A too-facile comparison, but the technical people, including the technical industry liberals, that I read often are united with some of the small-government conservatives in opposing the Stop Online Piracy Act, which is a bipartisan but ill-conceived piece of legislation that will give the government the ability to throttle technology companies, Web sites, and Internet businesses for the mere crime of linking to someone who might be infringing on someone’s copyright.
Welcome to the party, pals.
In September, a fellow I know shared a post from an “author, speaker, and entrepreneur” said:
On NPR I heard a Republican candidate (I can’t even remember which one–does it really matter?) say that the reason entrepreneurs aren’t starting companies is excessive regulation and corporate taxes.
Come again? I’ve never met an entrepreneur say that she would start a company if it weren’t for either of these two factors. In fact, if someone said that to me, I’d respond, “Then you’re not an entrepreneur, so stay on the porch.”
My acquaintance works in the software industry, and a lot of techies think like this: It’s not hard to start a business, you just go into your basement or to your Starbucks, open your laptop, and start coding; ergo, anyone who thinks regulation is killing businesses is wrong.
Well, except I’ve heard people who’ve recently hung out their shingles as technical consultants commenting on the number of government filings that they have to fill out. It’s giving them some pause.
But when technical, social media, author entrepreneurs look at starting a business, they’re not running into a lot of regulatory headwind. Yet. But that’s unlike other entrepreneurs who run into all sort of regulations layered on from the Federal government on down to the rent-seekers at the state or local level. Here’s one of my comments on the thread:
Take a shade tree mechanic. He’s doing brake jobs for people he knows for cash, taking his waste to the auto parts store. He’s not going to quit his day job because he knows the minute he hangs out a shingle on a rented garage, he’s subject to all kinds of OSHA regulations, EPA regulations, zoning regulations, increased paperwork to comply with city, state, and possibly local taxes and licensing.
Seriously, software businesses are very low footprint. You can do it from your dorm room and write some program that makes it big and then you’re set or whatnot. Other service businesses are not, and these are the entrepreneurs discouraged from opening businesses.
For example, here are the requirements for the licensing of a nail technician in Wisconsin: http://www.manicure.com/Wisconsin-nail-tech-licenses
Oh, sorry, that’s just the 300 hours of schooling you need to merely paint and file nails in Wisconsin. To open a shop, you need a Manicuring Establishment license. Of course, the nail technician license (techinically, the Manucurist license) does not apply to putting makeup on the face or rubbing oils on the body. That’s the Aesthetician’s license. So, if you want to paint someone’s nails at a profit, you need to get your professional license, your local business license, which might just be a home business license but you’re subject to sign restrictions and parking considerations and all that.
My point is that there are entrepreneurs out there who are not creating official businesses, who are not paying taxes and hiring employees, because the burdens of government compliance are onerous. They’re not going to grow their businesses, they’re not going to hire employees. They’re just going to do some work on the side for friends, for cash or barter, because they can’t be bothered. The government is keeping us very safe from these non-entrepreneurs.
The unspecified Republican candidate spoke about these people, not some eighteen-year-old sitting in a coffeeshop trying to combine Groupon with Foursquare.
The governments are starting to put their regulatory impediments in place for Internet and technology businesses, from this SOPA monstrosity to compelling etailers to collect sales taxes (resulting in Amazon dropping its affiliates in affected areas, for example). Now the governments are starting to do to technology companies and, yes, technology entrepreneurs, what they have been doing with increasing fervor and frequency to other industries for decades.
If only someone could make the compelling case that SOPA and whatnot are directly equivalent to the EPA or the FCC just making rules that directly impact businesses or legislatures passing laws based on their incomplete knowledge and overweening expertise of the lobbyists called to testify on the laws’ behalves.
That a government that can make ill-considered laws and rules that impact business will make ill-considered laws and rules that impact businesses. All businesses. Eventually.
And that’s bad.