The Start-Ups We Don't Need — The American, A Magazine of Ideas
The money quote:
We also have ample evidence that when governments intervene to encourage the creation of new businesses, they stimulate more people to start new companies disproportionately in competitive industries with lower barriers to entry and high rates of failure. That’s because the typical entrepreneur is very bad at picking industries and chooses the ones that are easiest to enter, not the ones that are best for start-ups. Rather than picking industries in which new companies are most successful, most entrepreneurs pick industries in which most start-ups fail. So by providing incentives for people to start businesses in general, we provide incentives for people to start the typical business, which is gone in five years.
As a startup owner, the idea that "we would be better off economically if we got rid of policies that
encourage a lot of people to start businesses instead of taking jobs
working for others." makes me throw up a little. Alright, the author doesn't like small businesses, but if people didn't try, we wouldn't have, well, pretty much every company in existence since most started out as startups and small businesses.
I also dislike the assertion that working for others should be encouraged because established companies will do more for our economy in the long run and are better places to work, since most small businesses fail and offer fewer benefits. First of all, working for an established company made me die a little inside every day I had to report to my cubicle, even with the great benefits. Second, if I was working for an established company, I might be getting laid off right now. Third, the established companies have created the worst economic environment since The Great Depression.
Overall, you could say I disagreed with pretty much everything the author said, and I agree with one of the comments on SAI, the article should have been titled, "The Small Businesses We Really Don't Need." since it's main arguments seem to be against local service type small businesses instead of web startups like mine.