Should small businesses be favored over large ones?

[consumedconvert]

I have just finished Hillaire Belloc’s book “The Restoration of Property.” He and other distributists advocate tax policies that dramatically favor small businesses and family farms over corporations, chains, and megafarms. He seeks to make it difficult for a big business to buy a small business, and impossible for mega-corps to arise.

Are small, local businesses better socially and economically? Should small or family businesses or farms be preferred to international chains? From an employment standpoint, would it be better to be a small farmer (what Belloc enthusiastically calls a “peasant”), to own a small shop or store, or other business, or to work for one of these small businesses where the boss actually knows you; or should higher-paying corporate jobs be preferred? Is money the only issue?

So what do you think–should the small guy be favored over the huge corp?

 

[mark_a]

I have just finished Hillaire Belloc’s book “The Restoration of Property.” He and other distributists advocate tax policies that dramatically favor small businesses and family farms over corporations, chains, and megafarms. He seeks to make it difficult for a big business to buy a small business, and impossible for mega-corps to arise.

Are small, local businesses better socially and economically? Should small or family businesses or farms be preferred to international chains? From an employment standpoint, would it be better to be a small farmer (what Belloc enthusiastically calls a “peasant”), to own a small shop or store, or other business, or to work for one of these small businesses where the boss actually knows you; or should higher-paying corporate jobs be preferred? Is money the only issue?

So what do you think–should the small guy be favored over the huge corp?

As for your boss (large or small company) who knows?

As for where you spend your money, it does more good for more people to spend it with the small guy.

I have given up on spending my money at wal-mart.

 

[whatevergirl]

I have just finished Hillaire Belloc’s book “The Restoration of Property.” He and other distributists advocate tax policies that dramatically favor small businesses and family farms over corporations, chains, and megafarms. He seeks to make it difficult for a big business to buy a small business, and impossible for mega-corps to arise.

Are small, local businesses better socially and economically? Should small or family businesses or farms be preferred to international chains? From an employment standpoint, would it be better to be a small farmer (what Belloc enthusiastically calls a “peasant”), to own a small shop or store, or other business, or to work for one of these small businesses where the boss actually knows you; or should higher-paying corporate jobs be preferred? Is money the only issue?

So what do you think–should the small guy be favored over the huge corp?

Hi consumed;

If I had my druthers, I would like to own my own business…preferrably an organic bakery. I would presume to do that over working for a large or small corporation. I work for a large corporation, now…and really like my job, but if comparing working for a smaller company (family owned) over larger–I would choose larger. Career path is better–stock options, 401k’s and pension are there…smaller family owned businesses sometimes struggle just to offer their employees healthcare, let alone any of the retirement vehicles. I have always worked in large firms, don’t know anything else. My sister works for a family owned business now–she is in hotel sales–for a resort–and she said the benefits are terrible…Not all family owned businesses can’t manage it, but the ones between $10 and $25 million in ann revenue, don’t offer the greatest healthcare or retirement for their ee’s…they just can’t afford it.

 

[whatevergirl]

I say that with the caviat of…it depends what you are looking for in your company…in your career path. My sister told me she would not like working for a large company like my employer. So, to each’s own…

 

[vern_humphrey]

These threads are like debating boxing with people who have never been in the ring, and are convinced the way to stop an opponent’s punch is with your chin.

Government should drop policies that hurt small businesses (like the laws that forbid unafilliated business to band together and bargain for health insurnance – and the Death Tax.)

But they should also remember, businesses are property. The right to buy and sell property is what makes the economy go. If you forbid one business to buy another – and forbid the owners to sell – you are creating an economic disaster.

When considering economic issues, always ask, “Am I talking about forcing people to do things they would not otherwise do for sound economic reasons?” If the answer is “yes,” then the proposed course of action is almost certanly wrong and likely to hurt people.

 

[consumedconvert]

But they should also remember, businesses are property. The right to buy and sell property is what makes the economy go. If you forbid one business to buy another – and forbid the owners to sell – you are creating an economic disaster.

When considering economic issues, always ask, “Am I talking about forcing people to do things they would not otherwise do for sound economic reasons?” If the answer is “yes,” then the proposed course of action is almost certanly wrong and likely to hurt people.

I seem to remember a series of distinguished authors discussing the so-called “universal destination of goods.” Property is not absolutely inviolable.

 

[Ridgerunner]

Government should drop policies that hurt small businesses (like the laws that forbid unafilliated business to band together and bargain for health insurnance – and the Death Tax.)

I agree, but I’ll raise you. In my opinion, government should not only seek to remove barriers to small business operation, it should attempt to level the playing field in other ways.

So, if Producer “A” sells to Walmart at $1.00/unit, it should be obliged to sell Product “A” to everyone else at that price.

One thing that truly aggravates me, and going back to removing “barriers”, something needs to be done about the “well worker effect” that massively aids large businesses but penalizes small ones. Small ones tend to keep employees who are suffering from some illness or disability. Large ones don’t because their minimum requirement is spelled out in FMLA and COBRA. And the minimum requirements are exactly what they follow. So, health insurance coverage with large corporations is often illusory. That’s part of the reason large corporations can buy health insurance much more cheaply than can small ones.

 

[SemperFidelis]

If you like a Distributist form of economics, which I do, then yes the government should favor small businesses to large ones. I do this myself all the time by refusing to shop at Wal-Mart and other “giants” when there is a local store that sells the same goods. I am a staunch Republican because of moral and social issues and I believe these are more important than economics. I am not however in favor of the big business model most Republicans prefer. However there are plenty of Democrats who like big business too, so it’s hard to find support for the “little man” anywhere these days.

 

[SpiritMeadow]

Many suggest that we are rapidly reaching a point where it is a fact that multi-national economic interests represented by huge multi-national conglomerates actually run the world. The nation-state is rapidly becoming obsolete as a result. None a single one of these people is elected by anybody, yet they will soon control everything in our lives. I think we might start favoring small business and containing these mega corps who are now starting to do their own foreign policy. I think we might better do it pretty soon.

 

[vern_humphrey]

I seem to remember a series of distinguished authors discussing the so-called “universal destination of goods.” Property is not absolutely inviolable.

And many people who do not have the grit and gumption to start and run their own businesses interpret that to mean they have the right to take other people’s property.

 

[SemperFidelis]

Many suggest that we are rapidly reaching a point where it is a fact that multi-national economic interests represented by huge multi-national conglomerates actually run the world. The nation-state is rapidly becoming obsolete as a result. None a single one of these people is elected by anybody, yet they will soon control everything in our lives. I think we might start favoring small business and containing these mega corps who are now starting to do their own foreign policy. I think we might better do it pretty soon.

Wow! Call the Pope! SpiritMeadow and I actually agree about something. I’m flabbergasted.

 

[vern_humphrey]

I agree, but I’ll raise you. In my opinion, government should not only seek to remove barriers to small business operation, it should attempt to level the playing field in other ways.

So, if Producer “A” sells to Walmart at $1.00/unit, it should be obliged to sell Product “A” to everyone else at that price.

Isn’t it funny how people who won’t get off their duffs and start their own businesses are so willing to tell **other people **what they can and cannot do in their businesses?

One thing that truly aggravates me, and going back to removing “barriers”, something needs to be done about the “well worker effect” that massively aids large businesses but penalizes small ones. Small ones tend to keep employees who are suffering from some illness or disability.

Can you prove that assertion?

Large ones don’t because their minimum requirement is spelled out in FMLA and COBRA. And the minimum requirements are exactly what they follow. So, health insurance coverage with large corporations is often illusory. That’s part of the reason large corporations can buy health insurance much more cheaply than can small ones.

The real reason is there is a law forbidding unaffiliated small businesses to band together and bargain for insurance for their employees from a position of strength.

Another example of people deciding they need to make other people follow their ideas.

 

[Malcolm_McLean]

Are small, local businesses better socially and economically? Should small or family businesses or farms be preferred to international chains? From an employment standpoint, would it be better to be a small farmer (what Belloc enthusiastically calls a “peasant”), to own a small shop or store, or other business, or to work for one of these small businesses where the boss actually knows you;

Generally no. We miss something when the fishmonger does not own his own business, but is a paid employee laying out fish chosen by head office at prices set by the marketing department.

Howwever we remember only the good and not the bad. The employee clocks off a five and returns to his wife and family. The small businessman, on the other hand, becomes a slave to the business. He goes back to his accounts, or cleans the store himself because he cannot afford to employ help, and his wife and children spend endless hours picking through baskets of fish waste to separate out the guts for pet food and the bones for fertiliser. That’s the reality of many small businesses.

Big business, on the other hand, works according to rules. It is not a panacea, but most of the corruption, in the criminal sense at least, is with the few at the top, There is actually less office politics in bigger organisations, because promotion depends more on formal qualifications and less on immediate colleagues. The employed fishmonger is likely to be far better off materially; he can rise if he has a talent for management, and he is less likely to cheat his customers.

 

[vern_humphrey]

Let’s remember, if I go into a small store – say a hardware store – the products this small store sells were mostly made by big business. Nobody sits down with a file and a chunk of steel and files out a chainsaw, a machinist’s vise, or a woodstove. The gas station down the street doesn’t have a well in the back yard and a refinery in the basement.

If we had to rely on cottage industry to build cars, a small sedan would cost a half a million dollars. And computers would be out of the question – who could build a computer chip in his garage?

So very often the “small business” is simply an outlet for much larger businesses. And typically a rather inefficient one.

 

[consumedconvert]

Isn’t it funny how people who won’t get off their duffs and start their own businesses are so willing to tell **other people **what they can and cannot do in their businesses?

How do you know none of us have or will start our own business? My grandfather was 45 before he started his first business. I’m willing to guess that many of us who oppose your idea of nearly unlimited capitalism and unrestrained mega-corps are younger than that.

I’m a little surprised by your reaction anyway. Why do you favor the rights of a multi-billion, multi-national corp against the rights of the start-up (which takes more guts)?

Andy why do you assume that those arguing in favor of more opportunities for small businesses are too lazy to “get off their duffs” and start their own (small, at least at first) businesses? That’s just a bit anti-logical, don’t you think?

Another example of people deciding they need to make other people follow their ideas.

Ideas like, say, forcing government to allow “unaffiliated small businesses to band together and bargain for insurance”? (A completely good idea, btw). We all have ideas and convictions, and if we believe in them, we think other people ought to follow them.

 

[vern_humphrey]

How do you know none of us have or will start our own business?

When you start your business, let me know.

I’m a little surprised by your reaction anyway. Why do you favor the rights of a multi-billion, multi-national corp against the rights of the start-up (which takes more guts)?

What’s this about “rights?” Under the Constitution (Article 14) we all have equal protection under the law. Therefore the government should favor neither large nor small businesses.

Andy why do you assume that those arguing in favor of more opportunities for small businesses are too lazy to “get off their duffs” and start their own (small, at least at first) businesses? That’s just a bit anti-logical, don’t you think?

When you start your business, let me know.

Ideas like, say, forcing government to allow “unaffiliated small businesses to band together and bargain for insurance”? (A completely good idea, btw). We all have ideas and convictions, and if we believe in them, we think other people ought to follow them.

You take the the position that restoring people’s rights is " forcing government" to do something?!?!

Now that’s what I call spin!!

 

[OriginalJS]

The above is correct. There is no way much that is done could be done by small business. This includes both light and heavy manufacturing. Railroad engines, airplanes, ships, and automobiles are a few examples. Large entities running in the corporate form produce huge amounts of products at reasonable prices - extremely reasonable if you consider what it would cost to have those products hand made.

As for retailing, the reason the Wal*Marts, Sears, Walgreens, K-Marts and Targets were successful was that they delivered goods and services more economically than the small businesses they replaced. Those small businesses often overcharged customers outrageously. It was good while it lasted, but times have changed. Margins have been narrowed and the consumer enjoys the lower prices.

There is no getting around the fact that there are economies of scale. A chain that can buy 12,000 Winchester rifles is going to get a better deal from the manufacturer than a small business that wants to buy five. This principle works all the way down to the retail level. A common example is business Christmas cards. If you buy 100 they may cost $75.00 but if you buy 1000 you may only have to pay $500.00.

 

[consumedconvert]

When you start your business, let me know.

Don’t worry, I will. KnowwhatImean, Vern?

 

[consumedconvert]

Many suggest that we are rapidly reaching a point where it is a fact that multi-national economic interests represented by huge multi-national conglomerates actually run the world. The nation-state is rapidly becoming obsolete as a result. None a single one of these people is elected by anybody, yet they will soon control everything in our lives. I think we might start favoring small business and containing these mega corps who are now starting to do their own foreign policy. I think we might better do it pretty soon.

 

[consumedconvert]

Let’s remember, if I go into a small store – say a hardware store – the products this small store sells were mostly made by big business. Nobody sits down with a file and a chunk of steel and files out a chainsaw, a machinist’s vise, or a woodstove. The gas station down the street doesn’t have a well in the back yard and a refinery in the basement.

If we had to rely on cottage industry to build cars, a small sedan would cost a half a million dollars. And computers would be out of the question – who could build a computer chip in his garage?

So very often the “small business” is simply an outlet for much larger businesses. And typically a rather inefficient one.

Belloc did consider the problem of industries that require large organizations, such as the auto industry. In his day the prime example was the railroad industry. “Cottage industry,” of course, could not produce a locomotive. Some businesses must be large; I do not dispute that, and neither did Belloc, although would object to exactly how large some auto companies have become, what with mergers, buyouts, and soforth.

One solution is to encourage the growth of companies who are “big enough.” For instance, I don’t know if many people could build a computer chip in a garage, but would imagine that fifty or a hundred could do so very well in a medium-sized lab/factory. If they happen to own the company (as in "employee owned and operated), so much the better!

Local stores are not “merely” outlets for manufacturers! They provide a needed service and generally provide well for their employees. And I think you would agree that an employer who knows his employees personally looks out for their interests better than one who has never heard their names. It also benefits a community to have a local business and to have the profit of that business be spent locally, as opposed to the major financial centers of the world. I’m much more comfortable knowing that the profit goes to pay for my bosses’ house–you know, to benefit the small entrepreneur–than if it went to pay for a multi-million dollar CEO bonus.

Sure, it would be better if products weren’t manufactured by multi-national mega-corps, but I’d rather have the small entrepreneur benefit from the sale than a faceless corp. entity.

Belloc makes the observation that distributism differs from Capitalism in a primary assumption. Capitalism assumes that the primary role of the economic policy is to cheapen prices and make the economy grow. The primary assumption of distributists is that the primary role of the economy is to encourage and protect a large class of property-holders, whether that property be businesses or small farms. Right now economic policy encourages and protects a very small number of property holders. Even most of those of us who own houses do not really own them; and Belloc contends that those who own real property are always more free and protected than those who don’t.