Entrepreneur

Cafe Hayek links to a Reason Magazine article – Katrina in Kentucky

The ice storm that slammed the American mid-south in the last weekend of January and then moved onward to the East Coast has left an estimated 1.3 million people without power. And nowhere was hit harder than Kentucky, where some 700,000 people lost electricity and 24 deaths were attributed to the storm. Yet President Barack Obama only declared the state a major disaster area this week. What took so long? Where is the presidential compassion for the victims of this tremendous disaster?

The answer is that nothing is wrong and President Obama surely feels for each and every person hurt or put out by the storm. The reality is that even after the emergency management reforms allegedly implemented after Hurricane Katrina, help from far-off Washington still does little in times of fast-moving crisis. This view may be heresy in the age of federal bailouts, but it is still true.

[…]

How then to explain the continued hardship in Kentucky? About 150,000 residents remain without power. No power means that gas stations and water pumping stations do no work. Needless to say, 21st century communications cease to function. Cooking and refrigeration become a struggle. To borrow a frequent post-Katrina refrain, these Americans have been reduced to Third World–style subsistence living.

[…]

Enter David Strange, the enterprising figure the Associated Press calls the “generator man.” Strange drove the hills and hollows of backwoods Kentucky delivering and setting up generators to those without power—at a $50 to $100 mark-up over retail. Willing customers included a dialysis patient and a powerless 80-year-old woman dependent on an oxygen system. They called him a “godsend,” although Strange prefers “jack of all trades” or even “hustler.” To Adam Smith, he would be recognizable as an agent of the invisible hand.

From the AP story-

Piloting his Dodge Dakota through the narrow horse trails of far west Kentucky during the worst power outage in state history, David Strange was quickly earning his new nickname: “the generator man.”

The 52-year-old Texas transplant, who has worked dozens of jobs including roughneck, auctioneer, and trailer park landlord, managed to get his hands on 200 units of the disaster region’s most precious commodity: gas-powered generators to keep the lights and heat running through a blackout that could last weeks.

Some call him a Good Samaritan – even a godsend – for distributing the machines, which cost anywhere from $450 to $1,100. But Strange has a more earthly view: “I’m a hustler,” he said through a Texas drawl that has taken on a touch of Kentucky slide during 22 years of life here. “But I won’t rip anyone off,” he added. “I guess that’s why I make such a good living. … People just seek me out when they need something.”

[…]

The enterprising generator salesman said he has an 11th-grade education, but said he earned a six-figure income last year from various investments and occupations. When asked if his business sense could make him a billionaire if coupled with a college degree, he said he never gave it much thought.

“I just want to be what I am,” he said. “A jack of all trades.”

This line – “When asked if his business sense could make him a billionaire if coupled with a college degree, he said he never gave it much thought” – reminded me of the classic W. Somerset Maugham short story “The Verger” / “The Man Who Made His Mark.” However, unlike Strange, when the Verger is asked a similar question, he gives a great reply. No wonder the bank manager is floored.

The Mises Blog has a post on the Maugham story, and even quotes Murray Rothbard on entrepreneurship-

The late economist Murray Rothbard described the role of the entrepreneur very well. He wrote that an entrepreneur “earns profits only if he has by superior foresight and judgment, uncovered a maladjustment — specifically an undervaluation of certain factors [of production] by the market. By stepping into this situation and gaining the profit, he calls everyone’s attention to that maladjustment and sets forces into motion that eventually eliminate [the profit].” Losses, on the other hand, Rothbard wrote, “are a sign that [the entrepreneur] has added further to a maladjustment.”

Entrepreneurship is a talent that combines creative thinking, foresight and a tolerance for risk. It probably cannot be taught in school; indeed, many very successful entrepreneurs never graduated from college or even — in decades not long past — high school.

Advertisements
Trackbacks are closed, but you can post a comment.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s