Under the title “Rotting-Flesh Reaganism,” R. R. Reno argues that Reagan’s campaign for economic freedom “made sense in 1980, a great deal of sense. But we’re in 2016 now, and we’re no longer suffering under suffocating collectivism and clotted, complacent capitalism. . . . The politics of freedom is losing its salience.”
It surely is the case that the old Reagan message has less purchase now than it did a quarter-century ago. The word “entrepreneurship” hardly was spoken during the recent Republican primaries. That is disturbing, because the empirical evidence argues strongly that today’s capitalism is more “clotted” and more “complacent” than at any time for which we have data.
Here are some parameters that show just how cartelized the American economy has become:
First, and most alarming, startup businesses contributed virtually zero new jobs during the post-2009 employment recovery. Nearly all the employment growth since the depth of the Great Depression came among the 1,500 largest American public companies by market capitalization. In a February study for Asia Times, I showed that the reported employment growth of the S&P 1,500 companies was nearly identical to the total increase in payroll employment reported by the Bureau of Labor statistics during the past seven years.
That is a drastic and unprecedented reversal of historic patterns. As I observed in the Asia Timesstudy, “Economists from the US Census Bureau and the University of Maryland showed in a 2014 study that startup firms created an average of 2.9 million jobs a year between 1980 and 2010—twice the 1.4 million average increase in employment. In other words, startups created 2.9 million jobs a year while established firms lost 1.5 million jobs a year.”