Posts tagged with: business

The Goldwater Institute has released a new study showing that states with a larger share of entrepreneurs do a better job at reducing poverty than states with fewer entrepreneurs.

There is a strong connection between a state’s rate of entrepreneurship and declines in poverty. Statistical analysis of all 50 states indicates that states with a larger share of entrepreneurs had bigger declines in poverty. In fact, comparing states during the last economic boom—from 2001 to 2007—data show that for every 1 percentage point increase in the rate of entrepreneurship in a state, there is a 2 percent decline in the poverty rate.

To help reduce poverty, policymakers should focus on increasing the number of entrepreneurs in their state. Research shows that one of the most effective ways to increase entrepreneurship is by lowering tax burdens. In particular, this study shows that high tax burdens, measured as a percentage of personal income, drags down the growth rate of entrepreneurship in a state: for every 1 percentage point increase in the tax burden, there’s a corresponding 1 percentage point drop in the entrepreneurship rate. States without income taxes also have higher average rates of entrepreneurship than those with income taxes. The average number of sole proprietors as a percentage of employment in states without an income tax is 21.7. The rate for states with an income tax is 19.6.

You can access a PDF of the report here.

This week I wrote about the dignity of paying taxes (among other ways of contributing to social flourishing). But as we know, not all taxes are created equal. Indeed, as Antony Davies and James Harrigan write this week at US News, “Politicians are in the business of buying votes with tax breaks and sweetheart deals for their preferred constituencies, and they have to offset these deals by taxing disfavored constituencies at increased rates. The longer this game is played, the more convoluted the tax code becomes.”

As I argued previously at Capital Commentary, this amounts to a kind of back door social engineering (as well as playing favorites, picking winners, and so on). The fundamental purpose of taxation is not to buy votes and give preference to lobbies and special constituencies. Instead, as I write, “The point of taxation is to raise funds to enable the government to fulfill its moral, political, and social responsibilities.” Such a view is ultimately at odds with a Utilitarian theory, which considers taxation to be a tool rather used “to maximize overall well-being in society.” Matthew Weinzierl argues for greater attention to a theory of Equal Sacrifice, which on Weinzierl’s account “assumes individuals have the first claim to their output, and that they voluntarily agree to form societies that collect taxes in order to purchase public goods.”
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This morning at Ethika Politika, I argue that “acting primarily for the sake of national interest in international affairs runs contrary to a nation’s highest ideals.” In particular, I draw on the thought of Vladimir Solovyov, who argued that, morally speaking, national interest alone cannot be the supreme standard of international action since the highest aspirations of each nation (e.g. “Life, Liberty and the pursuit of Happiness”) are claimed to be universal goods. I would here like to explore his critique with reference to the subject of international trade. (more…)

At an Acton Institute event on Oct. 3 in Grand Rapids, Mich., Amway President Doug DeVos delivered a talk on ‘Free Enterprise and the Entrepreneurial Spirit’ to an audience of 200 people. He was introduced by the Rev. Robert A. Sirico, president and co-founder of the Acton Institute.

See the Grand Rapids Press/MLive coverage of the event in “Read Doug DeVos’ take on Amway, the presidential race and Dwight Howard leaving the Orlando Magic” by reporter Shandra Martinez.

DeVos’ Amway bio:

Doug DeVos oversees daily operations of the company and shares Amway’s Office of the Chief Executive with chairman Steve Van Andel. Since 1986, DeVos has spent his career building enthusiasm for the Amway business. His belief in its ability to foster entrepreneurs around the world is reflected in the company’s record of sales growth during his time as president, since 2002.

He also has helped Amway grow into one of the world’s most international enterprises. DeVos has also served in various leadership positions in Asia, Europe and the Americas. DeVos is the youngest son of Amway co-founder Rich DeVos. In 1959, Rich DeVos and his lifelong friend and business partner, Jay Van Andel, started Amway from their homes in Ada, Mich. (more…)

Forbes recently ran a profile of Christian billionaire and Hobby Lobby CEO David Green. According to Forbes, Green is “the largest evangelical benefactor in the world,” giving “at upwards of $500 million” over the course of his life, primarily to Christian ministries.

Yet, for Green, his strong Christian beliefs don’t just apply to how he spends his wealth; they’re integral to how it’s createdin the first place:

Hobby Lobby remains a Christian company in every sense. It runs ads on Christmas and Easter in the local paper of each town where there’s a store, often asserting the religious foundation of America. Stores are closed on Sundays, forgoing revenue to give employees time to worship. The company keeps four chaplains on the payroll and offers a free health clinic for staff at the headquarters–although not for everything; it’s suing the federal government to stop the mandate to cover emergency contraception through health insurance. Green has raised the minimum wage for full-time employees a dollar each year since 2009–bringing it up to $13 an hour–and doesn’t expect to slow down. From his perspective, it’s only natural: “God tells us to go forth into the world and teach the Gospel to every creature. He doesn’t say skim from your employees to do that.”

Economists have increasingly recognized the ways in which healthy stewardship and property rights are linked—how increased ownership leads individuals to weigh costs and benefits more thoughtfully and effectively. Green’s comments add a slight twist to this approach, calling Christians in particular to reconsider who the “owner” actually is and how we might weigh particular costs/benefits and subsequent action accordingly:
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President Obama’s speech last week in which he asserted to businesspeople, “You didn’t build that,” has been getting some pretty harsh and some pretty hilarious responses.
In this week’s Acton Commentary, “It Takes a Village to Raise a Business,” I caution against responses that play into a simple individualist/collectivist dichotomy that underlays the president’s message:

We all know at some level that we didn’t get where we are on our own, and that we have an ongoing responsibility and dependence on others for our continuing enjoyment of the goods of human existence. Christians realize too that our independence and freedom is ultimately limited and dependent not simply on other people but on the grace of God.

So to President Obama’s problematic construal of the structure of society (essentially consisting of the individual and the helping hand of government), critics shouldn’t respond simply with the vehement assertion of naked individualism. Instead, we need to articulate a more balanced and accurate perspective, one that properly relates “independence and mutuality, individuality and community.”

One such response from Hunter Baker is here, and is worth checking out.

Legatus, an international organization of Catholic business professionals, is celebrating its 25th year of existence. The mission of Legatus is to help its members and spouses live out their Catholic faith and to spread that faith “through good works, good ideas, and high ethical standards.”

The current issue of Legatus magazine features an article by the Acton Institute’s Michael Matheson Miller, research fellow and director of Acton media. Entitled ‘Poverty, social justice, and the role of business’, Miller points out that business people – especially business people with well-developed faith lives – have a crucial role in alleviating poverty and creating truly just environments in which to grow businesses:

Poverty has been the norm for most people throughout history. The real question is: How do we create wealth?

That’s where businesspeople come in. Governments can help by providing clear private property rights, rule of law and justice. But they cannot create wealth. The Church is essential because it helps build a moral culture that supports strong families and vibrant communities. But the Church’s function is not to create wealth. Wealth is created through business and entrepreneurship….

I encourage you to think about how to bring your faith and business skills to bear on questions of poverty, social justice and development. It’s not easy and there isn’t single or simple solution to poverty, but the role that faithful Catholic businesspeople can play has been overlooked. It’s time to change the paradigm.

The men and women of Legatus receive professional and spiritual support in order to make a positive impact  in business, community and family life. They stand poised to change the paradigm, as Miller states, in their vocations as faithful business leaders.

Work: The Meaning of Your Life“When conducting Business as Mission, the primary purpose has to be to expand the Kingdom of God,” said Joseph Vijayam, founder and managing director of Olive Technology, a Colorado Springs-based information technology services provider. “Profits and an increase of shareholder wealth are an important result of a solid business that is well executed and are essential for the survival of any business, but they need not become the very purpose for existence.”

Vijayam invites Christian business leaders to reflect on the place of profits in the context of Tax Day here in the US: “I am not challenging business owners to stop making profits, but instead to look at those profits in a completely new way.”

In a piece for Comment magazine last year, “Reforming Economics,” I argued, “For too long a view has held dominance that has portrayed profit as a purpose or end, rather than as a means or a consequence. That is to say, the pursuit of profit is acceptable when it is couched within the broader framework of and constrained by the norm of service of others.”
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Calvin Coolidge quipped shortly before his death, “I feel I no longer fit in with these times.” The words came not long before FDR’s ascendency to the presidency and not long after the upsurge of government activism that started in the Herbert Hoover administration. Coolidge, even for his time, was seen as old fashioned, a throw back to simpler values, ethics, and principles. Coolidge cut the name tags out of his suits when he asked his wife to resale them, so not to profit from his name and position. He was lampooned for his hands off approach to the presidency. Ronald Reagan was even teased by the Washington Press Corps for hanging up a portrait of Coolidge in the White House. By many academics today, Coolidge is chiefly mischaracterized as a simpleton largely from quotes like “The chief business of the American people is business.” In that speech in 1925 delivered to newspaper editors, Coolidge also went on to say, “Of course the accumulation of wealth cannot be justified as the chief end of existence.”

I can’t help but feel that a new appreciation for Coolidge is long overdue. Why? Because almost everything Coolidge warned against is happening now. As the nation faces government mismanagement, rapid growth of centralized power, crippling debt, decline of purpose, and moral decay, the clarity of his ideas are magnified. Coolidge is also the subject of a new biography by Amity Shlaes due out in June. As a public servant, he is vastly underrated for his writing and speeches. He spoke in a manner that was easily understood and he popularized the message of thrift, limited government, religious principles, and conservatism. But there too was an intellectual depth to his remarks about conservatism not seen today by the popular dispensers of those ideas.

One wonders if there will be a major candidate in the general presidential election to offer a defense of the free economy. And in doing so, can defend the great need for morality and virtue within the free market.

Below is a speech Coolidge gave in 1916 as Lieutenant Governor of Massachusetts on the issues of character, the commercial society, and materialism. The remarks were given to the Brockton, Mass. Chamber of Commerce. Coolidge’s remarks are printed in their entirety.

Man’s nature drives him ever onward. He is forever seeking development. At one time it may be by the chase, at another by warfare, and again by the quiet arts of peace and commerce, but something within is ever calling him on to “replenish the earth and subdue it.”

It may be of little importance to determine at any time just where we are, but it is of the utmost importance to determine whither we are
going. Set the course aright and time must bring mankind to the ultimate goal.

We are living in a commercial age. It is often designated as selfish and materialistic. We are told that everything has been commercialized. They say it has not been enough that this spirit should dominate the marts of trade, it has spread to every avenue of human endeavor, to our arts, our sciences and professions, our politics, our educational institutions and even into the pulpit; and because of this there are those who have gone so far in their criticism of commercialism as to advocate the destruction of all enterprise and the abolition of all property.

Destructive criticism is always easy because, despite some campaign oratory, some of us are not yet perfect. But constructive criticism is not so easy. The faults of commercialism, like many other faults, lie in the use we make of it. Before we decide upon a wholesale condemnation of the most noteworthy spirit of modern times it would be well to examine carefully what that spirit has done to advance the welfare of mankind.

Wherever we can read human history, the answer is always the same. Where commerce has flourished there civilization has increased. It has not sufficed that men should tend their flocks, and maintain themselves in comfort on their industry alone, however great. It is only when the exchange of products begins that development follows. This was the case in ancient Babylon, whose records of trade and banking we are just beginning to read. Their merchandise went by canal and caravan to the ends of the earth. It was not the war galleys, but the merchant vessel of Phoenicia, of Tyre, and Carthage that brought them civilization and power. To-day it is not the battle fleet, but the mercantile marine which in the end will determine the destiny of nations. The advance of our own land has been due to our trade, and the comfort and happiness of our people are dependent on our general business conditions. It is only a figure of poetry that “wealth accumulates and men decay.” Where wealth has accumulated, there the arts and sciences have flourished, there education has been diffused, and of contemplation liberty has been born. The progress of man has been measured by his commercial prosperity. I believe that these considerations are sufficient to justify our business enterprise and activity, but there are still deeper reasons.

I have intended to indicate not only that commerce is an instrument of great power, but that commercial development is necessary to all human progress. What, then, of the prevalent criticism? Men have mistaken the means for the end. It is not enough for the individual or the nation to acquire riches. Money will not purchase character or good government. We are under the injunction to “replenish the earth and subdue it,” not so much because of the help a new earth will be to us, as because by that process man is to find himself and thereby realize his highest destiny. Men must work for more than wages, factories must turn out more than merchandise, or there is naught but black despair ahead.

If material rewards be the only measure of success, there is no hope of a peaceful solution of our social questions, for they will never be large enough to satisfy. But such is not the case. Men struggle for material success because that is the path, the process, to the
development of character. We ought to demand economic justice, but most of all because it is justice. We must forever realize that material rewards are limited and in a sense they are only incidental, but the development of character is unlimited and is the only essential. The measure of success is not the quantity of merchandise, but the quality of manhood which is produced.

These, then, are the justifying conceptions of the spirit of our age; that commerce is the foundation of human progress and prosperity and the great artisan of human character. Let us dismiss the general indictment that has all too long hung over business enterprise. While we continue to condemn, unsparingly, selfishness and greed and all trafficking in the natural rights of man, let us not forget to respect thrift and industry and enterprise. Let us look to the service rather than to the reward. Then shall we see in our industrial army, from the most exalted captain to the humblest soldier in the ranks, a purpose worthy to minister to the highest needs of man and to fulfill the hope of a fairer day.

Franciscan University in Steubenville, Ohio, has launched a new Center for Leadership which university alumnus Rep. Jeff Fortenberry, R-Neb., lauds as a project that “roots young men and women in virtue, forms them as leaders, and grounds them in sound philosophical thought.”

David Schmiesing, who directs the center and is also vice president of student life at Steubenville, said, “This is our most explicit and focused effort yet to train leaders for the Church and world.”

One of the resources provided to students through the Center is the university’s distinguished speakers series with the likes of Virtuous Leadership author Alexandre Havard and Acton Institute president and co-founder Rev. Robert A. Sirico, who is on the center’s board of advisors. Rev. Sirico spoke there on character, virtue, competence and vocation.

From the article by NCR writer Joseph Pronechen:

“We have a chance to speak with and meet with different distinguished speakers who have been all around the world studying incredible things,” said leadership student Camille Mica. “Getting the opportunity to talk with these speakers with such incredible credentials, I’ve learned a lot from them and been very encouraged and strengthened by their words and message and example.”

Though the leadership center will have a global outlook, Schmiesing noted that, ultimately, all leadership is local.

“If Catholic leaders don’t lead in their families, then all the other leadership is not going to be effective,” he said. “Leadership in the family is essential and applies to men and women. We’re teaching students in the center the skills, knowledge, virtues that will help them to be more effective in their families and then flow out to the churches, then to occupations.”

David Schmiesing is the brother of Acton Research Fellow Kevin Schmiesing.

Read “Training Leaders in Christian Virtue” on the website of the National Catholic Register.