Why did you write this book?

Schweikart:  “This book originally came out as a textbook because the business history textbooks didn’t have enough economics and the economic history textbooks didn’t have enough about entrepreneurship. So I thought a blend was needed. Most readers don’t need IS/LM curves or standard deviations, but do want the economic explanation of events. On the other hand, mainstream economic history has completely forgotten about the “animal spirits” as Keynes called them, or the “spirit of enterprise” as George Gilder labeled it.”

Entrepreneurism appears to be in the American DNA, why is that?

Schweikart:  “Great question, and you’re right. This is the result, I think, of the confluence of many factors to create a distinctly American character (and it’s why capitalism runs into problems in some parts of the world---you have to “buy in” to the whole concept). What are those elements? First, private property. While under assault since Kelo and with the Obama nationalization of GM, it is still the dominant characteristic of American business. Second, the ability to rely on private property rights (thus profits) generates risk-taking, which is the essence of the entrepreneur. Third, our Christian heritage and promise of forgiveness enhances that risk-taking in a good way, because people can fail and not lose everything. There is always a second chance in America---as Ford, Giannini, and Colt all discovered. Finally, the hostility to taxes and, until quite recently, “big government,” has kept larger shares of capital in the hands of entrepreneurs who have used it to better all of society, not just a few bureaucrats or government-favored elites.”

What makes the American system so fertile for starting businesses?

Schweikart:  “All of the factors I listed above. But let me add another: toleration. This began with religious toleration in England, then spread to the colonies. But it was a historically significant development, because up to that point, whoever didn’t believe like you did was essentially dead already---going to hell. The American experience began with religious toleration that said, “You believe your way, I’ll believe mine, and we’ll work together when we can.” If you can disagree on the biggest question in human life, i.e., the nature of God and man’s relationship with him, then who has a better clock or a more efficient sailing ship become relatively insignificant debates. You build yours, I’ll build mine, may the best man or woman win. No one had to worry in America about the Great Khan lopping off an inventor’s head because a device suddenly chose not to work.”

What are the traits of a successful entrepreneur?

Schweikart:  “I think the key traits are vision and faith. First, you have to have a vision for what is needed, what people want, what might work. It involves seeing how hamburgers all prepared the same way are in some ways superior to individually grilled burgers; or how ice that you find in your backyard pond, as Frederick Tudor did, is actually valuable for a lot of things. Then it takes faith to hang on when everyone else tells you your crazy, when the funding is running out, when the first five buyers say “no thanks.”

Why do some entrepreneurs fail?

Schweikart:  “Entrepreneurs fail for the same reason people fail in everything else: all people don’t have entrepreneurial talent; there is such a thing as bad timing; maybe you’re a great salesman but can’t balance books; maybe, like Robert Morris, you’re great at managing a country’s accounts, but never devote attention to the details of your own business. Just as there is a different story for while every entrepreneur succeeds, there is a story for why every one fails. Usually, however, it does not have to do with lack of effort. I’ve yet to meet a lazy entrepreneur.”

Which entrepreneurs that you researched were you most impressed with and why?

Schweikart:  “My favorites are James J. Hill and Walt Disney. Hill is a great story because while the federal government is literally throwing money at the Union Pacific and Central Pacific, he builds a transcontinental RR without a dime of government money. In the process, he has to take every precaution that it’s profitable: he keeps his depots close to his endpoints to minimize transporting supplies; he learns agriculture and breeding, then gives away land to farmers so that he’ll have future customers; he never builds on inclines if he can help it, even if the terrain is ugly. It paid off: in the Panic of 1873, he’s the only one who doesn’t go broke among the transcontinental. Disney is a different story, because he went from employee, as an artist, to founder and owner of an animated motion picture studio---then at the peak of his success, he took the greatest gamble of all to start an amusement park. The idea was so whacky, even his own brother and financial manager, Roy, wouldn’t support him on it initially.”

Is America losing its edge when it comes to entrepreneurship or do you see it as strong as ever?

Schweikart:  “Hard to say. I see kids embarking on all sorts of projects that are amazing---uses of the internet, employment of technology. I do worry though about their patience, stick-to-it-iveness in an MTV, six-second-sound bite world. Above all, I’m concerned that the “entitlement” mentality has started to so permeate the public’s mentality that it will dampen entrepreneurship.”

What do Federal and State governments need to do to foster and support entrepreneurship?

Schweikart:  “As little as possible. These are the major impediments today to entrepreneurship. In Dayton, Ohio, where I live, good idea after good idea is shot down by city councils and mayors because it doesn’t benefit this minority or that specific group. Entrepreneurship benefits everybody, but you can never predict in advance how. The worst thing we have going in our economy today is massive government interference, from federal to state to local.  The fact that America has four or five times as many lawyers as most other countries is a symptom of that, not the cause. The lawyers exist---and slow down everything---because everything becomes subject to litigation as opposed to common sense. Ronald Reagan would be great today, but I don’t think even he would go far enough to purge the system of “bureaucratic blight.” Cut taxes, slash regulations, cap civil lawsuits, and watch the entrepreneurs make everyone rich.”

Do you think entrepreneurship should be a core course in high school as a way to introduce young teenagers to the concept of starting a full or part-time business?

Schweikart:  “Actually, no. I know many people would be surprised by this, but the essence of entrepreneurship is something that cannot be taught. Teach the basics. Teach “readin’, writin’, and ‘rithmatic,” and of course good history, and students will have the tools they need so that IF they are entrepreneurs, they can proceed immediately with their vision.”