seem to have forgotten about the American Dream. The problem is that our educational system trains students to be “A” students—academics—or “B” students—bureaucrats. Our schools do not train our young people to be “C” students: capitalists. Furthermore, it’s these “C” students who so often follow an entrepreneurial path, carrying the torch of capitalism and creating new jobs.
Ask entrepreneurs today and many will tell you that bureaucracies are actively destroying the entrepreneurial spirit of capitalism.
They will also say many young graduates do not have the skills required for today’s work environment. In fact, many have a “bad attitude” towards capitalists.
Hatred of Capitalists
In 2008, The Kaufman Foundation, a leading entrepreneurial think tank in America, commissioned Dr. Luntz to find out what Americans thought about capitalism. His survey found:
“It’s hard to tell which has become the stronger emotion: respect for entrepreneurs or hatred toward CEOs.”
In November of 2012, Hostess Brands, the maker of iconic baked goods including Twinkies and Wonder Bread, shut its doors and filed for bankruptcy protection. The CEO of Hostess claimed the company was forced to shut down due to union demands for higher wages and benefits.
Making matters worse, it’s not just the 18,000+ workers who were affected. When the company closed, 18,000 families felt the impact as well. If there is an average of four people in a family, the number of lives impacted jumps to 72,000. This ripple effect spreads from each family, affecting schools and businesses such as dentists, grocery stores, dry cleaners, retailers, auto repair shops, even churches, and the rest of the community.
It was later disclosed that the CEO of Hostess Brands and his team of merry men and women paid themselves millions in severance bonuses.
Small wonder that Americans now hate CEOs. Many are graduates of our finest business schools and it begs the question: Is this what our business schools teach?
Unfortunately, it is.
Many of our brightest students go on to business schools, graduating with MBAs, and begin to climb the corporate ladder as employees, not entrepreneurs. The most ambitious become CEOs and executives of big business.
CEOs Are Not Capitalists
Later in this book I’ll write about the fact that most CEOs are not capitalists. Most CEOs and corporate executives fall into a category called managerial capitalists, employees who work for real entrepreneurs—entrepreneurs like Steve Jobs, Thomas Edison, Walt Disney, Mark Zuckerberg, and others—but who have no personal financial stake or investment in the business.
Interestingly enough, Edison and Disney did not complete high school. Jobs and Zuckerberg never graduated college.
Most “A” students, graduates from our finest schools, become “managerial capitalists”—employees—rather than “true capitalists.” It is these managerial capitalists, typically “A” students who land high-paying jobs, who give capitalism a bad name.
Managerial Capitalists Are Scary
In his book, What Americans Really Want… Really, Dr. Luntz states:
“… in today’s world, ‘capitalists’ frighten people and ‘capitalism’ is short hand for CEOs taking tens of millions of dollars on the same day their pens wipe out 10,000 jobs.”
Tragically, many people do not understand the difference between managerial capitalists and true capitalists.
Just think of the CEOs who were paid huge bonuses, while millions lost their jobs, their homes, and their retirement nest eggs. Is this what our schools teach our best and brightest young people?
Again, the answer is “Yes.” Our schools give capitalism a bad name, because what they teach is not true capitalism.
Unfortunately, most parents are proud when little Johnny or Susie graduates at the top of their class and is hired by a Fortune 500 firm earning a six-figure salary at the age of 26 and begins climbing the ladder. Most parents do not care that their child has been trained to be a managerial capitalist, rather than a true capitalist, an entrepreneur like Steve Jobs or Thomas Edison. Today we have a global crisis because:
• Schools are more focused on greed not generosity.
• Schools are about “How much money can I make?” versus “How much money can I make serving others?”
• Schools are about finding a high-paying job rather than creating high-paying jobs.
• Schools are about climbing the corporate ladder rather than creating companies and corporate ladders.
• Schools are about job security rather than financial freedom, which is why most employees live in fear of “losing their jobs.”
• Schools teach little to nothing about money, which is why millions of people now believe in entitlement programs, like Social Security and Medicare in the United States. And millions take jobs in government or military service, not to serve their country but for the retirement and medical benefits.
The New Depression
In 2007, the world awoke to the New Depression. There are many reasons for this modern-day depression. A few of them are:
1. Governments printing money.
2. Trillions of dollars of debt, both personal and governmental.
3. Underfunded entitlement programs such as Social Security and Medicare in the United States and a growing entitlement mentality all over the world.
4. High youth unemployment and student loan debt that can damage a student’s “credit worthiness.”
5. Globalization, including workers in emerging countries working for less and causing jobs to be exported, leading to lower wages at home.
These are the problems your child will face.
The Emperor Has No Clothes!
So the question parents should ask is: Are schools preparing my child for the real world?
The answer is “No.”
And so the plot thickens. As Hans Christian Anderson warned us in 1837 in his tale of the Emperor:
Soon the whisper spread from person to person until everyone in the crowd began shouting, “The emperor has no clothes.”
The emperor heard it, of course, and although he knew they were correct, that he was stark naked in front of the town, he held his head high and finished the procession.
It seems to me that the school system cannot admit they are not preparing children for the real world. That would be admitting to failure—and we all know what failure means in the school system.
It means the school thinks your
