Another benefit is simply the optionality it gives people for earning a living. Increasingly, whatever your educational background or profession, the two overwhelming career options today seem to be working for a large tech company or becoming an independent content creator (with some obvious exceptions like lawyers and doctors). Running a good ol' small business is a breath of fresh air in the age of digital economy.
"Why work forty hours a week for a corporation, when you can work eighty hours a week for yourself?"
But seriously, as a small business owner m'self, the push by Mamdani to support small business entrepreneurs--who generate something like 80% of all economic growth in the US--truly warms my heart.
And I would also imagine that permit reform and deregulation would make small businesses more productive in the future. I’m not a small business owner, but it seems like the somewhat “fixed costs” of excessive regulations (at least from a waste of time perspective) would negatively affect small businesses even more as there is less business to spread it over.
Supporting small business directly via grants, cheap loans, regulatory forbearance, etc. is a reasonable political choice. Supporting small business indirectly by distorting antitrust law to try and make competitive acts by a large business illegal (this is the essence of Lina Khan’s worldview and is basically what her famous paper about Amazon says) is *terrible* policy.
Sometimes small businesses are an aesthetic preference that I am willing to pay extra for. The local sandwhich shop doesn't have to be competitive with Subway. The guy making homemade gelato doesn't have to price like he is Baskin-Robbins. When I travel somewhere new, just see what the local grocer has on offer is more interesting than Walmart's largely homgonized offerings are.
I hope Mamdani follows through, but be prepared for the caveats. I'd expect any progressive support for small business to be identity based or rationed. Hope they prove me wrong.
As a small business founder-owner (actually several) I generally agree, and the potential for Ds to adopt pro small biz as excuse for streamlining, and win back a fraction of votes (percentages on the margins) seems a real potential given the Trump II.
Now a mitigating item is going over-favor on Small Biz (and equally definition of small biz*) but the overall win for political and economic support to market economics, and improved business climate is an overall benefit.
It's also of utility to reflect on longer-term efficiency factor - as economies of scale are fundamentally important but one needs to avoid falling into large firm ineffeciency (and have sufficient space for competitors to bring dynamic competition) - so small-biz promo as an overall economic risk mitigation strategy is an efficiency argument from a perspective of ensuring systematic flex for change.
(*: as mom and pop is a slogan but what's the operational definition on equity ownership)
I think cities deregulating small businesses and housing would be a huge step forward.
All economies need a healthy blend of locally-owned small businesses and large globally-competitive corporations. The large companies bring in the wealth and the small businesses provide the services and amenities.
What about the changing nature of small business? It seems this is primarily focused on old-fashioned store front businesses. Ironically, Amazon and Walmart (and Shopify) have enabled small businesses to grow and scale. I know a number of mom and pop store owners selling their wares on Amazon and with Shopify stores. They couldn't grow, scale and employ more people without these technologies and distribution platforms. We all have a nostalgic notion of the mom and pop store on Main street, but its much more nuanced today than that. I'm just not convinced that we need to shore up an old system and that there are new ways for small businesses to capitalize on the new systems we have access to today to effectively grow and compete.
I’m not so worried about the wal mart competition. Retail is a tough business and the internet killed more than Walmart ever did. Should we ban internet shopping? Ban UPS and Amazon trucks from city limits? Would be better for retail than banning Walmart, though I think the ship for small retail (ex convenience) has already sailed.
Restaurants are a sector that can survive. In CA I see chains dominating as they have good lawyers, know how to navigate the permit and approval process and stick with a cookie cutter model that may already been approved in that town or county.
In my CA county it takes at least 18 months for a new independent owner to renovate and reopen a pre-existing restaurant space. That’s 18 months with zero revenue. Unless you are independently wealthy- forget it. Construction and permits will be outrageously expensive and time consuming. And then figure in at least another $100k+ on top for mandated upgrades (only the best of the best for the permiteers): new exhaust fans, wiring and plumbing, etc. It’s not about the nickel and diming for signage and outdoor tables. The only model that works for the non-wealthy, non-chain restaurateurs is to buy or lease an Arby’s, tell the county you are changing nothing inside (except what you’ll do in the kitchen illegally later) and reopen it as a taqueria.
I’m not sure I’d be quick to congratulate the types who put a victim on the rack and cranked it up to 11 who have now have decided to ease up a notch or two.
The victim is still on the rack. Sure, 8 or 9 is better than 11, though.
Big business is important for the economy, and retirement savings/public stock market.
Small business however is the glue of culture. They are the public spaces where we meet people, where we can buy the things that are too niche and go under the radar of big business, where the trends of tomorrow are established.
Where you can meet the owner and share ideas, where budding entrepreneurs can access the market with ideas that aren’t being met, and bring vibrancy and true innovation can be tested.
While there are stores that cater specifically to meeting people (e..g, hobby stores / LGSes) I really don't buy the notion that stores are "the public spaces where we meet people" in general. If I'm in a store I'm just there to buy stuff, not strike up an acquaintance with random strangers. Heck, even bars and clubs are too loud (by design) to actually converse without shouting, rather than just drink.
Another benefit is simply the optionality it gives people for earning a living. Increasingly, whatever your educational background or profession, the two overwhelming career options today seem to be working for a large tech company or becoming an independent content creator (with some obvious exceptions like lawyers and doctors). Running a good ol' small business is a breath of fresh air in the age of digital economy.
"Why work forty hours a week for a corporation, when you can work eighty hours a week for yourself?"
But seriously, as a small business owner m'self, the push by Mamdani to support small business entrepreneurs--who generate something like 80% of all economic growth in the US--truly warms my heart.
And I would also imagine that permit reform and deregulation would make small businesses more productive in the future. I’m not a small business owner, but it seems like the somewhat “fixed costs” of excessive regulations (at least from a waste of time perspective) would negatively affect small businesses even more as there is less business to spread it over.
I’m becoming allergic to Noah Smith. I don’t care much about labeling people. Using progressive as a pejorative is a signal.
Well if progressives didn't double down on wildly ineffective policy (practically and politically), it wouldn't be a pejorative.
Supporting small business directly via grants, cheap loans, regulatory forbearance, etc. is a reasonable political choice. Supporting small business indirectly by distorting antitrust law to try and make competitive acts by a large business illegal (this is the essence of Lina Khan’s worldview and is basically what her famous paper about Amazon says) is *terrible* policy.
Sometimes small businesses are an aesthetic preference that I am willing to pay extra for. The local sandwhich shop doesn't have to be competitive with Subway. The guy making homemade gelato doesn't have to price like he is Baskin-Robbins. When I travel somewhere new, just see what the local grocer has on offer is more interesting than Walmart's largely homgonized offerings are.
If the local sandwich guy can’t compete with *Subway*, he should go into a different line of work. That’s a low bar!!!
I hope Mamdani follows through, but be prepared for the caveats. I'd expect any progressive support for small business to be identity based or rationed. Hope they prove me wrong.
As a small business founder-owner (actually several) I generally agree, and the potential for Ds to adopt pro small biz as excuse for streamlining, and win back a fraction of votes (percentages on the margins) seems a real potential given the Trump II.
Now a mitigating item is going over-favor on Small Biz (and equally definition of small biz*) but the overall win for political and economic support to market economics, and improved business climate is an overall benefit.
It's also of utility to reflect on longer-term efficiency factor - as economies of scale are fundamentally important but one needs to avoid falling into large firm ineffeciency (and have sufficient space for competitors to bring dynamic competition) - so small-biz promo as an overall economic risk mitigation strategy is an efficiency argument from a perspective of ensuring systematic flex for change.
(*: as mom and pop is a slogan but what's the operational definition on equity ownership)
Great article.
I think cities deregulating small businesses and housing would be a huge step forward.
All economies need a healthy blend of locally-owned small businesses and large globally-competitive corporations. The large companies bring in the wealth and the small businesses provide the services and amenities.
Iowa City has free buses and it’s working quite well.
What about the changing nature of small business? It seems this is primarily focused on old-fashioned store front businesses. Ironically, Amazon and Walmart (and Shopify) have enabled small businesses to grow and scale. I know a number of mom and pop store owners selling their wares on Amazon and with Shopify stores. They couldn't grow, scale and employ more people without these technologies and distribution platforms. We all have a nostalgic notion of the mom and pop store on Main street, but its much more nuanced today than that. I'm just not convinced that we need to shore up an old system and that there are new ways for small businesses to capitalize on the new systems we have access to today to effectively grow and compete.
I’m not so worried about the wal mart competition. Retail is a tough business and the internet killed more than Walmart ever did. Should we ban internet shopping? Ban UPS and Amazon trucks from city limits? Would be better for retail than banning Walmart, though I think the ship for small retail (ex convenience) has already sailed.
Restaurants are a sector that can survive. In CA I see chains dominating as they have good lawyers, know how to navigate the permit and approval process and stick with a cookie cutter model that may already been approved in that town or county.
In my CA county it takes at least 18 months for a new independent owner to renovate and reopen a pre-existing restaurant space. That’s 18 months with zero revenue. Unless you are independently wealthy- forget it. Construction and permits will be outrageously expensive and time consuming. And then figure in at least another $100k+ on top for mandated upgrades (only the best of the best for the permiteers): new exhaust fans, wiring and plumbing, etc. It’s not about the nickel and diming for signage and outdoor tables. The only model that works for the non-wealthy, non-chain restaurateurs is to buy or lease an Arby’s, tell the county you are changing nothing inside (except what you’ll do in the kitchen illegally later) and reopen it as a taqueria.
I’m not sure I’d be quick to congratulate the types who put a victim on the rack and cranked it up to 11 who have now have decided to ease up a notch or two.
The victim is still on the rack. Sure, 8 or 9 is better than 11, though.
Big business is important for the economy, and retirement savings/public stock market.
Small business however is the glue of culture. They are the public spaces where we meet people, where we can buy the things that are too niche and go under the radar of big business, where the trends of tomorrow are established.
Where you can meet the owner and share ideas, where budding entrepreneurs can access the market with ideas that aren’t being met, and bring vibrancy and true innovation can be tested.
While there are stores that cater specifically to meeting people (e..g, hobby stores / LGSes) I really don't buy the notion that stores are "the public spaces where we meet people" in general. If I'm in a store I'm just there to buy stuff, not strike up an acquaintance with random strangers. Heck, even bars and clubs are too loud (by design) to actually converse without shouting, rather than just drink.
Economist in 'efficiency isn't everything' shocker!