The radical nature of this book is fully captured by its title. For it is Gunderson’s theme that wealth is created—not stolen, exploited or simply stumbled upon. He argues that creative thinking is what underlies the act of creating wealth.
To defend this thesis, the author traces America’s entrepreneurship from 1600 to the present. He describes, for example, how in the early 19th century steelmakers could not prevent the frequent occurrence of adverse reactions between Iron ore and distilled coal in the blast furnace. Costly trial-and-error was the only available method for knowing which particular batches of ore and coal were chemically compatible. But once scientists began discovering how the structure of a molecule determined its chemical properties, steel producers were able to add appropriate reagents to make virtually any combination of iron ore and coal usable in the steelmaking process. Gunderson concludes that this is “a vivid example of how new knowledge expands the supply of economic resources. It is not that more mineral supplies appeared in the world, but that much of that large quantity which had been held hostage was released by new knowledge.” This is just one example of the book’s compelling reconstruction of major entrepreneurial feats in American history. There are sections on the role of producers in the Revolutionary War; on the tremendous obstacles hurdled by the 18th century businessmen in the transportation field (when, Gunderson says, it cost as much to transport goods 30 miles overland as it did to send them clear across the Atlantic Ocean); on the innovations of the steel business (including a —all of which offer ringing tribute to the managerial genius of Andrew Carnegie) striking illustrations of the creative process of wealth production.
23 Gunderson also shows how a free market is a necessary context for entrepreneurship. Despite an unfortunate tolerance for certain government Interventions in the economy, the author fundamentally defends capitalism. He shows) in concrete historical detail, how production flourished as state controls were eliminated from the economy, Pennsylvania, for instance, was the most successful of all the colonies in the 1700s because of the social and economic freedoms established by William Penn. Gunderson declares: “One of the most misleading concepts about economic affairs is that they require exploitation. Voluntary exchange between two parties cannot be exploitation. One has to offer the other Creating value must be the party something that is believed to be a gain.
entrepreneur’s basic tactic because he lacks any other means of compelling people to provide him with something,” The Wealth Creators is an extraordinary work of historical scholarship. For identifying the creative nature of entrepreneurial achievement, this book deserves the widest acclaim.
This review is made available by the Ayn Rand Bookstore (formerly Second Renaissance Books)