My Kansas City friends will especially appreciate this article, written by Matthew Slaughter, the Dean of the Tuck School of Business at Dartmouth and Matthew Rees, the founder of Geonomica, which is a consulting firm focused on the intersection of business and public policy.
The authors point out that while much of the media attention goes towards tech startups and so-called unicorns, companies that receive $1B valuations within a very short time frame (i.e Uber, Airbnb), that the majority of companies that succeed do so following the Royals’ model of having a vision that inspires, placing calculated investments with the long-term in mind, and a focus on global talent acquisition.
But the barriers that the Royals face are not the same as those that small and aspirational U.S. businesses face. As a matter of public policy, government should foster laws and rules that enhance small business access to capital, reduce corporate taxes while eliminating special-interest deductions that favor the entrenched and lobbying large companies, and reduce barriers to trade and global talent acquisition. As it relates to access to capital for small businesses, Dodd-Frank in the U.S. is doing precisely the opposite of this, making banks even bigger and driving small banks that can’t afford to keep up with these regulations out of business, effectively doing the opposite of its stated intention to make banks no longer “too big to fail”. The U.S. continues to have some of the highest and most complex corporate tax rates coupled with one of the world’s only global tax regimes in which overseas profits are taxed twice, effectively forcing companies to hold their cash overseas. The U.S. restrictions on H1B visas for talented and educated global talent limits business access to the best talent available. The looming votes on the Trans-Pacific Partnership (more on that here) as well as the general decline in U.S. citizens’ support of globalization indicate a wrong-headed belied that protectionism will somehow protect U.S. jobs and promote economic growth. Thus, to optimize business pursuit of the Kansas City Royals model of successful long-term growth, then quite a few things need to change in the public policy arena.