There are lots of ways to make money, many of them challenging and personally rewarding and all that. You want to be a lawyer? Go for it. Seven years of medical school sound like fun? Be a doctor, your mother will be so proud. Insist on getting a license from the government to run a cell phone company or burn fuel or deliver ESPN or harvest oysters or run an auto dealership, don't let me stop you. You'll make decent money, join a country club, be a pillar of your community, be asked to join the board of the Opera. Whatever. There are so many ways to make money, even a lot of money. But--there is always a but!--don't get holier than thou by building huts in East Timor or donating your political entrepreneurship earnings to Habitats for Humanity or The Robin Hood Foundation or I'm Personally Saving Children/The Poor/The Planet. You may feel good about yourself and maybe you just got "points for Heaven." But deep down, you know that you didn't give those gifts, the rest of us did. Through political connections, you redistributed our wealth to yourself and then for community standing or personal satisfaction, you redistributed it again to some pet cause. I'm not impressed. You could have been a Free Radical all along and improved society while you improved your own standing.
That's what Thomas Edison, John D. Rockefeller and Mark Zuckerberg have in common. They are all Free Radicals. A Free what? A Free Radical is someone who not only creates wealth for themselves, but at the same time, improves the world, makes life better, and increases everyone else's standard of living.
By wasting black, sticky oil, Rockefeller lowered the cost of lighting by a factor of ten, as well as heat and, eventually, transportation. Lighting from candles and whale oil was none too cheap before the Civil War. The rich could read at night while the rest sat around in the dark and drank moonshine. But by 1865, the price of 42 gallons of refined oil, wood barrel included, cost around $25. Just seven years later in 1872, the price of that filled barrel was under $10 and by 1884, not twenty years later, the cost had dropped to $3.36.
By wasting carbon filaments, Edison drove the cost of lighting down even further, extending everyone's day by six hours - mostly for leisure time, if you think about it - by lowering the cost of lighting streets and homes by another factor of ten. Add phonographs and movies and he got rich (though not as much as Rockefeller) by making society rich.
Zuckerberg? Sure. He wastes storage and bandwidth and uses data to lower the cost of communications, in ways never before possible. That's the economic case for Facebook. You won't find it in Econ 101, but it's there. Productivity. Time saved communicating and finding information. Zuckerberg created a structure for wealth not only for himself but also for society, by lowering the cost of a new form of communication. No one handed him anything. He's donated $100 million to Newark public schools and later in life, he'll probably be judged by what diseases he tries to eradicate or how much he donates to Africa. But forget it--he's already done his share.
It's a pretty simple test. Doctors may think they are Free Radicals, they make money and they make society better, but they do it one at a time. They don't really scale. The device maker or someone that invents an ever cheaper test to detect cancer five years earlier, now that's a Free Radical. A social worker certainly helps the poor and downtrodden, but taxpayers pay. Tort lawyers keep society safe by suing large corporations and keep them honest and focused on, for example, consumer safety. But these businesses just raise their prices and we all pay.
It's the Free Radicals that are increasing productivity, increasing society's wealth, reinventing the way the world works and generating enough profits to reinvest in their process to keep this reinvention going for decades on end.
Sure there is income inequality. The Haves and the Have Nots as Saul Alinksy puts it in his book Rules for Radicals. Some get left behind. As a country, we are far from heartless. But the way to solve poverty is not to take more from the Haves, but to create more Haves, whatever it takes.
Why is that important? Because you can't just create wealth out of thin air. You can't dig it out of the ground. You can't just declare wealth ("let's pay living wages"). You can't print it with a printing press or by increasing the monetary base at the Federal Reserve. Nope--you have to invent it. Sure, you can join the Peace Corps or Teach for America and do your part, whatever small part that may be. You can go into public service and try to change the system. But to keep getting elected, you will inevitably fall into the same populist trap of entitlement expansion every politician falls for. Or...as a Free Radical, you can make, hack, create, innovate, be productive and multiplicate to the only thing that really matters for the future of society, and that is rolling the ball of progress up that ever steeper slope. Steve Jobs has done more for society than he can possible give away.
These are the real heroes in history. Want to encourage Free Radicals? Just stay out of their way.
Kessler is a former hedge-fund manager and now author, most recently, of Eat People: Unapologetic Rules for Game-Changing Entrepreneurs.