from an undertaker, they were there, scalpels flashing, ready to slice and dice. When leg bones were extracted, they were replaced with PVC tubing and the slits stitched up so the corpse would look OK in an open casket. The undertakers made about $1,000 per corpse, the mortuary nurse about $300 plus salary, Mastromarino somewhere between $7,000 and $15,000. Police later stated that some of the procedures had been carried out so sloppily that surgical gloves were found sewn into the cadavers.
It’s not a story that gets nicer with closer acquaintance, so I won’t go on, suffice to say that Mastromarino ticked every single box on the checklist for entrepreneurs that began this chapter. Risk-taking is only a breath away from dangerous speculation or law-breaking. The drive to build and organize is only a whisker away from a drive to dominate and control. Persua-siveness can also be about lying, creativity about coming up with new and nasty ways to make money or pervert the law. Those entrepreneurial virtues of the first four chapters aren’t actually virtues at all. They’re talents or dispositions which can be put to good use or bad; which can be perfectly judged or wildly excessive. Arguably, the risk-taking aspect of an entrepreneur’s make-up is one which, if unguarded by law and meaningful enforcement measures, will always tend towards the reckless.
Anecdotal evidence for the All Businesspeople Are Bastards theory isn’t hard to find. D’Arcy was reckless, Carnegie a liar, Rockefeller (once) a perjurer, Vanderbilt a bully, Ford an anti-Semite – the list could be extended almost indefinitely. Even today, when ethical standards in business are far higher than they ever used to be, we look at modern day giants – Bill Gates, Steve Jobs, and their ilk – with a weird mixture of admiration and loathing. We admire what they’ve achieved yet can’t help giving credence to the whispers which tell us that Gates is aggressive, Jobs an egomaniac. We tend to believe those whispers regardless of the evidence, because we find it all but impossible to believe that entrepreneurs can be both successful and nice. The strange result is that while the extraordinary improvement in living standards of the last 250 years has come about very largely because of entrepreneurs and business types, nobody seems to love them for it.
Some of our ambivalence comes from reasons that have a lot more to do with us than with any sensible estimation of Messrs Gates, Jobs et al. For starters Bill Gates is obviously a very rich man. Humans are perfectly well used to the fact that we’re not all equally well endowed, but the scale of inequalities in wealth runs far beyond ordinary biological diversity. Take speed, for example. I’m 43. I go jogging occasionally, but I’m far from obsessive. Even as a youngster, I was never a particularly fast runner. Usain Bolt, on the other hand, is a sprinter so prodigiously gifted that he can simultaneously win an Olympic gold, break a world record, and fool around ten metres before the finishing line. Yet, viewed in terms of cold mathematics, Usain Bolt isn’t all that much faster than I am. He can run the hundred metres in about ten seconds. I could comfortably run it in twenty. On that simple measure, Bolt is twice as good as I am.
Or take looks. Jude Law and Brad Pitt and a young Paul Newman are all, I’m happy to admit, better looking than I am. But how much better looking? We’ve all got the same numbers of eyes, noses, mouths, and ears. None of us are deformed or have a skin condition or any startlingly displeasing physical feature. The differences in our physiognomies come down to tiny differences in the exact weight and balance of our features – a matter of millimetres here, a shade of colouring there.
When it comes to money, these happy resemblances are entirely absent. A careful cross-country study of household wealth conducted in 2000 put the median household wealth in the United States at about $39,000. (Median is the ‘man in the middle’ way of looking at averages, so that exactly 50 per cent of households has total wealth above the median level, and exactly 50 per cent has total wealth below that level. The British median household wealth, by the way, was a few thousand dollars higher than in the United States. America is richer in aggregate, but wealth in Britain is more evenly spread.) Now, $39,000 is a perfectly nice amount of assets. You yourself may be poorer or richer than that, but, almost by definition, the chances are that you know somebody whose household is not so far off that level of aggregate wealth. Unless you are a hermit, or hang out exclusively with the very rich or the very poor, then you can’t help bumping into somebody who’s on or around that median level.
To Bill Gates, however, that $39,000 is an entirely trivial sum. He’s worth around $60 billion. That’s almost two million times better off than the ‘man in the middle’ median. If Usain Bolt was that much faster than me, he’d be running the hundred metres in one one-hundredth of a millisecond. If Jude Law was that much better looking than me – well, he just couldn’t be. Most ordinary human attributes just aren’t scalable in that way. Because financial wealth is conjured from far beyond the reach of biology, aggregating profits over the entire globe and then capitalizing them to reflect a value of all future profits too, it produces outcomes that nothing in nature has ever accustomed us to. Evolution simply hasn’t given us a template for dealing with a message which, crudely interpreted, reads ‘you are two million times worse than that geeky bloke with the unfortunate glasses’. And, naturally enough, humans being human, we tend to react to the unfamiliarity of that message in the simplest possible way: by disliking the unfortunate person who delivers it.
There are other reasons why business types are generally unloved. The good that entrepreneurs do goes largely unnoticed – even by themselves. When I spoke to entrepreneurs and asked them about their own contribution to the wider public good, they all, every one, began by talking about their charitable and philanthropic work. Money donated, time given, organizations put to work. And they all missed the point. Missed it by a mile and two hundred and thirty-something years, because back in 1776 Adam Smith wrote:
It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our necessities but of their advantages.
These lines can’t be too often repeated. Entrepreneurs don’t have to be nice guys to do good. They do good by being entrepreneurs.
An example: one of those I interviewed was a serial entrepreneur called Martyn Rose, a vigorous fifty-something who’s donated a large amount of time and cash to a number of charities. Back in the 1970s, Martyn made his first investment in a company that made waterproofing chemicals. He invested during a recession – invested everything he had and borrowed heavily on top – and discovered that waterproofing chemicals sold well in times of hardship. Instead of chucking stuff out when it started to leak, consumers bought something to patch it up and keep it going. The investment did well. He reinvested his profits. He improved his products. He made some efficiency savings. The company grew and went on to make his fortune. (His first fortune, that is; he made a few more after that.)
In speaking about, and disparaging his achievement, Martyn said that if he hadn’t done what he’d done, then someone else would have done it and that, in any case, it was only waterproofing materials, for crying out loud. It wasn’t a cure for cancer. It wasn’t cheap energy. It didn’t put food in the mouths of the starving.
That’s all true, but Adam Smith teaches us to think differently. When Adam Smith wrote, the world around him was desperately poor. Poor in all kinds of things including, as it happens, cheap and effective waterproofing materials. The lack of those materials wasn’t a particularly significant part of the problem. You could have made a list of the hundred things that the world back then most needed and waterproofing materials would not have been on the list.
Yet, even if things only matter a bit, they still matter. We value those things enough to want to buy them, even though we have only a limited budget and plenty of other things we could spend our money on. Add up all a company’s sales, knock off the cost of its inputs (raw materials and the like), and you have a fair measure of how much value – as measured by us, the buyers – that company has brought into the world. And the magic of capitalism is its win-win nature. It’s not just consumers that are made happy by all their tins of waterproofing kit. It’s the people who make them, who are given a decent wage in exchange for their labour, who are able to raise their families without want or worry. And, magic upon magic, the whole merry-go-round whirls round happily enough that the government can take its share of everything in tax, so