Imagine that you are a successful small-business entrepreneur.

And then imagine that the government was forcing you to spend $30,000 to build something utterly useless just to prove that you were serious about your business.  Sound crazy?  That is essentially what is happening to Minnesota funeral-home entrepreneurs:

Verlin Stoll is a classic American entrepreneur.   Although he’s only 27 years old, Verlin opened his first business, Crescent Tide funeral home, in St. Paul last April.  He prides himself on being “a different kind of funeral and cremation service” by providing high-quality funeral goods at a lower cost than his competitors.

With basic services at merely $250, Verlin saves his customers serious money.  The bigger funeral homes on average charge ten times as much.  Indeed, Crescent Tide is one of the only businesses in the area that benefits low-income families who cannot afford the high prices of the big funeral-home companies.

Predictably, Verlin’s business model is a success.  And he wants to expand on that success by hiring new employees and building another business so even more Minnesotans can benefit from his services.  Unfortunately, there’s an obstacle standing in his way:

Big government.

Minnesota refuses to let Verlin build a second funeral home unless he first builds a $30,000 embalming room.  He doesn’t have to actually use the room, it just has to be there.  As Institute for Justice economic liberty expert Katelynn McBride explains: (more…)

From The Guardian (UK):

The revolution could be trademarked in the US as more entrepreneurs seek to profit from the Occupy demonstrations.

T-shirts began to appear days after the first protest on 17 September, a march through lower Manhattan. Now T-shirts, coffee mugs and other merchandise are being offered on the campsites that have sprung up in cities across the US. The US patent and trademark office has received a spate of applications.

(more…)

Two names loom large in this week’s news. Two names that ordinarily we wouldn’t think about together.

But, in the great struggle now unfolding before us for our nation’s future, it seems to me these two quintessential Americans are worth thinking about in light of each other.

One is Steve Jobs.

The other is Dr Martin Luther King, Jr.

Jobs, of course, is in the headlines because of his decision to step down and retire from Apple Computer, the company he co-founded, from which he later got fired, and to which he subsequently returned and resurrected.

Dr. King is in the news because of the opening of the King monument in Washington, D.C.

Other than being in the news at the same time, why might we think of these two very different Americans together?

I think they are icons of two essential but different and opposing aspects of American life. One is the individual and the other is our social reality.

It’s these two aspects of American life, the dignity and potential of individuals living free, and the social reality, the rules by which we all agree to live and to which we all submit, that has always caused tension in American life. And this tension is becoming particularly acute today.

(more…)

Michael Spence, Nobel Laureate and former Dean of the Stanford Business School, has just published a rigorous economic analysis called: “The Evolving Structure of the American Economy and the Employment Challenge.” The report illuminates how the unbridled growth of government consumption spending has destroyed America’s productivity leadership, driven entrepreneurs to off-shore production, and destroyed middle class wage rates.

Adam Smith, 18th Century English economist, pioneered the concept of the “invisible hand” to describe how capitalism through self-interest, competition, and supply and demand, more effectively allocated resources than the “dead hand” of the state; it levied punitive taxes, adopted restrictive regulations, and enforced monopolies to favor their crony allies. Smith described how English entrepreneurs flourished after their King’s feudal dominance of the economy was liberated by adopting the laissez-faire economics that allowed transactions between private parties to be free from the state’s coercion. Smith described how new wealth was rapidly created and compounded over time form the productivity gains of the Industrial Revolution that leveraged the value of workers and led to higher wages.

The Spence report illuminates that from 1988 to 2008, America’s productivity dominance collapsed by 70%; shrinking from 2.5% gain per year to only .7% per year. This crash in American leadership was the result of 98% of the 27.3 million new jobs created during the period coming from the lower productivity, and thus lower wage, “consumption” sector of the economy. Higher productivity, and thus higher wage, “goods-producing” sector grew by only 620,000 jobs. The root cause of this substitution for lower productivity jobs was a 23% growth in government, to 22.5 million workers, and a 63% growth in government dominated healthcare, to 16.3 million workers. Productivity for the American goods-producing sector continued to grow by a healthy 2.3% per year, but productivity of government workers sunk by 4% and productivity of healthcare workers plummeted by 9%.

In 1988 the average value added for American workers was $75,000. Over the last twenty years, America’s revolution in information-technologies helped drive up the valued added of a goods-producing American worker to $115,200 per year. But the productivity value of government and healthcare worker tumbled to $72,000 per worker; dragging down the average value added of American workers to only $90,750. That $24,450 loss of productivity explains allot about why the American middle class wages have been shrinking in the United States.

(more…)

When you think about a highly aggressive cartel teaming up with politicians to pass protectionist laws that kick entrepreneurs out of work, you probably don’t think about interior designers.

But you should.

The American Society of Interior Designers (ASID) represents less than 3 percent of all designers, but its members have designated themselves as spokespeople for the entire industry. ASID has spent over 30 years and millions of dollars lobbying from coast to coast for interior design licensing schemes.  Not surprisingly, the schemes they propose would force all interior designers to have the exact same credentials as required for membership in ASID.

The group has worked relentlessly to enlist state legislatures in its campaign for total industry cartelization. The Institute for Justice has documented these efforts in a study titled “Designing Cartels.”

Florida is ground zero right now in this epic battle.

(more…)

The Institute for Justice has been vindicating the rights of entrepreneurs for the last twenty years.

Across the country, IJ has teamed up with casket makers, florists, hairbraiders, horse teeth-floaters, interior designers, sign-hangers, taxi-drivers, trash haulers, vintners and numerous other Americans to secure their basic right to earn an honest living.

This week, we are proud to announce a new, nationwide effort in our fight for economic liberty:  Our National Street Vending Initiative.

From coast to coast, we will team up with mobile food vending entrepreneurs whenever their rights come under attack, filing lawsuits and engaging in grassroots activism and media efforts.

In conjunction with the launch of this initiative, we have filed a major federal lawsuit against the city of El Paso Texas:

For thousands of years, vending has been a way for entrepreneurs to provide for themselves and their families.  In the United States, this ancient trade is more popular than ever.  By 2007, over 760,000 vending businesses were operating in the country.  And consumers love them, so they continue to grow.

The Economist magazine predicted that in 2011 food vendors would create “[t]he biggest shift in America’s culinary landscape” and that “some of the best food Americans eat may come from a food truck.”

(more…)

What do you get when you mix bureaucrats with a bunch of adorable puppies?

In Kim Houghton’s case, you get a major First Amendment lawsuit.

Kim Houghton decided after a successful, 20-year career in advertising that she wanted more.  She wanted to realize her American Dream and become an entrepreneur in a business focused on dogs.

She had the gumption to quit her job and make her dream come true:  Wag More Dogs is a high-end canine daycare located next to a popular dog park in Arlington, Virginia.  Kim commissioned an outdoor mural on her wall that has cartoon dogs, bones and paw prints as a way to give something back to the park she’d frequented for years, and build up some good will for her new business.

The mural was a big hit.  After all, who doesn’t like puppies?   Things were smooth for a few months.

And then Arlington bureaucrats got involved.

Officials blocked Kim’s building permit and told her that she could not open unless she painted over the mural or covered it with a blue tarp.

Her crime?

Painting a piece of art that—in the eyes of government officials—had too strong a “relationship” to her business.

(more…)

Hey mom and dads, it’s election week!  Does your child like to argue?  Does he like to boss his younger siblings around?  Does he love the sound of his own voice?

If you answered “yes” to any of these questions, your child is a natural born politician.  Now to ensure his success in the political world, send him to Camp Politics for a three-week intensive training program:

Once he gets elected to office, the most important thing for him to learn is how to stay there.  If he does a bad job, people will want to get him out of office.  So your child will need to learn how to silence those that want to speak out against him.

Of course, this violates basic free speech rights.  But Camp Politics has figured out a sure-fire way around the First Amendment that means politics will remain a game for special interests and political insiders.

It’s called campaign finance laws.

We all know that speaking takes money.  And the only way ordinary Americans can speak out effectively about politics is to pool their resources with their friends and neighbors.  But campaign finance laws limit the amount of money people can spend on political ads and organizing and they wrap people in red tape to the point that they can’t even speak!

(more…)

Nationwide, government at every level is requiring more and more of the workforce to get its permission just to earn a living.

In the 1950s, only about 5 percent of the workforce needed a government license to do their job. Today, that number is over 30 percent.  And governments impose all kinds of other requirements that make it hard for would-be entrepreneurs to start and grow small businesses.

Entrepreneurs like Chuck, here:

Unemployment in the United States has now topped 9.5 percent for 14 straight months—the longest stretch since the Great Depression.  Nearly 14.8 million people were unemployed last month.

Consider the nation’s capital.

Year after year, Washington, D.C., is ranked the worst place in the United States to start a small business. How can the District change its ways to allow entrepreneurs to create more jobs and opportunity?

(more…)

Amidst the requisite election-year class warfare being played across the country, one of the common arguments being made by the left and accepted begrudgingly by the right is that those who earn the most should pay their fair share.  While both sides might differ over the size of one’s “fair share,” nevertheless even the most sober conservatives will usually concede this point.  Yet when one looks at how wealth is created, especially in spite of an economy as increasingly shackled as ours, this proves to be a specious argument.

The “fair share” arguments insinuate that the businessman, the entrepreneur, the inventor greedily piles their money on the backs of the poor.  Even for those who don’t see the world this way, there is a pervasive feeling that because one lives comfortably, one should be forced to support others because one has had such good fortune.  While you or I may agree that there is great merit to being charitable, I think we can also agree at least in principle that it is immoral for us to force someone to be charitable — especially if that “charity” is a government-run one for a government-determined cause, which is to say that it bears little resemblance to a charity at all.

But more importantly, what is forgotten are all the benefits that accrue to society as a result of the efforts of the wealth producer.

For it is the producer who generates wealth by applying his skills, energies and ideas and taking risk, generation which requires the creation of jobs both within his firm and within the firms that make up the other cogs in the chain of production, the proper allocation of capital by investors to fund the idea and the provision of a product that society values.  For one to make a lot of money, all of these disparate parts must come together, leading not just to success for the the producer, but food, an education and healthcare for the family of the employee and all of the employees at the firms that helped in the production of the good, a return for investors that can be reinvested in other profitable ventures to grow the overall economic pie and over time better and cheaper goods for the consumers, those who solely determine which producers are rewarded with profits and which are penalized with losses.

(more…)