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“The Myth of The Robber Barons” by Burton W. Folsom, JR. Tells a fantastic storyline about important entrepreneurs in early America. Folsom states clearly that there are two different types of entrepreneurs, market entrepreneurs, and political entrepreneurs. Folsom justifies that both types of entrepreneurs are part of Americans’ success. Folsom includes stories of both market entrepreneurs like Carnegie, Rockefeller, and Vanderbilt. Folsom also included stories about political entrepreneurs like Leland, Stanford, Henry, and Villard. Throughout the stories, Folsom makes an approach to identify an honest businessman compared to a businessman that uses the government in counterfeit attempts.
Folsom believes all these men have shaped America in some sort of way no matter if they are political or market entrepreneurs. Folsom included information in the book that has different spins to what some history books have said.
According to Folsom, market entrepreneurs were the people that liked to give back. Market entrepreneurs did everything in cost to make things better even if it involved some type of risk at their end.
Market entrepreneurs built their own businesses with private funds. Market entrepreneurs are good people, they like to help the economy. One example of a market entrepreneur who did a good deed was John D Rockefeller. “Before he died, he had given away about $550,000,000 to charity, more than any other American before him had ever possessed” (98). 1 He donated to help kids in school and built libraries. The more Rockefeller got in money the more he kept giving. To Rockefeller, it was the true fulfillment of the biblical law: “Give, and it shall be given unto you; good measure, pressed down, and shaken together, and running over, shall men give unto your bosom,” Not “Money” itself but “the love of money” was “the root of all evil.
” Folsom tends to show the true person Rockefeller actually was. Rockefeller saved the
American industry by showing dominance over the Russians and helped price reductions. Folsom kept giving evidence of how Rockefeller was such an amazing person. In my previous history classes, they educated me with a different view of Rockefeller than Folsom did. In the textbooks, the lead was different and did not honor him as much.
On the other hand, the other type of entrepreneur Folsom states is a political entrepreneur. They try and gain benefits from government contracts and subsidies. The business they produce is corrupt. Political entrepreneurs spend money like kids in other words. When they get money from the government, they put it to complete waste. Those who tried to succeed in steamboating primary through federal aid, pools, vote, buying, or stock speculation will be classified as a political entrepreneur. According to Folsom, “The political entrepreneurs often fit the classic Robber Baron Mold” (1). 2 Every entrepreneur fit into one type of category even though it might not be perfectly according to Folsom. Political entrepreneurs are only concerned with how fast they can get things done, and also how much money they will gain. Some political entrepreneurs that Folsom tells us about is Edward K, Robert Fulton, and Samuel Cunard. Which they all helped and worked in the steamboat factory and while working for the factory they did receive some aid. The part that made their political entrepreneur stand out is they all made their mail postage a higher price, so they can gain from it. Eventually, Vanderbilt defeated this by his market innovations. One quote Folsom uses to show Vanderbilt thought was, “If I could not run a steamship alongside another man and do it as well as he for twenty percent less than it cost him I would leave the ship” (5). 3
The main points of the book were pretty convincing. Folsom implemented federal intervention and how taxes hurt America. He backed up this information by talking about Andrew Mellon. Andrew Mellon believed in cutting taxes. Andrew Mellon was an entrepreneur in oil and aluminum and became Secretary of Treasury under Coolidge. Andrew believed that the high rates of taxation do not necessarily mean large revenue to the government. Mellon had a
prediction that lowering taxes might produce more revenue for the government was controversial right from the start. “from 1921 to 1929 the tax rates on those earning under $4000 per year had been chopped eightfold (from 4 to ½ percent); those in the $4000 to $8000 bracket had their burden slashed fourfold (from 8 to 2 percent), and taxes on top incomes had been cut threefold (from 73 to 24 percent). On top of this Mellon was trying to cut taxes for everyone. The middle class had a cut from 8% to 2% and the lower class had a cut from 4 % to ½ %. When Mellon cut the taxes, it made tax revenue increase. Mellon thought that people who struggle with the taxes, the lower classes should pay the least amount. Mellon wanted an income tax credit of 25 percent on earned income which was by wages would be taxed less than incomes earned through investments. When Folsom explains all of this it backs up his thought and belief with Mellon. Folsom brags about market entrepreneurs and provides this information to show how it helped Americans greatly and how it this wasn’t taken in place many American’s would have struggled throughout the time.
Throughout the book, I found Folsom’s arguments convincing. Folsom included great information in his book that made it very good and interesting. He expressed his opinions in manurable and reasonable ways that would make it hard to argue against. Folsom creates a great illusion to show the misperception that the great competitors of the 19th century made. Throughout the book, he concluded evidence to help back up information that could be perceived in ways most Americans view. After each argument that I wasn’t too sure about her made me think about it again with the statistics we provide especially when talking about Mellon.
In conclusion, Folsom tells great stories about important American figures and how both political and market entrepreneurs have changed America today. America’s jobs, foreign markets, and many incomes were saved by these men. Folsom also believed taxes slowed economic growth. Folsom argued that some textbooks could be wrong and has bias approaches to them. Entrepreneurs played important roles in our society. Folsom included the term Robber Baron in the story, which describes a wealthy person who amassed their fortune by stealing or cheating from others. This in other words, according to Folsom could be a political Entrepreneur. Folsom used this term to announce many people in his book to assemble riches through free-market capitalism.
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