Folsom shows that the "Robber Baron" school of historians of American business enterprise was partly right and partly wrong but was unable to distinguish which was which. He points out that during the nineteenth and the early twentieth century (and by unmistakable implication, in the late twentieth as well) there were two kinds of business developers, whom he describes as "political entrepreneurs" and "market entrepreneurs." The former were in fact comparable to medieval robber barons , for they sought and ...
Folsom shows that the "Robber Baron" school of historians of American business enterprise was partly right and partly wrong but was unable to distinguish which was which. He points out that during the nineteenth and the early twentieth century (and by unmistakable implication, in the late twentieth as well) there were two kinds of business developers, whom he describes as "political entrepreneurs" and "market entrepreneurs." The former were in fact comparable to medieval robber barons , for they sought and obtained wealth through the coercive power of the state, which is to say that they were subsidized by government and sometimes granted monopoly status by government. Invariable, their products or services were inferior to and more expensive than the goods and services provided by market entrepreneurs, who sought and obtained wealth by producing more and better for less cost to the consumer. The market entrepreneurs, however, have been repeatedly --one is tempted to say systematically --ignored by historians.
One another level, Folsom's study has profound implications for American historiography beyond the immediate subject to which it is addressed. It is commonly held that the Whig Party of Clay and Webster and its successor Republican Party of Lincoln and William McKinley were the "pro-business" parties, and that the Jacksonian Democrats were anti-business. What comes through here is something quite different. The Whigs and Republicans engaged in a great deal of pro-business rhetoric and in talk of economic development, but the policies they advocated, such as subsidies, grants of special privileges, protective tariffs, and the like, actually worked to retard development and to stifle innovation.
On Yet another level, though Folsom's work is balanced, judicious history, addressed tot he past (and is unmarred by the shrill accusatory tone that characterizes the writings of anti-business historians), it has a powerful relevance to current political discourse.
Adam Smith forewarned us more than two centuries ago, "The statesman, who should attempt to direct people in what manner they ought to employ their capital, would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it."
Excerpts from the Foreword by
"I rad this book in one sitting. In spite of the easy reading of the text, the book has profound meaning for the nature of business in America, with implications for political philosophy and economic theory. There isn't a businessman in the country who would not profit from the reading of this important book."
"The Myth of the Robber Barons" is a lively, well written and informative introduction to the subject. It is a useful source for students of American history.
"The Myth of the Robber Barons is...excellent... In short, this book is the perfect supplement to most standard economic and business history textbooks. This reviewer had adopted it already."
Stuart D. Brandes
"The subtlest essay makes James J. Hill an American hero as the only man who built a transcontinental railroad without government subsidy.... The most daring attempt at revision is the author's paean to John D. Rockefeller."
Burt Folsom is Charles Kline professor of history at Hillsdale College in Michigan.
He received his Ph. D. from the University of Pittsburgh, and has taught U. S. history at the University of Nebraska, the University of Pittsburgh, Murray State University, and Northwood University.
He has written articles for the Wall Street Journal, The American Spectator, Policy Review, and Human Events. Also, he has written seven books, which include Urban Capitalists (Johns Hopkins University Press), The Myth of the Robber Barons (Young America's Foundation), New Deal or Raw Deal: How FDR's Economic Legacy Has Damaged America, and Empire Builders (Rhodes and Easton).
He also runs a blog at burtfolsom.com.
Folsom is giving speeches this year on the New Deal book and on the comparisons between the New Deal of FDR and the recent promises of a New Deal under Barack Obama.