This past election, Barrack Obama and the DNC-loyals were attacking Mitt Romney and other business people for shipping jobs overseas. Like most patriotic Americans, it upsets me to see jobs leave the United States as well. But was this really a fair criticism of business owners?
As a former entrepreneur myself, let me give you an analogy. This criticism is akin to farting while sitting next to me, then getting upset when I leave because you’ve made the room smell like three-month-old milk and despair.
If we were a statist nation like former Russia, China, Cuba, etc., businesses would exist to serve the state; something many on the left seem to wish were the case here—you know, the people who supported millionaire capitalist Michael Moore by attending his movies bashing capitalism yet fail to see the hypocrisy in that?
The reason I believe this idea is so ridiculous, is because despite my requests, not one of these people can name a statist nation whose people don’t live in absolute squalor. Note that Russia’s GDP has nearly quadrupled in the last 12 years, and they’re budding ideas on capitalism are still being ironed out. So I’ll be happy to consider statism a practical system of governance for maintaining quality of life and basic human rights when a successful example arises.
In our capitalist system however, businesses are the product of a risk an entrepreneur takes to offer a good or service to the public to make a living for themselves, as opposed to working at the behest of someone else. We all know that the greater the risk, the greater possibility for reward. This carrot on a stick is what makes entrepreneurs take such a risk.
So to explain my flatulence analogy; America has the third highest corporate tax rate on the planet. We also have one of the most intrusive regulatory networks as well, thanks to NHTSA, OSHA, the EPA, and other federal and local legislations and regulators. Add labor unions to that, which infect businesses like a cancer feeding off the host until the Hostess dies. All these roadblocks make America a very expensive place to do business. So how is it fair to blame people who leave America when we make it such an inhospitable place to do business?
Let’s ignore all the ideology for a moment and think about this skeptically and empathetically. What are some of the issues of doing business outside the United States?:
- There are regulatory issues of your home country and the one you’re doing business in, requiring you to hire a plethora of compliance lawyers and staff just to make sure what you are doing is even legal.
- Language barriers exist for nations that do not have English as their primary language.
- Shipping, tariffs, and customs expenses increase.
- Massive expenses in building a new facility and moving operations from a U.S. based plant to a foreign one.
- Travel expenses increase for those headquartered in the United States that have to often visit overseas facilities.
- Loss in quality assurances due to lack of direct oversight.
These are but a few issues I can think of off the top of my head; certainly there are many more. So if all these issues exist, why even do it? Because doing it is still more profitable than doing business here in the United States. Stop and think about that for a minute—let it fester in any liberty-minded bones you have in your body. If you’re like me, it should offend you to the core.
Because we are one of the richest nations in the world, American workers are not going to work for the pennies a day that some third world nations consider a reasonable salary, so if we intend to compete in the world market, you’d like to think our legislators would make every effort to overcome our higher wage demands by keeping corporate taxes and regulations as unobtrusive as possible so we can be competitive. Greater expenses make it more expensive to the consumer. Yet, during the election, the people like Mitt Romney were vilified as heartless rich bastards for attempting to rectify this.
I propose we start calling out those who want to bash the rich, playing the hero while doing it. This pure ignorance of economics, history, and logic is offensive. Our economy depends on people with money investing in American products and workers. But why would they when we treat them like dirt, tax them to hell and back, and regulate them like a dog on a choker chain dying to run ahead of its master?
If you’ve ever been in the middle of a productive task and had someone interrupt to “help” you, only to slow you down and make matters worse, then you should inherently understand what government does to entrepreneurship every single day.
Unless we vote for liberty minded candidates, entrepreneurs will observe the basic physics principle of taking the path of least resistance. We have no one to blame but ourselves for electing and re-electing those who are content to push them away to pass “feel-good” legislation that is a product of jealousy as opposed to evidence based hypotheses. When emotion trumps logic, we all lose.