Recovery's not enough. Rekindle America's entrepreneurial fires.
America needs a long-term plan to rekindle its entrepreneurial spirit and spur new ventures.
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Wow. This quote is wrong on so many levels. Actually the largest source of financing has always been the entrepreneur's own money and any funds they are able to raise from friends and family members. This accounts for about 85-90% of all funding. Very few entrepreneurs max out credit cards successfully to start a venture. While this makes for great theater for journalists, it just does not happen that often and when it is used by an aspiring entrepreneur it is rarely successful.Skip to next paragraph
Jeff is the Jack C. Massey Chair in Entrepreneurship and Director of the Center for Entrepreneurship at Belmont University in Nashville, Tenn.
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And what about bootstrapping? Heck, even Silicon Valley has finally caught on to how creative one can be when starting a venture with little capital.
The surveys by NFIB and others clearly show that credit availability is not the problem. It is demand in the economy. If you want to find blame for that, let's not start with the financial sector sucking out talent and credit, but let's start with the giant sucking sound coming from a government that taxes too much and spends twice as much as they tax.
But let's get back to the premise behind myth number five. Yes, start-up rates are down right now. However, it is wrong to conclude from this statistic that entrepreneurship is a useless tool for economic recovery.
Just the opposite. Since small business has led job growth coming out of almost every past recession it is time to redouble our efforts to spur new venture creation.
How do we do this?
- Cut taxes and create a simple tax system that does the one thing it is intended for -- raising the money needed to fund the basic functions of government. Tax systems should not be a tool for social, economic, cultural or political engineering and manipulation.
- Cut red tape. We still regulate business with a broad brush that punishes small firms for the sins of a few very large companies.
- Celebrate economic success that is achieved through hard work and perseverance. Stop demonizing those who create wealth through the risk taking made possible by free enterprise. Make them the heroes that they are.
- Protect property rights. Stop the abuse of eminent domain. Stop the use of taxation for redistributing wealth. Stop basing policy on the assumption that government lets us have money and property out of the generosity of their hearts -- they work for us, not the other way around. Property in this country is ours, not the government's.
- Educate. Educate our children about economics, liberty, and free enterprise. Educate high school kids about entrepreneurship as a noble and viable career path. Educate adults on the tools and knowledge they need to successfully launch and grow businesses.
This economy is not in need of recovery. It is in need of rebuilding. We have had decades of misguided public policy that has slowly bled the entrepreneurial spirit and incentives for entrepreneurial risk taking out of our country.
It is a time for action. It is a time to commit to a long-term plan to rekindle the entrepreneurial embers that are fading in this country. Our best hope for the return of sustainable prosperity is to reignite the entrepreneurial fire in America.
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