The Myth of the Robber Barons
The Myth of the Robber Barons describes the role of key entrepreneurs in the economic growth of the United States from 1850 to 1910. The men studied are…
- Cornelius Vanderbilt
- John D. Rockefeller
- James J. Hill
- Andrew Mellon
- Charles Schwab
- The Scranton family.
Most historians argue that these men, and others like them, were Robber Barons. The story, however, is more complicated. The author, Burton Folsom, divides the entrepreneurs into two groups: market entrepreneurs and political entrepreneurs.
Market entrepreneurs, such as Hill, Vanderbilt, and Rockefeller, succeeded by producing a quality product at a competitive price.
Political entrepreneurs such as Edward Collins in steamships and in railroads the leaders of the Union Pacific Railroad were men who used the power of government to succeed. In other words, they tried to gain subsidies, or in some way use government to stop competitors. Nonetheless, it was the market entrepreneurs who helped lead to the rise of the U. S. as a major economic power.
By 1910, the U. S. dominated the world in oil, steel, and railroads led by Rockefeller, Schwab (and Carnegie), and Hill. The political entrepreneurs, by contrast, were a drain on the taxpayers and a thorn in the side of market entrepreneurs. Interestingly, the political entrepreneurs often failed. Without help from the government, they could not produce competitive products.
