OK, so you don’t want to be rich.
What if you are a writer or a musician, and you want to publish your own work?
The only way to do that is to start up your own business.
And what if your work becomes popular?
Then you need to expand by hiring people and setting up an organization, with you at the top.
I know of individuals who were stone cold broke and had an idea and it took off and within a short period of time they were employing hundreds of people and millions of dollars were pouring in and they were traveling around meeting with people to the point of exhaustion. At least of of these people went and bought an executive jet just to make travel a little easier. [All are real, actual cases, by the way.]
So, I am questioning you … if you become successful, how do you handle your success?
Your goal was not to make millions; you just wanted to offer your work to the public.
But, now, without lobbyists, you are in the 1%.
Using your thinking, would you attack yourself? Would you put a cap on your earnings and the earnings of the people who work for you?
Would you close your company because it is too successful?
What would happen to the people who work there for you? They would be out of work.
And you would be responsible.
Would you cut your profits? But what if the business slumps for some reason? If you don’t have a cushion of retained earnings … money in the bank … from saving up some of those profits … how would your company get through the tough times without laying people off?
These are very good questions and I’m glad you asked them. What I want to point out is the difference between
company money and
personal money.
If I were in the situation you described, here’s how I
hope that I would act. But like I said, having access to, or control over, lots of money is a very strong temptation for almost anyone, so I can’t promise you I would be strong enough to do these things.
Let’s say I have a passion for making “widgets”. I want to keep this completely fictional so I don’t insult anyone’s real career choice. When I start my widget company in my garage, I’m not thinking about getting rich at all, just how much I love making widgets and that I want to make the best widgets I can. Making widgets is my passion and I feel blessed if I can make enough money to support my family doing something I love. You get the point…
One month, totally unsolicited by me, my widgets receive a glowing review in “Widgets Quarterly”. Suddenly I’m flooded with orders and the garage is no longer big enough, so over the course of several years I hire employees, and move into first one, then two, and eventually many production facilities around the world. The company is no longer called “Mgoforth’s Widgets”, it’s now “Widgets International, Inc” and we employ 50,000 people globally. We’re the largest widget producer in the market, and we’re even thinking of expanding our line to include doo-dads and thingamajigs. Basically the business is a stunning success, beyond my wildest dreams when I first started. And to answer your question, I would reserve a “prudent” amount of capital to keep the business going through rough economic times, but I know that I’ll never be able to guarantee anyone a job for life. I’m not God and I can’t make that kind of promise. I would do what I could to avoid layoffs though.
To me, nothing I’ve written above seems sinful. You have a successful business, employing lots of people, and making a product that people (let’s assume) have a need for.
Somewhere along the line from garage tinkerer to Fortune 500 CEO, I had to decide what to pay myself and my employees.
Again, this is what I hope I would be strong and wise enough to do… As a hard-working business owner, I don’t live in a one bedroom apartment or force my children to skip meals or wear old shoes that are too small. We live in the suburbs in a comfortable home that is big enough for our needs. The square footage isn’t critical to this example, but let’s just say it’s an “average size” for a house in the US. My business is successful enough, and I’m so well-loved as the company founder, that I could pay myself anything up to $10 million per year with zero complaints from the board of directors, share-holders or employees. Instead I choose to cap my personal salary at a level that will allow me to live my
average American lifestyle debt-free and at the same time save money for the same average lifestyle in retirement and for my children to go to college.
That’s after-tax, BTW. I’m no fan of taxes (and this is the real me talking now) because I think the government runs pretty inefficiently and is corrupt. But remembering the words of Christ to
“Render to Caesar the things that are Caesar’s, and to God the things that are God’s” (Mark 12:17), my CEO alter-ego pays his taxes and doesn’t attempt to take advantage of special loopholes in the tax code that wouldn’t be available to most Americans.
continued in next post…
