The Rise of Mediocrity
During the Carter era and stagflation of the 70’s, our economy may have sucked, but at least the entrepreneurs were busy starting news business. Apple and Microsoft began in the 70’s before they exploded in 80’s under the Reagan era. Reagan's economic policy liberated the entrepreneurs and as they say, the rest is history as the United States experienced a quarter of a century of economic growth. Instapundit Glen Reynolds observed, “The latest data indicates that start-ups are becoming rarer, not more common. A new report from JPMorgan economist Mike Feroli indicates that employment in start-ups is plunging. New jobs in the economy tend to come from new businesses, but we're getting fewer new businesses. That doesn't bode well…In fact, it is yet another sign of a United States that is looking more like Europe: A society in which big businesses have cozy relationships with big government, while unemployment remains comparatively high.”
One new threat for long term economic growth is the lack of new startups. Are we missing the next Steve Jobs or Bill Gates, and when we get sound economic policy, will there be enough entrepreneurs to liberate? We are seeing an economy looking more like Europe and less like America. Higher taxes are making risks less profitable, and in the Obama era, entrepreneurship has been under attack. Go back to 2012 when Obama gave his famous “You didn’t build that” speech, in which he added small businesses and entrepreneurs to church goers and gun owners as bitter clingers. For Obama, government is the ultimate engine of growth and the entrepreneur threatens the rule of the bureaucrats for entrepreneur think outside of the box and refuses to cooperate with the economic game plan designed by bureaucrats.
Reynolds noted, “Since 2008, this country hasn't celebrated achievement or entrepreneurialism. Instead, we've heard talk about the evils of the '1%', about the rapaciousness of capitalism, and the importance of spreading the wealth around. We've even heard that working in the public sector is somehow nobler than working in the private sector… And local regulatory bodies, too, make starting new businesses harder…But I wonder if the biggest problem isn't cultural. Countries where those attitudes prevail tend not to produce as much entrepreneurialism, so it's perhaps no surprise that as those attitudes have gained ascendance among America's political class and media elite, we've seen less entrepreneurialism here…We hear a lot about the role of financial capital in economic development. But just as important -- perhaps even more important -- is the role of moral and intellectual capital. A country that celebrates achievement and risk-taking is likely to see more economic success than one that does not.”
What we see is the celebration of mediocrity, not excellence. We see economists and pundits who tell us that what we see now is the future with employment at 7% as opposed to what we witnessed over the past three decades at 4-5% and a near full employment society. With a President and an intellectual class who view the entrepreneur not as someone to respect but to disdain. A businessman like Jeff Immelt of GE whose business model is to seek government favors are far more respected among the political class for he cooperates with the government and tolerates the expansion of government since he is profiting from it.
As Reynolds concluded, “Some people, of course, will start businesses no matter what politicians and pundits say, and will do so even in the face of hostile legal and regulatory climates. But their numbers will be fewer and so will be the numbers of jobs generated. As millions of Americans are unemployed -- while millions more have dropped out of the workforce entirely -- perhaps it's time for our political class to think harder about the messages it's sending. And perhaps it's time for voters to send the political class a message of their own.” Obama stands for mediocrity, it will be nice we had a political opposition that stands for excellence.