The definition for Robber Barons may have a different meaning depending on what historical perspective one examines it from. If a distinction is made between market entrepreneurs and a political entrepreneurs, it is easier to understand the true meaning. Someone who attempts to succeed through aid from the government, paying off politicians, or creating pools should be considered a political entrepreneur.
If an individual finds success by producing better products and selling them at cheaper cost, he/she ought to be considered a market entrepreneur. So, a Robber Baron is a businessperson who slowed innovation, misused government support and developed monopolies or pools of capital to satisfy needs. The myth of the Robber Baron is that the rich continued getting richer and the poor stayed poor. The myth states that these wealthy individuals held on to their assets at the expense of others. In actuality, the rise of big businesses and corporations led to many opportunities for the working man.
Some businessmen deserve the title of Robber Baron; Folsom argues, such as Edward Collins and Henry Billiard. Others, he insists, serve credit for “decisive and unpredictable contributions to American economic development. ” Two of these men are James Hill and John Rockefeller. As market entrepreneurs, they found success through skill, efficiency and vision. During the steamship competition between The United States and England, a political entrepreneur named Edward Collins received a federal subsidy of $3,000,000 down and an additional $385,000 per year, to race the British fleet.
Keeping in mind that efficiency nor time was not a key priority, Collins did not have incentive to outperform opponents as long as the government funds kept refunding his rising sots. As a true Robber Baron would, Collins chose to lobby for more government assistance rather than cutting prices or challenging his business opponents. Coincidentally, Congress agreed to give him $858,000 a year to stay competitive. While market entrepreneur Cornelius Vanderbilt said he would run the trips for less than half of Collins, most congressman still supported Collins.
Folsom claims that Collins cared little for the nature of his business. Common of Robber Barons, the money behind his actions was more important than the actual market itself. Commonly, Robber Barons are not overly conscious of their spending habits. Eventually, Collins inferior ships, lack of knowledge and reluctance to adapt led to his demise. Henry Billiard, another abuser of government funds, went bankrupt due to unfortunate business circumstances. A few reasons were his impractical rail line and the overspending throughout the construction.
Billiard, according to Folsom, “manipulated stock; in fact, he bought his NP shares on margin and used overcomplicated stock as collateral for his margin account. ” Billiard was in favor of monopolies as well, so nee Doughnut many steamships Ana railroads to remove competition. Instead of efficiently planning his route, he invested heavily in expensive hotels and spas in the Northwest region. Since he didn’t have to pay for it, it was not in his best interest to pick the shortest route. Thus, the Robber Barons tradition lives through his arrogant actions. In addition, he did not gain much knowledge on the railroad industry.
Again, as a Robber Baron, Billiard was more interested in making quick profits rather than the business behind the industry. Billiard’s assistance dried up and he could not support the Northern Pacific railroad financially. In sharp contrast, James Hill did what Ward could only dream of. Not only did Hill build a successful transcontinental railroad connecting the Northwest United States, but he did so with no government assistance. Hill does not deserve the title of Robber Baron because to achieve success he used efficient lines, the best quality rails and private contracts.
Hill supported the areas surrounding his railroad as he progressively built the tracks. For instance, in the Great Plains region, Hill spread the idea of dry-farming to people helping to develop each area ensuring the prosperity of his freight. Hill also understood that building stable and reliable railroads would cost ore initially but less in the long run. Ultimately, his knowledge on how to cut costs on supplies and fuel led to Hill’s superiority over the other transcontinental railroads at the time. John Rockefeller wrote, “the best… T the lowest price. ” These six simple words exemplify much of Rockefeller practices. Folsom does not consider Rockefeller; who eventually became the wealthiest man in the world, a Robber Baron. Instead, he gives credit to Rockefeller unmatched efficiency. Rockefeller had to overcome immense struggles against the Russian oil industry on the international scale. In this sense, there was no elimination of competition by any stretch of the imagination. His business overcame these struggles in three ways.
First, research teams made it possible to get more out of each barrel of oil. Next, the company was made even more efficient. Finally, Rockefeller gained precious knowledge by learning about the foreign markets. Combined, Standard Oil (Rockefeller company) controlled about 90% of the American oil industry. However, he did not seek a monopoly. Not to mention Rockefeller incredible charitable work (about $550,000,000 worth), coming trait from his pocket were funds to cure meningitis, yellow fever and hookworm.
Instead of plowing through government funds, Rockefeller vision and attention to detail led to his fortune and success. The characteristics that distinguish Robber Barons were taking advantage of federal aid to feed their growing debts revealing Edward Collins and Henry Billiard as Robber Barons. However the aspects that categorize Hill and Rockefeller as true entrepreneurs are taking risks, investing personal capital, efficiency and superior knowledge of the industry.