Arthur Brooks presents on the intersection between entrepreneurship and poverty

American Enterprise Institute President Arthur Brooks lectures about escaping poverty through entrepreneurship Wednesday in the Annenberg Auditorium.

American Enterprise Institute President Arthur Brooks lectures about escaping poverty through entrepreneurship Wednesday in the Annenberg Auditorium. Buy this photo
Sam Mousigian/Daily

 

Wednesday, October 4, 2017 - 8:59pm

Arthur Brooks, president of the American Enterprise Institute, says there are several ways in which those in poverty can escape their situation. One of these ways is by living a "startup life."

Brooks, who gave a talk Wednesday afternoon about escaping poverty through entrepreneurship as a part of the Policy Talks at the Ford School of Public Policy, said living a “startup life” includes taking risks and using weaknesses to propel strengths. He also discussed how those in positions of privilege can help those in poverty.

Brooks highlighted the Prison Entrepreneurship Program, an organization based in Houston, Texas, that works to educate and mentor men in prison on starting and running their own businesses.

“People walking around who can’t work, they’re literally the most vulnerable people in our society today,” Brooks said. “The reason the Prison Entrepreneurship Program exists is because they’re trying to find a way to solve this.”

Of the men who were took part in the program, only 7 percent went back to jail in their first three years out, as opposed to 50 percent of those who were not a part of the program, according to Brooks.

Through the program, Brooks said, he realized what the incarcerated men were learning was changing their outlooks on life. Suddenly, they started talking about the things that were going right in their lives and living like an enterprise.

“I thought I was going to find the secret to startup businesses, and what I found was the secret to startup lives,” Brooks said. “See, when I talked to these guys, they didn’t want to talk about their businesses and the money they were making. They wanted to talk about all the things that were going right in their lives because they had learned about entrepreneurship.”

Public Health student Stuart Hammond came to the event because he wanted to get Brooks’s perspective on capital within entrepreneurship.

“I have experience working in pretty low-income settings and so I was interested in what he was going to say about the role of capital in having successful entrepreneurial experiences,” Hammond said. “The indirect way that he talked about it was he did talk about these people coming out of prison, they had time, and time itself is a resource that you can capitalize on.”

The men in the program implemented two things Brooks later recognized were part of people living “startup lives”: taking risks and using weaknesses to propel strengths.

Brooks cited a study done by Steven Levitt, an economist at the University of Chicago and the co-author of Freakonomics, which looked at participants facing a big decision. Levitt told the participants that he would make the decision for them through the flip of a coin, with heads being yes and tails being no.

At two intervals, two months and six months, Levitt followed up with the participants and found that those who were told yes were significantly happier than those were told no at both check-ins, reaffirming Brooks’ notion that taking risks leads to more success.

“It means that the conservatism that we bring to our personal decision-making is usually suboptimal,” Brooks said. “But for most people across the population … you need to say yes more when you’re afraid.”

LSA senior Jesse Arm, co-chairman of the American Enterprise Institute’s executive council at the University of Michigan, expressed the importance of having differing viewpoints presented on campus.

“I think Dr. Brooks and his institution represents the competition of ideas and particularly today, in 2017 on college campuses, it’s important that we have different people with different ideas coming in and expressing their viewpoints,” Arm said. “And I’m really happy that we could do that today in a venue where we could all discuss things civilly … I think it’s important that we have more speakers like that on this campus.”

The second key to success Brooks discussed was one’s willingness to use weaknesses to propel strengths. Brooks gave the example of someone he knew who was an alcoholic through college, and in his senior year, while driving drunk, killed a pedestrian and spent time in jail. He is now a drug and alcohol counselor, using a rough spot in his past to propel his success today, Brooks said.

Brooks also talked about his own past, including his undergraduate experience and how it helps him today.

Brooks concluded the talk by adding that while government aid has its place, in order to bring people out of poverty, we must believe in them, building their dignity. 

“If you join me in believing that your work must go for the benefit of people with less power than you, you must start by admiring people who have less power than you,” Brooks said.