Everything’s a Scam

Scam

Scam: Anything and everything new you’re excited about

Word of mouth is crucial to the business community, especially in the world of entrepreneurship. New business thrives on excitement and energy, and a critical key to its success is imparting enough of this energy onto investors to secure startup funding. Because of this, frauds, thieves, and con-men have long exploited the entrepreneurial environment to convince investors to part with their hard-earned cash before disappearing into the night. Therefore, the basic “Stay away from X, it’s a scam!” warning can be a currency of high value in the business community.

That’s where we run into problems: people “printing money,” or fabricating scams to artificially inflate their own value in the community. You see, the cost of poo-pooing a new idea is very minimal in the long run. Even if a new venture succeeds, no one doubles back and makes former critics eat their words. They instead focus (as well they should) on keeping their victory going. Meanwhile, the consummate critic gets a momentary boost of clout, and this only increases if they end up vindicated.
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Labor Day or Capital Day?

union investment

Today, millions of Americans from across this great nation are taking a much-needed respite from the cares of the world, gathering with friends and family, and celebrating Labor Day. On this important day, we must remember what we’re celebrating. And what we’re not celebrating, but should be.

Labor day has become such a quintessential American holiday that many of us would be surprised to learn that it was created to celebrate labor unions. As its name suggests, Labor Day honors laborers. It was declared a national holiday under President Grover Cleveland over 100 years ago in order to appease striking labor unions.

And there’s nothing wrong with giving the workers their due. Laborers helped build this country and make it the economic marvel of the modern world. But that’s only half the story (and the lesser half at that). The other half that we really should be celebrating is capital. [Read more…]

Adversarial Marketing

handshake

A door-to-door salesman knocks. You don’t answer. A telemarketer calls. You snarl at him and hang up. Advertisements pop up while you’re reading the daily news. You do everything in your power to hide, close, mute, or otherwise marginalizes these little affronts to your personal activity and space.

What’s the matter with marketing? Why do we consumers have such an adversarial relationship with this side of business? Because we’ve forgotten the beauty of voluntay exchange, both as consumers and businesspeople.

Forget the anticapitalist stigma that has been unfairly thrust upon the making of profit: business is amazing. At its core, it’s nothing but the voluntary exchange of goods and services, an exchange which always makes each party better off. Two or more people decide that they would rather have what the other person has than what they currently possess, so they trade. And the trade makes everyone happier. That’s all business is. Sharing and caring. Peace love and brown rice. Rainbows and unicorns. All that. But in order for this to work, exchange must be voluntary, not forced. If both parties don’t feel like they’re better off with the exchange, then no deal. There’s no point in trading unless everyone’s happy.

Advertising, then, is a purely good thing. All it should seek to do is reach, inform, and educate potential consumers as to the specifics of a product or service. To advertise is simply to see if a business relationship is mutually benefitial. If not, then further advertising is pointless. Move on. Find the happy customer you’ve been looking for. This approach to sales is touted by seasoned salespeople like Stephan Schiffman as “high-efficiency,” but in reality this shouldn’t be the best way to do business. It should be the only way.

Somewhere along the way, however, things got a little sidetracked. Sales became a hostile and competitive sport. Advertising became deceptive. Marketing efforts began to view consumers not as partners, but as prey. It’s natural to expect humans to want to cheat and try to nudge a voluntary exchange a little in their favor from time to time. But now this has become expected, and we have suffered as a result. Ignoring the “voluntary” part of “voluntary exchange” has had its consequences. Now people have their defenses up when salespeople come around because they expect to be lied to, manipulated, and coerced into a business relationship they don’t want.

French economist Frédéric Bastiat talked about what is seen and what is not seen in economic activity. In this case, what is seen is the sale or two that can be gained from adversarial marketing. What is not seen is the increased cost of advertising because of the adversarial relationship. Or the dissatisfied customers who would never have honestly done business in the first place. Worst of all, what is not seen is the vast potential of society to grow and prosper through happy and willing exchange, wasted because some of us just couldn’t take “no” for an answer.

Business is an incredible and transformative thing. Adversarial business is poison, a contradiction in terms. We would do well to return to truly voluntary exchange before any more human potential is wasted.