Why does Big Business get such a bad rap? A better question: Why does small business enjoy such positive PR, portrayed as the engine of job growth and the symbol of all that’s good with American capitalism?
The April issue of The Atlantic has an excerpt from “Big is Beautiful: Debunking the Myth of Small Business,” which was written by Robert Atkinson and Michael Lind.
The authors tick off some reasons why Big Business is “the object of almost universal scorn,” including Enron’s “accounting chicanery,” Goldman Sachs’s “manipulation of derivative markets,” and globalization that “turned American corporations into multinational enterprises with interests that do sometimes counter to those of their home country.”
Small business, in contrast, stands as the “exemplar of American ingenuity and pluck,” the “rare hero championed by both sides of the yawning political divide” that separates Republicans and Democrats.
To Atkinson and Lind, admiration for small business “is rooted in anachronistic ideals passed down from the nation’s preindustrial founding.”
On the flip side: “the reflexive disdain for large businesses exaggerates their malfeasance while misapprehending their vital role in continued American success.”
While critics like Massachusetts Senator Elizabeth Warren rail against corporate concentration, Atkinson and Lind note the percentage of manufacturing industries in which the top four companies accounted for at least half of total shipments increased only from 35 to 39 percent from 1952 to 2007.
Big companies pay higher tax rates, spend more on R&D, salaries/benefits and create more jobs (“though the depredations of a few job cutters have earned Big Business a reputation for heartless streamlining”) than small firms.
Working Americans face many challenges, but turning them into shopkeepers, artisans or members of the gig economy is not that answer. The authors note that the richest parts of America and abroad are areas where self-employment is lowest.
Atkinson and Lind believe the ability of Big Business to buy influence in Washington via a battery of lobbyists, PR, PA and government relations firms may be why people hold it in low esteem.
They note, however, that small business has its own lobby on K Street through representation in trade groups and associations.
General Motors president Charles Wilson famously told Congress in 1952: “I thought what was good for the country was good for General Motors and vice versa.”
Atkinson and Lind believe a dynamic economy requires interaction of firms of all sizes. “To flourish in the 21st Century, we must learn again that big can be beautiful, too,” they wrote.