Everything I knew about economics was instincual untill the whole Ron Paul thing. I learned a lot from buying a small working class bar in Ohio about six years ago at the age of 21 (as well as a couple of houses to rent out but that didn't last long). I just recently had to sell it. Anyway, I just thought this might be fun to draw from real experiences as a business owner how the free market works and how any govt regulation will almost always hurt the smaller business' first. And maybe a good place to let off some steam against government thugs.
For example I lived in Toledo Ohio, just the city not the state or the county passed a smoking ban. Never mind the fact that I may not have invested my money in a bar had I known a smoking law was going to be passed. The city in itself has large suburban sprawl, so all the outlying suburbs were allowed to smoke but not Toledo. So that alone helped the suburban bars over us.
They did have a rule that allowed smoking sections (they had to be completley sealed off). My bar couldn't hold one (the design of the building would not allow it). Even so this infinatly hurt the smaller bars as some couldn't build smoking rooms or simply couldn't afford to put one in. For the city ban I just said screw it and allowed smoking. I got busted twice by local TV investigative reporting, and 2 city fines, but at least I was on TV.
A year later the city said nevermind, you can smoke in bars again. Now this really hurt the smaller bars that took the risk of putting in a smoking area, and then found they wasted there space and thousands of dollars for no reason (I knew one owner who went out of business almost directly from that). Fun stuff.
Oh ,and yes the statewide smoking ban (this one I followed, govt thugs already hated me from the first go around) implimented most certainly did negativly effect my business and I can safley say at least 4 other bars (we all lost between 10-20% of business that never came back).
Let us look then and see, how they manage their concerns- they for whose cause we are to labor, devote ourselves, and grow enthusiastic
-Max Stirner, The Ego and His Own
my sisters and I were raised by a welfare leech who had no good reason not to work (she had a masters degree even). It has been a little funny to watch my sisters do a 180 degree ideology shift as soon as they became producers. One is very successful in corporate america and the other runs a small business.
But my point is that people don't realize this stuff until they are the ones that society is hosing for their "free stuff" schemes. Then it becomes instantly obvious.
I've recently thrown myself into a small business. It's a very funny adventure!
Government requires all sorts of permissions in all imaginable sectors of business. But I just don't give a damn about it! I compete not so much on competence (I don't know much about this business sector since I'm totally new to it), but mainly only by not paying any taxes or follow any regulations. Earning money like this is like stealing candy from a child! Government of course almost only cares about putting things in writing, not actually verifying what's happening out there in reality. Without paper trail they have no chance of getting anywhere. I've visited numerous trials on tax and similiar regulation issues to see how they play out. Never ever did I see any evidence brought up which wasn't based on a paper (such as a reciept) issued by the prosecuted himself! The government has no idea whatsoever what I am doing. They only go by the papers I send to them, and the corresponding papers of my clients, suppliers and employees. So by faking that ridiculous paper work, (and doing carefully, make no mistake about it!), government is off your back. And actually, taxes and regulations then work hugely to your personal advantage (short term) since they are such a straightjacket on competitors. I do take care to not expand too fast in order to not attract too much attention (from my competitors who might figure out what's going on), so I mainly just take enormous profit margins. I'd really prefer to lower prices and expand, but since competitors aren't as stupid as the government, that is indeed somewhat of a limitation.
I certainly have much higher operating costs than my competitors, and I've made som huge mistakes as I'm learning, but my profit margin is still about 5 times higher than that my more skilled and established competitors. Just by ignoring the government. That's my key business strategy!
It's not fascism when the government does it.
“We must spend now as an investment for the future.” - President Obama
Very interesting. I love to hear this type of stuff.
ProudCapitalist, if you don't mind me asking, what kind of business are you in?
I run a small web design and development business for the moment while I'm in school to make extra cash. All of it goes unreported. I get to keep all the money I make and I love it.
Steve:ProudCapitalist, if you don't mind me asking, what kind of business are you in?
I'd rather not spell it out specifically. I live in Sweden though, the country with the highest taxes in the whole world. And it's services. So there's no factory or products left behind. And mainly for private customers. Corporate clients often want paper works since my income is their expense, and expenses are tax deductable for them. Between companies it's only the question of who will pay the tax. Still, companies not planning to make a profit this year anyway (because of the depression) have limited tax advantages of formally increasing their costs = losses with paper works. And most of my suppliers readily accept selling me stuff without any receipt, which gives me quite some rebate. Small suppliers of course, where I negotiate directly with the owner, not an employee who of course cannot make such decisions. My employees are of course very happy to get higher net salary (they and I split the half of the salary which would otherwise be income taxed). A crucial point is to have trusted employees who understand this. Formally they are of course not my employees, but probaly most of them enjoy tax financed social welfare of some sort or another. I don't put my nose into that.
My concept isn't trixy or elaborate at all, like off shore tax haven stuff. I simply exploits that the tax authorities almost only go by paper trails. And I simply don't leave them any useful paper trail. Sure, if you run a bar selling alcohol you might get under cover visits by special tax inspectors. In some businesses it isn't as easy. And I'm sure I'm taking legal risks, I just consider them worth to take.
And by the way, it is interesting to see how contracts always are kept to the point (I still haven't experienced any exception!), even though neither I nor my clients have any formalities to go by. Most sales are so small anyway, that very few would "go to court" even if they would have proof that I have failed my responsibility (or vice versa). It has helped me realize that human interactions are not based on a third party ruling them, but on mutual trust. And it works very well. Even misunderstandings have ealisy been sorted out after the damage has been made. I have denied service a couple of times to clients which haven't seemed trustworthy to me. But I doubt it would've been different if I'd done all by the book.
So, there's my little secret out in the open... Anyway, I'm new to it and just surprised how well it works, thus far. I'm not really doing it for the money, but because I'm tired of sitting in an office being told to do stupid things. Entrepreneurship is the sh!t, I'm hooked on it!
February 17 - 1600 - Giordano Bruno is burnt alive by the catholic church. Aquinas : "much more reason is there for heretics, as soon as they are convicted of heresy, to be not only excommunicated but even put to death."
It is odd how much the government distorts the market. Another one of the million and five examples they made my life a living hell was telling me when I could or couldn't put certain alchoholic beverages on sale, and putting proice controls on liquor, and making my options from buying liquor and marketing my bar very difficult. This of course hurts the smaller businesses even more due to more limited funding and if you are new harder name recognition, and much harder to open a business without being well conected and very rich already. Like I said, that is just one more of many headaches the govt made my life a living hell.
But government is great for schemers, parasites, and the uber rich, I can not dispute that. That fact became inevitable when I was trying to be in a world where I wanted to ignore government and politics.
nazgulnarsil: my sisters and I were raised by a welfare leech who had no good reason not to work (she had a masters degree even). It has been a little funny to watch my sisters do a 180 degree ideology shift as soon as they became producers. One is very successful in corporate america and the other runs a small business. But my point is that people don't realize this stuff until they are the ones that society is hosing for their "free stuff" schemes. Then it becomes instantly obvious.
If I am prying to much please forgive, but why would some one with a masters degree refuse to work? It is nice to know you guys got out of it a rare and impressive feat indeed, I wonder if I would have had I been raised in it.
nazgulnarsil: my sisters and I were raised by a welfare leech who had no good reason not to work (she had a masters degree even). It has been a little funny to watch my sisters do a 180 degree ideology shift as soon as they became producers. One is very successful in corporate america and the other runs a small business.
I've always found it funny how people in my school that are intelligent and informed tend to be left-leaning only (of course, that's not how they explain their ideology, but it's clear to the "objective" outsider) because their parents are government employees in one way or another.
The difference between libertarianism and socialism is that libertarians will tolerate the existence of a socialist community, but socialists can't tolerate a libertarian community.
I don't even want to get into the FDA and cops, they really hurt everyone in the service industry I think.
ProudCapitalist's example is a great one, because we often just think of the effects of government intervention from the standpoint of how it effects us if we play by the rules. It's quite possible that PC's business would fail in an unhampered market (by his own admission, he doesn't know the business that well), but because he knows how to work the system, and his competitors don't, he succeeds. Success, under government intervention, therefore, doesn't go to the company which most efficiently meets the needs of it's customers, but rather, to the company that most knows how to exploit the current system.
This is evident in the welfare system, as well. Those who know how to get around the rules can keep their cool cars but still get a check. The newbie to the system, however, who tries to play by the rules, has a much harder time getting government aid. This fact is often cited as a weakness of the welfare system, when in fact, it is a weakness of any system where government intervenes.
(BTW, no criticism of ProudCapitalist, or welfare cheaters for that matter, is implied here. Survival is about adapting oneself to one's environment. When the environment is artificial, who can blame someone for pursuing their survival by being false?)
The Rev
Lifes a piece of shit, when you look at it
Life's a laugh and death's a joke, it's true
Just remember it's all a show, keep em laughing as you go
Just remember that the last laugh is on you
I recently came up with the idea of setting up a motorcycle workshop to cater to the local road racing enthusiasts and teams. My main idea would be to have it fitted with a Dynojet Dynamometer and ancillaries since there are very few of them around here and the importer is striking very good deals for new customers. Problem is bureaucracy is getting in my way...
I know I would have to comply with noise and pollution regulations (motorcycles revving at full load... please do not hate me) but nobody seems able to point out who I need to contact to get the details. Do I need a soundproof, dedicated room or can I do without? Which ventilation systems and filters do I need to install? Can I set up shop in a normal artisan area without risking violating some byzantine law? Are there restrictions to the number of days I can work with my Dyno because of noise regulations for professional workers? Nobody seems to be able to answer and each passing day is a lost day.
Yes, it's time for the Dr Goebbels show!
Kakugo: I recently came up with the idea of setting up a motorcycle workshop to cater to the local road racing enthusiasts and teams. My main idea would be to have it fitted with a Dynojet Dynamometer and ancillaries since there are very few of them around here and the importer is striking very good deals for new customers. Problem is bureaucracy is getting in my way... I know I would have to comply with noise and pollution regulations (motorcycles revving at full load... please do not hate me) but nobody seems able to point out who I need to contact to get the details. Do I need a soundproof, dedicated room or can I do without? Which ventilation systems and filters do I need to install? Can I set up shop in a normal artisan area without risking violating some byzantine law? Are there restrictions to the number of days I can work with my Dyno because of noise regulations for professional workers? Nobody seems to be able to answer and each passing day is a lost day.
for what state?
I have been tooling around with computer repair, nothing official, all under the table
I don't think I know 1 bar owner who plays by the rules. It would be impossable to do so, trust me (at least for the smaller ones). The really good owners are like magicians with secrets they refuse to give away on how they do their books or keep the inventory costs down (I would have payed an arm and a leg for a really shady accountant). Even so in the service industry in general there are so many hurdles to jump, it would be great if there was no leviathan to contend with.
while maybe not a business owner writing this article I found this amusing fro the Lew Rockwell site
http://www.lewrockwell.com/crovelli/crovelli26.html
These people can make life difficult for even the emplyees they are trying to proptect from us evil entrepenuers.
I can vouche that most of my bartenders (all who could be dubbed "working class") hated most govt regulations, even when there was an employers must pay employees health care law that came up on a ballot, because working for a small business, some even said if it passed they were willing to work for crazy low wages and work under the table (and more importantly, being reasonably smart people who had to work for a living). I guess according to the government if that law passed, and I could no longer afford to pay all my employees on govt/ hip enlightend people terms, but could pay them for what my employees asked for (on tips only) I would be consider an evil exploiter.
Dondoolee: Kakugo: I recently came up with the idea of setting up a motorcycle workshop to cater to the local road racing enthusiasts and teams. My main idea would be to have it fitted with a Dynojet Dynamometer and ancillaries since there are very few of them around here and the importer is striking very good deals for new customers. Problem is bureaucracy is getting in my way... I know I would have to comply with noise and pollution regulations (motorcycles revving at full load... please do not hate me) but nobody seems able to point out who I need to contact to get the details. Do I need a soundproof, dedicated room or can I do without? Which ventilation systems and filters do I need to install? Can I set up shop in a normal artisan area without risking violating some byzantine law? Are there restrictions to the number of days I can work with my Dyno because of noise regulations for professional workers? Nobody seems to be able to answer and each passing day is a lost day. for what state?
Italy, part of the glorious European Empire, mate!
Kakugo: Dondoolee: Kakugo: I recently came up with the idea of setting up a motorcycle workshop to cater to the local road racing enthusiasts and teams. My main idea would be to have it fitted with a Dynojet Dynamometer and ancillaries since there are very few of them around here and the importer is striking very good deals for new customers. Problem is bureaucracy is getting in my way... I know I would have to comply with noise and pollution regulations (motorcycles revving at full load... please do not hate me) but nobody seems able to point out who I need to contact to get the details. Do I need a soundproof, dedicated room or can I do without? Which ventilation systems and filters do I need to install? Can I set up shop in a normal artisan area without risking violating some byzantine law? Are there restrictions to the number of days I can work with my Dyno because of noise regulations for professional workers? Nobody seems to be able to answer and each passing day is a lost day. for what state? Italy, part of the glorious European Empire, mate!
Oh wow, I guess that's way out of my area of expertise, can't really help you there. Other than suggesting knowing good shady lawyers and accountats you can trust (so hard to come by). I feel sorry for you from what I hear it is 10 times harder to do business in Europe than the US. I had a friend tell me that in France they are only allowed to have sales at certain parts of the year, is that true in Italy too?
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