(1000+ posts) Sat Jan-01-11 11:50 AM
Original message The American Dream: "It is a lie, and it is a multi billion dollar lie."
Featherbed of Lies Take 6 Death of a Dream
by Im a frayed knot
Sat Jan 01, 2011 at 08:33:22 AM PST
Today I pull a bunch of feathers out of the featherbed as I look at what what is commonly known as "The American Dream."
We raise our children believing it. We see it on TV. It is a favorite topic among motivational speakers. If you have the belief and the discipline, you can get rich by owning your own business. Only in the US, they proclaim, can any child who puts his or her mind to it open their own storefront and become a millionaire. It is a lie, and it is a multi billion dollar lie.
This is a personal story. It is hard to tell. It hurts.
Five years ago last month, my son and partners negotiated a lease on a store front in a strip mall. To ensure their acceptance on the lease, I cosigned. They were sure I would never have to pay in any money, they were going to be able to pay it easily from the profits they would make. My son and his partners were about to realize their dream, the American Dream. They were going to own their own gym. They bought a franchise and began the build out. It would be spectacular. They were talking about the lavish lifestyles they would have when the profits came rolling in.
The profits weren't there immediately. That was ok, because I told them it would take three to five years before any new business that required capital would show a profit. So they worked. And worked. After a few months one partner left, then before they had been open a year the other partner walked out. Now it was just my son - and me. He did the work, I infused the cash (well, my husband and I did, month after month, exhausting our savings and the equity in our home). My other son worked too, to help out. Those profits weren't coming in.
Over the years, 9 other gyms went under and we got many of their members. We expanded to include day care and a classroom to retain them. We were always within a hair's breath of making a profit but each time we were there something would happen - a furnace would blow out and need to be repaired. A bad snowstorm. A trainer would leave and take his clients. The horrible economy cost several members their jobs and forced them to quit. A multinational company came in right up the street. We weathered that too. Over the summer, our franchise agreement came to term and the franchise wanted us to spend thousands of dollars to remodel in their new image as well as wanting to change our pricing structure, so we left them to another local franchise. As a result, we had to hire several new employees. After many snafus and much expense in making the change, we were beginning to click. It looked like we would finally be profitable. My son took great pride in the fact that even in this economy he was providing employment to some 30 employees and another 25 independent contractors. The employees were not full time, but it was work they would not have otherwise had. One time he posted a help wanted ad on Craig's list and within half a day he had over 200 applications. Times here were tough.
Then another multinational moved in. they began charging new members so little we could not process the paperwork for the price they were charging. And they were much bigger, with many more amenities. They were funding their initial pricing with profits from other locations. Yes, it was predatory pricing as described in the Sherman Antitrust Act and the Clayton Act. But those laws have either been gutted by corporate owned courts or are no longer enforced. In three weeks, we lost 40% of our members. It wasn't just us. Even established, very profitable gyms suffered similar losses. We could not survive. When we first decided that we had to shut down, it was like being punched in the gut. I found myself recalling the words from the Stones' Angie, "they can't say we never tried." "All the dreams we held so close seemed to all go up in smoke."