Why Other Harvards Aren't Discovering It
Peters, Charles
Why Other Harvards Aredt Discovering It by Charles Peters In the preceding article, James Glassman laments the fact that our best and brightest young people are not becoming entrepreneurs. I...
...The capital gains tax break is now given to investors without regard to whether their investment is new or not...
...And in our meritocracy, the most widely recognized post-school grade is the amount of money someone else will pay you to work for him...
...The entrepreneur need not be immune to the acquisitive instinct but he must be willing to delay its gratification...
...Too many of the people we now have in our large corporations and government agencies are bland, cautious, and unoriginal...
...There is always a tendency to sentimentalize about young people, and the foregoing has assumed that given the right challenge and the right information, the young will react in the right way...
...They are children of the television, shopping center, consumerist age...
...All you have to do is break even...
...This would encourage the entrepreneur and produce new jobs as well...
...I very much doubt that you have...
...Their knight in shining armor has been Ralph Nader, the protector of those who buy things...
...I think there are four reasons for this failure...
...Finance your new organization yourself if you possibly can...
...But how about the others-the joy of creating a new organization, of providing people with work, of making that work satisfying, of providing a product or service of the highest quality...
...The last thing you want to do is sell stock to the public-that gives you an obligation to those outside stockholders to maximize profit, which could be death to all the good things you wanted to do, all the fun you were going to have...
...that asserted, “Without a hope of reasonable profit, no one would start a business, introduce a new product or service, or even continue producing an old one...
...None of them requires profit...
...The best solution to the financing problem is to do it jointly with your employees...
...What a narrow and unexciting view...
...If you want to be sure of having a nice house, you’re going to be reluctant to risk that second mortgage to finance your new organization...
...Of course profit can be one motive...
...In fact, it is entirely possible that seeking profit could lead you into, say, shoddy products or unsafe working conditions...
...The plant created 350 new jobs...
...They can be humane, adventurous, creativethe qualities young people are supposed to admire, the qualities the country desperately needs if we are to Charles Petets is editor-in-chief of The Washington Monthly...
...As you read it, ask yourself if you have seen this sort of thing discussed anywhere else...
...generally retains nearly 90 per cent of its profits for reinvestment, like the recent offering of a new pjant in the little town of Roosevelt, New Mexico...
...Entrepreneurs do not have to be greedy monsters or dull Babbitts, as they are usually depicted in art...
...A second mortgage on your home might do the trick...
...A third reason for the lack of entrepreneurship is that government policy does not encourage it...
...Young people also want to make a lot of money so they can buy a lot of thing...
...Time magazine recently published an essay entitled, “Profits: How Much Is Too Little...
...The great irony is that the acquisitive and the entrepreneurial drives can be inconsistent...
...One is the way the challenge is presented...
...revitalize our economic and political system...
...What we should do is restrict the capital gains break to investment in new plant or new business...
...If you can’t swing it on your own, seek investments from friends or employees who share your aims...
...Or together you might decide to plow profits back into a new plant, instead of distributing them to stockholders...
...The Time essay mentioned earlier describes how Levi Strauss & Co...
...And if you continue to want to get good grades, you’re going to continue giving the safe answers at the very time when we’ve found that a lot of the old answers don’t work and that our greatest need is for fresh and original approaches to our economic and political problems...
...Here, to illustrate the problem, is the kind of advice needed by someone humane, adventurous, and creative who is starting out in business...
...Today’s young achievers are achievers in terms of grades, in terms of others’ views of them, not in terms of their own view of themselves-as they go forward from the academy to work, they still need someone to grade them...
...There is of course the Small Business Administration but it, to put the matter simply, is a joke that has traditionally been the preserve of the grubbier hangers-on to the incumbent administration and to its chief congressional patrons...
...The result is that it encourages trading in existing issues as much as it does the financing of new enterprise...
...If you can make $35,000 or more a year working for someone else, get your A, and buy those things, why risk all starting a new business...
...Or borrow the money...
...That may not be the case...
...This country now ranks 18th out of the top 20 industrial nations in new investment...
...Then together you can make decisions to sacrifice profit in favor of such things as quality of product and quality of work...
...The secret here is that the controlling stock in Levi Strauss is owned by one family, who can decide to forego dividends, just as you and your friends and employees could...
...Another reason for the absence of entrepreneurs is the dearth of practical information on how best to become one...
...The final reason for the shortage of entrepreneurs may be found in the attitudes and values of today’s youth...
...In other words, money is the only motive for the entrepreneur...
Vol. 8 • October 1976 • No. 8
