In our current culture, it’s hip to equate capitalism with greed. The people who associate these terms suggest that the two represent the “American way” — as if they are synonymous. Entire movements and ideologies have grown out of a disdain for capitalism. Whether Communism of the last century, or the Occupy movement in recent years, there is a growing perspective that capitalism is a flawed system, that greed and selfishness are integral to it, and that it must be replaced.
Given that my entire adult life has been involved in capitalistic pursuits and recognizing that many of my friends and clients are engaged in capitalistic ventures, I think it’s important to answer the allegations of many Americans who condemn capitalism, the economic system upon which our nation was founded. To start with though, it’s important to define capitalism.
Capitalism in its most basic definition is simply:
“an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market” versus a planned economy via a central government.
This economic system, berated by many, is the approach that places the individual as the supreme authority over economic ventures, their ownership and the ultimate distribution of their product to a would be customer. In contrast to capitalism is the economic system that elevates the government to the position of authority and the ultimate master of the individual, often referred to as socialism, or in its more radical form, communism.
However, noticeably absent from the definition of capitalism and other forms of economic systems is any reference to greed or selfishness. I would contend that these two human flaws, encountered in the best examples of mankind, are present in all of us. So whether one finds himself working in a capitalistic society or a socialistic one, greed will be present in both.
When individuals berate capitalism as evil and greed-induced or suggest some other negative attribute, they typically point to a company, industry or even an entire society that provides fodder for their argument. I think of the instances just a few years ago when financial behemoths collapsed as a result of the greedy and selfish decisions of their executives. At the same time many of these same executives made out like bandits with their “golden parachute” deals. To compound the calamity, politicians gratuitously bailed out some of these firms on the backs of the American taxpayers.
Just this week I was meeting with a young entrepreneur who recounted the story of how his family’s new start-up company was defrauded out of $100,000 by a national corporation just days before that national company filed for bankruptcy protection. The company ordered the young entrepreneur’s product, knowing all the while that just days later they would seek bankruptcy protection. By then though the product would then be in the company’s possession and the payment for that product would be tied up in the court for months to come. Was greed and malicious intent involved? Without question.
Examples such as the two just cited are undisputed evidence that greed and selfishness often abound within capitalistic endeavors. But here’s the question: Should we impugn the 28 million businesses in America and their owners based on the actions of a number of errant ones?
To partially answer this question let’s apply this same reasoning to another area of our society. Consider for just a moment a family where the father is a workaholic, totally engrossed in his company to the detriment of his family. At the same time, the mother is self-absorbed, interested more in her friends and high society than the needs of her children. The husband may fail to tell his children or wife that he loves them, given his undue focus on his business. When he arrives home from work, he may “kick the cat,” yell at the kids and quickly turn his attention to his overwhelming business projects. Meanwhile, his wife throws some meals in the microwave and heads out for a night of socializing with her friends. Clearly, this husband and wife are failures as parents, with their priorities all amok and their children will sadly suffer as a result. But because this couple fails to exemplify what good parents look like should we denigrate the concept of families and impugn the thousands of parents that are seeking to do it right?
Of course not.
Likewise, when I hear the denigrators of capitalism throw up examples of companies and their CEO’s, whether a few or even dozens, who exemplify “greed gone wild” in their capitalistic endeavors, it ignores the reality that hundreds of thousands of business owners in our nation are genuinely seeking to offer a product or service to meet the needs of their fellow man and in so doing generating an honest profit.
Profit is what enables a business owner to provide for his family, his community, his church and his world. And that profit is enhanced and incentivized via capitalism. So if you are a business owner, by all means check your motives to make sure they are pure. But never, ever shy away from pursuing the dream of building and growing your business enterprise. Each time you sell your product, generate a profit and reinvest that profit into growing your business, you exemplify capitalism, the greatest economic system ever known to man and upon which our nation was founded.
Because of you and millions of other risk-taking entrepreneurs, you continue to preserve at some level the America that our forefathers envisioned and of which one of my favorite US Presidents, Ronald Reagan, referred to as “the last best hope of man on earth…”
Thank you for building your business the American way, via capitalism and free of greed and selfishness.
No doubt you’re familiar with the old saying, “It’s not what you know, it’s who you know!” The concept suggests that it’s more important to have the right connections than having the right information or knowledge. Such a statement asserts that when it comes to getting ahead, your own learning and application of that knowledge is of lesser importance than simply knowing and/or befriending certain people.
Personally, I take issue with this connection-oriented approach to life that deemphasizes many other critical qualities. While I won’t deny that having connections and developing friendships can at times open doors, in my view this is a very sketchy and unpredictable way to live one’s life.
Recently I read a story that suggests there is a greater attribute than friendship that will determine whether you will achieve success in life. The story goes like this:
Imagine what would happen if you went to a friend in the middle of the night and said, “Friend, lend me three loaves of bread. An old friend traveling through just showed up, and I don’t have a thing on hand.”
The friend answers from his bed, “Don’t bother me. The door’s locked; my children are all down for the night; I can’t get up to give you anything.”
But let me tell you, even if he won’t get up because he’s a friend, if you stand your ground, knocking and waking all the neighbors, he’ll finally get up and get you whatever you need.
As you think about this story, what is clear is that the friendship between the two neighbors did not hold that much sway. What ultimately opened the door for the fellow who had no food was his persistence.
According to Webster, persistence is the quality that allows someone to continue doing something or trying to do something even though it is difficult or opposed by other people.
There are few qualities more important than persistence for an entrepreneur or for life in general. At times persistence can require that one should continue on the same path since the problem is not the effort, strategy or idea itself but rather timing may be the real issue. However, it could be that the business concept may be valid but the strategy, pricing or message may need to be tweaked or revised.
I can think back to a time in my company when we had a large number of properties that we had recently built and we were in the process of seeking to increase their occupancy. Some of the properties experienced a relatively quick fill-up while others dragged on and on. With an average of a $4 million investment to open each property (and some as high as $12 million), there was no option for simply abandoning our effort when our business plans did not play out according to our projections. Rather, we had to continuously persist in finding solutions for those properties that were struggling.
At times it required a pricing change. Other times it required a new marketing strategy. Still other instances required changes in personnel. And seeking the wisdom and counsel of outsiders or counselors who approached solutions from a completely different vantage point played an important part as well.
At the end of the day though, it was critical to persist in our efforts. Failure was not an option. And with millions of dollars in negative cash flow annually, it was incumbent upon us to persist in finding the answers quickly.
So what about you? Are you facing some continuous road blocks as you pursue your dream or tackle an objective you have for your business? If so, I’d encourage you to consider this quote from Matt Biondi, an eleven-time Olympic medalist and world record holder:
“Persistence can change failure into extraordinary success”.
Next time you are tempted to throw in the towel, remember that you may be on the verge of extraordinary success… and persistence can be your secret weapon and make all the difference.
Business ventures have played a prominent role in my life for the last 35 years. In addition to business, though, one of my other passions is following and engaging in politics. While politics can often times be very divisive, one thing that most Americans would agree on is that truth is a rare commodity when it comes to the political arena. It’s been said that there’s only one time when politicians are untruthful: when their lips are moving.
I realize this may be an overstatement, at least for some, but it’s sad when an entire profession, which enjoys referring to themselves as “public servants,” is characterized as dishonest.
But what about you and me? When people think of us, both personally and in our profession or businesses, does the word honesty come to mind? Is truth a word that characterizes your business? Here are a couple of questions you can ask yourself to determine if Truth is not only important but is it a value that others see in you.
Do you fudge on truth?
In business, there are a myriad of relationships in which we are engaged. Whether it’s our employees and partners, lenders and vendors, or customers and prospects, we are regularly confronted with the option to communicate truthfully or “fudge” the truth to fit our agenda or gain an advantage. Whether our motivation is pure financial profit, or perhaps it’s a power or prestige issue, we can often be tempted to exaggerate, confuse or disguise the absolute truth. Unfortunately, it’s all too easy to justify communicating in an untruthful manner.
I can recall at one point in our business that my business partner and I had the unpleasant task of meeting with one of our lenders which had financed the construction of four of our projects. We owed the lender over $15 million and several of the properties they had financed were not living up to our projections or their expectations. If you ever figuratively “went to the woodshed” as a child, that’s what this meeting was like. Clearly, the temptation was great to simply tell the lender what they wanted to hear. But it would have been untruthful.
The meeting grew very tense with the executive of the lender hurling a string of obscene expletives at us. In the heat of the moment, I responded that if he wanted the keys to the properties he was welcome to them. We were doing the best we could do and if that wasn’t good enough, then he was welcome to step in and take them over. It’s interesting how simply responding firmly in truth changed the entire demeanor of the conversation. While the facts were still the same, the attitude of the lender changed when he understood that we could not simply promise him what he wanted to hear. As a footnote, several years later when we sold our company, those four properties contributed significantly more in value than their associated debt.
Do you invite truth from others?
In politics, it’s easy to see whether a politician is interested in the truth by observing with whom he surround himself. Are his advisors and team members simply “yes” men who tell him what he wants to hear or does he open himself up to divergent views and opinions? There’s a verse that says, “Iron sharpens iron.” The concept is that as we hear the truth from others we trust, we ourselves are sharpened in the process.
Do you invite input from your team, advisors, and customers that might conflict with your views, even if at times it might be hard to hear? And if you do, are there times when the truth they share with you causes you to change your attitude, behavior or actions? Truth is sometimes hard to receive, but it’s critical that we display an attitude that invites it. Doing so reveals another important quality we all need, humility.
As I think of the importance of truth in my life and business I am reminded of this verse: “Truth has stumbled in the streets.” (Isaiah 59:14) Sadly we see the reality of this verse being borne out in all areas of our society including politics, business, athletics and even in the church. Just this last month, corporate giant VW was caught in a scandal that involves millions of their vehicles and will cost the company billions of dollars, but more importantly their reputation will be tarnished for years. And it all originated from a scheme to cover up the truth.
At the end of the day, truth is one of the most important qualities in both your life and business. Embrace truth and you can overcome or confront any obstacle in your life. Compromise truth though, or even worse reject it, and you can be certain that those same obstacles will come back to haunt you.
“At the end of the day, Truth is one of the most important qualities in both your life and business. Embrace Truth and you can overcome or confront any obstacle in your life. Compromise Truth though, or even worse reject it, and you can be certain that those same obstacles will come back to haunt you.”
On this Memorial Day, our collective thoughts as Americans turn to those men and women throughout the history of our nation who gave their all so that we might continue to enjoy the “blessings of liberty.” Whether those unselfish patriots laid down their lives in 1776 as a result of “the shot heard ’round the world” or perhaps more recently as our fellow citizens gave their lives half way around the world, there is no greater act of love, sacrifice or commitment than the one they demonstrated.
Clearly at this special time of year, there is no more fitting act of honor or tribute than for each of us to take some quiet time to reflect on their lives, their heroism and their legacy.
As I’ve reflected about these gone but not forgotten patriots, their acts of sacrifice should cause us to feel a sense of responsibility and accountability. Should we not then respond in some overt manner to acknowledge the worth of their lives and the value they placed on our country?
One life is of immeasurable worth. Exponentially though, over a million lives, sacrificed for our nation over these 240 years, demand our attention and our action. We must go beyond an annual recognition that honors our fallen heroes and make our own “sacrifices.”
While most of us will never be called to lay down our lives for our nation, surely we can lay down a TV remote, or a golf club and give back a few hours a month to the nation in which we have been so blessed to live. There are hundreds of ways that you and I can rise up to defend and protect our nation’s future on a daily basis but we must be intentional about doing so. As you do so though, I encourage you to share your commitment and your plans with a friend or family member and then together, step up and give back to this wonderful nation.
Finally, this day of reflection reminds me of another Truth expressed 2,000 years ago by a man whose life exemplifies love, sacrifice and commitment. This God-man we know as Jesus left the blessings and comforts of heaven and declared this Truth:
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But Jesus did not just speak this Truth. He too sacrificed His life for you and me, so that we could also enjoy the blessings of liberty by embracing Him and His message.
On this special day, as we remember and honor our fallen service men and women, let’s also honor the One to whom we ultimately owe the blessings of liberty: Jesus Christ, our Lord and Savior.