Paper Entrepreneurs Winning Over Product Entrepreneurs

Dr. Reich’s article echoes a similar assertion that the fire economy has beaten the real economy.

From Reich’s article:

Paper entrepreneurs — trained in law, finance, accountancy — manipulate complex systems of rules and numbers. They innovate by using the systems in novel ways: establishing joint ventures, consortiums, holding companies, mutual funds; finding companies to acquire, “white knights” to be acquired by, commodity futures to invest in, tax shelters to hide in; engaging in proxy fights, tender offers, antitrust suits, stock splits, spinoffs, divestitures; buying and selling notes, bonds, convertible debentures, sinking-fund debentures; obtaining government subsidies, loan guarantees, tax breaks, contracts, licenses, quottas, price supports, bailouts; going private, going public, going bankrupt.

Product entrepreneurs — engineers, inventors, production managers, marketers, owners of small businesses — produce goods and services people want. They innovate by creating better products at less cost.

For an economy to maintain its health, entrepreneurial rewards should flow primarily to product, not paper.

http://robertreich.org/post/491676652/the-paper-entrepreneurs-are-winning-over-the-product