Defending entrepreneurship in Bucharest

The Free Market Road Show, the event that visits thirty five cities across Europe, the Caucasus, and Israel with the message of sound economic policy and individual liberty made its stop in the capital of Romania. The event in Bucharest was hosted by the Murray Rothbard Center of the Romanian American University.

The first panel dealt with the issue of how to create economic growth.

American Journalist John Fund specifically addressed the challenges which Romania currently faces. He started by pointing out the outstanding progress the country has made since the fall of the Iron Curtain. However, he said that Romania still needs to overcome many problems.

Mr. Fund highlighted the importance of the rule of law: “The strengthening of the rule of law is one of they practices that can help your country.” He also claimed that to support the rule of law is in fact a form of patriotism. Even Milton Friedman realized in the last part of his life that economic reform is ineffective without well functioning courts. “Milton Friedman told me that the rule of law should be the foundation of a free economy”, Fund recollected.

In this sense, he warned about the dangers of the “fight against corruption” when there is not a balanced and independent judiciary system. “There is always the temptation of being selective when you fight corruption”, claimed Fund who continued, “and thus the fight against corruption can be  turned into a weapon against political rivals.”

The second panel referred to the situation of entrepreneurship in Romania and in the European Union in general.

John Chisholm gave his keynote speech emphasizing on the difficulties and setbacks that entrepreneurs have to overcome. “In the first half of 2001, the dot-com bust, I would often wake up around 2 a.m. with sweat-soaked sheets sticking to my skin knowing that my business was running out of cash.” Chisholm, a now very successful entrepreneur and venture capitalist based in the Silicon Valley, narrated how he had to mortgage his own home and reduce his salary to the minimum wage in order to allow his company to stay afloat.

Then came Barbara Kolm, the Director of the Free Market Road Show, and the local economist Radu Șimandan. The latter criticized the European Union way of subsidizing entrepreneurship. Instead of that, which is totally ineffective and creates wrong incentives, the EU “should get out of the way.” This means that Brussels should cut red tape and let the free market work. In turn, Ms. Kolm affirmed categorically that “if we entrepreneurs take subsidies, we are as corrupt as the people in government.”

The event was closed by the entrepreneur and local hero Octavian Bădescu. Like John Chisholm did, Mr. Bădescu told the audience about his struggle to succeed: “I was in the lower 10% of income – my salary was 50 dollars for a long time.” Because of this, he explained that the narrative against the top 1% and inequality is nonsensical. “I was at the bottom, now I am much better, but who knows what can happen in the future”, said the Romanian entrepreneur.

About his intellectual influences, Bădescu explained that it was because of his entrepreneurial activity that he found the Austrian School of Economics. He said that it was indeed through practice that he discovered his agreement with Ludwig von Mises and Friedrich von Hayek. So it comes as no surprise that he considers the state as “the  greatest enemy of entrepreneurship.”