The New Machine

The New Machine

1.In the documentary “The New Machine” it takes us through some of the early entrepreneurs that had success and how Teddy Rosevelt becoming president really changed a lot. The main focus was on Henry Ford and his new innovative process of making affordable cars. At the time cars were a luxury and only the rich could afford it. Henry Ford created a new way of efficiently producing the automobile. Because the process was so efficient it made the production cost a lot less than what it would normally be. Because production cost was cheaper this allowed Henry Ford to pay the workers more and from that the employees worked harder so production went up even more because of that. Because of all of these things Henry Ford could sell his car at an affordable price so that even the common person can buy one. There was only one problem with this whole operation and it was that another company had a patient on all cars and only they had the authority to allow someone to produce cars. Obviously whenever Henry Ford applied to being able to produce cars it got declined because why would they want another competitor on the market. The film also goes through the trial of John D Rockafellar. He was accused of having a monopoly on the oil industry and the trail was trying to break it up so he can't control the market anymore and basically make it impossible for new companies to start up. It is entrepreneurial because it walks us through some of the trials that entrepreneurs face especially with patents and government.

1. It is interesting because it shows how before some of these trials happened there was really no way of being successful by starting your own business in some markets. Like the oil business eventually Rockerfeller would buy you out and if he didnt then eventually he would put you out because he controlled the market. The same thing for the car industry. The reason why cars were a luxury item was because there was no optionality. There were only a couple of options that were all expensive and not innovative but there was nothing that could be done about it because one company owned the patent and they were allowed to choose who entered the market and who didn't. Usually we see court trials against companies as a bad thing because they are trying to limit the entrepreneur but in this case it helped everyone as a whole.
   3A This type of entrepreneurship ultimately hurts society (before the trials). When you take away optionality it ultimately hurts society because it limits the options customers have and usually there is less innovation because they don't have to spend money on improving their product if they have no threat of being dethroned. They also tend to have higher prices because there are no companies to try to make the price lower and so the companies who control the market don't have to change their prices because everyone accepts them for what they are.
   3B. Society affected the entrepreneurs because they wanted a trial in the first place. The rockefeller trial was described as the people vs big business. People understood the hold he had on the market and how it could benefit society if they broke up the monopoly he had on the oil industry. After the trial it started the industrial revolution and from that it created the middle class because people could now own businesses and work for better wages because they had more places to work instead of the couple big businesses that they used to choose from.
   3C. The interaction between the entrepreneurs and society is interesting. On one hand society hated big business because they felt forced to buy their products because they had no other option. Then once all the trials were over it gave way to the creation of a new societal group (middle class). Overtime though society ended up warming up to the old entrepreneurs because they turned to giving all of their money away and created libraries and other improvements for society so this made society happy.