What can we learn from Sears and G.E.?

Robert Samuelson writes in Investors Business Daily,

For both companies, economic pressures changed the terms of competition. Sears ultimately could not adapt to a world that included Walmart, other "big box" stores, and the internet. GE tried to diversify from its traditional industrial base of appliances, lighting, electric generators and jet engines.

...Last year, GE was removed from the Dow Jones Industrial Average. It was the last of the original 12 firms to go. The others included enterprises making shoes, refining sugar and producing lead — all mature industries. Would we be better off if they were still our leading firms? Hardly.

Capitalism's vices are also its virtues. We pay a high price for economic flexibility but benefit enormously from the rising living standards it produces.

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