The Kid and the Benevolent Bully
A tale of exploitation
The kid had eighteen cents.
The benevolent bully had a buck-forty-nine.
The kid went to the corner candy store, bought a licorice pipe and a jawbreaker for two cents. He was giving serious consideration to the chewable wax lips, when he overheard a big kid at the fountain ordering a large lemonade for a dime. He put back the lips and hustled down to the grocer’s on the next block.
“I can make better lemonade and sell it for a nickel,” the kid thought. So he bought a supply of lemons, sugar and paper cups, scrounged up some pitchers and a lemon squeezer from the attic, and a card table and folding chair from the garage. He perched out on the corner with a cardboard sign that read, “All-American Lemonade, 5 Cents.” It wasn’t fancy, but the kid was in business.
Meanwhile, the benevolent bully had spent his buck-forty-nine (“borrowed” from the littler kids) on candy, comic books and 10-cent lemonades. He liked to give away stuff to his favorite friends. He felt popular – and important. That is, until the money ran out. Then he had to borrow more from the little kids, which was tedious work.
The kid’s All-American Lemonade was a big success, and pretty soon, he had expanded his line to other premium drinks – all for a nickel. After expenses, he was making 3-cents a serving and, at 30 cups a day, had netted more than $25 the first month.
Then the kid had a brainstorm. He noticed that, for some reason, the little kids around town never had any money. So he proposed to set them up with All-American Lemonade stands in their own neighborhoods, and split the profit 50-50. Within a few weeks, the kid had eight lemonade stands at strategic locations all over town. His local managers were making a phenomenal $10-$15 a month, and the kid was getting rich (by kid standards), which allowed him to open still more stands, while hiring three helpers to run his own operation and keep the other stands stocked up. He kept improving his products, and the town folks kept buying his beverages all the more. Life was good.
The kid’s success did not go unnoticed by the benevolent bully who, filled with indignation and a keen sense of social justice, insisted that he and his buddies deserved their fair share. The argument went something like this. The kid had too much money, while other deserving souls had none. To stimulate the economy the kid’s excess earnings should be redistributed to worthy kids as entitlements, to spend on wax lips and comic books.
The benevolent bully’s ideas proved popular among the poorer masses (most of whom had forgotten that it was the bully who had impoverished them.) Pretty soon, the kid was being forced to pay a heavy “stimulus tax” to grow the economy (which, naïvely, he thought he had already been doing.) So he quit opening new stands. At the same time, the kid’s local managers were being told that their All-American Lemonade was actually un-American, because they were making and keeping too much money. They, too, were forced to contribute to the benevolent bully’s stimulus program, with a 50 percent tax on their ill-gotten gains.
Before long, all of the benevolent bully’s friends could be seen around town in wax lips. But there didn’t seem to be as many lemonade stands as before, and people were starting to complain that the drinks tasted a bit watered down. The bully took immediate action, sensing that the capitalist-corrupted kid had compromised his product to recapture lost profits. He formed a Lemonade Quality Control Board, forcing the kid to use only premium, board-approved “green” ingredients. He levied fines on the kid, turned him in to the city for operating without a license and to the Board of Health for failure to have a state certified kitchen.
To make a profit, the kid now had to raise the price of his lemonade to 10 cents a cup. People soon quit buying his beverages, and by the end of the summer All-American Lemonade was out of business. Coincidentally, the market for wax lips and comic books dropped off about the same time. The benevolent bully reminded people how bad things could have been if it wasn’t for the economic stimulus plan. The people were grateful.
Soon, the bully had launched the Lemonade Stand Recovery Program (LSRP), paid for by the taxes extracted from the kid and his former managers. He set up stands around town, run by his friends, and subsidized by the LSRP until money ran out. None of the stands made a profit (their lemonade was expensive and ordinary,) but at least the benevolent bully was able to temporarily stimulate the economy, while running robber barons like the kid (with his 5 cent lemonade) out of business.
Many years later, the kid became a successful entrepreneur and grew a company that employed ten thousand in the manufacture of consumer goods. The economic recession, brought on by government spending, borrowing, and regulation has since forced the company to lay off three-quarters of its workforce.
The benevolent bully became a United States Senator. He is working on the problem daily, diligently deficit spending, and redistributing wealth to stimulate the economy.
Let’s pour ourselves a glass of nongovernment lemonade and learn the lessons of liberty.
Comment by Tony on 1 November 2010:
Sweet! Sad! True!
Why am I a Bigot to think like this?
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[...] Kid and Economic Liberty The Kid and the Benevolent Bully | The Freeman | Ideas On Liberty The kid had eighteen cents. The benevolent bully had a buck-forty-nine. The kid went to the [...]
Comment by Joshua on 1 November 2010:
What a perfect story to relay to my children when they are a little older. Thank you Roger!
Comment by William Griesinger on 1 November 2010:
It’s Atlas Shrugged writ large with undefined “Duties to Society” and the Control Boards, etc., all of which made “society” poorer. When will the economically ignorant ever learn; we’ve traveled this road before and it has NEVER worked.
Comment by Capt marvel on 1 November 2010:
In the 1800s we had an industrial revolution. As such we saw the reduction in the need for agricultural labor, due to mechanization. With this, came the migration from the rural areas into the cities. From early 1900 until WW II we saw the creation of new technology, such as the automobile, airplane, electric lighting and appliances. The conclusion of WW II bought forth the assembly line where technology and and mechanization brought labor to it’s maximum efficiency. But today many 3rd world nations have come to achieve what America did in 1946 at 1946 labor costs. This has brought this nation to the brink of economic disaster. So the question for today is “What will become the new pardyne shift of this century, for economic survival?”
Comment by Deefburger on 1 November 2010:
Beautiful illustration! Thank You.
Here’s one I wrote. Not as good or as short, but I think the point gets made:
https://docs.google.com/document/pub?id=18kwUwnu2rQ8mMkCSeMmLV2bIB5nAr4sPPDvOhdyeDjM
Comment by Libertarian jerry on 1 November 2010:
Why didn’t the kid buy a baseball bat and when the bully came around to harass him whack the bully in the knees with the bat? After all,there was a right to bare baseball bats written into the law. I guess the kid was afraid to stand up for his rights. Maybe this is why bullies almost always get their way. By intimidation.
Comment by Frank on 1 November 2010:
BRILLIANT! BRAVO!
Comment by RandFan on 2 November 2010:
Lawless people depend on the law-abiding citizen for their survival. The road to serfdom is paved with the good intentions of “respectable,” “selfless” people who want to “do the right thing” and, in so doing, feed the monsters of the world. This clever fable brings that message home in a way that even a child (but not necessarily the American voter) can understand.
Comment by RandFan on 2 November 2010:
P.S.–
The moral of this fable: Everything you need to know about life you can learn on a grade-school playground; or, bullies can never be appeased, they just find bigger playgrounds to terrorize.
Comment by James Madison Fan on 2 November 2010:
What I’d like to know is what happened to the guy that ran the fountain and his employees? Did he go bankrupt because he had rent to pay and all these kids were setting up lemonade stands with a fraction of the overhead?
Did anyone get sick because kids are notorious for not washing their hands? What happened when”The kid” got sued? Did he hire a slick lawyer to hold up the suit in court for years until the injured party lost interest, couldn’t afford the layer’s fees, or died?
Where did the kid dump his lemon rinds, used cups, and other garbage? Did he pay to have it disposed of properly or did he just toss it in the local river?
Why did “The Kid” get 50% of the work the Managers did? If they protested did he hire a less benevolent Bully to beat them up and take the 50% or did “The Kid” shut down the stand and move it down the road with different Managers?
Did he import and hire Managers from different towns that would work for less leaving the kids in his own area without comic books and candy lips so he could make more money?
Did “The Kid” force managers to buy from “All American Lemonade” approved vendors of did “The Kid” have his own lemon grove he required them to buy from cutting the grocer’s lemon sales?
Did one of the Managers set up “Liberty Lemonade” only to have “The Kid” drop his prices to 4 cents a cup by tapping his war chest knowing that “Liberty” couldn’t establish market share before exhausting their startup funds and going bankrupt?
There is more than one flavor of tyrant and not all of them are as obvious as the bully in this story nor anywhere near as benevolent. Corporations have no more interest in your personal liberties than the government does and they don’t have to work their way around the Constitution and the Bill of Rights the way the government does.
There is no benefit to avoiding Scylla if you fall victim to Charybdis.
Comment by LG on 2 November 2010:
Bravo James Madison Fan. I was about to make 1/3 of your points – you made them better and fuller.
I would only add this. Like parables, the idea of an unregulated free market is a fantasy. There is no such thing. In order to be truly free and open a market must be governed by rules against croneyism, insider dealing, anti-competitive tactics, price gouging, exploitation of natural and human resources…(I could go on). If these things are not regulated against, the market is not free and open to all – it is instead a rigged game.
Do we have too much regulation in this country? Is much of it ineffective? I think so, otherwise I probably wouldn’t be reading The Freeman. But is the fairy dust of de-regulation sprinkled all over our economy the answer to our problems? Not a chance.
Comment by free on 2 November 2010:
Surely, James Madison Fan, you can see how much easier it is to defend yourself from an entrepreneur who is doing wrong than a government official. An entrepreneur might fool you into buying from them for a time, but they have no minions to force you to purchase their goods. Do you feel compelled to give money to people you do not agree with? Do you not think the public withholding money from the business would cause the entrepreneur to change his ways if not put him completely out of business. There may be all sorts of tyrants but tyrants of the private sector are much more easily defeated.
Comment by James Madison Fan on 2 November 2010:
Free,
Unfortunately I don’t see these ease you describe.
Let me be clear that I don’t trust Big Government but I don’t think Corporate America holds the key to our salvation either. They want to control and regulate us every bit as much as the government does if not more so. The politicians want power; Corporations want money; and we are a means to those goals.
Big Tobacco spent decades intentionally getting people addicted with full knowledge they were killing their clients and even with government lawyers and scads of suits they were immune until an insider leaked confidential information (fired). They even fought to keep advertising to kids (Joe Camel) and not to put warning labels on packs that cigarettes have been linked to lung cancer and heart disease. They paid their own scientists to do “research” that countered independent and government studies that demonstrated these links. They spent billions on lawyers to keep cases tied up in court until the injured parties lost interest, couldn’t afford to proceed, or died. If it were up to the tobacco companies we’d still be hearing about the therapeutic effects of a good smoke instead of calling them “cancer sticks.”
Love Canal is one of the most famous of environmental disasters but when was the last time you saw the name Hooker Chemical? Most people couldn’t tell you what state Love Canal was in much less that Hooker was purchased by Occidental Petroleum which is ranked in the top 50 polluters in the US. The acorn truly does not fall far from the tree. Do you see much public backlash? The hamsters were stirred up for a couple minutes but they settled back down.
What’s worse is that Corporations have rights to control our lives that Big Government doesn’t have, even when I’m not at work. I can tell Barry Obama that he’s an (inster expletive) of epic proportions to his face with no consequence whatsoever. Try that with your boss and you’ll probably get a pink slip. A corporation can even fire me for behavior that takes place after hours no where near my work place. If I go to Cabo and get drunk as a lord and end up on the top of a nude pyramid of hotties and management gets the picture (someone else posts it on Facebook without my knowledge) I can get fired. That doesn’t work for me.
People rarely stand up to obvious tyranny from the government (Kelo vs. New London) so when Corporate America does something less obvious I have very little hope the sheep will bleat when they get sheared.
Comment by Mary D on 5 November 2010:
Great analogy! Sad, but true.
Comment by TaxMaiden on 7 November 2010:
Hey, James Madison – Question, “did the tobacco company force the cigarette in your mouth?” and “did someone force you to get drunk in Cabo, etc.” These are choices you made; it’s called personal responsibility. You said, “Corporations have rights to control our lives that Big Government doesn’t have”. Are you new here? You are not required to work for Corporate America; that is a personal choice. Government control is mandatory. Just sayin’…
Comment by James Madison Fan on 8 November 2010:
TaxMaiden,
I would offer that responsibility is a two way street. I have the responsibility not to put a cancer stick in my mouth but Big Tobacco has the responsibility to be truthful about the effects of their product. Failing to be truthful about your product is fraud. When you increase the amount of nicotine in an effort to make your product more addictive so people can’t quit and do your best to hide the fact it is carcinogenic as well as hiring an army of lawyers to avoid culpability that isn’t caveat emptor; that’s a criminal conspiracy.
This applies to Toyota and the runaway cars. If they had been honest and done a recall and you bought a defective auto after the fact then you walked into the situation knowing there was the potential you would end up ramming through a guard rail and flying off an overpass. Darwin in action. But that isn’t what they did. They denied, denied, denied even though there were internal memos floating around years before it came out. I have the responsibility to keep my car in good working order. They have the responsibility to let me know that they have a design flaw that could put my family in jeopardy even when it is in good working order.
I’m not new here. I just think a lot of these people have the foot on the wrong shoe when it comes to the concept of freedom. It isn’t anyone’s business what you do in your free time regardless of if we’re talking about the government or your employer. I don’t care if it is one of the Fortune Five or a “Mom and Pop” operation on the corner. They don’t own you. They pay you for your work. I have no more business firing you because you got blasted and did something naughty on vacation than I do firing you because you have the “wrong” political views, sleep with the “wrong” gender, have the “wrong” skin color, worship the “wrong’ God, etc. If it doesn’t have any affect on your job performance then you should be able to do whatever you want when you aren’t on the clock.
I don’t care if the tyrant is using a gun and the threat of prison or a paycheck and the threat of poverty, it is still tyranny. I don’t see either flavor being preferable to the other. It is still subjugation.
Comment by Michael Wayne on 8 November 2010:
Evil happens when good men(and women) stand by and do nothing!
I treat my employees the same as I wish to be treated. They get paid according to their skills and a 40hr work week. I don’t ask where they were last night or what they do on weekends as long as they report to work on time and sober. If they need time off for personal affairs, then we arrange for time to be made off or take a sick day. Either way it’s all about fair treatment, honest work for honest pay. AND, if Mr. Bully thinks he can pass a stimulus on me….well, I have a trick bag for him.