Howard Wolk is an entrepreneur and Co-President of Cross Country Group (CCG). He was an associate council member of the transition team during the Clinton administration and a member of Vice President Gore’s task force on government reform. John Landry is a historian and senior consultant for the Winthrop Group. Previously, as editor he spent 13 years. harvard business review.

Below, Howard and John share five key insights from their new book. Launchpad Republic: America’s Entrepreneurial Advantage and Why It MattersListen to the audio version read by Howard and John themselves in the Next Big Idea app.

Launchpad Republic: America's Entrepreneurial Edge and Why It Matters by Howard Wolk & John Landry

1. Entrepreneurship is key.

Most of us have grown up with stories of great entrepreneurs, from Cornelius Vanderbilt and Andrew Carnegie to Henry Ford and Steve Jobs. But when we think about how our economy works as a whole, we tend to look at what the big established companies are doing. Consider how much influence you have on Dow Jones Industrials. As if the 20 largest companies (across many industries) really matter in a $25 trillion economy.

Everyone is for entrepreneurship. We are not dependent on him for his economic progress in a mature 21st century economy. But in reality, start-ups have driven much of our progress throughout history. They carry out many of the major innovations in the economy, yet the established companies ignore them because they are so focused on continuing to operate at scale. No matter how wealthy entrepreneurs become, society gets the bulk of the value they create. Entrepreneurs create value for themselves and the economy, and even make large companies better.

2. Starting a business is difficult.

Most of the history of the U.S. economy disrespects entrepreneurs. They take risks for granted and criticize limited government support and unequal benefits to society. But America’s entrepreneurial tradition is quite different from most other countries. The United States is the only country that has allowed start-ups to evict incumbents on a regular basis. Other countries tend to protect existing businesses, often in the name of saving workers and communities from disruption. Americans have tolerated more risk and creative disruption to encourage startups.

“The United States is the only country that has allowed start-ups to evict incumbents on a regular basis.”

We open the book with the story of Uber and its founder, Travis Kalanick. Uber has dared to attack taxi incumbents with an alluring new transit app. Kalanick would break the law just about anywhere Uber operates, but the app brings so much value to customers that most cities and states in the U.S. are likely to allow his Uber to operate. famously declared that it would change the law to he was right. In contrast, in Europe and elsewhere, most governments have kicked Uber out, preferring to protect incumbents. This really shows the difference in the political economy between the US that supports entrepreneurs and the rest of the world that is skeptical of entrepreneurship.

3. Entrepreneurship is messy and often political.

We tend to look back at the framework of the Federal Union, but it was the result of a series of compromises unanimously reached by bright, visionary, and public-spirited people. But those founders were just as polarized as we are today. This was good. Because our constitution made it difficult for the government to give privileges to anyone. It was a mess.

Broadway musical Hamilton It shows some of this tension, but the real differences go much deeper and lead to the interests of future entrepreneurs. Although he favored enterprise with privilege, Thomas Jefferson favored regional monopolies so that every community could be headed by a gentleman of leisure with education and the public interest. Stance members hated and fought with each other, resulting in dissuading the monopoly both both nationally and locally. From the outside, it was a terrible mess, but the result was a country and economy with extraordinary dynamism that essentially institutionalized competing interests. In doing so, we have arrived at an economy that welcomes entrepreneurship.

4. Entrepreneurship can tackle inequalities.

Entrepreneurship has done a lot to increase inequality. The richest people tend to be great innovators like Elon Musk and Jeff Bezos, whose rewards are not proportional to anyone’s achievements. But it is part of the engine of capitalism. To get people to save money and invest in risky ventures, you have to give them the potential for high returns. At the same time, entrepreneurs can undermine worrisome inequalities that stem from government privilege. In inequality he has three kinds. Inequality arising from wealth, income, and special privileges often enacted by governments.

“The entrepreneurial drive can take away monopolies and all kinds of privileged positions.”

Without entrepreneurship, you will seek progress from big government-backed big companies. It ends up leading to nepotism, where favors (subsidies and protection) are given to certain companies, making them socially more valued than we are. By keeping entrepreneurs and citizens opposed to government support, we prevent government-driven inequalities that harm society.

That also applies to monopolies. Some companies may become so big and powerful that the government may need to fold their wings, but entrepreneurs have a much better way to overcome monopolies than government intervention. Atlantic & The Pacific Tea Company (A&P) grocery chain innovated and became the dominant grocery store chain in the early 20th century, forcing thousands of small grocery stores out of business in towns across the country. These grocers and their suppliers sought help from state and federal officials, but A&P’s actions were given only minor restrictions. What really knocked A&P down was the next wave of grocery innovation: supermarkets. It was the innovators who won the customers and put A&P out of business. In this way, the entrepreneurial drive can usurp monopolies and all kinds of privileged positions.

5. Entrepreneurship can tackle climate change.

Entrepreneurs have destroyed the environment in many ways over the centuries. Aggressive steelmakers like Carnegie polluted Pennsylvania’s air, land, and water. But we can embrace the same drivers of creativity and risk-taking that have led these companies to minimize and protect against climate change. Governments can help infrastructure that forces companies to pay for pollution, but climate change is such a big problem that radical innovation is needed. It’s not enough to come up with a good idea in a university lab. We need entrepreneurs to invest in that idea, test it in the market, and scale it.

“Leveraging entrepreneurs to commercialize their innovations and drive change in the marketplace can be a key catalyst for solving some of the most pressing issues in the climate change arena.”

Let’s take a look at the history of electric cars. For decades, the federal government tried to get major auto companies to invest in this technology, but the EPA’s fuel economy requirements weren’t enough. There was incremental progress until an entrepreneur (Elon Musk) and his startup (Tesla) finally made electric vehicles attractive to consumers. He took a more radical approach to promoting electric vehicles, backed by government subsidies to make the purchase a little more affordable.

Modifications of the seismic platform can be brought to market through this paradigm. New innovators are more likely to enter the market, forcing big companies to change. Big companies won’t do it unless their competitors force them to do so. Leveraging entrepreneurs to commercialize their innovations and bring about change in the marketplace can be an important catalyst for solving some of the most pressing problems in the climate change arena.

To hear the audio version read by co-authors John Landry and Howard Wolk, download the Next Big Idea app today.

Hear Key Insights with the Next Big Idea App

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