Blog | Personal Finance

The Difference Between a Unionist and a Capitalist

The rich focus on opportunity, not entitlement

As many of you know, I grew up with two different dads. My poor dad, my natural father, was the head of the Hawaii education system. He was staunchly unionist, as were all the members of my family who worked in public education and the government.

My rich dad, my best friend’s dad, was a successful, self-made businessman who owned hotels in Hawaii. He was very much against the unions because of the abuses he saw and because he believed they were anti-capitalist.

As a child, I heard both sides of the story, and I was able to understand the arguments both my rich dad and my poor dad gave for their positions. Though I loved my poor dad and respected him as a wonderful person, I eventually could not agree with him on unions. I sided with my rich dad, and the rest was history.

If you want to know more about why I believe that unions are anti-capitalist and obsolete, I encourage you to listen to the Rich Dad Radio Show podcast, “Pension Tension.” There I share my views in detail, and I also go into why chronically unfunded public service pension funds are the next ticking financial time bomb for the US.

But today, I want to share a simple story that I think perfectly highlights why I am a capitalist and not a unionist.

The night of the vote

Many years ago, an employee of my rich dad’s named Bobby decided that the workers at rich dad’s hotel should be unionized. For months he worked tirelessly to organize the employees, preaching the “merits” of being in a union. Bobby’s work was so effective that eventually he was able to call a meeting for a vote on whether or not the employees would go on strike and unionize.

The night of the vote, I was with rich dad, ready to help and do whatever was needed to keep the hotel running should his hundreds of employees walk off the job. The atmosphere was tense, to say the least.

In the end, the votes were cast, and the final tally was a defeat for Bobby. The workers had not decided to unionize, and business resumed as normal—or as normal as it could be after so much tension.

The day after the vote, my rich dad called Bobby to his office.

“Bobby,” he said. “I don’t like you.”

Bobby thought he knew what was next. He was certain the words, “You’re fired,” would be the next thing out of rich dad’s mouth. They were not.

Instead, rich dad said, “But even though I don’t like you, I never knew you had so much leadership ability. It took a lot of work to organize all those people and have them follow you like that. So, I’m promoting you. You’re now over the entire staff.”

The night’s lesson

I learned that night that Bobby, a unionist, was blinded by entitlement while my rich dad, a capitalist, clearly saw opportunity.

That is why I’m a capitalist. I believe the world is full of opportunity, none of which I’m entitled to, all of which I can pursue.

Learn more lessons from rich dad. Join our free, online community here.