Dateline: Chicago, United States
I had almost forgotten just how bad things have gotten here in The Land of the Free.
In the barely two weeks I’ve been on the ground here, I’ve been sadly reminded that the police state here is in full swing. What’s more, businesses are so scared to make a decision because out of fear of some regulator putting them out of business.
At lunch today, I spoke to an Asian woman who came in the restaurant after getting a speeding ticket for a grand four miles over the speed limit. My lunch partner said one of the guys in his office got a ticket for jaywalking last month.
Having spent months in countries where cops turn a blind eye to people driving on the sidewalk, going 49 in a 45 mile per hour zone seems tame. Does anyone really care?
Of course, it’s not like people in Vietnam are being killed by the dozens every day because some guy wanted to get home faster. That’s merely how the system works.
Call it the ultimate free market; people drive where they need to drive to do what they need to do.
And unlike when I’ve asked the odd person in Southeast Asia what a cop “got them for” (usually a $3 or $5 bribe), the traffic tickets here in the United States are hundreds of dollars and have big consequences.
How personal freedom makes doing business difficult
That’s why I was so horrified to see a story about several online businesses in California that is being harassed left and right by the state government.
According to VentureBeat, eight “learn-to-code” online bootcamps – basically, sites that provide online learning services – have received cease and desist letters from some stealth state regulatory agency, the California Bureau for Private Postsecondary Education.
Apparently, this band of thieves advised eight different internet companies that they faced $50,000 in fines and imminent closure of their businesses if they didn’t begin an application process with the board immediately.
VentureBeat managed to get an interview with one of the businesses’ co-founders, and asked them with astonishment why they hadn’t signed up to be regulated by this little-known board before.
Their answer: we hadn’t heard of it.
Imagine that a small company started by a couple of twenty-somethings hadn’t spent the time to research every inane regulatory body before selling.
They were probably too busy doing what entrepreneurs have to do to survive: sell.
Yet in the USSA, businesses are faced with incredible challenges when it comes to the government. Enough that I have no idea why almost anyone is starting a business in the United States these days.
How US bureaucracy is killing small business
Just to open a hot dog cart, you have to consult with city, county, state, and possibly even federal agencies. The bureaucracy is maddening.
Just sitting on the phone with hotel bureaucracy reviewing the bills from our conference last week was bad enough. At least those people want my money.
Government bureaucracy could care less about your money, because unlike the casino we held our Passport to Freedom event in, government is a “reverse casino”. Rather than shower those that pay in and support their pathetic system with gifts, they badger the rich guys while giving the free rooms and meals to the freeloaders.
And if you’re an entrepreneur, you have to know they’re gunning for you.
The idea of doing your best and not screwing people isn’t enough in the United States. Regulators are ready to assess fines that will bankrupt you and your family just because you didn’t follow some law to the letter.
And in a sign of just how much brainwashing the government has done to its victims, the business owners interviewed in the California case said they’d comply with the state’s mandates, “no matter the cost”.
If the state of California were threatening my business with $50,000 in fines, I’d reply by moving my business out of the jurisdiction.
Why your business should leave California
California is simply the worst place in the world to start a business. And the United States as a country has to be right up there.
I made the mistake of running part of my business from California for seven months when I was first getting started. I was young and naive, and I sensed opportunity there.
I did end up making quite a bit of money and jumpstarting a lucrative part of my career, but California had nothing to do with it.
My success had nothing to do with California’s tax-and-spend welfare state, or their infrastructure, or how much they dislike honest capitalism.
It had to do with my efforts. I worked hard. And as a thanks for conducting commerce in their state – commerce that my clients said they would have been bankrupt without – I was subjected to years of hounding by the California Franchise Tax Board.
Even after I paid their $800 annual extortion fee for running a corporation there.
I’ve long said there is no – repeat no – reason for doing business in California. It is, without a doubt, the worst place in the world to start a business.
They’ll tax you endlessly and mercilessly. They’ll subject you to nonsense regulations. They’ll send some inefficient buffoon to your office to inspect everything you’re doing and harass you. Hiring people there is a disaster.
Why would anyone start a business in California when better options exist?
Offshore alternatives to California for entrepreneurs
For starters, Chile is basically the California of the south. Chile has vineyards, beaches, mountains, and just about everything else California has to offer. The climates are similar.
Yet Chile is encouraging business to come to its shores, while California is pushing it away.
As comedian Adam Carolla says, California is the forty-five year old rude bimbo that got used to treated to treating people with disrespect because she could. California got used to having nice beaches and figured no place could ever compete with it.
So they started treating people like total rubbish.
As a result, businesses having been fleeing California for places like Arizona, Texas, and elsewhere. Texas Governor Rick Perry had a whole campaign to attract businesses from California to the Lone Star State.
Now, California is on the verge of a total meltdown with train wreck finances. Worse yet, the population wants even more of the same to speed up the decay.
I don’t care if California has beaches. Or wine tastings. Or women in cleavage-baring tops.
I can show you plenty of places that respect entrepreneurship and capital a lot more that also have those things. Perhaps not Miley Cyrus twerking down Hollywood Boulevard, but you’ll have to work with me.
The entrepreneurs interviewed about the threatening letters they got from California said they didn’t share their predicament with the media because they didn’t want to create animosity between the government and their company. If I had an online class and the government wanted to shut me down, what a bunch of regulators thought of me would be the furthest thing from my mind.
But I guess when you live in a police state, you have to worry about keeping the man happy.
Fortunately, almost every problem I’ve run into in the United States in the past two weeks is one that I can confidently say happens very rarely – if ever – in most of the other countries I spend time in.
I assure you no entrepreneur in Colombia is worried about having his online learning center shut down by authorities for such silly reasons. And that’s worth thinking about.
Nomad Capitalist is all about helping people like you “go where you’re treated best”. If you want to learn more about what exactly that means, and why I believe so strongly in it, I made this video that is worth watching: