A Thesis for The American Dream 2.0
Entrepreneurs, board of directors and owners of small businesses have a responsibility to save American capitalism. We help ensure the greatest economic and wealth creation system in the history of the world by making employees owners in our businesses.
We need to create new business models and corporate structures that are equitable for all the key stakeholders in a company.
Not only are Americans politically divided, but owners and employees are divided amongst themselves. The Great Resignation as they call it shows what has been bubbling underneath our economy for years.
Everyone now knows the economic system is tilted against the majority of Americans. What do we do? What comes next? It only gets worse unless people start to step up and provide transformative solutions to the problem.
It probably won’t be our politicians. Well, they can help. Will the entrepreneurs and the hundreds of thousands of small business leaders in communities across America help?
Equality isn’t the solution to our problems in America. Sure, equality works if you don’t want Capitalism. Unions are better than nothing, but does America need high paid agencies for employees?
Equitability is a solution. [1] I mean Equity, ownership.
America’s economic and taxation system is constructed for owners, entrepreneurs and shareholders. When our ex. President said the system is rigged, what he really meant is that the economic system of America is built for the owners of corporate America, entrepreneurs and small business owners not employees.
It seems everything I read lately, I hear the following:
We need more staff.
I Don’t have enough workers.
No one wants to work.
The supply chain is breaking down.
Blah, Blah, Blah. When you hear companies talk like this, they’re just complaining out of frustration. Their business model is broken and they don’t know how best to fix it other than maybe just paying people more money.
Employees, especially front-line workers have had enough. The industry I work in, travel, tourism and hospitality has been hit the hardest by the Pandemic and worker shortages.
Yes, paying employees more money helps, but I don’t believe this solves the underlying systemic problems.
Only 25% of employees think their company cares about their wellbeing. [2]
1/3 people in America earn less than $15 an hour.[3]
Ultimately deep down, what people want is respect, to feel worthy, be able to contribute to their company and society and earn their fair share.
Employees might not say this directly but if you listen closely to what they say they want, ownership provides many of these intangible and tangible wants and needs.
As an owner when we come to work each day we have purpose. The harder we work the bigger the payoff for us down the road, right? We’re not only earning an income, but more importantly we are building equity.
I believe we are cruising towards an unsustainable economy.
Poll after poll shows that 65%-75% of Americans live paycheck to paycheck.
What does the travel industry do to compensate? They build buy-now-pay-later financing schemes.
The CEO of a major US travel app recently said that 70% of their customers can’t pay for an airline ticket. They just don’t have the cash available in their checking account. The average airline ticket in the US costs around $350.
Wow, we are in serious trouble if we don’t change the economic system to be more equitable. At some point this will break.
Employees aren’t coming back to work as fast as they have in the past because they are looking for more independence.
They’re looking for freedom.
They’re looking to feel happier.
They’re looking to work for themself.
They’re sick and tired of feeling expendable.
They’re looking for respect.
They’re looking for more money, more opportunities.
Business ownership provides many of these needs.
It’s not all gloom and doom. Here in my home state, Maine, a leading employer, LL Bean, recently paid their workers a 20% end of year bonus. This is in the right direction, but why not make all their employees owners, locking in potential bonuses for years to come.
Over the last few years the gig economy has taken off. You’ve seen the Door Dash advertisements recently on TV. Make money on your own time. This model is good as you get freedom and independence, but you’re beholden to the corporation running the show.
What if companies like Airbnb, Uber, DoorDash enabled their hosts, drivers, delivery people to be owners and share in the wealth of the company?
If one good thing has happened due to the Pandemic it’s finally uncovered the weaknesses about American Capitalism. The owners get almost everything and the workers, independent contracts and W2s get mostly nothing.
The American Dream
My wife and I have been fortunate to be entrepreneurs and owners our entire lives. We’ve built SMBs in the travel and hospitality industries. We’ve been consultants, advisors and managed a travel, tourism and hospitality travel technology incubator.
We’ve risked our entire life for entrepreneurship and ownership. It’s been a rollercoaster ride for sure.
As my wife Nicole says, “it’s feast or famine.”
We measure our wealth in “time.”
Freedom to do what we want, when we want, most of the time and “ownership,” assets we have that pay us income or provide us with shelter and security.
The American economic system is built for owners, people that own companies, own shares in companies and own assets.
You’ve read the news, Peter Thiel and how he built his Roth IRA into $5B. Warren Buffet’s tax rate is lower than his secretary. Google, Facebook, Amazon CEOs flying private jets to their islands to escape the Pandemic.
Everywhere you look you’ll see how the American economic system was built for entrepreneurs, owners and not workers.
The majority of wealth in America is derived from ownership in assets not income.
Equity vs. Equality
You hear a lot about the need for equality in America.
Creating equality in America will be very difficult to accomplish especially if you don’t want socialism.
We can create an equitable America. We can execute this.
Equitable [4] means everyone is provided what they need to succeed in an American Capitalistic system.
You can increase your income and build wealth in America if you have equity and are an owner.
Building an ownership-based economy will help us move away from America’s inequalities to becoming an Equitable America, a country of owners. An employee owned small business in America will help create a more sustainable economy. As more Americans become owners we can change Capitalism for the better.
We can, we must build a better country for all Americans.
#ownershipeconomy
[1] EQUITY VS. EQUALITY
“Equity involves a commitment to give people what they need to enjoy full, healthy lives. Equality, in contrast, aims to ensure that everyone gets the same things in order to enjoy full, healthy lives. Like equity, equality aims to promote fairness and justice, but it can only work if everyone starts from the same place and needs the same things.” Source: https://www.aecf.org/
[2] https://www.gallup.com/workplace/390776/percent-feel-employer-cares-wellbeing-plummets.aspx
[3] https://www.msn.com/en-us/money/markets/one-in-three-us-workers-are-earning-less-than-15-an-hour/ar-AAVnBlo
[4] Equity involves trying to understand and give people what they need to enjoy full, healthy lives. Equality, in contrast, aims to ensure that everyone gets the same things in order to enjoy full, healthy lives. Like equity, equality aims to promote fairness and justice, but it can only work if everyone starts from the same place and needs the same things.
