Do You Want A Revolution?

Recently, I stumbled upon a children's book titled "Sylvia and Marcia Started a Revolution." Its message is clear: young minorities should engage in social activism, even start a revolution, to better America. However, this popular notion is actually counterproductive. To truly uplift America, especially for minority groups, the focus should shift away from social activism and towards entrepreneurship.

Entrepreneurs accomplish something that social activists, revolutionaries, or politicians can't replicate. They create jobs, not just for themselves, but for countless others. In the US, there are 33 million small businesses, responsible for two-thirds of new job opportunities, driving innovation, and fueling economic growth. Comparing small business owners to alchemists is fitting. Unlike the fruitless pursuit of turning lead into gold, these entrepreneurs genuinely turn ideas into reality, generating value where none existed before. The positive economic ripple effect spreads through communities and beyond.

So, who are these small business owners? Remarkably, they're disproportionately represented by minorities. In fact, compared to their share of the population, minorities exhibit higher rates of business initiation than their white counterparts. And many are thriving. Consider the example of Carlton Guthrie. Alongside his brother, Carlton owns Detroit Chassis, a company that manufactures frames for motorhomes and commercial trucks. Carlton took a modest metal stamping shop and transformed it into a substantial manufacturer, raking in over a hundred million dollars annually and employing around 160 workers, predominantly black like the Guthrie brothers.

A parallel trend can be observed among Hispanic entrepreneurs. The gap between white and Hispanic household wealth decreased from 8-to-1 in 2013 to 5-to-1 in 2019, largely due to increased Hispanic entrepreneurship. Carlos Gazitua, a Cuban-American proprietor of Miami's Sergio's Restaurant, deeply comprehends the significance of minority entrepreneurship. He urges minorities to showcase their achievements, revealing that business success is attainable, disproving the notion that the system is rigged against them. Carlos aptly concludes that entrepreneurship epitomizes the American dream.

The Kaufman Foundation reports that 360 out of every 100,000 Americans initiate a business monthly. Among Hispanics, this number rises to 540 per 100,000, a substantial 50% above the national average. With 10 million minority-owned small businesses in the US, generating a staggering two trillion dollars in annual wealth and providing jobs for 10 million people, the positive impact is undeniable. These businesses primarily flourish in minority neighborhoods, offering employment opportunities to minority workers.

However, not all is rosy. Small businesses, due to their size, are more susceptible to adverse government policies compared to larger enterprises. Consider this: which business is more strained by an escalating government-mandated minimum wage? The local dry cleaner or the downtown law firm? Similarly, whose profit margins are more affected by inflation stemming from reckless government spending? Is it the corner barbecue joint or the financial services company's CEO? Further, which entity is hit harder by surging gas prices triggered by constrictive government energy policies? The neighborhood landscaper or the work-from-home data analyst?

The takeaway here is simple: while entrepreneurs already face challenges competing against established players, these difficulties are magnified when compounded by unfavorable government policies. So, what constitutes beneficial government policies? They adhere to a straightforward principle that should underpin all governmental actions: do no harm. Each new tax or regulation chips away at the bottom line. Factor in rampant inflation, and already slim profit margins erode further. Profits drive the expansion of small businesses, leading to the creation of jobs, improved wages, and enhanced benefits.

Consult any entrepreneur, and they'll likely concur: "Just let me be." To elevate minorities and bridge the racial economic divide, it's unproductive to follow the path of Sylvia and Marcia, social activists, or well-meaning politicians. Instead, we should seek inspiration from the countless minority entrepreneurs who courageously strive to better their lives and communities daily. For those genuinely interested in triggering a revolution, look no further than embarking on an entrepreneurial journey.