The American media are always in search of heroes. It often takes a hero to make a story or a product sell. But the only way a salesman gets to be a hero is to die.
Television goes for tough cops. Films often settle on an updated medieval knight or a swashbuckling savior from outer space. Children’s literature, as always, resorts to dogs, cats, mice, pigs and even bugs. Intellectuals seem to resolve on Winnie Mandela; conservatives clutch at 011ie North, a revival of the classical warrior, and a justly perennial heroic image. Historians focus on presidents and generals. If such an array is low on representation from women and minorities, the national media will be sure to add Michael Jordan or Florence Griffiths Joyner to the list, together with a few policewomen and social workers.
In finding villains, though, television has no problem. Congratulations, folks, it’s you, the CEO. Television shows routinely climax in the lair of the malefactor: a plush corporate headquarters. For the media, nothing is so rare in the annals of heroism as the inclusion of a virtuous developer, a brave businessman, or an inventive entrepreneur. The key reason for the absense of these men and women from the lists of heroes is that heroism is, by definition, assumed to be altruistic (a word that comes from the latin alter, meaning other). Heroes commit themselves, risking their lives for others. Businessmen are believed to look out for number one; even conservative economists see entrepreneurs as selfish money-maximizers.
The entrepreneurs who have won the largest profits-men such as oil tycoon John D. Rockefeller and steelman Andrew Carnegie-are seen in nearly all the history books as the most ruthless predators: so-called “robber barons” who made their fortunes at the expense of the public. Since heroes cannot be selfish, entrepreneurs are dismissed as possible heroes.
This view completely misunderstands the nature of profits. Profits are not an alternative to public service, but a measure of it. Businessman thrive to the extent they serve the interests of others: their customers. Profits measure the difference between the costs of the goods to the business and their value to customers.
Thus total profits may serve as an index of the altruism of a company: the degree to which it creates value for others.
A businessman’s profits spring not from what he takes from his customers, but from what he gives to them. If he gives a good product, highly valued in the marketplace, at a price appealing to the greatest number of potential buyers, he will do well. He will usually earn greater profits than if he gouges for high margins.
The real heroes of the modern age are not the so-called public servants who often work to increase the costs of their product: government. Nor are they the businessmen who collaborate with government to corner the market and protect their corner. The heroes are the real public servants-the business men and women who reduce the prices and enhance the value of their products.
An entrepreneur, such as Lee Iacocca, may seem a hero to some. But if he is letting the price of his product drift upward without greatly enhancing its value-while trying to exclude low priced rivals-he actually deserves the title of robber baron that the historians have so often awarded to the great price cutters. Iacocca is serving the interests of himself and some of his workers and shareholders at the expense of his customers.
By contrast, Rockefeller and Carnegie both reduced the price of their product by some 90 percent during their careers. By reducing the price of gasoline and steel, they made possible the triumph of the automobile age and the creation of the industrial might that prevailed in two world wars.
“Give and you will be given unto,” is the central rule of enterprise. The entrepreneur begins with an act of thrift, forgoing consumption in order to save, suppressing his own desires in order to serve the desires of others. He commits his work and wealth, often for a period of years, to bring into the world a new product which the world may very well reject.
Entrepreneurs make these commitments and sacrifices in the face of a world of unbelief. They defy the bestselling prophets of “the crash of 1990,” and the unctuous ministers of government subsidy. They reject the promises of “fair prices” and protected markets from so called reformers who would banish risk and outlaw failure. The givers know that an economy without failures will prohibit all personal success outside of politics.
Entrepreneurs ignore the suave voices of expertise: the economists who deny their role as the driving force of economic growth, the psychologists who see their work and sacrifice as an expression of greed, the sociologists who identify their dreams of service as “dog-eat-dog,” and the politicians who call their profits unearned and their riches pure luck.
In America, the leading heroes emerge from a throng of some 16 million owners of businesses and proprietorships. They comprise millions of salesmen and franchisers whose pay depends on their initiative and spirit of enterprise. They reach out to many potential millions more who aspire to start businesses or launch new ventures. Among these millions are the heroes of economic life. Without them, no economy can grow.
In order to take a hill, someone must dare first to charge the enemy bunker. Heroism, the willingness to plunge into the unknown, in the hope that others will follow, is indispensable to all great human achievement and economic progress. A willingness to defy the always visible and formidable problems and to pursue the invisible opportunities glimpsed in the mind of the entrepreneur, is the secret of all economic triumph. Regardless of the view from Sunset Boulevard, the men and women who take these creative risks are the true heroes of economic life.
George Gilder is the author of Wealth and poverty, The spirit of Enterpise, and the forthcoming Microcosm (Simon & Schuster).