For one pizza man, 'It's a Wonderful Life' … Nick's Pizza is an Illinois eatery where families bring the kids, and you can throw the peanut shells on the floor. When Nick's announced it was facing foreclosure, the community rallied to save the beloved pizzeria. – NBC
Dominant Social Theme: Business is tough. There will be casualties.
Free-Market Analysis: Our tiny, Grinch-sized hearts are supposed to be warmed by this story of Nick Sarillo who was a carpenter who built a pizza restaurant in Illinois, over-expanded and faced ruin. He wrote a letter asking people to patronize his restaurant and NBC reports the letter went viral on Facebook and enough people showed up to reduce his debts, at least for now.
Of course, that's the kicker. Sarillo over-expanded by building two restaurants and the chances are that unless he writes another letter – and then another and another – with similar success he'll STILL end up going under. That's not stated in this "feel good" article (and broadcast) but even the so-called happy ending can't obscure this looming possibility. Here's some more from the article:
Nick Sarillo was a carpenter who dreamed of owning a restaurant. So, he built one from the ground up and, of course, called it Nick's. That was about 16 years ago. However, these days most customers aren't coming for the food. They are showing up for Nick and his team of about 200 employees. That's because Sarillo was staring foreclosure in the face. Sarillo is a real go-getter, who expanded his business a few years back when times were good. He hired more people and opened a second restaurant, expecting the community, and its appetite for pizza, to keep growing.
The recession and rampant foreclosures stopped all of that. And it left Sarillo drowning in debt, with a lot of pizza on his hands. Sarillo says he did everything possible to keep the ship sailing but ran out of options, except for one. He wrote an impassioned email to his customers, about 16,000 of them. Basically, he admitted he screwed up, didn't cut back soon enough, didn't have a big enough rainy day fund, didn't anticipate how bad the economy would get. Finally, he pleaded: "SO MY FINAL REQUEST NOW IS FOR EACH OF YOU TO COME TO NICK'S NOW AND TELL AS MANY PEOPLE AS POSSIBLE TO COME NOW!"
When you look around the restaurant these days, it looks like most of the folks who got that email, and their friends and neighbors, showed up! … That email doubled the number of customers for the week. Sarillo was able to pay his staff, and his bank … Sarillo says he is safely on the road out of red ink, for now. Perhaps the moral of the story is: You get back what you give … If you wish to help Nick's, click here.
That's the kicker so far as we're concerned. "If you wish to help Nick's, click here." He's still got financial problems and that doesn't bode well for his business. Businesses are not charities, not even restaurants; when people start to regard their night out as a duty-bound excursion to a failing enterprise, you're metaphorically cooked.
The NBC article is a great example of the "personalization" of news. All large media complexes in the West seek that sort of "human story" that encapsulates bigger issues within the context of an individual drama. In this case, however, the story warms one's heart – but only at the cost of leaving out more painful realities.
In truth, Nick may still lose his business, not because he was greedy or stupid but because like millions of others he was fooled by incorrect price signals. Those signals were generated by an overheated economy that was choking on too much paper money printed by the Federal Reserve and rates that were too low as well.
This overstimulation of the economy created numerous problems of Nick's sort. It is too bad that NBC could not be a little more candid about Nick's situation, but this is how the mainstream news paradigm works. You're not supposed to get into the larger issues. The economy is bad and for the moment Nick's neighbors fixed it for him. End of story.
Only it's not the end of the story. Ben Bernanke and the central banking system in America – and throughout the West – are responsible for millions of these metaphorical (and real) serial murders. And for every Nick temporarily saved by the generosity of the community there are endless numbers of businesses that go under because of the inevitable and vicious turning of the cycle.
We hope Nick makes it. Maybe he will survive with a very shrunken enterprise and have to let go much of his 200-person staff. One thing we are sure of: NBC didn't tell much of the story at all. Its producers scored a heart-warming "news" episode that may win them reporting prizes at the end of the year. But in fact, they contributed nothing to the larger knowledge base of those who read the article on Nick or saw the broadcast about his restaurant.
This is how the system murders hopes and dreams. The business cycle grinds them down and the mainstream media treats those casualties as inevitable. One is a man-made disaster and the other a lie.