I admittedly didn’t finish reading the article, and maybe there’s some that I’ve missed.
I think a large issue with the discussion of capitalism is that it largely ignores discussion of free market, well regulated, capitalism.
This article is right, shareholders of major corporations are not taking risks.
But small, local companies? They are. Even if they’re an LLC. Suppliers realized that small businesses were all LLCs and most of them would go belly up. So why would they give any credit terms to the small time businesses? That’d be ridiculously risky. The suppliers make the owners personally sign for the risk.
Small business owners are also caught between, “do you quit a job that gives healthcare or do you moonlight?” Until your business is thriving you are making the choice of bankrupting and losing everything if you get hit by a car or burning out and losing everything.
If there was universal healthcare, we would have lowered the barriers of entry to entrepreneurship, which is a good thing. It would also reduce the risk.
I personally would love to see an economy of small business, in every (or as many as feasible) industry. One where the owner is present. One where its easy for the worker to think their boss isn’t doing things the way they would and go on and make a new business doing it the way they believe it should be done.
Small business takes on a lot of the risk talked about in the article. It’d be nice to separate it so that there can be real talks of reform.
The worker has much more say in a small company too.
Small local companies are smaller versions of the same thing, and yes, they are protected by their LLCs. I’m in the small business world and I am constantly shocked by the level of incompetence and short-sightedness of the average business owner. There is no way the average person gets a business loan only on their proven track record of effectiveness in executive roles maintaining consistent profitability. I once went to a seminar for small business people and the speaker literally revealed that the secret to a successful business was to make a profit, and profit equals revenue minus expenses. There were business owners in the room who literally did not know that or had any idea at all of their financials.
What businesspeople at all levels know is that you never ever risk your own money. You risk other peoples’ money. Risk the money of people and institutions who wouldn’t miss it or who would miss it that you can gain the confidence of. When you hear about “chronic entrepreneurs” who owned a series of failed businesses until they finally ran one that was successful, it’s not because they proved they were competent to get a loan in the first place. They proved they were incompetent several times, in fact. Having limited liability applies in this context. Having good connections applies most of all in these contexts. Most people becoming business owners aren’t seasoned experts who have proven to our wisened financial leaders that they are responsible enough to manage a business.
I have no doubt that there are some honest workers who believe capitalists when they say their money is at risk and willingly risk their own money on a business venture. This is absolutely not the norm.
Small and new businesses get loans not based on their competency but their ability to put 20% down and/or their willingness to put their assets, such as their houses, up for collateral.
They then personally sign liability from their suppliers.
Sure, some of them survive 5 years and pay back the loans, but most don’t. Most fail within 5 years. There’s a good reason many states print the suicide hotline number on the envelopes of their tax collection agency’s outgoing mail.
If a business survives 7 years, they’ve likely paid off their startup loans, and are now not risking their own personal capital as much.
Maybe small business owners are greedy, maybe theyre not, but let’s not pretend that they’re a part of the Epstein Class. The reality is they’re part of the same working class as the rest of us.
I admittedly didn’t finish reading the article, and maybe there’s some that I’ve missed.
I think a large issue with the discussion of capitalism is that it largely ignores discussion of free market, well regulated, capitalism.
This article is right, shareholders of major corporations are not taking risks.
But small, local companies? They are. Even if they’re an LLC. Suppliers realized that small businesses were all LLCs and most of them would go belly up. So why would they give any credit terms to the small time businesses? That’d be ridiculously risky. The suppliers make the owners personally sign for the risk.
Small business owners are also caught between, “do you quit a job that gives healthcare or do you moonlight?” Until your business is thriving you are making the choice of bankrupting and losing everything if you get hit by a car or burning out and losing everything.
If there was universal healthcare, we would have lowered the barriers of entry to entrepreneurship, which is a good thing. It would also reduce the risk.
I personally would love to see an economy of small business, in every (or as many as feasible) industry. One where the owner is present. One where its easy for the worker to think their boss isn’t doing things the way they would and go on and make a new business doing it the way they believe it should be done.
Small business takes on a lot of the risk talked about in the article. It’d be nice to separate it so that there can be real talks of reform.
The worker has much more say in a small company too.
Small local companies are smaller versions of the same thing, and yes, they are protected by their LLCs. I’m in the small business world and I am constantly shocked by the level of incompetence and short-sightedness of the average business owner. There is no way the average person gets a business loan only on their proven track record of effectiveness in executive roles maintaining consistent profitability. I once went to a seminar for small business people and the speaker literally revealed that the secret to a successful business was to make a profit, and profit equals revenue minus expenses. There were business owners in the room who literally did not know that or had any idea at all of their financials.
What businesspeople at all levels know is that you never ever risk your own money. You risk other peoples’ money. Risk the money of people and institutions who wouldn’t miss it or who would miss it that you can gain the confidence of. When you hear about “chronic entrepreneurs” who owned a series of failed businesses until they finally ran one that was successful, it’s not because they proved they were competent to get a loan in the first place. They proved they were incompetent several times, in fact. Having limited liability applies in this context. Having good connections applies most of all in these contexts. Most people becoming business owners aren’t seasoned experts who have proven to our wisened financial leaders that they are responsible enough to manage a business.
I have no doubt that there are some honest workers who believe capitalists when they say their money is at risk and willingly risk their own money on a business venture. This is absolutely not the norm.
Small and new businesses get loans not based on their competency but their ability to put 20% down and/or their willingness to put their assets, such as their houses, up for collateral.
They then personally sign liability from their suppliers.
Sure, some of them survive 5 years and pay back the loans, but most don’t. Most fail within 5 years. There’s a good reason many states print the suicide hotline number on the envelopes of their tax collection agency’s outgoing mail.
If a business survives 7 years, they’ve likely paid off their startup loans, and are now not risking their own personal capital as much.
Maybe small business owners are greedy, maybe theyre not, but let’s not pretend that they’re a part of the Epstein Class. The reality is they’re part of the same working class as the rest of us.