The Myth of the Robber Barons: A New Look at the Rise of Big Business in America

Burton Folsom's The Myth of the Robber Barons is a short, but excellent book that argues that the mislabeled "Robber Barons" of the 19th century became wealthy not because they robbed anyone but because they offered quality products/services at record low prices. These productive giants made their fortunes because so many Americans chose to do business with them. There are several values to gain from this book. First, you will learn several inspiring stories about how great industrialists amassed their fortunes through ingenuity, extended dedication and taking great calculated risks. You will learn about how Cornelius Vanderbilt defeated the Fulton NY/NJ steamship-transport monopoly by offering lower rates, earning a reputation for his punctuality, investing in faster and larger ships and providing ancillary services such as concessions. You will also learn about how Andrew Carnegie was obsessed with cutting costs, which led to him profitably carting off tons of steel shavings discarded from a competing steel plant owned by the Scrantons. Other business heroes covered in depth in this book are James J. Hill (who built the Great Northern Railroad without a penny of Federal aid), oil tycoon John D. Rockefeller, the Scranton steel family, Carnegie's right hand man Charles Schwab and Andrew Mellon, the Secretary of the Treasury whose laissez-faire policy recommendations allowed the 1920s to roar. Another great value of this book is that it dispels a few common myths about capitalism. For one, Folsom correctly identifies that "Robber Barons" is an invalid concept. That is, "Robber Barons" includes market entrepreneurs (i.e., those who *created* their fortunes by revolutionizing an industry) with political entrepreneurs (i.e., those who made their fortunes through government aid or with political connections.) Examples of market entrepreneurs include Carnegie, Rockefeller, Hill, and Vanderbilt. Examples of political entrepreneurs include Henry Villard and Leland Stanford. Instead of subsuming all wealthy industrialists under a single category, Folsom suggests that we instead judge these industrialists based on *how* they made their fortunes. A final great aspect of this book is that it offers a concise, essentialized history of what made these individuals great. Thus, an avid reader may absorb a healthy amount of introductory material without committing himself to reading an 800-paged biography. If you enjoy this book, then I also highly recommend both Burton Folsom's "Empire Builders" and Andrew Bernstein's "The Capitalist Manifesto". To a lesser extent, I also recommend H. W. Brands' "Masters of Enterprise."

Folsom's book is accessible, eye-opening, and compelling. It is, I believe, the very best short work that punctures the prevailing myth of the robber barons. As Folsom shows, many of the most reviled "robber barons" were incredible benefactors of humankind - J. D. Rockefeller included. Folsom's chapter on Rockefeller is a special gem. In a few pages, Folsom demonstrates what a truly remarkable human being Rockefeller was. Everyone in the industrialized world today would be noticeably less-well-off had J. D. Rockefeller not lived, or if he had lived in a time and place that would have snuffed out his incredible entrepreneurial creativity.Not all late-19th-century businessmen were admirable. Folsom capably identifies the most notable "political entrepreneurs" (Folsom's term). Political entrepreneurs made their fortunes by manipulating the political process - by persuading or cajoling government to transfer wealth from politically weak parties to themselves. Market entrepreneurs, in contrast, earned their fortunes by making consumers and workers better off.This is a superb work of business and economic history.

After reading the earlier review (below this one), I must say that I enjoyed this book immensely, and I am not a Conservative, and especially not a member of the Religious Right. This book sets the record straight about the "Robber Barons" and the attacks on them by the Muckrakers. It should be read by people of various political stands, whether they are Democrat, Republican, Libertarian, Moderate, etc. I loved the chapters detailing the success stories of Cornelius "Commodore" Vanderbilt, James Jerome Hill, Charles M. Schwab, the Scrantons, John D. Rockefeller Sr., and Andrew Mellon. I must admit that I sort of wished there were also chapters on J. P. Morgan and Thomas Fortune Ryan, since I'm very curious about them. Anyway, reading this book really made me reflect on what I learned in school, and forced me to think about whether my teachers' moral condemnation of these entrepreneurs was actually justified. This book really makes you think.

A central purpose of this book is to distinguish between 19th century political entreprenuers, who gained monopolies by co-opting the legislature and judicial apparatus of the state, and market entrepreneurs, who built railroads with private money or who developed a competitive presence in, for example, the early 19th century steamship business. The book discusses how J.D. Rockefeller reduced the cost of kerosene for millions of American consumers, which allowed them to light their homes without using whale oil. The book discusses the 30 year oil price war with the Russians in Baku (1885-1915), which drove Rockefeller to relentlessly reduce prices in order to compete in international markets; all the while thousands of American jobs hung in the balance. There are seven different chapters on different American economic events which unfortunately aren't given thorough enough coverage in the history departments of our universities. But, that does not diminish the importance of these events in the development of America and the stage they set for the continuing increase in living standards for the common man. By changing the debate from "big business is bad and workers are good" to a dialogue that puts the collusion of big business, big labor, and big government in sharper perspective, Folsom does the reader an important service. A terrific book.