Wednesday, 18 July 2012

Lemonade Stands Find Government Hurts, Rather Than Helps, Business

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President Obama has recently told the American people that businesses in America relied upon government to succeed: 

If you got a business, you didn’t build that. Somebody else made that happen. If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you've got a business, you didn't build that. Somebody else made that happen.

The parents of a couple of young girls in Houston, who have established a booming lemonade stand business, beg to differ. Clara and Eliza Sutton, aged 7 and 4 respectively, opened CoolBlast Lemonade in their suburban neighborhood in Houston, Texas. Business was so brisk that they soon added their younger brother Erik as a third employee.

Young Clara explained how operating a small business is very instructive about the real world: “You learn how to make change. We learned about customer service, that we should always be nice to the customer. We learned how to advertise. We donate some of the money to charity to help other people out. We used the rest for supplies. We might buy a gift for our brother since he’s our employee.”

Andrew Sutton, father of the two entrepreneurs, had no help for the government: “Nobody helped them except us. They did it on their own. “My wife and I both run our own businesses, so running a lemonade stand with them was showing them what they do. They were curious how we got money for things. It’s been a positive experience for them.” Sutton was also critical of Obama’s comments about the reliance of business upon government: “It was not very presidential. A leader should lead by being more positive. He should've said, ‘You guys should be the backbone of the economy.’”

Jeff Brown runs an organization in Seattle named “Teaching Kids Business,” which strives to teach children about opening and operating a business. He said that the Obama remarks, while not completely incorrect, were basically wrongheaded: “I’m not sure I agree with the comments made. I think there is a partnership between government and business but they are not dependent on each other. The government tends to justify their spending by touting job creation," he said, "but it’s a self-serving position.”

Nellie Akalp of Thousand Oaks, California, has taught her four children how to operate lemonade and cupcake stands. She and her husband have founded, which is a legal service for small businesses. The Akalps want their children to learn about the real business world, said Nellie:

My husband and I have tried to instill in them that you have to be passionate about what they do. We’ve tried to show them to take things they like and take it to a business concept. We try to teach them the value of making money every day. We try to show them they won’t have anything handed to them. That if they want success, they will have to work for it.

Lemonade stands are an iconic American example of children opening businesses. No government program helps them and these businesses seek no special favors from the state. That does not mean, however, that the relationship between lemonade stands and government is nonexistent. As Reason magazine noted in an article one year ago, police have cracked down on unregulated lemonade stands.

In Midway, Georgia, police closed a lemonade stand that three girls had set up, saying that the girls did not have a business license or a permit to peddle goods, which could cost from $50 to $180 per day. Casity Dixon, a 14-year-old girl and one of the operators of the lemonade stand, said: “It’s kind of crazy that we couldn’t sell lemonade. It was fun, but we had to listen to the cops and shut it down.” Amy Roberts, another partner in the business, added of the police action: “It’s almost like they don’t have anything better to do.”

Also in the summer of 2011, when Abigail Krutsinger in Coralville, Iowa, set up a lemonade stand, the four-year-old girl ran into the same problem with the law. City health officials stated that the little girl must apply for a permit and get a health inspection. She had set up a stand to reach a very thirsty group of customers, folks who entered the Des Moines Register’s Annual Great Bicycle Ride Across Iowa. 

One year before, in August 2010, police in Multnomah County, Oregon, shut down seven-year-old Julie Murphy’s lemonade stand because she did not obtain a temporary business license, which costs $120. Two officers were required for the job, and they were so aggressive that the young girl began to cry. She was threatened with a $500 fine if her lemonade stand remained open. 

People in the neighborhood rallied around young Julie, offering to make donations if she would give away her lemonade and telling Multnomah County officials to leave the girl alone. Jon Kawaguchi, Supervisor of Environmental Health for the Multnomah County Health Department, explained the government’s position: “I understand the reason behind what they’re doing and it’s a neighborhood event, and they’re trying to generate revenue. But we still need to put the public’s health first.”

Ian Murray observes in an article at that government seems to be waging war on lemonade stands all across America. So far the Sutton children in Houston have avoided the “help” of government for business which Obama spoke about, and the two little girls and their younger brother are learning what the American Dream is really about.

Photo: Children selling lemonade in front of their home via Shutterstock

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