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Before this discussion heads that way, this one can't really be blamed on the venture capitalists directly, because VCs are involved in less than 1% of new smal
by michaelochurch 12y ago
Before this discussion heads that way, this one can't really be blamed on the venture capitalists directly, because VCs are involved in less than 1% of new small businesses, most of which are local concerns like restaurants, parking garages, and bookstores. The VCs aren't at fault for what happened to them. What's happened to the Valley is just one campaign in a larger war on the middle class (and, yes, there is such a thing going on... and the middle class is losing).
The main problem is general economic disenfranchisement. When truck drivers had powerful unions (today, many unions are corrupt and weak, with union leadership buddied up to management) and made what would be six-figure salaries today, while living in houses where the land was effectively free (i.e. the cost of the house was the construction cost alone), it was possible for people in the middle class to accrue real savings. College tuitions were reasonable, because you could get a good job from a (well-funded, cheap) state school and so there wasn't an arms race to get into elite colleges.
The idea that a working-class family could bankroll a business seems insane now, but it wasn't, 30 years ago. The Satanic Trinity of housing, healthcare, and tuition hadn't been re-summoned yet, so average people had money to do things like start companies after a couple decades of working.
The Boomers pulled up the ladder, and made life for the rest of us a race to the bottom. Now, college is expensive, healthcare is a long-tail risk for pretty much anyone (even the "good" insurance policies have exclusions) and housing is obnoxiously expensive anywhere that there are jobs. Add to this the advent of consumer debt (which breaks the Fordist correlation between worker prosperity and the health of the economy) and you have a world in which almost no individuals have capital, and people are stuck relying on a few wealthy individuals and large (usually corrupt) institutions.
When most people don't have any money, fewer small businesses will be formed. It's that simple. These businesses aren't being created because people don't have the means.
- notacoward 12y ago"Pulling up the ladder" captures it well. The "steady climb" route to modest prosperity is increasingly unavailable. Now you have to be superman and leap tall buildings at a single bound, or (more often) go splat trying.
- michaelochurch 12y agoThey want you to think they leapt over tall buildings. In reality, cheating seems to be the preferred strategy among those (from the Boomers and later generations) who've clawed their way into the leadership ranks of Corporate America over the past 30 years.
- fredgrott 12y agoahem, son of trucker.. truckers never made six figure salaries and my father was a union trucker during unoin's heyday ie the teasmsters
- hga 12y ago"truckers never made six figure salaries" Are you sure that's true after adjusting for inflation, at least in the ICC regulated days? Teamsters, though ... two specific incidents around the same time when I was coming of age helped turn me totally against trade unions, the UMW murder of Joseph Yablonski, his wife and daughter, and at the local level in the Teamster's union and locally to me, the murder of one John Galt (oh, the irony) by shooting his explosives laden truck (which could have killed others, it certainly did a number on the shooters on the overpass he was approaching).
- turnip1979 12y agoI don't want to contradict you but I've heard different things. I had a student in a CS program who told me that he was getting a truck after graduating. His brothers were in the business and making 6 figures. This was in the days that a new grad would make 50K as a starting salary in tech if they were awesome. This is a data point from Canada btw. Edit - might there be a difference if you own the truck vs. just being a driver? I don't know the details of the industry.
- at-fates-hands 12y ago>> Edit - might there be a difference if you own the truck vs. just being a driver? I don't know the details of the industry. I have an uncle who's a repo man. 80% of his business is collecting big rigs when the owner falls behind in payments. Trucking is an incredibly tough industry to be in. If you don't own the truck, you have a monthly payment that's almost equal to your house payment. Throw in gas prices going through the roof, and you're lucky to make a decent salary,
- enraged_camel 12y agoRead what he wrote more carefully. He said, "and [they] made what would be six-figure salaries today." As in today's dollars.