This was a revolutionary concept 250 years ago when governments meddled in every aspect of life. When the enlightenment led to liberal ideas and policies the result was an explosion in productivity and wealth that the world had never seen before. A key element in that explosion was private entrepreneurship. The freedom to take risks, employ and accumulate capital, create businesses, serve customers, innovate and enjoy the fruits of one’s efforts. The entrepreneur is the unsung hero of our high standards of living. The most amazing thing is this: all we had to do to get him or her to do his marvelous work was to leave him alone.
One of the themes of this 2021 Free Market Road Show concerns limitations on entrepreneurial freedom. I would like to address that here primarily in the context of something that entrepreneurship desperately needs – encouragement. Entrepreneurs see something that nobody else sees and they possess the courage to act on it. They think big. They endure setbacks and failure, but they press on. The rest of us, I am convinced, do not fully appreciate the indispensable contributions they make to human progress. Without men and women willing to and take risks life for the masses would surely still be in the words of Thomas Hobbes “nasty brutish and short,” just as it was for centuries until capitalism gave the entrepreneur the chance to succeed.
Never underestimate the power of encouragement. Applied in the proper form at the right moment it can accomplish remarkable transformations in both people and economies. Sometimes the best encouragement is a kick in the rear end. It might be what’s required to stop bad behavior or to get a fool to use his brain for a change. However, the form of encouragement that I prefer as a first resort, whether I am its recipient or its administrator is illustrated in a true story involving a high school football game in late 2008.
Sportswriter David Thomas recounts it in his book “Remember why you play.” Here’s a summary: The lions of Faith Christian School in Grapevine, Texas were set to play the Gainesville State Tornadoes. The Faith Christian players had everything in their favor, including a guaranteed slot in upcoming state plays-offs. The Gainesville players by contrast were teenage prisoners of a maximum-security correctional facility. They had won no games and scored only two touchdowns all seasons. To date, they seem to be losers in both life and football. But they boarded the bus for the one-hour drive to Grapevine and did so with the lowest expectations. Thomas writes: “The game was supposed to mean nothing. The game turned out to mean everything.”
With no fans except for prison personal, the Gainesville team members were accustomed to being outnumbered, outplayed, and outcheered until encouragement worked its magic. Faith Christians coach, Kris Hogan saw an opportunity to make a statement. With his guidance, the school treated the visiting as if it was the home team. As Gainesville players entered the field, Faith Christian parents and students waved a Tornados banner to welcome them. And about half of Faith’s fans and cheerleaders, Thomas reveals, moved over to the visitors’ side of the stadium and cheer the Gainesville players throughout the game.
Parents of Faith players were encouraging kids they did not know to tackle their own sons. Though the prison team did not win the team, its players scored two touchdowns and played their best of the season. Guess what happened next. After the game, the teams met at midfield for prayer with Faith fans standing all around. Mark Williams, the Tornados coach asked if his quarterback could pray. In a simple manner, but with a heart-felt debt, the player thanked God for things easily taken for granted, from the sun coming up that morning, to the opportunity to play football that night. There was one thing however for which he said he did not know how to express thanks because he never knew so that many people cared for him and his teammates.
In a small Grapevine Texas stadium, that evening tears flowed freely. Nobody felt he was a loser. Lifelong friends and memories were made. Spirits and standards were lifted. Effects of that moment will resonate in many lives for years to come. Word of what happened quickly traveled across the globe. For months, stories of it appeared in papers from Britain to Australia, likely inspiring millions. All from a little unexpected encouragement that didn’t cost anyone so much as a penny.
The late author Leo Buscaglia was right when he said “Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around.” As an economist, it is natural to me to find connections between what works on a micro-level and what works for society at large. If you want to know what produces a healthy growing economy think back to what motivates the individuals who comprise it. Encouragement looms large at every level because we humans respond positively to incentives. We react negatively to disincentives. If we encourage something we will get more of it. If we discourage something we will get less of it.
An economy produces no wealth of its own. Only real individual people produce wealth. If they didn’t there would be no economy to talk about. They do it through the acts of working, risking, investing, inventing, innovating, employing, building, and serving customers. If we want a wealthier society it follows that we must encourage people to work, to risk, to invest, to invent, to innovate, to employ, to build, and to serve.
To those football players on the prison team, Gainesville’s encouragement showed up in the form of other people cheering them on. The message they heard was: Go for it! You can do it! We love you! We wish you the best! How well would have they performed in the field if the message was: Losers! You are no good! Go back to prison!
Now you know why more than a few American entrepreneurs found it demoralizing a few years ago when President Obama denigrated them with the thoughtless sneer “You didn’t build that.” In so many tragic ways all over the world, governments smother wealth creators in discouragement. They denounce them as greedy and punish them with high taxes. They drive them off the playing field. In socialist Venezuela for instance, every conceivable discouragement crushes those who work, invest, invent, innovate, employ, build and serve. Freedom to do those amazing things is replacing with politicians barking orders. Only a moron should be surprised at the disastrous results.
If you can see how encouragement made a difference in that texas football game you can surely understand how vital it is in our economic lives as well. When the world finally embraces this truth entrepreneurship will blossom and poverty will become something you will have to learn from history books. Entrepreneurship is one of many wonderful things that occur spontaneously with no government commends necessary when people are free where freedom reigns. So it would seem more than a little appropriate for me to work toward a conclusion by summarizing just what freedom is all about.
More than a half-century ago Ronald Reagan warned us with this prophetic words “Freedom is never more than one generation away from extinction. We didn’t pass it to our children in the bloodstream. The only way they can inherit the freedom we have known is if we fight for it, protect it, and then hand it over to them with the well-thought lessons of how they in their lifetime must do the same. and if you and I don’t do this then you and I may spend our sunset years telling our children and our children’s children what it was once like when men were free.”
In those four sentences, the actor who would become America’s 40th president expressed more wisdom than the typical politician offers in an entire speech.
Freedom is a strange thing. Everyone claims to be in favor of it. Nobody ever dares to declare that he’s against it. At election time, all candidates endorse it even if they disagree with each other on everything else. Some people are for it in certain spheres of life but not others. And freedom of entrepreneurship is probably favored least because so many people have been taught to disdain the entrepreneur, especially successful ones because they are supposedly greedy and self-serving. Could the freedom that Reagan spoke of in such serious terms really be so malleable that it fits any agenda? If it is, then it is meaningless.
Let’s pause, take a breath, and refresh ourselves on some principles of freedom that we may have forgotten. Here are nine of the most important.
Freedom is your birthright. It is yours from day one by virtue of who and what you are. A unique being endowed by nature and nature’s God with the right to exercise that uniqueness through the choices you make. It remains forever unalienable unless you forfeit it by depriving another person of his or her birthright. Freedom is an inherently universal birthright, meaning no one is granted superior status to run around and tell everybody else what to do, other than say a parent’s right to raise a child to independent adulthood. Freedom is routinely suppressed and abused, but that said fact does not invalidate your right to it. Is not something you are entitled to only if politicians decided to give it to you.
Freedom doesn’t mean you get to do whatever you want. It is not a blank check. As the old saying goes “your freedom to swing your fist ends where my nose begins.” You are not free to enslave or assault another sovereign human because doing so would violate the same right to freedom that all peaceful rights-respecting people possess.
Freedom is not automatic or guaranteed. We live in a dangerous world full of people who will be happy to deprive others of freedom for all sorts of deplorable reasons, such as a lust for the limelight or power, expediency, short term, and self-right benefits, you name it. Most people who have ever lived in fact have lived as slaves, or serfs, or subjects who feared the disapproval of others in power. So achieving freedom and sustaining it demands knowledge, vigilance, and courage.
Freedom can be voted away. Might doesn’t make right which is another way of saying that a majority doesn’t sanctify wrong. Don’t use democracy as a cover of evil that you would never endorse if your neighbors ganged up and did the same thing to you. Remember that Hitler was elected. Just as fully and powerfully as an invading army you can wipe freedom out by what and who you vote for.
Freedom doesn’t mean you get to grab the other guy’s stuff. In one sense, this is an application of the second principle to property. It’s amazing how many people think that they are not free unless they use the political process to appropriate what belongs to others. Freedom and private property are connected at the hip. Take one away and the other disappears with it. And if you think, you are entitled to someone else’s property, don’t be surprised if they decide to stake the same claim on you.
Freedom produces unequal outcomes. As it seeks to uphold the equal rights of us all, the law should be fair, predictable, impartial, and nondiscriminatory. Equality before the law is not the same however as equality in material income or possessions, or even happiness. Differences between people are immense in terms of behavior, ambitions, talents, work ethic, intelligence, resourcefulness, savings, risk-taking, on and on. To expect them to generate equal incomes in the marketplace is absurdly childish and the only way such equality could ever be achieved is through brute force anyway. Do we really want to punish success and achievement to approximate the impossible fantasy of equal possessions?
Freedom without character is doomed to fail. Benjamin Franklin warned “Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters.” Freedom requires high standards of honesty, humility, responsibility, patience, and self-discipline. No nation ever lost its character and kept its freedoms.
The freedom to be an entrepreneur is no less important than any other freedom. In one important sense, it may be the most important because if we’re not free to take risks, employ capital, innovate and create most of us would starve to death.
Freedom is what makes life worth living. Imagine life without freedom with some Orwellian “Big Brother” spying on you, telling you what you can and can’t do at every turn, and stomping on your rights to life and property because he feels like it. You wouldn’t actually be living your life at all. Big Brother will be living his life through you and that’s what it means to be a slave.
So, let’s rededicate ourselves to these common-sense freedom principles. Let’s remember that a little encouragement goes a long way. Discouraging entrepreneurship with a climate of repression and arrogance may be appealing to the shortsighted and power-hungry but should be an enemy to all decent people who want peace, freedom, and prosperity.
The AEC’s fundamental goal is to promote a free, responsible and prosperous society. Through education and improving public understanding of key economic questions, the AEC promotes the idea of a free market economy and the ideal of a free society.