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Dengler Domain: Small Businesses

Sean Dengler.

The United States was built on the back of small businesses, be it farmers or small merchants. When financial and political power is spread between many, this makes a healthier democracy. As Supreme Court Justice Louis D. Brandeis said, “We must make our choice. We may have democracy, or we may have wealth concentrated in the hands of a few, but we cannot have both.” By utilizing anti monopoly policies and antitrust laws, the United States and Iowa government should do everything in their power to help small businesses.

While farming, what I loved about working with Tama-Benton Cooperative was the small business feel. The big wigs were in the same office as those I worked with. It is a local business run by the locals. I went to school with and taught Bible school to those who worked there. It felt right collaborating with them even if I may have been paying a higher price for services. It was good to keep my dollars in the community. There are other cooperatives like this in other parts of Tama County as well.

This is in stark contrast to Landus Cooperative. After recently laying off less than 10% of their workforce and with locations spread across the state, where do you talk to their big wigs? Nowhere else than across the street from where I worked in downtown Des Moines. This larger cooperative oversees downtown Des Moines while their advertising plasters the walls of Wells Fargo Arena. This company cannot be providing the same amount of service and dignity to its employees as a smaller cooperative. Benefits may be better in addition to other parts, but are they caring for their individual communities like other smaller cooperatives are?

Unfortunately, this problem persists throughout the American economy. According to a recent article published in the Washington Post by Andrew Van Dam titled “Is America still a nation of small businesses?,” he lays out the case that businesses in this country have only grown larger. Before the Great Recession, most Americans worked for businesses with fewer than 500 employees. This has since flipped where 53% of people work for businesses with 500 or more workers.

This has not happened because big business is better. Stacy Mitchell, from the Institute for Local Self-Reliance, is quoted in the Washington Post article as saying when given an even playing field, local entrepreneurs show time and again that they can provide better service at lower costs. The reason big business continues to grow bigger is politicians from both major parties began to abandon small business in the 1970s and 1980s.

While there is much to discuss in this article, the biggest point is the share of grocery store employment shows this change. This is due to the lack of enforcement of the Robinson-Patman Act since the 1980s. In 1980, firms with less than 10,000 employees stood over 65% of the grocery-store employment share while firms with more than 10,000 employees were slightly below 35%. Fast forward to now, the industry has flipped with firms with more than 10,000 employees making up around 65% of the share and firms with less than 10,000 employees making up around 35% of the share. This leads to a hollowing out of grocers causing food deserts to make up more of the landscape.

This is all self-inflicted pain that we can stop. Small grocers and small businesses do not need to close. We have stopped and broken up consolidation before, and we can do it again. Bigger is not always better, and we can have more cooperatives like Tam-Benton which react more nimbly than larger cooperatives like Landus. It is about advocating for these changes to help every small business and giving everyone a fair and equal shot. No matter where one lives or which business one works for (or with), every person deserves the same dignity and economic liberty.

Sean Dengler is a writer, comedian, farmer, and host of the Pandaring Talk podcast who grew up on a farm between Traer and Dysart. You can reach him at sean.h.dengler@gmail.com.