The Self-Made Myth

[finehoe]

The Self-Made Myth: Debunking Conservatives' Favorite -- And Most Dangerous -- Fiction
A new book makes a strong case that nobody ever makes it on their own in America.
April 25, 2012  | 

The self-made myth is one of the most cherished foundation stones of the conservative theology. Nurtured by Horatio Alger and generations of beloved boys' stories, It sits at the deep black heart of the entire right-wing worldview, where it provides the essential justification for a great many other common right-wing beliefs. It feeds the accusation that government is evil because it only exists to redistribute wealth from society's producers (self-made, of course) and its parasites (who refuse to work). It justifies conservative rage against progressives, who are seen as wanting to use government to forcibly take away what belongs to the righteous wealthy. It's piously invoked by hedge fund managers and oil billionaires, who think that being required to reinvest any of their wealth back into the public society that made it possible is "punishing success." It's the foundational belief on which all of Ayn Rand's novels stand.

If you've heard it once from your Fox-watching uncle, you've probably heard it a hundred times. "The government never did anything for me, dammit," he grouses. "Everything I have, I earned. Nobody ever handed me anything. I did it all on my own. I'm a self-made man."

He's just plain wrong. Flat-out, incontrovertibly, inarguably wrong. So profoundly wrong, in fact, that we probably won't be able to change the national discourse on taxes, infrastructure, education, government investment, technology policy, transportation, welfare, or our future prospects as a country until we can effectively convince the country of the monumental wrongness of this one core point.

The Built-Together Realty

Brian Miller and Mike Lapham have written the book that lays out the basic arguments we can use to begin to set things right. The Self-Made Myth: The Truth About How Government Helps Individuals and Businesses Succeed is a clear, concise, easy-to-read-and-use summary that brings forward a far more accurate argument about government's central role in creating the conditions for economic prosperity and personal opportunity.

Miller, the executive director of United For a Fair Economy, and Lapham, a co-founder of UFE's Responsible Wealth project, argue that the self-made myth absolves our economic leaders from doing anything about inequality, frames fair wages as extortion from deserving producers, and turns the social safety net into a moral hazard that can only promote laziness and sloth. They argue that progressives need to overwrite this fiction with the far more supportable idea of the "built-together reality," which points up the truth that nobody in America ever makes it alone. Every single private fortune can be traced back to basic public investments that have, as Warren Buffet argues in the book, created the most fertile soil on the planet for entrepreneurs to succeed.

To their credit, Miller and Lapham don't ask us to take this point on faith. Right out of the gate, they regale us with three tales of famous "self-made" men -- Donald Trump, Ross Perot and the Koch brothers -- whose own stories put the lie to the myth. (This section alone is worth the price of admission -- these guys so did not make it on their own!) Once those treasured right-wing exemplars are thoroughly discredited, the middle of the book offers a welcome corrective: interviews with 14 wealthy Americans -- including well-known names like Warren Buffet, Ben Cohen, Abigail Disney, and Amy Domini -- who are very explicit about the ways in which government action laid the groundwork for their success. Over and over, these people credit their wealth to:

* An excellent education received in public schools and universities.

Jerry Fiddler of Wind River Software (you're probably running his stuff in your cell phone or car) went to the University of Chicago, and started his computer career at the Lawrence Livermore Laboratory. Bookseller Thelma Kidd got her start at Texas Tech and the University of Michigan. Warren Buffet went to the University of Pennsylvania and the University of Nebraska as an undergrad. And beyond that: several interviewees paid for their educations with federal Pell Grants and Stafford loans.

Over and over, the point gets made: public universities -- and the good public schools that feed them, and the funding programs that put them within financial reach -- have hatched millions of American entrepreneurs who might not have been fledged without that opportunity to get an education.

* The support of the Small Business Administration and other government agencies.

Ben Cohen notes that almost all the business training he and Jerry Greenfield had came from extension courses at the University of Vermont and Penn State, and small brochures produced by the SBA. And as they spun up, they also got an Urban Development Action Grant from the federal government. Other interviewees started their businesses in incubators or other quarters provided or arranged by their local city governments.

* A strong regulatory environment that protected their businesses from being undercut by competitors willing to cut corners, and ensured that their manufacturing inputs are of consistently high quality. Glynn Lloyd of Boston's City Fresh Foods points out that nobody in the food business can get by without reliable sources of clean water; and that the USDA inspection process is an important piece of his quality control.

* Enforceable copyright and intellectual property laws that enabled them to protect good ideas. Abigail Disney recalls that her father, Roy Disney, and her Uncle Walt made and lost one great cartoon character -- Oswald the Rabbit -- because they didn't have copyright protection. They didn't repeat that mistake when Mickey Mouse was born three years later, launching the Disney empire.

* A robust system of roads, ports, airports, and mass transit that enabled them to reliably move their goods both within the US, and around the world. Kim Jordan of New Belgium Brewing (the makers of Fat Tire beer) points out that "Beer is heavy, and it needs to be transported in vehicles. Certainly, the highway system has been important to New Belgium Brewing." Lloyd also points out that Boston's excellent public transit system enables him to draw on a far wider employee base.

* The government's role in creating the Internet, without which almost no modern company can function. Anirvan Chatterjee built Bookfinder.com (now a subsidiary of Amazon.com), the world's biggest online used-book marketplace, as an entirely Internet-based company -- an achievement that wouldn't have been remotely imaginable without DARPA, the establishment and enforcement of common protocols, and significant congressional investment in the 1980s to take the Internet commercial.

* The ability to issue public stock in a fair, reliable, regulated marketplace  -- a benefit that raised the value of several interviewees' companies by about 30 percent overnight. Peter Barnes, founder of Working Assets, spoke with concern about the loss of trust in this system over the past decade. "The corporate scandals [Enron and Worldcom] caused people to stop trusting the numbers that companies were reporting. Imagine how much value is created by trust and the whole system that assures that trust?"

Besides the government, most of those interviewed also locate their companies in the context of a large community of customers they utterly depend on for their success. "It takes a village to raise a business," says Nikhil Arora of Back to the Roots, a sustainable products company that came about through partnerships and grants from UC Berkeley, Peet's Coffee and other interested parties. 

Others are quick to acknowledge the contributions of their employees, without whom their companies wouldn't exist. When Gun Denhart and her husband sold their company, children's clothier Hanna Andersson, in 2003, they distributed a healthy portion of the sale proceeds to their employees, prorated on the basis of their length of service.

All businesses exist within a vast network of human connections -- customers, vendors, employees, investors, and the communities that support their work. These stories make it clear: saying you did it all yourself and therefore don't owe anybody anything is about as absurd (and self-centered) as saying that you raised yourself from babyhood, without any input from your parents, and therefore don't have any further obligations to your family.

The Role of Luck and Timing

We all know wealth isn't just a matter of hard work, brains or talent. Most of us probably know hard-working, brilliant, or extraordinarily talented people who aren't being rewarded at anything close to their true value. So perhaps the most intriguing and useful part of the book is a long discussion of the many other essential factors that go into making someone wealthy -- factors that are blithely brushed off the table whenever the self-made myth is invoked.

Rich conservatives have to downplay the role of luck. After all, if we think they're just lucky, rather than exceptionally deserving of exceptional wealth, we'll be a lot more justified in taxing their fortunes. But luck -- the fortunate choice of parents, for example, or landing in the right job or industry at the right time -- plays a huge role in any individual's success. Timing also matters: most of the great fortunes of the 19th century were accumulated by men born during the 1830s, who were of an age to capitalize on the huge economic boom created by the expansion of the railroads after the Civil War. Likewise, the great tech fortunes almost all belong to people born between 1950 and 1955, who were well-positioned to create pioneering companies in the tech boom of the late 1970s and 1980s. Such innovative times don't come along very often; and being born when the stars lined up just so doesn't make you more entitled. It just makes you luckier.

Because Americans in general like to think we're an equal society, we're also quick to discount the importance of race, gender, appearance, class, upbringing, and other essential forms of social capital that can open doors for people who have it -- and close them on those who don't. The self-made myth allows us to deflect our attention from these critical factors, undermining our determination to level the playing field for those who don't start life with a pocket fat with advantages.

What Changes?

The book winds up with specific policy prescriptions that can bring the built-together reality back into sharper political and cultural focus. The last section shows how abandoning the self-made myth for a built-together reality creates fresh justification for a more progressive income tax, the repeal of the capital gains exemption and raising corporate and inheritance taxes. It also makes a far more compelling philosophical backdrop against which progressives can argue for increased investment in infrastructure, education, a fair minimum wage, a strong social safety net, and better anti-discrimination laws.

But the most striking thing about the book -- implicit throughout, but explicit nowhere -- was the alternative vision of capitalism it offers. Throughout the book, Miller and Lapham seem to be making the tacit case that businesses premised on the built-together reality are simply more fair, more generous, more sustainable, and more humane. While far from perfect (Disney's empire being one case in point), they are, as a group, markedly more aware of the high costs of exploiting their workers, their customers, the economy, or the environment. Owners who believe themselves to be beholden to a community for their success will tend to value and invest back into that community, and they seem to be far more willing to realize when they've got enough and it's time to start giving back.

The implication is clear: if we can interrupt American's long love affair with the self-made myth, we will effectively pull the center tent pole out from under the selfish assumptions that shelter most of the excesses of corporate behavior that characterize our age. This isn't just another point of contention between progressives and conservatives; it's somewhere near the very center of the disconnect between our worldviews. The Self-Made Myth is an essential primer that gives us the language and stories to begin talking about this difference, and the tools to begin to bend that conversation in some new and more hopeful directions.

http://www.powells.com/biblio/9781609945060?&PID=32513

[NotNow]

Finehoe,

What you and the authors continue to fail to understand about the vast majority of conservatism/libertarianism is that the disagreement here is not about what the balance of "generosity" to "income" should be for both individual taxpayers and corporations.  The disagreement is about HOW that balance is achieved.  Conservatives rightfully fear the power of the state.  The power to take....anything.   It is a slippery slope that almost all governments eventually find themselves.  Conservatives want to (rightfully) limit that power, as govrnments thoughout history have abused and mistreated their own citizens.  Corporations have no such legal mandate, and have no taxing authority.  I still fear corporations far less than government.  Ask any North Korean, Syrian, or PRC citizen if they fear Apple or Exxon more than their own national government.  They would universally agree that their own government is the greater threat to their personal lives and freedom. 

We don't disagree on the need to publicly fund our infrastructure, feed our hungry, staff our military and government post, properly regulate our industries and provide for other interests of our nation as a whole.  We disagree on the authority that we grant government and how much intrusion government can have in our private lives.

Let's just say I agree to disagree on your "self made myth" theory.  I believe in people, not government.

[finehoe]

Ask any North Korean, Syrian, or PRC citizen if they fear Apple or Exxon more than their own national government. 

Ask any Gulf Coast resident if they fear their national government more than BP or investor if they fear the government more than MF Global.

Obviously it's not as black and white as you paint it.

[bill]

Ask any North Korean, Syrian, or PRC citizen if they fear Apple or Exxon more than their own national government. 

Ask any Gulf Coast resident if they fear their national government more than BP or investor if they fear the government more than MF Global.

Obviously it's not as black and white as you paint it.

It was the governments fault they forced BP and others to deep water drilling.

[finehoe]

What you and other so-called conservatives continue to fail to understand about the vast majority of liberals/progressives is that none of them believe in unlimited state power.  In a democracy (as opposed to North Korean, Syrian, or PRC) the government is made up of the people, and if the government oversteps its bounds, we can vote them out.  If a corporation oversteps its bounds, who will reign them in if we have a weak ineffectual government?

[bill]

What you do not understand is the rule of unintended consequences. More government and regulations hurt small business. Govt cannot control small business but it can and does larger companies. Larger companies have the resources to either comply or get around the rules. It also makes it easier to get "in bed" with them. How many banks were there before BO? and after?

BTW I think the free market and public outcry can work on Companies that over step the bounds. The voters almost never vote out the incumbent.

[simms3]

One of the most absurd things I couldn't finish reading.  Borderline offensive to those who work hard, play right, and succeed where others have failed.

[BridgeTroll]

Same here... in the very first paragraph...

conservative theology.

and...

entire right-wing worldview

and...

government is evil because it only...

and

redistribute wealth

and...

piously invoked by hedge fund managers and oil billionaires

blahblahblahblahblah...yadayadayadayada

[finehoe]

More government and regulations hurt small business. Govt cannot control small business but it can and does larger companies.

If government can't control small business, how is it hurting them?

Larger companies have the resources to either comply or get around the rules. It also makes it easier to get "in bed" with them.

So this is justification to allow corporations to do as they please?

I think the free market and public outcry can work on Companies that over step the bounds. The voters almost never vote out the incumbent.

The "free market" is a myth.  All markets are manipulated in some way, shape, or form.  Which aspects of the "free market" caused concentrations of sulfur dioxide in the atmosphere to decrease 33% since 1983?

[finehoe]

It’s quite a different story in reality from the tale that is sometimes told of how capitalism grew up without controls in the United States, and then with the New Deal it came under regulation. In fact, the government both at the federal and the state level was deeply involved with projects for promoting the industrialization of the United States and the creation of a capitalist market from the administration of George Washington onward.

    One of the ways it did so was through investing in infrastructure. We’ve had a series of ambitious infrastructure projects â€" the early canal system and then the transcontinental railroads that were funded by the Lincoln administration and Congress at the beginning of the Civil War, through to the interstate highway system. But government contribution to economic growth wasn’t just limited to that â€" it included funding basic research. For example, Congress gave a grant to Samuel Morse, who developed Morse code and the first American telegraph [in the 1840s] ...

http://www.salon.com/2012/04/30/americas_failing_powerhouse_salpart/

[peestandingup]

One of the most absurd things I couldn't finish reading.  Borderline offensive to those who work hard, play right, and succeed where others have failed.

And were born with silver spoons in their mouths?

[downtownjag]

One of the most absurd things I couldn't finish reading.  Borderline offensive to those who work hard, play right, and succeed where others have failed.

Agreed!  Now let me get back to having everything handed over

[finehoe]

Now let me get back to having everything handed over

Must be a banker...

[fsquid]

Total unadulterated crap.

This is the left's newest talking point du jour, trying to come up with some conceptual justification for Big Brother. Sell the idea that all wealth is created in common, and it's up to government to decide how to distribute it, and they've won. But in reality the societies that have tried to go that route ("from each according to his abilities, to each according to his needs," ring a bell?) have ended up creating little or no wealth and distributing what little was created much less equitably than a free market.

Actually, the common wealth is always the sum of individual efforts to create wealth, not the other way around. When the rewards go to those who earn them instead of those favored by the governing elite, society progresses.

If government protects the borders, preserves public safety, and provides a reasonable, consistent, rules-based environment for the conduct of commerce, and lets individual enterprise take it from there, we'd be fine.

I'm both disturbed and offended that anyone in this country could seriously be peddling this absurd garbage, or that any intelligent person could be buying it.

[aclchampion]

fsquid +1,000,000