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Thread: The Truth About the "Robber Barons"

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    The Truth About the "Robber Barons"

    There are two fundamentally opposed means whereby man…is impelled to obtain the necessary means for satisfying his desires. These are work and robbery, one’s own labor and the forcible appropriation of the labor of others…I propose…to call one’s own labor and the equivalent exchange of one’s own labor for the labor of others, the “economic means”…while the unrequited appropriation of the labor of others will be called the “political means.” -- Franz Oppenheimer

    The Truth About the "Robber Barons"

    The late nineteenth and early twentieth centuries are often referred to as the time of the "robber barons."

    It is a staple of history books to attach this derogatory phrase to such figures as John D. Rockefeller, Cornelius Vanderbilt, and the great nineteenth-century railroad operators — Grenville Dodge, Leland Stanford, Henry Villard, James J. Hill, and others. To most historians writing on this period, these entrepreneurs committed thinly veiled acts of larceny to enrich themselves at the expense of their customers. Once again we see the image of the greedy, exploitative capitalist, but in many cases this is a distortion of the truth.

    As common as it is to speak of "robber barons," most who use that term are confused about the role of capitalism in the American economy and fail to make an important distinction — the distinction between what might be called a market entrepreneur and a political entrepreneur. A pure market entrepreneur, or capitalist, succeeds financially by selling a newer, better, or less expensive product on the free market without any government subsidies, direct or indirect. The key to his success as a capitalist is his ability to please the consumer, for in a capitalist society the consumer ultimately calls the economic shots. By contrast, a political entrepreneur succeeds primarily by influencing government to subsidize his business or industry, or to enact legislation or regulation that harms his competitors

    <...history...>

    ...The lesson here is that most historians are hopelessly confused about the rise of capitalism in America. They usually fail to adequately appreciate the entrepreneurial genius of men like James J. Hill, John D. Rockefeller, and Cornelius Vanderbilt, and more often than not they lump these men (and other market entrepreneurs) in with genuine "robber barons" or political entrepreneurs.

    Most historians also uncritically repeat the claim that government subsidies were necessary to building America's transcontinental railroad industry, steamship industry, steel industry, and other industries. But while clinging to this "market failure" argument, they ignore (or at least are unaware of) the fact that market entrepreneurs performed quite well without government subsidies. They also ignore the fact that the subsidies themselves were a great source of inefficiency and business failure, even though they enriched the direct recipients of the subsidies and advanced the political careers of those who dished them out.

    Political entrepreneurs and their governmental patrons are the real villains of American business history and should be portrayed as such. They are the real robber barons....
    Tradition is not the worship of ashes, but the preservation of fire. ― Gustav Mahler

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    OLD GUY IN FLORIDA (11-30-2022),RMNIXON (11-30-2022)

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    Another myth is that the railroads in this country were build with government funds in the form of land grants. That is simply not true. The government owned vast acres of land west of the Mississippi River but could not sell it as there was no transportation to move the goods to markets in the East. The government therefore entered into an agreement with the railroads that they would give them enough land to build their right of ways but the railroads would enter into agreements to allow the government reduced rates in exchange. By the end of WW2 the government had reaped the benefit of over twice the value of the land deeded to the railroads in reduced freight charges. Furthermore, with the ability to move products from the Western States to the East the government was able to sell large swaths of land to developers. It was one of the very few things the government did that actually proved beneficial to the country.
    Devotion to the truth is the hallmark of morality; there is no greater, nobler, more heroic form of devotion than the act of a man who assumes the responsibility of thinking.”
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    The Rockefellers in particular used Government influence and favored regulation to stamp out lesser competition. This is Not a Free Market principle. It is the very same kind of Government/Business partnership we see Democrats promoting today.

    This is especially true with so-called Green Energy concerns.
    My Revenge will be Success! - Donald J Trump

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    Quote Originally Posted by RMNIXON View Post
    The Rockefellers in particular used Government influence and favored regulation to stamp out lesser competition. This is Not a Free Market principle. It is the very same kind of Government/Business partnership we see Democrats promoting today.

    This is especially true with so-called Green Energy concerns.
    All economic regulation is designed to protect the major corporations from the individual company.
    Devotion to the truth is the hallmark of morality; there is no greater, nobler, more heroic form of devotion than the act of a man who assumes the responsibility of thinking.”
    Ayn Rand, Atlas Shrugged

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    zelmo1234's Avatar Senior Member
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    Quote Originally Posted by RMNIXON View Post
    The Rockefellers in particular used Government influence and favored regulation to stamp out lesser competition. This is Not a Free Market principle. It is the very same kind of Government/Business partnership we see Democrats promoting today.
    This is especially true with so-called Green Energy concerns.

    ???? There was no regulation when J.D. created the Standard Oil monopoly?? He just was better at negotiating freight contracts built the first pipelines to lower cost of Transportation, He did not believe in competition, he called it a sin. He either bought out his competitors or put them out of business. But did bring stabilization to the Oil industry. Also, single handedly caused the depression of the late 1800's

    The regulation came when the government used the antitrust laws to break up Standard Oil, that by the way increased the price of Kerosene, and it was that Break up that made him the richest man in the country.

    He made so much money that the family has been giving it away ever since. But in today's political environment the government picks the winners and the losers, and that is part of the problem

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