George Gilder

George Gilder in Recapturing the Spirit of Enterprise says in his chapter "The enigma of enterprise" that disparity of wealth is good and criticism of those who have money is wrong. Doesn't Father have a lot of money? Is he the only person on earth who is spending it wisely? Gilder gives reasons why it is good that entrepreneurs have money. He says, "Why should the top 1 percent of families own 20 percent of the nation's wealth, while the bottom 20 percent have no measurable net worth at all? On a global level, the disparity assumes a deadly edge. Why should even this bottom fifth of Americans be able to throw away enough food to feed a continent, while a million Ethiopians die of famine? Why should the dogs and cats of America eat far better than the average citizen on this unfair planet?"

"We all know that life is not fair, but to many people, this is ridiculous. These huge disparities seem to defy every measure of proportion and propriety .... Most observers now acknowledge that capitalism generates prosperity. But the rich seem a caricature of capitalism. Look at the 'Forbes Four Hundred' list of the wealthiest people, for example, and hold your nose. Many of them are short and crabby, beaked and mottled, fat and foolish." Many, he says never finished high school or college. "But capitalism exalts a strange riffraff with no apparent rhyme or reason. Couldn't we create a system of capitalism without fat cats? Wouldn't it be possible to contrive an economy that is just as prosperous, but with a far more just and appropriate distribution of wealth?

"Wouldn't it be a better world if rich entrepreneurs saw their winnings capped at, say, $15 million. Surely Sam Walton's heirs could make do on a million dollars or so a year of annual income."

"Most defenders of capitalism say no. They contend that the bizarre inequalities we see are an indispensable reflection of the processes that create wealth. They imply capitalism doesn't make sense, morally or rationally, but it does make wealth. So, they say, don't knock it." He says some people defend greed as making the system go. Gilder criticizes Adam Smith for having such a cynical view of people for saying "it is only from the entrepreneur's 'luxury and caprice,' his desire for 'all the different baubles and trinkets in the economy of greatness,' that the poor 'derive that share of the necessaries of life, which they would in vain have expected from his humanity or his justice."

"In perhaps his most famous lines, Smith wrote of entrepreneurs: 'In spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they proposed from the labours of all the thousands they employ, be the gratification of their own vain and insatiable desires...they are led by an invisible hand...and without intending it, without knowing it, advance the interest of society.' Thus did capitalism's greatest defender write of the rich of his day." Gilder says people like John Kenneth Galbraith today "speak of the rich wallowing in their riches and implicitly bilking the poor of the necessities of life."

Gilder is disgusted with this attitude towards hard working, creative people who provide goods and services: "What slanderous garbage it all is! This case for capitalism as a Faustian pact, by which we trade greed for wealth, is simple hogwash. America's entrepreneurs are not more greedy than" most other people. He says, "they work fanatically hard. In proportion to their holdings or their output, and their contributions to the human race, they consume less than any group of people in the history of the world."

Gilder loves capitalists. He says it is worth bringing out violins and getting teary eyed at the cornucopia of abundance and beauty they give. Instead of looking at all the things at the mall as greed, we should be inspired and excited. Once my wife went shopping with an early member of the UC, Lady Doctor Kim. They went into a mall, and my wife saw how excited this lady was at all the beauty. She told my wife that the ideal world will be so beautiful, and everyone will have all these nice things.

Gilder is the 20th century's greatest apologist for capitalism as being spiritual. He gives capitalism a theology. It is socialists who are unspiritual. He says, "Far from being greedy, America's leading entrepreneurs -- with some unrepresentative exceptions -- display discipline and self-control, hard work and austerity that excel that in any college of social work, Washington think tank, or congregation of bishops .... If you want to see a carnival of greed, watch Jesse Jackson regale an audience of welfare mothers on the 'economic violence' of capitalism, or watch a conference of leftist professors denouncing the economic system that provides their freedom, tenure, long vacations, and other expensive privileges while they pursue their Marxist ego-trip at the expense of capitalism."

Gilder explains that the rich have their money tied up in businesses that can go under the next day. The world is changing so fast that nothing is secure. Everyday you have to compete and win the customer. The competition to serve is great. It requires constant attention. All my life I have typed on a typewriter from a company that dominated the industry, Smith Corona. Last year they went out of business. Computers came and everyone went that direction. The free market is exciting, not a dog-eat-dog world. It is as exciting as watching athletes compete or playing chess. The president of the UC was not chosen at random. He won the favor of Father. He works hard and pleases his boss. He has equal value to me, but we do not have equal access to Father. There is order here. Should Father have to report to anybody to make that decision? Of course not. Why should the owner of a barber shop have to report to anybody? But he does. He has to report to many government agencies that tell him in a hundred ways how to run his business. Father had to report to these socialists, the IRS, and they took him to court. Regulators are everywhere, and they use force if you don't do as they say. The only role of government should be to protect people from violent criminals and to be an umpire to settle disputes in court. That was the vision of our Founding Fathers. They left people alone to build their dreams whether it was a garbage company or a church.

Gilder says, "In a sense, entrepreneurship is the launching of surprises. What bothers many critics of capitalism is that a group like the Forbes Four Hundred is too full of surprises. Sam Walton opens a haberdashery and it goes broke. He opens another and it works. He launches a shopping center empire in the rural south and becomes America's richest man. Who would have thunk it?" God works in mysterious ways. The messiah is the ultimate surprise. God wants people to be open to surprises. He wants a free market so the messiah isn't crushed by socialists who are out to protect everyone.

Automatic transmissions -- frivolous luxuries?

What is one man's greed today, often becomes common household items tomorrow. When automatic transmissions came out on cars just before WWII, few could afford them. Some at that time said it was a frivolous luxury. Of course, it is common place now. When WWII came, both America and Germany were trying to perfect them to use in military vehicles but because America had so much experience from the private sector using many thousands of these transmissions on personal cars, the Americans quickly applied it to military purposes. The military used it build a tank and that helped us to win the war. Socialists are nay sayers and don't know the effects of what they call greed. Who knows how much electronic games have contributed to inventing military devices that keep us safe. The marketplace produces cigarettes, but it also produces books teaching against it. It is better to win through persuasion than forcing people to do right. Socialists make more mistakes than the marketplace. Socialists killed Jesus and tortured Father in their quest for world peace.

Here is the story about the technology that helped us win the war because of what some would call greedy, hedonistic people absorbed with luxury. In Mainspring of Human Progress, Henry Weaver says before the Second World War he read an article in a magazine on inventions. The author said that America needed government social planning. He said that there was too much wasted effort by people working on "non-essential gadgets" instead of "useful inventions. He was particularly critical of automobile design and made special mention of the trend toward automatic transmissions as an example of gadgetry gone rife. To make a long story short, it added up about like this: 'Right at a time when the world is tottering on the brink of disaster -- right when so many important things need to be done--the automobile industry is prostituting its talents and diverting its engineering genius to working out gadgets that relieve people of the inconsequential task of shifting gears by hand.'"

"Well, it was quite true that the world was tottering on the brink of disaster and it was also true that some of the automotive engineers had worked out a way to shift gears automatically. I didn't quite agree that it was a useless gadget, but maybe I was biased." He goes on to say a few years later during the war "tanks were being equipped with automatic transmissions .... This made the driving of a tank so simple that the operator could be trained in a matter of hours instead of weeks. The job no longer called for a muscular giant, and in a pinch the driver could help with the fighting. Along with these advantages and of even greater importance, the gears could be shifted without bringing the tank to a stop. This reduced the danger of getting hit." These automatic transmissions "made in American automobile factories played an important part in winning the war for ourselves and our Allies."

"Adding it all up, my thoughts began to turn back to the article that tried to draw hair-splitting distinctions between essential inventions and unnecessary gadgets." He goes on to explain how free people are creative and achieve more than people who are not. God works in mysterious ways, especially when people are free.

Entrepreneurs (like Father) drive socialists crazy because they come out of nowhere and mess things up. Socialists want to make people like widgits that can be categorized and made mathematically equal. There is no creativity. People are cogs in a machine who are predictable. Everything is neat. Entrepreneurs give socialist social engineers headaches. Gilder says, "entrepreneurship overthrows establishments rather than undergirds them, the entrepreneurial tycoons mostly begin as rebels and outsiders. Often they live in out-of-the-way place-- like Bentonville, Arkansas; Omaha, Nebraska; or Mission Hills, Kansas (or Israel and Korea) -- mentioned in New York, if at all, as the punch lines of comedy routines."

Socialists know the price of everything, but they don't know the value of anything. They don't know how to create wealth for all, just for the few. Gilder says, "The means of production of entrepreneurs are not land, labor, or capital, but minds and hearts .... The wealth of America is not an inventory of goods; it is an organic, living entity, a fragile pulsing fabric of ideas, expectations, loyalties, moral commitments, visions. To vivisect it for redistribution would eventually kill it."

"This process of wealth creation is offensive to levelers and planners because it yields mountains of new wealth in ways that could not possibly be planned. But unpredictability is fundamental to free human enterprise. It defies every econometric model and socialist scheme. It makes no sense to most professors, who attain their positions by the systematic acquisition of credentials pleasing to the establishment above them. By definition, innovation cannot be planned. Leading entrepreneurs...did not ascend a hierarchy; they created a new one. They did not climb to the top of anything. They were pushed to the top by their own success. They did not capture the pinnacle; they became it."

"This process creates wealth. But to maintain and increase it is nearly as difficult. A pot of honey attracts flies as well as bears. Bureaucrats, politicians, bishops, raiders, robbers, revolutionaries, short-sellers, managers, business writers, and missionaries all think they could invest money better than its owners. Owners are besieged on all sides by aspiring spenders -- debauchers of wealth and purveyors of poverty in the name of charity, idealism, envy, or social change."

"The single most important question for the future of America is how we treat our entrepreneurs. If we smear, harass, overtax, and overregulate them, our liberal politicians will be shocked and horrified to discover how swiftly the physical tokens of the means of production collapse into so much corroded wire, eroding concrete, scrap metal, and jungle rot. They will be amazed how quickly the wealth of America flees to other countries."

"Even the prospects of the poor in the United States and around the world above all depend on the treatment of the rich. If the rich are immobilized by socialism, the poor will suffer everywhere. High tax rates and oppressive regulations do not keep anyone from being rich. They prevent poor people from getting rich. But if the rich are respected and allowed to risk their wealth -- and new rebels are allowed to rise up and challenge them -- America will continue to be the land where the last regularly become the first by serving others." Gilder says the UC is one those great surprises to the elite in New York and within the beltway of Washington D.C. Gilder sees the salvation of America is in the entrepreneur -- the creative geniuses that pop up from nowhere. Gilder includes the UC in his list of those who will bring "renewal" to America. He writes: "The idea that America might find renewal from a melange of movements of evangelical women, wetbacks, Dartmouth Review militants, South Asian engineers, Bible thumpers, boat people, Moonies, Mormons, Cuban refugees, fundamentalist college deans, Amway soap pushers, science wonks, creationists, Korean fruit peddlers, acned computer freaks, and other unstylish folk seems incomprehensible to many observers who do not understand that an open capitalist society is always saved by the last among its citizens perpetually becoming the first." I love George Gilder. I also love my enemies the socialists. But I sure don't want to be around them. I would rather read and be around George Gilder and those who believe in capitalism such as the Republican Party and Libertarian Party instead of being around the Democratic Party and Socialist Party.

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