Entrepreneurship is the launching of surprises. The 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. Creativity cannot be planned because it is defined by information measured as surprise. Leading entrepreneurs — from Sam Walton to Larry Page to Mark Zuckerberg — 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.
In the Schumpeterian mindscape of capitalism, entrepreneurial owners are less captors than captives of their wealth. If they try to take it or exploit it, it will tend to evaporate. Bill Gates, for example, already a paper decibillionaire, commented during his entrepreneurial heyday that he was “tied to the mast” of Microsoft.
If Gates had tried to leave or substantially cash out at any time during the early decades, the company would have plummeted in value more rapidly than he could have harvested the funds. When the founders of Bain and Company attempted to cash out in 1991, taking $200 million with them, Mitt Romney was faced with the likely bankruptcy of the firm. He had to confront a Goldman Sachs effort to close it down. As the once-lucrative company collapsed, Romney cut the share of his departing partners in half in order to save his company and his reputation in business. David Rockefeller devoted a lifetime of 60-hour weeks to his own enterprises. Younger members of the family wanted to get at the wealth and forced the sale of Rockefeller Center to Mitsubishi. But they will discover that they can keep the wealth only to the extent that they serve it, and thereby serve others, rather than themselves.
Most of America’s leading entrepreneurs are bound to the masts of their fortunes. They are allowed to keep their wealth only as long as they invest it in others. In a real sense, they can keep only what they give away. It has been given to others in the form of investments. It is embodied in a vast web of enterprises that retains its worth only through constant work and sacrifice. Capitalism is a system that begins not with taking but with giving.
For this reason, wealth is nearly as difficult to maintain as it is to create. 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. Bureaucrats, politicians, bishops, raiders, robbers, short-sellers, and business writers all think they can invest money better than its owners. In fact, of all the people on the face of the globe, it is usually only the legal owners of businesses who know enough about the sources of their wealth to maintain it. It is usually they who have the clearest interest in building wealth for others rather than spending it on themselves.
Nevertheless, even while dismissing the charge that the “rich” indulge in a carnival of greed, we have not fully explained the reasons for their great wealth, much less justified it. Some apologists will say that Mark Zuckerberg’s Facebook billions, for example, are a reward for his brilliant entrepreneurship and software coding, while penury is just the outcome of alcoholism and improvidence. The saintly social worker and even the president of the United States, for that matter, earn modest salaries by comparison, and they are neither improvident nor necessarily less brilliant than Mark.