Happy Birthday, America! This month marks the 243rd anniversary of our country’s founding. While most will celebrate the occasion with backyard barbecues and fireworks displays, the holiday also provides an opportunity to acknowledge all the prosperity the country is currently experiencing, as well as the unsung heroes that make it possible.
In recent months, the unemployment rate hit a five-decade low, job creation remained robust, and wage levels rose at an accelerated pace. In fact, the economy is moving so quickly that there are more available jobs than people to fill them.
Walking back in time, this environment is not new. Although we’ve hit snags along the way the U.S. has long experienced unprecedented levels of economic success, whether measured on a macro scale or simply observed anecdotally. But what’s the reason behind such prolonged well-being? American entrepreneurs and the free-market system in which they operate.
There are tens of millions of businesses across the U.S. – all of different sizes, structures, and focus areas. However, they all have one thing in common: They all began with someone having an idea.
Take Bernie Marcus, the founder of my organization, the Job Creators Network, as an example. After becoming unemployed in his late 40s, he – along with his business partners – embarked on an entrepreneurial venture. After noticing an area where consumer demand was not being fully met, the group opened two modest home-improvement stores in Atlanta, GA. Today, that once-humble idea has ballooned into a billion-dollar corporation that employs 400,000 people.
You may have heard of the store chain The Home Depot.
The entrepreneurial drive and economic freedom that shepherded an idea from infancy into a successful business is the foundation of the American success story. Without companies like The Home Depot and the individuals from whom they were derived, the American Dream would be nothing more than a fantasy.
If we want to ensure the pattern of economic prosperity continues, policy makers need to promote entrepreneurship and protect the free-market system that makes it possible.
To a large extent, this means defending what is considered to be the backbone of the American economy: small businesses. There are more than 30 million small businesses, and they act as an engine of job creation and an incubator for future larger-than-life companies. Not only do they currently employee nearly 60 million Americans, but they are responsible for two-thirds of all new job creation.
And not to state the obvious, but every big business once started out as a small one.
From a policy perspective, small business entrepreneurship can be encouraged by lowering taxes, cutting government red tape, and expanding access to credit – all of which have been at least partly addressed during the past two years.
The Tax Cuts and Jobs Act was passed and signed into law at the tail end of 2017 and has lowered the tax burden for millions of small businesses, giving current business owners the ability to invest back into operations and their employees, as well as prompting others to enter the world of entrepreneurship for the first time.
Considerable progress also has been made on the regulatory front. Not only has the current administration mandated that two regulations be eliminated for every new one added, but rules governing the finance industry have been loosened for community banks, a main source of small business start-up investment.
Apple pie, baseball, and backyard barbecues are all hallmarks of the American experience. But on this Fourth of July, remember that when it comes to the economic prosperity historically enjoyed in the U.S., nothing has contributed more than small business entrepreneurs.