

Democratic nations are notorious for refusing to change until crisis forces their hand, and I suspect this is what we’ll witness in the 21st Century.

At some point, probably after major crisis and a superhuman American response, we’re going to need a new party.

Those who love freedom should start thinking about what it should look like.

One thing is clear: When it does come, it needs to be a party of small business.

Free enterprise and the entrepreneurial spirit made America great, and it will do so again if we let it.

Whatever comes in the economy, we want to be led by those whose attitude is, “It might sound bad, but this is an exciting adventure! Let’s get started…”

 

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odemille 133x195 custom Egypt, Freedom, & the Cycles of HistoryOliver DeMille is the chairman of the Center for Social Leadership and co-creator of Thomas Jefferson Education.

He is the author of A Thomas Jefferson Education: Teaching a Generation of Leaders for the 21st Century, and The Coming Aristocracy: Education & the Future of Freedom.

Oliver is dedicated to promoting freedom through leadership education. He and his wife Rachel are raising their eight children in Cedar City, Utah.

Category : Blog &Business &Citizenship &Community &Constitution &Culture &Current Events &Economics &Entrepreneurship &Family &Featured &Government &Independents &Leadership &Liberty &Mission &Politics &Producers &Prosperity &Statesmanship

Resolve to read this book.

February 25th, 2012 // 8:37 am @

A review of Orrin Woodward’s game-changing new book, Resolved: 13 Resolutions for LIFE

by Oliver DeMille

The freedom of any society is directly related to the quality of books that are widely read in that society. That said, there are some books everyone should read, like The Federalist Papers and Democracy in America.* And in a society like ours where we are desperate for more leaders at all levels, truly excellent books on leadership are vital to the future of freedom.

I recently read a book on leadership that everyone simply must read. It is Resolved, by Orrin Woodward.

I’ve read Woodward’s books before, so when this one arrived in the mail I put away everything else and read it straight through. It kept me up most of the night, and it was so worth it!

This is a fabulous book on leadership. It outlines 13 resolutions every person should make in our modern world, and gives specific helps on how to turn them into habits. Indeed, this book could be titled The 13 Habits of Success and Happiness for Everyone. The stories and examples from great leaders of history and current events are moving and uplifting. I literally have never read a better book on leadership than this one.

Woodward’s book is on par with the great leadership works like:

It is truly a revolution in leadership books.

The 13 resolutions are exactly what we need leaders to adopt across our society. They are applicable to family and home leadership, community and business leadership, and societal and national leadership. They apply to the United States and other countries, and together they form a blueprint for renewing America and innovating a new and better Western Civilization.

The book is divided into three parts: private resolutions, public resolutions and leadership resolutions. Each of the 13 resolutions build upon each other, and together they create an effective and motivating system of becoming a better person and leader. They help the reader improve in career and in societal impact.

This focus on societal leadership is both timely and profound. In the 1950s we experienced a major “leader-shift” in society. Before World War II, most communities were led by professionals—doctors, lawyers, teachers, accountants, etc.—and before that by big landowners and even earlier tribal chiefs. The management revolution started by Edward Deming and popularized by Ray Kroc changed the focus of leading society from professionals to managers. This was captured in William Whyte’s great 1956 classic The Organization Man.

By the 1980s another major leader-shift occurred, this time from management (“do things right”) to leadership (“do the right things”). The great transitional classic of this shift was The 7 Habits of Highly Effective People by Stephen Covey. It outlined 7 habits that leaders needed in order to help their companies excel, and these habits became part of the mainstream language: for example, “Be Proactive,” “Think Win-Win,” and “Synergize.” Another great classic of this shift was Synergetics by Buckminster Fuller. The leadership revolution brought a whole new vision of what is means to be a leader.

Today we are witnessing a similar leader-shift, this time from leadership of organizations (“do the right things”) to leadership of society (“move society in the right direction”). Woodward’s Resolved is a seminal classic in this change. In fact, some of the early books in this change include Launching a Leadership Revolution by Orrin Woodward and Chris Brady, The 8th Habit by Stephen Covey, and Primal Leadership by Daniel Goleman.

Woodward is more than an author; he has actually put these 13 resolutions to work in his business leadership. For this leadership, Orrin Woodward was named the 2011 International Association of Business’s Top Leader of the Year Award. His book Resolved outlines how we can all become such leaders.

In Resolved, Woodward shares a host of ideas and effective means of using family, business and societal leadership to impact the world. For example, he shows how Gibbon and Toynbee taught the laws of decline that are now attacking our culture and modern free nations.

He shows the three types of freedom and why they depend on each other—and how the loss of one is actually a loss of all. He helps leaders understand how freedom and character are inseparable and at the root of all societal progress and therefore leadership. His model of “Leadership Legacy” alone is worth the price of the book, and adds a whole new dimension to leadership literature.

Woodward adds several other new models to the leadership genre. He shows how five important laws from science, economics and history (Sturgeon’s Law, Bastiat’s “Law,” Gresham’s Law, the Law of Diminishing Returns, and the Law of Inertia) are combing in our current world, and what leaders need to understand and do about these five laws—individually and collectively.

These five laws are already part of our mainstream culture, but the analysis of how they are working together and what future leaders must do about it is new, deep and profound. No leader can afford not to understand this cutting-edge thinking.

On a stylistic note, Woodward consistently uses fascinating quotes, ideas, stories, historical examples and even one equation in ways that make the reader see things in a whole new way. For example, he puts an intriguing new twist on Chaos Theory, the Butterfly Effect, a poem by Yeats, Systems Theory, the writings of C.S. Lewis and J.R.R. Tolkien, credit card usage, American Idol, the “TriLateral Leadership Ledger,” the IBM way, Aristotle on true friendship, and many other delightful references from every field of thought –all written in a highly understandable and enjoyable way.

After I read Resolved the first time, I placed it next to my work chair and each day I open it randomly and read the quotes or stories on whatever page opens. It is always uplifting. Here are a few topics I’ve studied in Resolved during such random reading:

  • Why courage isn’t pragmatism
  • Producers vs. Exploiters
  • A commentary on Jim Collins’ Hedgehog Principle
  • The common reasons 23 major civilizations in history declined, and how we can avoid their mistakes
  • The combining of mind, heart and will
  • Charles Garfield on Success through Visualization
  • Will Smith’s work ethic
  • Never whine, never complain, never make excuses—and what to do instead
  • Woodward’s 10 principles of financial literacy (Wow! Every American should study these.)
  • Five steps for effective conflict resolution—in family, business and beyond
  • How to really build business systems that work
  • Henry Hazlitt’s economics in one lesson—and how to really understand the economy
  • The conflict between creativity and realism in national leadership

There is so much more. In one example, Woodward quotes G.K. Chesterton after he was asked to write an essay on “What’s Wrong with the World?” Chesterton wrote simply: “Dear Sirs, I am. Sincerely yours, G.K. Chesterton.” This, in summary, is what Resolved is all about. The rest of the book, all 13 resolutions, teaches us how to effectively become the leaders the world needs—and that we were born to be.

This book has articulated the leadership motto of the 21st Century: “It has been said that everyone wants to change the world but few feel the need to change themselves. Even a basic study of history, however, demonstrates that those who first focus upon self-improvement usually ending up doing the most good in the world.”

Gandhi taught the same sentiment when he said that we must be the change we wish to see in the world, and Woodward quotes Confucius in saying that those who want to improve the world must ultimately focus on bettering themselves.

Buddha is credited with saying that our purpose in life is to find our purpose in life, and then to give our whole heart and soul to accomplishing this purpose. Perhaps no generation more exemplified such leadership by example than the American founders, and Woodward discusses them and their words (especially Washington and Franklin) at length in showing us how to become the leaders we meant to be.

Woodward also shows examples of effective leadership from such greats as Sam Walton, John Wooden, Ludwig von Mises, and Roger Bannister, among others.

I could go on and on. Resolved really does, in my opinion, mark a leader-shift to a whole new level of leadership training for the new Century. If you are only going to get one book on leadership, this is the one. What a great book. Our whole society needs to study more about leadership, and apply what we learn.

*Links to book titles provided for your convenience in reviewing and purchasing referenced books. Any purchases on amazon initiated from these links result in amazon sharing a portion of their profits with TJEd. Thanks so much for your support!

 

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odemille 133x195 custom Egypt, Freedom, & the Cycles of HistoryOliver DeMille is the co-founder of the Center for Social Leadership, and a co-creator of Thomas Jefferson Education.

He is the co-author of New York Times, Wall Street Journal and USA Today bestseller LeaderShift, and author of A Thomas Jefferson Education: Teaching a Generation of Leaders for the 21st Century, and The Coming Aristocracy: Education & the Future of Freedom.

Oliver is dedicated to promoting freedom through leadership education. He and his wife Rachel are raising their eight children in Cedar City, Utah.

Category : Blog &Book Reviews &Business &Entrepreneurship &Family &Leadership &Liberty &Mini-Factories &Mission &Producers &Prosperity &Service &Statesmanship

An Old Joke

July 13th, 2011 // 9:01 am @

Just One Wish

A society without adequate entrepreneurship will see little, if any, progress.

Disney’s Aladdin & the Genie

The old Cold War-era joke is told of an American, a Frenchman, and a Russian, lost in the wilderness, who find a lamp and rub it.

Out comes a Genie.

He offers them each one wish, for a total of three.

The American pictures the large ranch owned by the richest people in the valley where he grew up, and wishes for a ranch ten times its size, with flowing streams and meadows full of horses and cattle.

His wish is granted and he is transported home to his new life.

The Frenchman pictures the farm and cattle of the largest estate from his home province, and pictures one just like it.

Again, his wish is granted.

Finally, the Russian pictures the land and herds of the rich family in the steppes where he grew up, and wishes that a drought kill the cattle, dry up the grass, and bankrupt the aristocratic family.

This play on old stereotypes isn’t really very funny, though it brings big laughs with audiences of producers.

They get it.

The Frenchman, thinking like an entrepreneur, wants the good things that life provides, and is willing to go to work to produce them.

The American, who thinks like an entrepreneur and an investor, is willing to go to work also, but wants to see his assets create more value.

The Frenchman wants value, the American plans for value, increased market share and perpetual growth.

In contrast, the stereotypical-punchline “Russian” in this parable can only think of one thing—getting even with those who seem to have more than him.

This is the same as Steve Farber’s lament about the sad state of our modern employee mentality—where “burn your boss” is a slogan of millions of workers who see their employer as the enemy.

Even Washington sometimes likes to join the blame game by pointing fingers at Wall Street, Main Street and everyone in business.

Initiative, vision, effective planning, the wise use of risk, quality execution—all are the contributions of entrepreneurs and investors.

Without them, any society will decline and fall.

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odemille 133x195 custom Egypt, Freedom, & the Cycles of HistoryOliver DeMille is a co-founder of the Center for Social Leadership, and a co-creator of Thomas Jefferson Education.

He is the co-author of the New York Times, Wall Street Journal and USA Today bestseller LeaderShift, and author of A Thomas Jefferson Education: Teaching a Generation of Leaders for the 21st Century, and The Coming Aristocracy: Education & the Future of Freedom.

Oliver is dedicated to promoting freedom through leadership education. He and his wife Rachel are raising their eight children in Cedar City, Utah.

Category : Blog &Business &Culture &Economics &Entrepreneurship &Mini-Factories &Producers &Prosperity

The American Caste System

July 5th, 2011 // 6:57 am @

The American framers overcame domination by an elite upper class by establishing a new system where every person was treated equally before the law. This led to nearly two centuries of increasing freedoms for all social classes, both genders and all citizens—whatever their race, religion, health, etc.

During the Industrial Age this system changed in at least two major ways.

First, the U.S. commercial code was changed to put limits on who can invest in what. Rather than simply protecting all investors (rich or poor) against fraud or other criminal activity, in the name of “protecting the unsophisticated,” laws were passed that only allow the highest level of the middle class and the upper classes to invest in the investments with the highest returns.

This created a European-style model where only the rich own the most profitable companies and get richer while the middle and lower classes are stuck where they are.

Second, the schools at all levels were reformed to emphasize job training rather than quality leadership education. Today great leadership education is still the staple at many elite private schools, but the middle and lower classes are expected to forego the “luxury” of opportunity-affording, deep leadership education and instead just seek the more “practical” and “relevant” one-size-fits-all job training. This perpetuates the class system.

This is further exacerbated by the reality that public schools in middle class zip-codes typically perform much higher than lower-class neighborhood schools. Private elite schools train most of our future upper class and leaders, middle class public schools train our managerial class and most professionals, and lower-class public schools train our hourly wage workers. Notable exceptions notwithstanding, the rule still is what it is.

Government reinforces the class system by the way it runs public education, and big business supports it through the investment legal code. With these two biggest institutions in society promoting the class divide, lower and middle classes have limited power to change things.

The wooden stake that overcomes the vampire of an inelastic class system is entrepreneurial success. Becoming a producer and successfully creating new value in society helps the entrepreneur surpass the current class-system matrix and also weakens the overall caste system itself.

In short, if America is to turn the Information Age into an era of increased freedom and widespread economic opportunity, we need more producers.

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odemille 133x195 custom Why are We Still in Recession?Oliver DeMille is a co-founder of the Center for Social Leadership, and a co-creator of Thomas Jefferson Education.

He is the co-author of the New York Times, Wall Street Journal and USA Today bestseller LeaderShift, and author of A Thomas Jefferson Education: Teaching a Generation of Leaders for the 21st Century, and The Coming Aristocracy: Education & the Future of Freedom.

Oliver is dedicated to promoting freedom through leadership education. He and his wife Rachel are raising their eight children in Cedar City, Utah.


Category : Aristocracy &Blog &Business &Culture &Economics &Entrepreneurship &Featured &Generations &Liberty &Mini-Factories &Mission &Producers &Prosperity

A New Call for Free Enterprise

June 22nd, 2011 // 1:13 pm @

A review of Beyond Capitalism and Socialism: A New Statement of an Old Ideal, edited by Tobias J. Lanz

The message of this excellent book, Beyond Capitalism and Socialism, is straightforward and timely: both socialism and capitalism are lacking. But the book goes a step further, offering suggestions for what type of economy and society we should adopt in the twenty-first century:

“There must be a better way. And, of course, there is, and has been for a very long time. It is a society based on small self-sufficient regions, empowered communities, vibrant neighborhoods, gainfully employed families, individual self-satisfactions, decentralized politics, local economies, sustainable organic agriculture, cooperative work, environmental humility, and careful nurturing of the earth.”

The entire book outlines these basic ideals in a realistic and real-world, even anti-utopian, way.

First, it notes that through history humankind has faced on ongoing series of major crises. These are simply the reality of history. Every generation faces challenges, and some are bigger than others. We have enjoyed a period of relative peace and prosperity which is rare in human history. Crises of some kind will come, and at some point they will challenge or end the ability of big government to solve the world’s problems.

Second, the book argues that truly sustainable society depends on something more than dependence on big institutions:

“As James Kunstler puts it in The Long Emergency, when these [inevitable] crises hit, national and supranational economies will disintegrate and ‘the focus of society will have to return to the town or small city and its surrounding agricultural hinterland…’”

“’It will require us to downscale and rescale virtually everything we do and how we do it…’”

“’Anything organized on the large scale, whether it is government or a corporate business enterprise such as Wal-Mart, will wither as the cheap energy props that support bigness fall away.’”

This is an extremely important point. Towns and cities along with families could, and indeed should, at some point become once again the central institutions of human society. As a society, we have given far too little thought to this eventuality.

Third, if any or all of these changes—or others like them—occur, we will see our world drastically altered. Unfortunately, little of our modern schooling, scholarship, career training or leadership preparation is geared in any way to dealing with such a possibility.

“And then, of necessity, the world will reconstruct itself on the lines of a more human-scale, community-based, local-resource-dependent societies…”

I don’t know if this forecast will come as predicted here, but it certainly could. And if it does, we need leaders who are prepared. In fact, even if this prediction doesn’t occur, such an increase of leadership on local levels could only help our society. Even if our major institutions remain big, even global, strong local leadership is vital to success—economically, politically and on a societal level.

A Breakdown of Local Leadership

In fact, it is the breakdown of exactly this kind of local leadership, I believe, which has caused such drastic growth of institutions that are too big and such widespread dependence on these institutions. Any organization that is too big to fail is, put simply, too big. Period. If it is too big to fail, its failure is a major threat—because all man-made institutions eventually fail. Most do so earlier rather than later.

The authors of Beyond Capitalism and Socialism get it right that the answer to our major current problems are rooted in our citizens and community, and that until we build strong local foundations across society we can only expect to witness further economic decay. They are also correct that neither capitalism nor socialism hold the answers, that a return to true free enterprise is essential, and that we must get started in this process rather than wait for some crisis to force such changes.

At times the authors get caught up in denominational debates from the Catholic perspective, but this tends to deepen the benefit of the book rather than detract. Readers do not have to buy into any religious themes to learn from the numerous commentaries on the potential of free enterprise society.

The book is invaluable reading for American, and all freedom-loving, citizens. As one of the authors wrote:

“Given a society, in which men, or the vast majority of men, owned property and were secure in their income, the myriad interactions of free men making empowered choices really would balance supply and demand. We would be astonished at the variety, the non-servility, and the creativity of our neighbors.”

I am convinced that this is both true and, especially in our modern world, profound. Still, I found the book lacking in one major detail. I prefer the term “free enterprise” to “Distributive,” first because I think it more accurately describes the philosophy for which it stands and second because I’m not convinced that free enterprise and distributism are precisely the same thing. They share many ideals, it is true, but there are differences.

For example, both free enterprise and distributism agree that:

  • neither capitalism nor socialism is the ideal
  • capitalism, in which those with wealth are treated differently by the law than those without wealth and the level of one’s wealth determines which laws pertain to each person, is flawed
  • socialism, in which the government owns the major means of production and levels incomes and work assignments in an attempt to create long-term equity between all citizens and where one’s status is determined by one’s government position, is flawed
  • the local society, economy and government is more important than the state- or national-level economy and government and should be treated as such
  • families are the central institution of society, and they are more important than markets or governments; markets and governments exist to help families, not vice versa
  • money is an important consideration in making choices for family, career, business and society, but it is less of a priority than relationships, spirituality and morality
  • we have reached a point in the modern world where our societal dependence on big institutions—both government and corporate—is a serious weakness in our culture and causes much that is negative in our world
  • a return to society that is more ideal, more locally-oriented, and citizens that are more independent and entrepreneurial is overdue. In such a society, most families would own their own businesses rather than remaining dependent on government or corporations for their jobs and livelihoods

Free Enterprise and Distributism

The big difference between free enterprise and distributive thought hinges on how we should move toward such a society. Dale Ahlquist, one of the authors in Beyond Capitalism and Socialism, suggested the following:

“The dilemma of Distributism is the dilemma of freedom itself. Distributism cannot be done to the people, but only by the people. It is not a system that can be imposed from above; it can only spring up from below….If it happens, it seems most likely that it would be ushered in by a popular revolution. In any case, it must be popular. It would at some point require those with massive and inordinate wealth to give it up.”

The desire for popular support is normal for all political groups, but the idea that Distributism “would at some point require those with massive and inordinate wealth to give it up” is alarming at best. Why would the wealthy have to “give it up?” Why is that necessary in free society? The word “required” is the problem. Fortunately, Ahlquist clarifies that this would be voluntary, so it isn’t Marxist, but it still makes me wonder, Why?

Nor is this the isolated view of just one author. Here is how another of the authors put it (and for this author voluntarism is replaced by government force):

“For instance, if I own one or several stores (say pizza restaurants) I would have a reasonable and normal rate of taxation, but as soon as I begin to assemble a chain of such businesses, then my rate of taxation would rise so sharply that no one of a normal disposition would seek to continue to own such a chain….A similar scheme of taxation would attack ‘multiple shops,’ that is, stores selling many lines of goods, such as a mega or ‘box’ stores, and stores with ‘large retail power.’”

Again, the obvious question is, why? The answer is that no big institutions can be allowed, that everything must by force remain small. This makes the same mistake as Marx, who taught that government would take from the rich and redistribute equally to all. The mistake was to think that those running the government wouldn’t keep a little (or a lot) extra for themselves and their families. In the Distributive ideal, where no institution can be allowed to be too big, the clear flaw is that any institution powerful enough to keep all the others small will have to be, well, big.

That means big government. The Distributists would presumably want the government to be local, but strong enough to keep all the other institutions small. The American founders already dealt with this and wrote about it extensively in the Federalist Papers. Madison, for example, said that nearly all of the colonies in the late 1780s suffered from local governments that were too dominant—they nearly all had corrupt and anti-freedom practices. This was one of the strongest arguments in support of the U.S. Constitution: a central entity would help reduce oppressive, intrusive and unfair governing fads which always arise in small (and therefore inbred) governments.

Clearly government has become much too big today, but a return to locales dominated by a few powerful families that ignore the needs of the rest of the people is not the answer—though it is precisely what would happen to most local governments if left to themselves. History is clear on this point.

We certainly need more local leadership, independence and a lot more entrepreneurialism and real ownership. We need good local government to make it work, and ideally a federation of local governments to maintain real freedom.

Is Taxation the Answer?

But back to the main point: Why would we want to use government taxation to keep any business from growing? If it offers a good product at a good price and people prefer its offering to those of other businesses, why should we drastically increase its taxes so that it remains small? Is smallness the central point? If so, this is the reason I prefer free enterprise. One more quote will suffice to further my point:

“Of course, a suitable period of time would be necessary to complete an orderly sell-off of property from excessively large owners to small owners before the new tax system came into full effect. Moreover, if this is instituted at a very reasonable pace, with tax rates on concentrations of property increasing gradually each year, this would give owners more time to prepare and help prevent a ‘firesale’ of their property. Similarly some form of guaranteed loans would have to exist to allow those without property or money to purchase the excess property that was being sold.”

My first thought when I read this was, “Who gets to determine what ‘excess’ means in such a society? Whoever it is, they’ll eventually keep more of the money and power than everyone else.” This one flaw in how the book describes Distributism is a serious problem. It proposes stopping one capitalist from getting too much wealth and power, but it doesn’t seem to realize that it also proposes taking the “excess” money from the capitalist and giving it to the socialist.

In contrast, free enterprise takes a different route. It establishes good laws that treat the rich, middle and poor the same. Period. That is freedom.

Is the U.S. a Free-Enterprise Economy?

Some people may believe that this is the system we live under in the United States today. Such an assumption is incorrect. The U.S. commercial code has numerous laws which are written specifically to treat people differently based on their wealth.

For example, it is illegal for those with less than a certain amount of wealth to be offered many of the best investment opportunities. Only those with a high net worth (the amount is set by law) are able to invest in such offerings. This naturally benefits the wealthy to the detriment of wage earners. This system is called capitalism, and it is a bad system—better than socialism or communism, to be sure, but not nearly as good as free enterprise.

In a free enterprise system, the law would allow all people to take part in any investments. The law would be the same for all. If this seems abstract, try starting a business in your local area. In fact, start two. Let the local zoning commissions, city council and other regulating agencies know that you are starting a business, that it will employ you and two employees, and then keep track of what fees you must pay and how many hoops you must jump through. Have your agent announce to the same agencies that a separate company, a big corporation, is bringing in a large enterprise that will employ 4,000 people—all of whom will pay taxes to the local area and bring growth and prestige.

Then simply sit back and watch how the two businesses are treated. In most places in the United States, one will face an amazing amount of red tape, meetings, filings and obstacles—the other will likely be courted and given waivers, benefits and publicity. Add up the cost to government of each, and two things will likely surprise you: 1) how much you will have to spend to set up a small business, and 2) how much the government will be willing to spend to court the large business.

This is the natural model in a capitalist system. Capital gets special benefits. Apparently, in contrast, in Distributist society the small business would pay little and the big business would have to pay a lot more. Under socialism, neither business would be established at all—at least not by you. A government official would do it all, or not do it.

In free enterprise, the costs and obstacles would be identical for the two businesses. In free enterprise, the operative words are “free” and “enterprise.”

Some Distributists seem to share the socialist misconception that unless government forces smallness, every business owner will push to become too big. Wendell Berry, a favorite writer of mine, often took the same tone. In reality, however, the evidence is clear that American business and ownership stayed mostly small—with most people owning family farms or small businesses—until the 1960s. It was government debt which wiped out the farming culture that dominated the South and Midwest, and the rise of big corporations over family-owned businesses came after the U.S. commercial code was changed by law to a capitalist rather than a free-enterprise model.

Give Freedom a Try

Instead of using government to force businesses to remain small, let’s consider giving freedom a try. It has worked for us in the past. If we altered the laws at all levels so that government entities treated all businesses and citizens the same, regardless of their level of capital in the bank, the natural result would be the spread of more small businesses. Freedom, not government control, is the answer.

With all that said, I’m convinced that at least some, maybe many or most, of Distributists in general and the contributing authors to Beyond Capitalism and Socialism specifically would agree with this point, that in fact their view of Distributism coincides with free enterprise. For example, Ahlquist’s chapter appears entirely supportive of free enterprise.

Still, I am concerned by this one thread of thought among some of the authors that seems to see government as the way to keep business from growing. Free enterprise gives no special benefits to big business like capitalism does, but it also does not force businesses to remain small. If this is the view of most Distributists, I agree with them. Even if we disagree on this point (and I’m not certain that we do), I find much to praise in this excellent book.

Quotable Quotes

Beyond this one concern, I can’t say enough positive about Beyond Capitalism and Socialism. It is greatly needed by our citizens today. Everyone should read it and ponder its application to our current world. Consider the following thoughts from this thought-provoking book:

“Home and family are the normal things. Trade and politics are necessary but minor things that have been emphasized out of all proportion.” –Dale Ahlquist

“What then is Distributism? It is that economic system or arrangement in which the ownership of productive private property, as much as possible, is widespread in a nation or society. In other words, in a Distributist society most…would own small farms or workshops…” –Thomas Storck

“As Political Economy is the child of Domestic Economy, all laws that weaken the home weaken the nation.” –Joseph McNabb

“The family, not the individual, is the unit of the nation.” –Joseph McNabb

“We don’t want to work hard. We don’t want to think hard. We want other people to do both our work and our thinking for us. We call in the specialists. And we call this state of utter dependency ‘freedom.’ We think we are free simply because we seem free to move about.” –Dale Ahlquist

“The conservatives and liberals have successfully reduced meaningful debate to name-calling. We use catchwords as a substitute for thinking. We know things only by their labels, and we have ‘not only no comprehension but no curiosity touching their substance or what they are made of.’” –Dale Ahlquist

“The real purpose of traveling is to return. The true destination of every journey is home.” –Dale Ahlquist

“[T]oday here in the United States of America, and in all industrialized countries…there is a class of men and women, perhaps the majority, that…is unfree….I mean, all those who subsist on a wage, the price paid for the commodity they have and who have no other means of maintenance for themselves and their families. I mean…all those who subsist on a wage that is paid to them by those who are, in actuality, their masters; a wage that may be withdrawn at any time and for any reason, leaving them on the dole, or to starve, if they can find no new job…These are not free men in any rational and exact sense of the word.” –Ralph Adams Cram

“Every man should have his own piece of property, a place to build his own home, to raise his family, to do all the important things from birth to death: eating, singing, celebrating, reading, writing, arguing, story-telling, laughing, crying, praying. The home is above all a sanctuary of creativity. Creativity is our most Godlike quality. We not only make things, we make things in our own image. The family is one of those things. But so is the picture on the wall and the rug on the floor. The home is the place of complete freedom, where we may have a picnic on the roof and even drink directly from the milk carton.” –Dale Ahlquist

“The word ‘property’ has to do with what is proper. It also has to do with what is proportional. Balance has to do with harmony. Harmony has to do with beauty….The word ‘economy’ and the word ‘economics’ are based on the Greek word for house, which is oikos. The word ‘economy’ as we know it, however, has drifted completely away from that meaning. Instead of house, it has come to mean everything outside of the house. The home is the place where the important things happen. The economy is the place where the most unimportant things happen.” –Dale Ahlquist

Caveat lector! For there is little resemblance indeed of the real ownership of real property…to the ‘rent-from-the-bank’ home ‘ownership’ (sic) of most American families.” –John Sharpe

“Our separation of economy from the house is part of a long fragmentation process….Capitalism has separated men from the home. Socialism has separated education from the home….The news and entertainment industry has separated originality and creativity from the home, rendering us into passive and malleable customers rather than active citizens.” –Dale Ahlquist

“In the age of specialization we tend to grasp only small and narrow ideas. We don’t even want to discuss a true Theory of Everything, unless it is invented by a specialist and addresses only that specialist’s ‘everything.’” –Dale Ahlquist

“In material things there can be no individual security without individual property. The independent farmer is secure. He cannot be sacked. He cannot be evicted. He cannot be bullied by landlord or employer. What he produces is his own: the means of production are his own. Similarly the independent craftsman is secure, and the independent shopkeeper.

No agreements, no laws, no mechanism of commerce, trade, or State, can give the security which ownership affords. A nation of peasants and craftsmen whose wealth is in their tools and ski and materials can laugh at employers, money merchants, and politicians. It is a nation free and fearless. The wage-earner, however sound and skilful his work, is at the mercy of the usurers who own that by which he lives.

Moreover, by his very subjection he is shut out from that training and experience which alone can fit him to be a responsible citizen. His servile condition calls for little discretion, caution, judgment, or knowledge of mankind. The so-called ‘failure of democracy’ is but the recognition of the fact that a nation of employees cannot govern itself.” –John Sharpe

Whether you agree or disagree with the details, this book is a treasure of great ideas to consider, discuss, ponder and think about. We need this book today, and we need a society that has read it and deeply contemplated its numerous profound concepts.

Whether or not the ideas in Beyond Capitalism and Socialism become necessary to all of us through some major crisis ahead, a national consideration of these topics is long overdue. We do need to move beyond capitalism and socialism. We need a rebirth of free enterprise, for our nation, economy, freedom, prosperity and above all, for our families and communities.

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odemille 133x195 custom Egypt, Freedom, & the Cycles of HistoryOliver DeMille is a co-founder of the Center for Social Leadership, and a co-creator of Thomas Jefferson Education.

He is the co-author of the New York Times, Wall Street Journal and USA Today bestseller LeaderShift, and author of A Thomas Jefferson Education: Teaching a Generation of Leaders for the 21st Century, and The Coming Aristocracy: Education & the Future of Freedom.

Oliver is dedicated to promoting freedom through leadership education. He and his wife Rachel are raising their eight children in Cedar City, Utah.

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