The National Pulse

No More Garage Businesses? How One City Is Destroying Startups

This article is part of a series focusing on Lens of Liberty, a project of the Vernon K. Krieble Foundation.

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”

These three inalienable rights acknowledged in the first sentence of the Declaration of Independence form the basis of the American notion of freedom. Although they slightly changed the wording of the third right from “property” to “pursuit of Happiness,” the Founders were strongly influenced by John Locke’s threefold emphasis on life, liberty, and property. Despite this change, “the pursuit of Happiness” has historically been interpreted to include as one of its primary guarantees the right to private property.

Additionally, the Fifth Amendment explicitly recognizes the right to private property when it states that “No person shall . . . be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”

In Milwaukee, Wis., however, the government has been trying to limit both of these fundamental rights. In her Liberty Minute entitled “No Garage Entrepreneurs Allowed,” Helen Krieble discusses the negative influence that government regulations have on small start-ups:

Steve Jobs and his friends built the first fifty Apple computers in a California garage. Jeff Bezos started an online bookstore in his Washington garage. Today Apple and Amazon are two of the world’s largest companies.

Disney, Google, and Harley Davidson, and hundreds of other famous companies were started by dreamers in their garages. There are 38 million home-based businesses in the U.S. today earning over $400 billion a year . . . but not in Milwaukee. Businesses in garages are illegal there, nor can home businesses have any employees or take deliveries.

Citizens there should look through the lens of liberty and realize such rules violate essential American rights — the right to pursue happiness and the right to enjoy private property. The business in our garage is none of the government’s business.

Interestingly, for the third year in a row, both the Milwaukee metro area and the state of Wisconsin received shameful last-place rankings in a report measuring startup activity. Evaluating the rate of new entrepreneurs, startup density, and opportunity share of new entrepreneurs, the Kauffman Index of Startup Activity Report has shown Milwaukee lagging behind for the past three years. In the most recent report for the year 2016, Milwaukee tied for last place among the forty largest metro regions in the country, and the state of Wisconsin came in dead last of all fifty states.

Of course, correlation does not necessarily prove causation, but it is certainly worth noting that the city which would have shut down Apple and Amazon is the same one failing to stimulate start-up business activity. Maybe if Milwaukee was more respectful of its citizens’ rights to pursue happiness and enjoy private property, especially in their own garages, it would see its ratings improve.

Terry Schilling

Terry Schilling is executive director of the American Principles Project.