Once upon a Time, Small Business Made America Great

In just a year and a half, President Trump appears to be turning his slogan, "Make America Great Again," into that rarest of things: a campaign promise fulfilled.

The U.S. economy grew at slightly over 4.1 percent in the second quarter of 2018, something that never happened under Obama and that the experts derided as impossible.  The unemployment rate has been hovering at around 4 percent all year, the lowest level in 17 years.  And to top it off, 285,000 good manufacturing jobs, which Obama assured us "weren't coming back," have been created in the last year.  That's a 2.3-percent increase, the largest since 1995.

And the stock market, which the experts also assured us would crash under Trump, has dramatically risen, with the Dow Jones Industrial average up around 6,000 points.

Yet the stock market, the GDP, the employment rate, and all the other common metrics that Obama's unique combination of perfidy and incompetence depressed, while obviously important measures of our nation's well-being, don't really touch a central component of America's greatness.  Though probably no one under 50 remembers, once upon a time, small businesses were the backbone of America's economy and, at least as importantly, our communities.

When I was a child, growing up in the sixties in Philadelphia, any neighborhood that wasn't an utter slum was peppered with locally owned businesses of every conceivable kind.  Hardware stores, butcher shops, electronic stores, appliance stores, hobby shops, bookstores – you name it, pretty much anything you might want to buy could be purchased at a small shop within walking distance from home.

Besides employing locals, these shops were also small enough that the owners interacted with their employees and, hence, recognized them as human beings rather than mere units of economic productivity, to be tossed aside whenever a few pennies can be saved.  And more of the money spent on ordinary purchases stayed in American communities instead of being taken out and concentrated in the hands of a few people like Jeff Bezos, folks so obscenely rapacious that they resemble James Bond villains more than what generations of Americans understood by the term "businessman."

It is hard to deny that corporate globalism has made things cheaper.  Nowadays, even poor people get the latest electronic gadgets as soon as they appear.  But when color televisions first came on the market, they were very expensive and middle-class folks – let alone poor ones – didn't immediately rush out and buy one.  People saved up and waited a few years, which, if you think about it, wasn't such a bad thing.  It's doubtful that losing our ability to delay gratification is something to celebrate.  And, in any event, to whatever extent foiled immediate gratification might count as a loss, it was more than compensated for by the gain in normal human community interaction.

In the 1960s, my sister-in-law and her siblings, at the time none of whom were older than 13, wanted to get their parents a TV as a gift.  They saved up enough money and went to the local electronic store to look around, leaving the cash behind.  They found something they liked, and the owner not only offered to let them take it home and bring the money later, but insisted!  Contrast this to my experience at a big corporate electronics store last month, where an employee regretfully explained me that he'd be fired if he gave me any information on how to fix my laptop on my own.

So while I'm happy that, underneath all the corporate media fake news and noise, President Trump is scoring so many successes, I'm not quite sure he's really on his way toward making America great again.  One among many truths Trump has managed to bring to light is that the expertise of our politicians is all smoke and mirrors – they're completely incompetent.  Without in any way minimizing the president's accomplishment, for I don't believe that anyone else could have achieved them, the ineptitude of previous administrations going back to the elder Bush made it easy for the right man to come in and improve things.

But the strangling of small business in favor of large corporations and the concomitant destruction of American communities will be harder to right.  Replacing the backbone that made America great with a high-tech synthetic substitute that supports the elites instead of ordinary American citizens was caused not merely by incompetence.

Our politicians sometimes go into office poor, but they inevitably come out wealthy.  They don't associate with ordinary Americans; they associate with other members of the elite.  And, at the end of the day, it's the elite's concerns that influence them.

The regulatory burden Trump has relieved from big business is nothing compared to the burden that remains on small business.  Complex tax codes and ever expanding laws and regulations at the local, state, and federal level make it almost impossible for businesses without vast resources to succeed.  Large corporations lobby our legislators for laws that tilt the playing field in their favor, while the voice of the small businessman goes unheard.

Indeed, our politicians and bureaucrats are so used to dealing with enormous sums of money that it's not even clear they've retained the concept of what a small business is.  The federal Small Business Administration, for example, allows that any electronic store earning annual receipts of less than $32.5 million counts as a small business.  Even adjusted for inflation, that would amount to almost $6 million annually in 1972, something I'm sure none of the small neighborhood businesses that were so much a part of my childhood ever dreamed of earning.

It's not clear how we can return to the days when small businesses were the lifeblood of American communities.  But the first step in doing so is not allowing ourselves to forget how much better it was when they were.

Michael Thau has a Ph.D. in philosophy from Princeton and is working on a series of articles at American Greatness exploring the considerable evidence that Russia never hacked the DNC server.  First can be found here.  Second can be found here.

In just a year and a half, President Trump appears to be turning his slogan, "Make America Great Again," into that rarest of things: a campaign promise fulfilled.

The U.S. economy grew at slightly over 4.1 percent in the second quarter of 2018, something that never happened under Obama and that the experts derided as impossible.  The unemployment rate has been hovering at around 4 percent all year, the lowest level in 17 years.  And to top it off, 285,000 good manufacturing jobs, which Obama assured us "weren't coming back," have been created in the last year.  That's a 2.3-percent increase, the largest since 1995.

And the stock market, which the experts also assured us would crash under Trump, has dramatically risen, with the Dow Jones Industrial average up around 6,000 points.

Yet the stock market, the GDP, the employment rate, and all the other common metrics that Obama's unique combination of perfidy and incompetence depressed, while obviously important measures of our nation's well-being, don't really touch a central component of America's greatness.  Though probably no one under 50 remembers, once upon a time, small businesses were the backbone of America's economy and, at least as importantly, our communities.

When I was a child, growing up in the sixties in Philadelphia, any neighborhood that wasn't an utter slum was peppered with locally owned businesses of every conceivable kind.  Hardware stores, butcher shops, electronic stores, appliance stores, hobby shops, bookstores – you name it, pretty much anything you might want to buy could be purchased at a small shop within walking distance from home.

Besides employing locals, these shops were also small enough that the owners interacted with their employees and, hence, recognized them as human beings rather than mere units of economic productivity, to be tossed aside whenever a few pennies can be saved.  And more of the money spent on ordinary purchases stayed in American communities instead of being taken out and concentrated in the hands of a few people like Jeff Bezos, folks so obscenely rapacious that they resemble James Bond villains more than what generations of Americans understood by the term "businessman."

It is hard to deny that corporate globalism has made things cheaper.  Nowadays, even poor people get the latest electronic gadgets as soon as they appear.  But when color televisions first came on the market, they were very expensive and middle-class folks – let alone poor ones – didn't immediately rush out and buy one.  People saved up and waited a few years, which, if you think about it, wasn't such a bad thing.  It's doubtful that losing our ability to delay gratification is something to celebrate.  And, in any event, to whatever extent foiled immediate gratification might count as a loss, it was more than compensated for by the gain in normal human community interaction.

In the 1960s, my sister-in-law and her siblings, at the time none of whom were older than 13, wanted to get their parents a TV as a gift.  They saved up enough money and went to the local electronic store to look around, leaving the cash behind.  They found something they liked, and the owner not only offered to let them take it home and bring the money later, but insisted!  Contrast this to my experience at a big corporate electronics store last month, where an employee regretfully explained me that he'd be fired if he gave me any information on how to fix my laptop on my own.

So while I'm happy that, underneath all the corporate media fake news and noise, President Trump is scoring so many successes, I'm not quite sure he's really on his way toward making America great again.  One among many truths Trump has managed to bring to light is that the expertise of our politicians is all smoke and mirrors – they're completely incompetent.  Without in any way minimizing the president's accomplishment, for I don't believe that anyone else could have achieved them, the ineptitude of previous administrations going back to the elder Bush made it easy for the right man to come in and improve things.

But the strangling of small business in favor of large corporations and the concomitant destruction of American communities will be harder to right.  Replacing the backbone that made America great with a high-tech synthetic substitute that supports the elites instead of ordinary American citizens was caused not merely by incompetence.

Our politicians sometimes go into office poor, but they inevitably come out wealthy.  They don't associate with ordinary Americans; they associate with other members of the elite.  And, at the end of the day, it's the elite's concerns that influence them.

The regulatory burden Trump has relieved from big business is nothing compared to the burden that remains on small business.  Complex tax codes and ever expanding laws and regulations at the local, state, and federal level make it almost impossible for businesses without vast resources to succeed.  Large corporations lobby our legislators for laws that tilt the playing field in their favor, while the voice of the small businessman goes unheard.

Indeed, our politicians and bureaucrats are so used to dealing with enormous sums of money that it's not even clear they've retained the concept of what a small business is.  The federal Small Business Administration, for example, allows that any electronic store earning annual receipts of less than $32.5 million counts as a small business.  Even adjusted for inflation, that would amount to almost $6 million annually in 1972, something I'm sure none of the small neighborhood businesses that were so much a part of my childhood ever dreamed of earning.

It's not clear how we can return to the days when small businesses were the lifeblood of American communities.  But the first step in doing so is not allowing ourselves to forget how much better it was when they were.

Michael Thau has a Ph.D. in philosophy from Princeton and is working on a series of articles at American Greatness exploring the considerable evidence that Russia never hacked the DNC server.  First can be found here.  Second can be found here.