Thirty-five years ago my first impression of business was of powerful big businesses and of struggling small ones. My father owned a women's clothing shop in the Hudson Valley of New York, and my memories in the 1940s and early '50s were of him coming home late at night, exhausted by how difficult it was to make a go of it. I now understand he was being squeezed on the one hand by the big retailers and on the other by the big clothing manufacturers.
Twenty-five years ago I was a student trying to contain what I considered to be the nonfeasance or malfeasance of U.S. corporations, confronting their insensitivity to civil rights, for instance. Then 15 years ago it was Bob Reich as a regulator, mired in federal red tape and trying to prevent monopolization and fraud by America's larger businesses.
The irony is that for the past 10 years I've spent a large part of my time working with U.S. corporations, trying to help them in the global competitive race. The more significant change is that as I do so, I'm witnessing their gradual demise. As I advise large corporations about how to become more competitive, I sometimes feel as if I'm talking to dinosaurs at the end of their prehistoric evolution -- huge bureaucracies with small brains incapable of adapting.
When I was at the Federal Trade Commission regulating U.S. business, the Fortune 500's share of the U.S. GNP was 55%. Now, it's a hair over 40%. In the mid-'70s, when I directed the policy-planning staff at the FTC, the Fortune 500's share of the civilian labor force was 17% or 18%. Now, it's less than 11%. No new jobs are being created by large U.S. corporations.
So, over these 35 years the tables have turned. The power and dynamism now are found in small business.
The biggest surprise for me on a personal level was to realize one day a few years ago that I myself am a small business: writing, teaching, lecturing, and on the one day a week that Harvard gives me, consulting. What I'm doing now, I think, is representative of another big change, a consequence of the changing nature of U.S. business. Today there are no longer such things as career paths.
Remember the movie The Graduate? Who was that fellow who leaned over and whispered in Dustin Hoffman's ear, "Plastics"? It was possible 20 years ago to envision a career with a particular company, a particular industry, moving step by step up a corporate ladder. It was possible to envision an academic career, staying put for 40 or 50 years. But today most people gain expertise through their working lives by doing a variety of things, sometimes simultaneously. I teach, write, lecture, consult, and pontificate on TV. Some days I do all five. And some days I stay home with my kids. I have ceased thinking of myself as pursuing any specific hierarchical career with a clear path and obviously ascending steps. And I'm not alone. An entire generation of people under age 45 also do a wide variety of things, sometimes changing what they do completely.
And the same is true with regard to the structure of the economy. High-volume, standardized products, the large industries of the past that were clearly delineated -- autos, steel, textiles, chemicals -- aren't coming back. Industries in the future won't have clear borders, just like jobs won't have clear pathways. In fact, the whole notion of an industry is itself anachronistic.
In 10 years' time, I expect I'll be doing a combination of things, as I do now. The modern career is a sequence of puzzles or of problems that one puzzles over. It's just hard to forecast what those puzzles will be 10 years from now.
"From time to time I see a bit of small-business revisionism on Capitol Hill. We run into two types of responses. One is, we've already done something for you. Why do you need this? The other is, you really don't deserve this. You're asking too much. I don't think very many representatives would openly say that, but priorities do ebb and flow. The small-business community has to make its arguments a bit more creatively than it did 10 years ago. It has to show that it's got political muscle, that it can focus political attention on various issues. Up until now you could just wave the small-business flag, and people would salute."
-- FRANK S. SWAIN, 38, chief counsel for advocacy, U.S. Small Business Administratio
JAMES J. BLANCHARD
46, Democratic governor of Michiga
My lifelong goal was to be a U.S. congressman, a position I was elected to at age 32. That was just when we had the shaking out, the downsizing, the incredibly difficult times for the U.S. auto industry, and I ended up being the author of the Chrysler rescue. It was an uphill battle. When it was over -- after I had worked with the big companies, the banks, the dealership network, Congress, the White House, the Treasury, and of course the United Auto Workers -- I said, I hope we don't have any more of these. If I had wanted to work for the auto companies, I would have gone to work for the auto companies.
After the Chrysler rescue, I was selected chairman of the Economic Stabilization Committee in Congress. I decided to launch a yearlong set of hearings -- no bills, just hearings -- on the dynamics of the U.S. economy. At that time everybody was debating industrial policy and wondering how many more companies we would have to bail out. But I quickly found that the whole clamor for industrial policy was almost irrelevant to the growing sectors of the economy. As David Birch and others were saying, what we had to look at was the rate of business growth. You don't want to be developing policies designed for the Fortune 500 when the rest of the world is providing most of the jobs.
I was lucky to have had that experience as I moved into the governor's office in Michigan, a state that wasn't particularly conscious of these trends. It allowed me to see the forest through the trees here: to realize that while the Dow Chemicals, Upjohns, Kelloggs, Fords, and K marts were extremely important to Michigan, it would be a big mistake to ignore the other segments. So I've been working with smaller companies for six years. And I can tell you that entrepreneurship is
