Thomas Friedman: Start-Ups, Not Bailouts

http://www.nytimes.com/2010/04/04/opinion/04friedman.html?hp

by gabrielroth • 16 years ago

58 26 16 years ago

nnutter• 16 years ago

He's not the first to make this claim and I question whether it is so clear cut. For instance, it seems very likely that some of those 40 million jobs created by start-ups had an effect on established business. Either through competition for growth or even competition for existing market space.

thwarted• 16 years ago

Obviously the people who work in those jobs need to come from somewhere. Are you implying that competition isn't a desirable outcome?

queensnake3• 16 years ago

Slack and inefficiency keeps people employed and spreads the wealth. Until we've got Utopian redistribution, every technical improvement puts someone out of work. Like, say, travel agents. What do people like that do now?

eplanit• 16 years ago

Mr. Friedman adds to his lengthy list of stories in which he lobbies (it has gotten to be numbingly repetitive, Tom) for increased immigration from India and China.

gruseom• 16 years ago

Why do you single out India and China? This article cites Brin (Russian) and Khosla (Indian); it nowhere mentions China. The immigrants the author plainly argues for are high-aspiring educated risk takers, regardless of where they come from.

pontifier2• 16 years ago

Immigration and education? It could be years before those things have an effect on the job market.

Why not ask people who want to start startups, or are currently starting them what would make it easier to get going quickly?

Personally, I would start hiring tomorrow if it wouldn't cost me any money or part of my business. Perhaps a program that helps startups by paying the wages for the first 3 or so employees for up to a year? That would certainly kick start my business, probably many, many, others.

pontifier2• 16 years ago

I thought a bit about this, and a loan system like federal student loans but that can only be used to pay employee wages would help me.

queensnake3• 16 years ago

Isn't that a bank, small business loan? You go make your case to a loan officer, you get it or not on the merits.

anamax• 16 years ago

> Perhaps a program that helps startups by paying the wages for the first 3 or so employees for up to a year?

What could possibly go wrong....

PG-13• 16 years ago

There was a painfully high occurrence of "high-I.Q. risk-takers" in this article.

msg• 16 years ago

High-IQ risk taking does not just come from the school system or immigration. It also comes from the freedom to fail. Increasing the safety net and taking the edge off failure will help people step out on the tightrope.

kurtosis• 16 years ago

I've heard this said many times - that in the U.S. there is less of a "stigma" against founding a company that happens to not work out (for any number of reasons). Can anyone here give examples of how this stigma is more severe in non-U.S. countries? Is it that no investor will ever give money to anyone who has so much as touched an unsuccessful business? Or are there more subtle social factors at work? (i.e. people stop being your friend if your business doesn't work out) I'd really like to hear some stories about how failure was more severely stigmatized that in the U.S. especially in countries that have much stronger "safety nets" than the USA

garply• 16 years ago

'Keeping face' is very important in China, and founding a failed company would cause you to lose face - which could damage your social network (people willing to trade favors with you).

Also, in China, many people don't respect people who start companies. I often hear the opinion that business people almost need to be devious and unethical to succeed here.

Plus, there is no comparable appreciation for smaller, boutique, local companies here that there is in the US. The notion that 'small can be good and premium' and 'big can be bad and faceless' doesn't really translate. If you ask a person if they think they'd get better quality at a little, specialized cafe vs. a Starbucks, most people would pick the Starbucks (unlike in the US, where Starbucks has been experimenting with running 'stealth stores' where they don't display their logo and which they attempt to customize to the neighborhood).

_delirium• 16 years ago

When I hear that phrase, I usually think of cultural factors, which includes some economic ones like the attitudes of employers. In Silicon Valley at least, it's perfectly reasonable to turn down an $80k solid job offer to start a company with an unproven idea, fail at at it within a few years, then go apply for those $80k jobs again. In a lot of countries: 1) your friends/family will think you're nuts for turning down a good job for some insane side project; and 2) future employers will look at your 3-4 years starting and then bankrupting a company as a negative, not a positive (i.e. as evidence that you're good at running companies into the ground).

Of those, #2 might be the biggest difference? I feel that in the U.S., #1 is actually still pretty strong, at least as far as reactions among non-techie family/friends go.

binarray2000• 16 years ago

From what the German business press has reported and my personal contacts with many entrepreneurs have confirmed, in Germany (which still has a strong "safety-net") you'll be stigmatized.

On the level of your personal contacts, when you start up, you'll mostly not be (morally for example) supported in your intent by your family, friends, peers. Most Germans want a secure job, working hours from nine-to-five, their (circa) 30 (working) days vacations etc. And will most likely aim for that (or eventually fall into the safety-net of the social state) than risk starting their own business.

Second problem is your future: If you start a company and it fails many doors will be (in many cases firmly) closed afterwards making it harder and harder with every failure for you to start again.

I'd say that a safety-net everywhere (!) isn't good. Because, when you put safety-net everywhere, everything becomes overregulated. Favorite joke in Germany is that, because most garages don’t have windows and laws forbid working environments without windows, Apple, Hewlett-Packard and many other garage start-ups wouldn't be possible.

necrecious2• 16 years ago

I liked the idea that if an immigrant create a company that gainfully employes 5-10 people, they get a green card.

That would get more entrepreneurial immigrants come and stay in the US.

prototype562• 16 years ago

What would be his legal status while he is doing that ? Or does he have to create his company in his home country and move it to US to get a green card.

necrecious2• 16 years ago

It can be anything from H1B to illegal immigrant. As long as he is here and is putting into the system more than he is taking out then why care about how he got here?

josephd• 16 years ago

What Friedman should be asking is as technology commoditizes, what other high-growth areas can the US be competitive in?Apart from some narrow niche (OS and productivity software, chip design), it seems the US is content with shifting certain types of hardware design and fabrication to foreign nations, while enjoying the role of brand marketing. Cost is usually cited as reasons. I think the question should be: what other growth areas remain and how can they be exploited by these risk-takers?

brc2• 16 years ago

I'm going to controversial and ask : if successful entrepreneurs are relentleslly resourceful, shouldn't they be able to find a way around the immigration laws? Everyone I ever met who wanted to live in a country found a way to make it happen.

GFischer• 16 years ago

Selection bias? I might not be the best example, but I haven't emigrated yet (to Canada, Australia, the US or the UK) because I am looking to work within the existing inmigration laws (and I'm not motivated - or resourceful, proving the point - enough I guess, but I'm definitely not moving illegally anywhere). For me, they're a powerful deterrent.

brc2• 16 years ago

That's a fair point - selection bias. I thought about that later after I wrote it. I was thinking about people I knew who wanted to move to a country and was successful in doing so, through visa applications, finding jobs with sponsorship or whatever. I realise it's not easy, just trying to play a little devils advocate.

Thomas Friedman: Start-Ups, Not Bailouts

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