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Monday, June 25, 2018

Why “Permit Patty” Called the Cops on an 8-Year-Old Entrepreneur

This is a symptom of our society's "entrepreneurial decay."

On Saturday, July 23rd, Alison Ettel called police on a young girl selling water without a permit in Oakland, CA. The girl’s relative caught a video of Ettel, tweeted it out, and an Internet rage mob had identified her and her business within hours.

Twitter quickly dubbed the then-unidentified woman in the video #PermitPatty.

The video is frustrating. It starts midway through an altercation with Permit Patty, a grown woman more than capable of remonstrating with a child, on the phone with what one assumes is the Oakland Police Department. Upon seeing herself filmed, she ducks behind a brick wall until the seller’s cousin confronts her personally.

(Ettel has since claimed that she was only “pretending” to call the police and did so after an altercation with the girl’s mother.)

Most of the discussion around #PermitPatty (and her metaphorical accomplice, #BBQBecky, another Oakland woman who called police on a black man using a charcoal grill in a public park) focuses on the racial element at play. Patty and Becky are well-educated white women calling the police on black people committing what are, at-best, nonviolent infractions of municipal code.

Permit Patty may be a racist, I don’t know.

She is indicative of a deeper and less-obvious problem in American society. This deeper problem comes from years of cultural and economic stagnation, decades of drilling a permission-based mindset into the lives of young Americans, and a slow decay of American civil society.

Permit Patty is a symptom of entrepreneurial decay. That we live in a world where it is at all normalized for a grown woman to call the police on a young business owner should give us pause to stop and think about how we got here.

Entrepreneurship Builds Civil Society

I’ve written before about how, contrary to popular belief, entrepreneurship among younger generations is declining, despite it never before being technologically easier to get started on a business. Too much debt, too much stifling, industrialized schooling, and too few role models for entrepreneurial activity all create this environment.  

It’s easy to stop and say, “too many busybodies like #PermitPatty, too.” But that gets the cycle backwards. Permit Patty is just a symptom of a society in which entrepreneurship (especially street markets and especially youth entrepreneurship) is so rare that somebody can stop and think, “does this person have a permit?”

That some people rush to Permit Patty’s defense is another sign of this entrepreneurial and civil decay.

In a healthy market culture, racial, political, religious, and ethnic differences disappear into the cosmopolitanism of the marketplace, at least for the duration of the exchange. Jane Jacobs (ironically, Permit Patty has an Urban Planning degree) wrote about the evolutionary and cooperative nature of commercial morals in her book Systems of Survival. Essentially, Jacobs says, there are two broad systems of morals and ethics that govern behavior. The first is commercial in nature and results in people putting their differences aside for mutually beneficial exchange. The second is governing in nature and results in policing measures. She called these the commercial and guardian systems.

The commercial system arises wherever you have healthy and functioning marketplaces (including black markets). Even in countries and societies deeply divided along racial, political, religious, or ethnic lines, people put aside their differences when they get to the market.

Problems start when these two systems needlessly bleed into each other. Dirty cops start working with the mob and taking bribes. Businesspeople turn to the heavy hand of the regulatory state to crush their competitors. The force that defines the guardian system replaces the cooperation and healthy competition that defines the commercial system. Without the healthy competition and cooperation that define the commercial system, people defer to the guardian system, involving the police in matters that formerly would have been dealt with through negotiation, remonstration, and debate, with force as a last resort.

In a functioning community with the commercial and guardian systems in check, it wouldn’t matter if Permit Patty were a racist. Even if she wanted to do something about a little back girl selling water, the norm of turning to the regulatory state to shut down a small business owner over a permit wouldn’t exist. Instead, the commercial norm would be to ask the business owner how she insures that her water is clean and how customers can hold her accountable if the water isn’t clean. If they don’t get a good answer, they go on their way. They don’t call the police to shut down the stand.

That Permit Pattys and others shutting down children’s’ small businesses continues to plague the news cycle (and that police enforce these shutdowns) shows a need to rebuild commercial society.

How You Can Rebuild Commercial Society

Rebuilding commercial society doesn’t start with congressional legislation or edicts from on high. It starts with re-establishing norms that reward starting a business and make it easy to explore. Doing that can mean changing regulations at the local level. Most people, though, can start by supporting young business owners, deferring to informal institutions for dispute resolution, and making it easier to start a business.

Supporting young business owners doesn’t look like signing up for a youth mentorship program or donating to Junior Achievement (those are fine if you enjoy them). It means buying a cup of lemonade from the local stand, hiring your neighbor’s son to shovel snow from your driveway, and putting up with a kid going around door-to-door to sell something. At the very least, it means not calling the cops on a lemonade stand or on an unsupervised child.

If you do have a dispute with a business owner, whether a child selling water on a hot summer day or a neighborhood business, don’t automatically defer to taking your dispute to the city council. That’s worse than being the guy who yells at a restaurant manager that you’re giving him one star on Yelp because he didn’t immediately do what you wanted. Start by rediscovering the lost art of negotiation, air your grievances and let the business owner know that you aren’t unreasonable and could be open to changing your mind. In other words, if you don’t want to live in a society of busybodies who use the police for small grievances, don’t be a busybody who uses the police for small grievances.

Finally, give people real options to explore starting a business. If you’re a parent and your child wants to start a business instead of focusing on extracurricular activities, let him. If you have a friend who wants to launch a business and you know somebody who can help her do that, offer to connect the two. If you are a business owner and a young person wants to shadow or interview you to learn about your business, be open to the invitation.

In a healthy civil and entrepreneurial society, it wouldn’t matter if Permit Patty were a racist. Rebuilding that society starts on the individual level.

  • Zak Slayback is a venture capital and private equity professional and a small business owner. He is the author of How to Get Ahead (McGraw-Hill, 2019) and wrote the foreword to John Taylor Gatto's Dumbing Us Down (New Society Publishers, 2017). He lives in the United States and writes at He is a Eugene S. Thorpe Fellow and FEE alum.