Does capitalism work for you?
SUMMARY
After the end of communism in 1989, we know that the only economic system that has a chance is capitalism. Yet, capitalism may work for a small number of people -- the financial and managerial elite, but does it work for you?
DETAILS
I recently went to a seminar where I shared my story with participants about how, in June 2000, I realized that capitalism doesn't work for me.
I was employed at a company and was generating significant revenues from a corporate account that was neglected. Yet, as I saw the revenues from that account increase, my paycheque remained the same. In fact, I was so good (excuse my modesty) and sold to so many clients that I had to give some of my clients to a friend in the sales department.
It was only years later, while reading a book on capitalism and Marx, that I realized that the growing difference between my fixed salary and the increasing revenues I was producing was what is called the "profit rate."
This, ladies and gentlemen, is how the rich get richer and the poor employees remain poor.
Employees work hard, day in, day out, until they reach retirement age. At that point, they basically retire from a game they never really understood.
That game is called capitalism, and only those who understand the game make money and become rich. Everybody else has to show up at the office and work hard, until the inevitable time when they feel it's no longer worth it and they decide to drop out of the "rat race."
According to Harvard Business Review magazine, 3 out of 20 women with MBAs drop out of the "rat race" after becoming a mother. This is not surprising. Women, more than men, want balance in their lives. Plus, the male culture at corporations is rarely open or receptive to work practices that are women-friendly or mother-friendly.
My point is not to denigrate people who have chosen to be employees. It is probably the best choice, given the fact that very few people have the talents, energy and work ethic to become entrepreneurs and run their business.
My point is only that people should explore all the options available (such as becoming a free agent, launching or buying a business), and then make a decision as to how they will spend their lives. Unfortunately, the educational system only presents one option: get a job.
Over time, people view "having a job" as critical to survival, so it never occurs to them that there are actually 3 other options.
This is mainly why capitalism doesn't work for most people. On the contrary, most people work for capitalism.
In his book Rich Dad Poor Dad, Robert Kiyosaki says that people work for money, because they have never learned how to make money work for them.
He talks about financial literacy. The shocking part to me is that even though I studied three years in business school, I did not learn about business, let alone capitalism. I had to figure it out on my own! I had to learn about the "profit rate" on my own.
I only hope that through this blogzine, I can share the business knowledge I gained both from books and from painful trial and error.
After the end of communism in 1989, we know that the only economic system that has a chance is capitalism. Yet, capitalism may work for a small number of people -- the financial and managerial elite, but does it work for you?
DETAILS
I recently went to a seminar where I shared my story with participants about how, in June 2000, I realized that capitalism doesn't work for me.
I was employed at a company and was generating significant revenues from a corporate account that was neglected. Yet, as I saw the revenues from that account increase, my paycheque remained the same. In fact, I was so good (excuse my modesty) and sold to so many clients that I had to give some of my clients to a friend in the sales department.
It was only years later, while reading a book on capitalism and Marx, that I realized that the growing difference between my fixed salary and the increasing revenues I was producing was what is called the "profit rate."
This, ladies and gentlemen, is how the rich get richer and the poor employees remain poor.
Employees work hard, day in, day out, until they reach retirement age. At that point, they basically retire from a game they never really understood.
That game is called capitalism, and only those who understand the game make money and become rich. Everybody else has to show up at the office and work hard, until the inevitable time when they feel it's no longer worth it and they decide to drop out of the "rat race."
According to Harvard Business Review magazine, 3 out of 20 women with MBAs drop out of the "rat race" after becoming a mother. This is not surprising. Women, more than men, want balance in their lives. Plus, the male culture at corporations is rarely open or receptive to work practices that are women-friendly or mother-friendly.
My point is not to denigrate people who have chosen to be employees. It is probably the best choice, given the fact that very few people have the talents, energy and work ethic to become entrepreneurs and run their business.
My point is only that people should explore all the options available (such as becoming a free agent, launching or buying a business), and then make a decision as to how they will spend their lives. Unfortunately, the educational system only presents one option: get a job.
Over time, people view "having a job" as critical to survival, so it never occurs to them that there are actually 3 other options.
This is mainly why capitalism doesn't work for most people. On the contrary, most people work for capitalism.
In his book Rich Dad Poor Dad, Robert Kiyosaki says that people work for money, because they have never learned how to make money work for them.
He talks about financial literacy. The shocking part to me is that even though I studied three years in business school, I did not learn about business, let alone capitalism. I had to figure it out on my own! I had to learn about the "profit rate" on my own.
I only hope that through this blogzine, I can share the business knowledge I gained both from books and from painful trial and error.
posted by Super Peter at 11:18 PM
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