Entrepreneurs are drawn to places with opportunities. For centuries, the place to make those dreams a reality was America. But the eternal optimist that was America is going through a down spell. A sluggish economy and a rhetoric against success threatens to unravel a society that long understood that the only way to lift yourself up is from your own bootstraps. The theme of today's activities at the Republican National Convention, "We Built It", seeks to re-energize that can-do spirit.
It was the promise of reward that inspired immigrants like my parents to come to this country as strangers in the first place. My father was a merchant marine ship captain. “I was at sea most of the year. My wife and kids would come with me, but they used to get seasick. It was becoming difficult for me to continue my profession with a family,” he remembers.
He tried his hand at business in India, but the bureaucracy made it impossible. Within six months his fledgling business shuttered. America -- his sister in Macon, Georgia promised -- was the land of opportunity. When they moved to Houston in 1980, they came not knowing a soul.
Without a credit history, even the little things like renting an apartment were a challenge. Even with savings in the bank, no landlord would give them a retail lease. Dejected, my father took a job that paid half the salary he made as a ship captain, but he never lost sight of his dream. As time passed, we purchased a home and with it came a sense of belonging. Soon retail landlords became more welcoming. Over the course of thirty years a gift shop grew to a chain of apparel stores that inspired a garment wholesaling company that led rise to a investment company which owns shopping centers, office towers and housing developments making my parents millionaires, many times over.
Image Credit: terren in Virgina, via Flickr
Today, America needs more entrepreneurs like my parents. They worked hard. They worked smart. But more importantly, they took risks, a skill that we don’t recognize, much less revere. From classroom to the halls of Washington, risks are considered bad. They are to be avoided. Those that take them are deviants.
But some risks can be very rewarding. In fact, researchers at Cambridge have determined that your likelihood of becoming the next Steve Jobs has more to do with your ability to take risky bets than your IQ, school pedigree or years of experience.
When entrepreneurs take risks that pay, they inspire others to do the same. Children of entrepreneurs are more likely to start businesses, as are people that know someone who owns a small business, a Babson University study finds. Even those that don’t start businesses, but instead adopt enterprising ways within larger organizations propel their companies to create new products that lead to whole new lines of business that inevitably lead to creation of new jobs along the way.
But just as entrepreneurial risk taking can be contagious, fear and risk aversion can also spread, but even more rapidly. The Princeton psychologists that discovered that fear is 2.5 times more powerful than greed or reward won the Nobel prize in Economics in 2002.
That is why we should be very concerned by the rhetoric coming from Washington, particularly when we hear our President say things like:
“If you are successful, you didn’t get there on your own… If you’ve got a business. You didn’t build that. Somebody else made that happen.”
What is the incentive to take a risk if when you find actually success, it will be marginalized by the government? For your success was surely built on the back of others. What other explanation could there be? You shouldn’t be allowed to keep what you didn’t earn. And that is the justification why you should be required to give more back to the government. Sounds radical? Yes, but it’s only a natural extension of the president’s “You Didn’t Build That” speech.
We need people to start new businesses. In fact, the laid off person that starts a company puts a bigger dent in unemployment than the person that who finds another job. When we hear the rhetoric coming from our leadership in Washington, it is no surprise to me that we continue to struggle with job creation. Entrepreneurs take risks where they believe those risks will be rewarded.
Entrepreneurs used to take risks here. It’s time ask ourselves what we are doing to continue this tradition in America. For the sake of our economy, the president’s guilt trip on the successful must stop.
Monica Mehta is the author of The Entrepreneurial Instinct: How Everyone Has the Innate Ability to Start a Successful Small Business (McGraw-Hill, Sept 2012). Read more from the author at monicamehta.com
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