Big Is Beautiful – The New Yorker

American politicians may not agree on much these days. But they are unanimous in their veneration of small business.

Meanwhile, the countries with the lowest percentage of workers employed by small businesses are Germany, Sweden, Denmark, and the U.S.—some of the strongest economies in the world.

This correlation is not a coincidence. It reflects a simple reality: small businesses are, on the whole, less productive than big businesses, and though they do create most jobs, they also destroy most jobs, since, while starting a business is easy, keeping it going is hard. This is true around the world.

Small may be beautiful. It’s just not all that prosperous.

Source: Big Is Beautiful – The New Yorker

 

Small business is not that prosperous for *society*. We would all be collectively worse off if we had to rely on 100,000 general stores each owned by a sole proprietor and fed by its own piddling supply chain rather than mostly rely on big box retailers, department stores, and supermarkets for most of our shopping while relegating the sole proprietorship businesses to remote locales or niche markets. It is ridiculous that the in-city corner store charges $2.50 for the same bottle of seltzer that costs $0.49 at the suburban grocery store, and I doubt that the grocery store is using seltzer water as a loss leader or that the in-city store is making a killing with an 80% profit margin. The costs really are that different and collectively everyone in the economy generates (through higher productivity) and receives (through higher wages and lower prices) more material value with the former than the latter in every case where the scale of the enterprise is available.

That said, I’ll agree that it is really hard to beat the work atmosphere and lack of corporate bureaucracy of a small business. Still, the pay is lower and I’m sure I am a less productive employee/member of society (if for no other reason than my work is going to help fewer customers, though I am sure that financing and leverage also play into that). Thus, I agree with the article and the quote:
“Small may be beautiful. It’s just not all that prosperous.”
— Small is more likely to be fun, friendly, inspirational, exciting, etc. but it is also an expensive way to conduct an enterprise and collectively society is materially richer and more productive with larger companies in many if not most cases.

Debt By Degrees – The New Yorker

In the past decade, Americans took out close to five hundred billion dollars in student loans, and now collectively owe close to a trillion dollars in …

Source: Debt By Degrees – The New Yorker

 

I would add that the rising cost of college combined with the rising wage premium of that education/piece of paper is probably helping to decrease American’s wage and class mobility, as well as seriously hampering the finances of those still under the burden of tens of thousands of dollars in student loan debt.

The Bomb Buried In Obamacare Explodes Today-Hallelujah! – Forbes

I have long argued that the impact of the Affordable Care Act is not nearly as big of a deal as opponents would have you believe. At the end of the day, the law is – in the main – little more than a successful effort to put an end to some of the more egregious health insurer abuses while creating an environment that should bring more Americans into programs that will give them at least some of the health care coverage they need.

Source: The Bomb Buried In Obamacare Explodes Today-Hallelujah! – Forbes

 

What kind of industry is incapable of spending less than 20% of its revenue receipts on *administration*?

Social Proof Is The New Marketing | TechCrunch

If you’re looking to grow your user base, is there a best way to cost-effectively attract valuable users?  I’m increasingly convinced the best way is by harnessing a concept called social proof, a relatively untapped gold mine in the age of the social web.

What is social proof?  Put simply, it’s the positive influence created when someone finds out that others are doing something.  It’s also known as informational social influence.

Source: Social Proof Is The New Marketing | TechCrunch