In a century already plagued by stories of “crony capitalism” like Halliburton and Solyndra, the concept of capitalism is really getting a bad rap. I decided long ago that the liberal indoctrination of my children through mainstream media would not happen. So, when I see an opportunity to parent them away from destructive messages and toward the highest ideals, I don’t go about it lightly. So that my children will have a proper understanding of capitalism – its merits and its challenges – I work to integrate that concept into my parenting whenever possible.
My thinking has been guided by just a few short lines of Alan Greenspan’s “The Assault on Integrity” (part of Ayn Rand’s Capitalism: The Unknown Self). Success in business, Greenspan said, “[r]equires years of consistently excellent performance.” Further, he argued that
“Capitalism is based on self-interest and self-esteem; it holds integrity and trustworthiness as cardinal virtues and makes them payoff in the marketplace, thus demanding that men survive by means of virtues, not of vices.”
If you like the idea of parenting toward capitalism, here are a few ways to put that theory into practice:
Pay for grades – Pay as much as you possibly can for As (significantly less for Bs). The real world rewards hard work and success with money, so teach them that early. I pay $10 per A and $5 per B. The financial incentive is there to earn the higher grade, and they do.
Charge fees for breaking rules – Tax behaviors you want to curb, right? Left a light on? That’ll cost a quarter to cover the increased electricity bill (got that one from my grandfather).
Give them a budget – When the kids outgrow their clothes, which happens often, it’s time to go shopping. Tell them up front that the excursion isn’t a free-for-all. Recently, for example, my son needed shoes. He wanted a pair of Sketchers ($45), but I had given him a budget of $30. If he wanted something in particular, something outside that budget, I told him, he would need to supplement the cost with his own money. So he waited until we found them on sale at a department store, instead. This might sound harsh – believe me, I get a ton of criticism from my friends about this one – but I figure, if it’s important enough to the kids, they will willingly invest in the purchase; if it’s not, then why would I invest funds above and beyond what I want to spend on the purchase?
Pay interest – When you “borrow” from your child’s cash stash to buy ice cream, pay back the full amount quickly…with interest. They took a risk lending that money (albeit a small one), and with risk comes reward.
Encourage entrepreneurial interests – Does your child want to be a car-washer? Pet-sitter? Lawnboy? My daughter wanted to sell cupcakes door-to-door when she was 8 years old, so we turned her hobby into a business. We gave it a name (Sweetie’s Cupcakery); created a logo; developed a price, order and delivery schedule; and designed a basic budget. As a result of that endeavor, she made almost $200 profit, which she used as spending money on our mother-daughter trip to New York City. Today, she sells duct tape flower pens to kids on her school bus.
Help Them Set Goals – At the root of most failure is the failure to plan. Financial success involves budgeting. Last year, my daughter decided she wanted a Morkie (designer dog). I told her she needed to save $1,000 in order get the puppy. That sounds like a lot of money, but most Morkies cost around $500. Add vet bills and food and toys, and you can see the need for additional funds. She now has about 1/4 of the money saved, and she has resisted the temptation many times to spend that money on something else. Not only will she be invested in this purchase and be more likely to care for it, but in the time it will take her to save the money, I will be able to gauge her responsibility. This exercise has taught her the value of delayed gratification and of setting a goal and working consistently toward it.
Let Them Fail – This is a hard one. But it’s essential in life, so do it. Just give them a safe place to fall. When my kids experience failure, I wrap my arms around them, tell them I love them and ask them one simple question, “Why do we fall down?” to which they respond, “so we can get back up.” (Yep, I taught them that.)
I doubt they know the term “capitalism” at all, but they are beginning to see the concept at work in their lives. As a result, they have a tremendous amount of respect for money. They don’t leave it in their pockets (to ruin my dryer) or lose it on the playground at school. They keep it in their piggy banks and count it often. When we go somewhere from which they might want to purchase something, they don’t assume I’ll buy it for them – and I’m a fairly generous mom – they bring their own money with them ready to participate fully in the capitalistic society.
Of course, there are other ways a mother could show her children capitalism at work…and many do. They spend hours at malls and restaurants mass consuming. But I’m not seeking to teach my children materialism or overindulgence of any kind. My goals are simple. I want them to recognize that they are the source of their own success, personally and financially. That, while they should be grateful for any love and support they get along the way, they should rely on no one else to achieve that success but themselves. That hard work is the single biggest factor in success, and they should be armed and ready to roll up their sleeves and build that.