Main Street Capitalism
Vero economist says a return to small business is the key for Americans to dream big again
David Smick, founder and editor of The International Economy magazine and chairman and CEO of the financial-market ad-visory firm Johnson Smick International, has written an optimistic book on the future of the American economy, The Great Equalizer: How Main Street Capitalism Can Create an Economy for Everyone.
Smick, who lives a major part of the year in Vero Beach, says, “The public wants bottoms-up dynamic economic growth, a return to Main Street from a system that seems rigged to Wall Street. They are yearning for the banks to kick in with loans for their businesses and give hope for their children’s futures. They are willing to fight for the American Dream.”
Smick alludes to a limited growth theory mentioned often by Larry Summers, a former government official, economist and Harvard president: “secular stagnation.” This theory recognizes that U.S. growth is now 1 to 2 percent as opposed to the historic 3.2 percent or higher. Many leading economists and politicians, including the Federal Reserve and International Monetary Fund, see this figure as the “new normal.” They postulate that there is no way out of it. Smick doesn’t agree. He thinks there’s a way out if certain bipartisan measures are taken that allow people to dream big and fight for their share of a growing economic pie. But the greatest challenge is behavioral: people need to start believing in the future again.
Two specifics that concern Smick are Washington’s devotion to “bigness” and the lack of a level playing field for small businesses. He also decries what he calls the slime pit of partisanship in Washington. In The Great Equalizer, he writes, “The absolute obsession with the big, the established and the corporate over the small, the new and the entrepreneurial permeates Washington D.C. This bias has come at the expense of economic growth.”