03/12/2009 05:12 am ET Updated May 25, 2011

Wealth Without Wall Street

I'll find somebody new and baby we'll say we're through.
And you won't matter any more

-Buddy Holly

We've had a number of government bailouts and "stimulus" programs over the past year. Trillions of dollars have gone down the drain. None of the money ever makes it to people like me, who run small businesses in places like Kentucky.

Like many, I am angry. Washington and Wall Street are tied at the hip and spend most of the time talking to each other. They have social and economic connections and media outlets devoted to promoting their philosophies.

I saw an insipid column by CNBC's Charlie Gasparino, who was horrified at the idea of capping Wall Street compensation at $500,000. He said waiters and restaurant workers would suffer if investment bankers don't have millions to throw around.

Here in Kentucky, I've not run into those Wall Street types throwing around big tips.

Maybe the Wall Street crowd isn't hitting the local Cracker Barrel.

Wall Street and Washington are not impacting my world in a positive way.

With the public outraged about out of control bonuses and out of control lobbyists, I keep waiting for someone on Wall Street and Washington to get it. I don't think they ever will. Politicians make gestures to keep us from rioting, but as soon as our backs are turned, Wall Street will go back at it again.

Wall Street and Washington developed the saying, "too big to fail." The idea is that big institutions must stay in business, no matter how badly they screw up.

The Soviet Union operated on the same premise.

Wall Street and Washington do not understand that entrepreneurs and small business people have been the economic growth engines of the past few decades.

Advances in technology have made it possible for smart people living in Kentucky, Oregon, India and China to compete with any business that Wall Street has to offer.

There has been a long and irreversible trend toward small, entrepreneurial businesses, located far from money centers.

Instead, Washington keeps throwing money at these "too big to fail" money losers.

As noted, the Soviet Union is a good example of why this doesn't work.

Most of the "too big to fail" organizations were created and encouraged by those who ran Washington.

After the last depression, we learned a lesson and put a variety of regulations in place. That worked well for over 50 years. Then "deregulation" became the hottest fad and gave us companies like Enron.

After the last depression, there were laws that let banks do banking and insurance companies issue insurance policies.

In the modern world of deregulation, Citibank, a bank, was allowed to merge with Travelers, an insurance company. Since the new company, Citigroup, is sucking down bailout money like a sailor on Cinderella liberty, I'm not seeing the advantages that this "too big to fail" business model brought to us.

One of the reasons small business gets overlooked is that they don't know anyone in Washington or on Wall Street and don't really want to. Their customers are local and a lot of them, like me, deal with local and regional banks that know them and their business.

If Wall Street knew a lot about their customers, they would not have spent billions on credit default swaps and mortgage-backed derivatives.

People starting their own businesses don't need bailouts. Businesses in a start up phase aren't in need of tax cuts. Small businesses need cash flow, access to capital, mentors and guidance.

The most important thing they need is the proper mindset. People who work for large companies expect employers to look out for their concerns. If someone is going to be an entrepreneur, they have to start looking out for their own concerns.

In a year of massive layoffs and cuts in employee benefits, big company workers "get" that their company may not be there for them. People are looking at entrepreneurship because big companies aren't hiring and in a changing economy, we are not creating new corporations that are "too big to fail."

I've seen a lot of lip service and dollars thrown at Wall Street and very little devoted to entrepreneurs. I would like small businesses to get enough clout in Washington so that politicians can tell the "too big to fail" corporations that "you don't matter anymore."

Don McNay, CLU, ChFC, MSFS, CSSC is the founder of McNay Settlement Group in Richmond, Kentucky. You can read his award winning, syndicated financial column at or write to him at . McNay is the author of Son of a Son of a Gambler and the Unbridled World of Ernie Fletcher.