Sunday, July 24, 2011

The Myth of the Robber Barons

Burton Folsom's book is a polemic, and judging from the title, that shouldn't be a surprise to anyone. Anything entitled "The Myth of..." is going to be looking at a popular, commonly accepted idea, and showing why it is wrong. Duh.

This book should not be the only information you have about American business from oh, 1820-1940. But it should absolutely be included as a corrective to everything else you are going to read. If the term "robber barons," accepted as applying to all captains of industry in that period, doesn't cue you in what the accepted view is, then I am afraid I will have to write you off as a person who is unable to even suspect prejudice in what is taught to him.

Folsom, for the record, believes that some people of the era were indeed robber barons. He reserves that term for those who built their industries via government subsidies - shipping, railroads, steel, petroleum. His view is not only that subsidy leads to inefficiency, but that it leads to corruption. He instead lauds those who built their fortunes via market efficiency - Carnegie, Rockefeller, the Scrantons, Mellon. Most especially, he praises James Hill in contrast to the other railroad builders. He briefly acknowledges that these men were sometimes difficult, irritating, or even largely immoral people. He states it is not his point to defend their character, but the idea of market entrepreneurship versus political entrepreneurship.

That's not quite true. He does focus on that, but the tone in which he describes what a fine Christian man Rockefeller was, or how Mellon played with his children, reveals that Folsom is not playing quite fair in the PR department. He strays rather far from the strict proof/disproof idea of market capitalism being different from political capitalism.

Folsom identifies two ways we can go wrong in evaluating the "robber barons," one more common to liberals, the other to conservatives. The conventional liberal opinion that all people who get rich in business have been politically connected, and secondarily lucky, does tend to irritate man-on-the-street conservatives and libertarians who resent that efficiency, creativity, and devotion to lowering prices are regarded as tertiary. That's not going to change. Even SCOTUS John Marshall Harlan - common man - couldn't get the idea straight that just because a business was big didn't mean it was bad for the common man. (Oliver Wendell Holmes, fully elite, got that idea more clearly.)

But an idea has been growing in conservative/libertarian circles that Folsom kicks to the curb as well, as he should - that we have to wink at corruption and let these big-idea capitalist bastards do as they wish because that's the only way that railroads, steel industries, or satellite networks come into existence. Folsom purses his lips in old-school fashion and shakes his head. This also, is the way of madness.

Yeah, Burt Junior does spend too much time bitching about how the standard college textbooks are sneering and inaccurate. It's hard not to, frankly, when one sees what gets launched to impressionable 18 y/o minds. But the book is an excellent corrective to the CW. Critics (Amazon and internet) complain that he cherry-picks his data. True, but only half as much as his opposite numbers in the academy, who are jaw-dropping in their selectivity and choice of prejudicial terms.

Four stars.

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