Change. Get used to it at a much greater rate than you ever have had to before. The United States can no longer sit back and live off its past. If you are a U.S. citizen, you should make a strong mental note that there is a large bulls-eye on your back. And who is […]
Change. Get used to it at a much greater rate than you ever have had to before. The United States can no longer sit back and live off its past. If you are a U.S. citizen, you should make a strong mental note that there is a large bulls-eye on your back. And who is it that’s aiming for that bulls-eye? The rest of the world has shown up for target practice, and they’d love to come home with a huge trophy.
How many times have you heard politicians say, “How can the wealthiest country in the world not” provide this fill-in-the-blank benefit or fund that fill-in-the-blank program? Every time I hear this, I would like to think that they’re smarter than that, but by now, I know better. Anyone that knows how to read a balance sheet knows that the United States is anything but wealthy. Think of the U.S. as the pro athlete that made $100 million and then declared bankruptcy. He’s hardly wealthy, but he did make an obscene amount of money. To quote Patrick Ewing during the 1998 NBA lockout, “Sure, we make a lot of money, but we spend a lot, too.” That pretty much sums up the U.S.
Gone are the days of security in government and employer-based programs. Social Security and Medicare are fiscally insolvent and are giant scams at this point. My generation is currently paying taxes into a system that will be non-existent upon our arrival, or severely compromised as to the level of benefit in comparison to what we paid in.
Employers are fighting market forces that they never contemplated would become an issue even as little as 10 years ago. As a result, executives are becoming very skilled at running their businesses with fewer and fewer people and more and more automation.
When I think about solving problems, I tend to think pragmatically about the solution. To me, data is the end-all-be-all. I recently had a conversation with a local economist in Park City, Utah. We were talking about the education system and how it affects someone’s future prospects. One fact that he brought up that was astonishing to me: 50 percent of the U.S. population pays into social services for the other 50 percent. Thus, we have a net 50 percent user system. As time progresses over the next 20-25 years, that stat will become about 25 percent of the population paying for nearly 75 percent of the population’s social safety net. That’s 75 out of every 100 people as net takers from the system. Twenty years may seem like a long time from now, but keep in mind that a 20-year old today would have to live in those conditions for about 60 years. That’s an awfully long period of struggle.
So what does this all mean? The private sector is going to get better and better at running companies without the need for many employees. Market forces and government shortfalls will continue to apply pressure on the private sector. Increased output will persist and hours worked will fall. The traditional path of college leading to a job will increasingly be challenged. You will continue to hear stories of those that leave college with lots of debt and very little prospects for a traditional career path. There will be fewer and fewer people living highly compensated lives through traditional careers. It also means that average personal income rates will remain stagnant or fall. Keep in mind that I said “average.” Those in the top 20 percent will continue to see incomes rise at exponential rates because of the scalable nature of the economic sectors that they work in and their position within the capital structure of the entities that employ them.
So how can one avoid the struggle that will continue to plague most of American society? Start a company, damn it. Yes, it’s a risky proposition, but what have you ever known that had substantial upside and little to no risk? It will certainly be a trying experience and have the possibility of failure, but so what? Your true opportunity cost is minimal at best, especially if you’re younger than 40 years old. Do you want to be chained to a desk wondering if it’s your division that’s next on the chopping block? Do you want to continue to pay ever-increasing tax rates on earned income?
Do you want to eventually be “downsized” and have to jump on the resume hamster wheel within market forces that I describe above? It’s an ugly situation and it’s just the facts.
Take control of your own destiny. Don’t wait. Learn how to start a company and never look back. I hate to think about what your prospects look like if you don’t.
Kyle Blumin is an entrepreneur in residence at Syracuse’s StartFast Venture Accelerator. He is a Syracuse native and serial entrepreneur with three successful exits in diverse industries.