The New Machine is an episode of The Men Who Built America that focuses on the government decentralizing big businesses, and also on the rise of Henry Ford. The aspect of entrepreneurship in the episode that I find interesting is the way that the government can greatly help-- and greatly hinder-- the success of entrepreneurs. This aspect can be seen in two different instances in the movie. The first being the forced breakdown of John D. Rockefeller's Standard Oil monopoly. Secondly, there is the beneficial governmental impact that exploded Henry Ford's automobile career. Each of these men had a role in creating the American way of market and economy, and the government both helped and hindered in each of these instances.
The role of government is very interesting to me because sometimes it is hard for me to decipher if it is inherently good or bad, or if it has to be either one. The episode does a great job of exemplifying this for me.
I have studied these men and watched the entirety of the Men Who Built America series, previously. Due to this, I know that men like Carnegie, Rockefeller, Morgan, Vanderbilt, and Ford have created so much value through innovation for American society. There was steel production, oil refining, railroads, cars, and financial practices like never before that were introduced by these men. Inherently, these are all things that provide value to the American people. The trouble comes when looking at the unhampered versus the hampered form of market that they operate in.
For the industrial titans, leaving them to be unhampered by government creates higher costs for consumers because there are no other options, and while regulations on a market can be seen as bad, they allowed for competition to rise and price to go down. For the entrepreneur, this is bad, but for the consumer, good. In Ford's case, regulations can be seen as beneficial again, but for the entrepreneur, because government hampering of the market allowed him to soar and provide the value of affordable cars. For me, this creates a differing mindset because on one hand, I think that market should be free and allowed to operate as it organically would with no governmental regulations. Although, on the other hand, the dynamic, unhampered market does not always create the most value for the consumer in the end. To me, this means that there has to be some form of trade off-- government interference for value-- regardless of if that is perfect market design or not.
The governmental regulation aspect of entrepreneurship can affect society in ways that can be seen in the movie. Specifically, government ordered breakdown of Standard Oil allowed for the price to be lowered for the consumers (society) because of the competition it allowed. Also, as we have discussed in class, it can reduce benefit for people that do not need oil. The episode said that Standard Oil was broken down into 34 different entities, so with this, 34 individuals left their previous positions for a higher profit opportunity in oil. Because of this, the value that was previously created by those individuals was lost.
Society can support the governmental regulation aspect of society by 1) supporting governmental officials that support follow through with these practices, and 2) being willing to pay the lower (or higher) prices that are brought about by these regulations. The interaction between governmental regulation and society can be either negative or positive. It can help or hinder society by providing value or taking it away, whether intentionally or unintentionally. It is just a question or whether governmental interference is viewed as good or not.
