Good article in The Atlantic about America’s Monopoly Problem and how it stifles innovation and entrepreneurship.
This decline in dynamism has coincided with the rise of extraordinarily large and profitable firms that look discomfortingly like the monopolies and oligopolies of the 19th century. American strip malls and yellow pages used to brim with new small businesses. But today, in a lot where several mom-and-pop shops might once have opened, Walmart spawns another superstore. In almost every sector of the economy—including manufacturing, construction, retail, and the entire service sector—the big companies are getting bigger. The share of all businesses that are new firms, meanwhile, has fallen by 50 percent since 1978. According to the Roosevelt Institute, a liberal think tank dedicated to advancing the ideals of Franklin and Eleanor Roosevelt, “markets are now more concentrated and less competitive than at any point since the Gilded Age.”
More and more money is funneled out of our communities by large chain stores and franchises that push out smaller mom and pop stores and boutiques. Like the end of manufacturing, this effectively eliminated a huge chunk of good middle class incomes for family store owners over the decades and replaced them with a bunch of lower income jobs while sending the profits all to one family in Arkansas (in the case of WalMart).
One idea I’d like to see pushed in the marketplace of ideas is that of limiting chain stores and franchises. Few think about it, but other countries do it. In India an individual cannot own more than 2 businesses. If a country wants to incentivize small business ownership then you limit the proliferation of large chain stores and franchises.
Certainly some businesses are better big, but there’s no reason for the concentration of drug stores, food stores, hardware stores, etc.
One way to bring back the middle class is to say no to big business.