Monday, July 19, 2010

Free Lemonade and Ms. Savage

Some time ago, Ms. Terry Savage wrote at article titled There Is No 'Free' Lemonade, where she discussed a pair of little girls with a lemonade stand. In her article, she stated that these little girls where giving away something that wasn't theirs (the little girls were not selling the lemonade, but giving it away to strangers for only a smile), and compared them to the current political climate of wanting everything for free and not knowing the value of the dollar, and the value of earning that dollar first to do charitable things. Below was my response to her article.

I understand that you were explaining to those children how lemonade stands have worked "for all time." However, because something has been done "for all time" does not mean that doing it another way is wrong. It also does not mean that it is the most efficient method of doing that something. I agree that America is about entrepreneurship and to a certain extent the (semi) free enterprise system. I think we also agree that entrepreneurship is not necessarily about a new idea, but the execution behind that idea. Entrepreneurship is about somebody, somewhere, saying ‘I can do X better/more efficiently/cheaper than already exists while receiving marginal benefit.’ Therefore, entrepreneurship, and to an extent Americanism, is about not settling for how things have been done "for all time," but about doing them differently and/or better than before. Every technological advance is due to this spirit. There are many examples of technological advances making prices drop, sometimes to zero. The internet is a great example, especially news outlets and blogs. Your blog is free. However, the marginal benefits you receive are not all directly related to profit. Some of these are directly associated with the marginal benefit of economic profit (salary for a career or royalties from book sales). Some are only indirectly related (name recognition and perceived expertise), which can lead to added economic profit.

I think the assumption that your article makes is that these children would not understand basic economics that dictates marginal benefit vs. cost. Perhaps these children figured that the marginal benefits of a 'thank you' or a smile were greater than the associated costs of the lemonade stand. If so, then these children probably also figured that the marginal benefits of a 'thank you' or a smile was greater than making an economic profit. They are fully immersed in the entrepreneurial/economics spirit of marginal benefits vs. costs, except without a cash transaction.


I also think your response makes these girls sound like irresponsible children at best, and thieves at worst: "simply taking 'stuff' out of their parents' kitchen and giving it away to strangers doesn't strike me as responsible behavior on a number of levels" and "they're giving away their parent's things--the lemonade, the cups, candy...It's not theirs to give." I do not know whether they took these things from their parents cupboard, or if their parents gave them these things knowing full well what the children intended. From reading your article, it seems you do not know either, but assumed that they did not have permission to do this. I would assume innocent children are exactly that, before assuming "it's not theirs to give."

Ultimately, I think Ms. Savage missed the entire point of what i was trying to explain: that gaining thousands, or even a few, dollars is not necessary to be charitable. Also, that these little girls should be treated as such, especially in world where we claim children grow up too quickly. Let these little girls be little girls, Ms. Savage.

No comments:

Post a Comment