GEORGE WASHINGTON: PRESIDENT AND ENTREPRENEUR AND BUSINESS INNOVATOR BY JOHN BERLAU
http://www.nationalreview.com/node/371268/print
This month, America celebrates the birthday of one of the country’s earliest business innovators and large-scale entrepreneurs.
During America’s existence as a British colony and then a young nation — when communication and transportation faced challenges, to put it mildly — this businessman built an enterprise with international reach. He built a mill that ground 278,000 pounds of branded flour annually that was shipped throughout America and, unusual during colonial times, exported to Europe. And in the 1790s, late in his life, he built one of the new nation’s largest whiskey distilleries.
You might also know him from some of his political and military achievements. As commander of the Continental Army during the Revolutionary War, he led the nascent American nation to a hard-fought victory for independence. Then, a few years later, he became the new nation’s first president.
That’s right, this entrepreneur was none other than George Washington. Had he never led the Continental Army to victory over the British or become president, he would still have had the distinction of being one of America’s most successful early business leaders. As National Review senior editor Richard Brookhiser has written in his book George Washington on Leadership: “[Washington’s] agribusiness and real estate portfolio made him America’s richest man. . . . He was the Founding CEO.”
For many decades, thanks in large part to the lackluster history taught in public schools, George Washington has been just the face on Mount Rushmore and the one-dollar bill. Most Americans revere him, but they often don’t know how to relate to him. Yet the success of Brookhiser’s books, as well as that of the recent best-seller George Washington’s Secret Six: The Spy Ring That Saved the American Revolution, by Brian Kilmeade and Don Yeager, shows that Americans yearn for more specifics about just what made the father of our country tick.
And now, some pioneering scholars are also documenting Washington’s life’s work as an enthralling story of early American entrepreneurship. In his 2006 biography The Unexpected George Washington, historian Harlow Giles Unger calls Washington “one of America’s leading entrepreneurs” and chronicles Washington’s transformation of Mount Vernon from a sleepy tobacco farm into an early industrial village.
In this challenging time for free enterprise, Washington’s business biography, in addition to his political biography, should be seen as emblematic of the American Dream. Washington’s background wasn’t exactly poor, but he was not as wealthy as many of his contemporaries among the Founders. His father died when he was eleven, and the family lacked money to give him a formal education.
After fighting with distinction in the French and Indian War, Washington began tending to the Mount Vernon farm he had inherited from his older brother Lawrence. Compared to the many sprawling Virginia estates of the time, 2,000-acre Mount Vernon was undistinguished when Washington acquired it. Although Washington received a boost in wealth when he married the widow Martha Custis, running a productive farm against the backdrop of British trade restrictions and taxes, as well as nature’s unpredictability, was not an easy task.
Washington began buying the land around Mount Vernon, building a beautiful homestead, and pioneering modern agricultural practices such as crop rotation. His first step was to abandon the most common cash crop of his native Virginia: tobacco. Washington worried that the tobacco crop was hurting Mount Vernon’s soil and saw the need to diversify to avoid “unprofitable returns,” as he noted in 1765.
Washington chose wheat as his main cash crop, and, pioneering the integration of related enterprises, he became a manufacturer of two products from his crop: flour and distilled whiskey.
Recently replicated on their original foundations at Mount Vernon Estate and Gardens (with support from the Distilled Spirits Council of the United States), Washington’s gristmill and distillery are architectural wonders that anticipated modern factories. The flour mill is three levels high with two sets of millstones, including French buhr stones that were used to make the finest quality of flour.
The mill produced about 278,000 pounds of flour per year, which was branded with the Washington name and sold throughout the colonies and exported to England and as far away as Portugal.
The distillery also offers a fascinating example of Washington’s entrepreneurial prowess. Washington built the distillery in 1797 after retiring from the presidency and returning to Mount Vernon — thus setting the American precedent for voluntarily relinquishing power.
He delegated day-to-day management to James Anderson, a native Scot who knew a thing or two about distilled spirits. The product was made largely from crops grown at Mount Vernon. As former Mount Vernon archaeologist Dennis Pogue notes in his book Founding Spirits, the distillery was soon producing 10,500 gallons of spirits annually, mostly rye whiskey, making it “one of the largest whiskey distilleries in America.”
Like that of other Founding Fathers, Washington’s career was stained by the evils of slavery, and this extended to his business enterprises. But his correspondence shows that Washington realized this contradiction more than most of the Founders, and he worked tirelessly the last few years of his life to free all of his slaves upon his and Martha’s death. He also made provisions for their education and for the support of the former slave children and elderly.
Washington’s lifelong entrepreneurship sheds new light on his fight for liberty and his motivation to develop a constitutional structure in which all were free to develop their many talents. It also provides an effective answer to claims like the ranting last year of a law professor in the New York Times that Americans should “give up on the Constitution” because it is not “remotely rational” to listen to “white propertied men who have been dead for two centuries” and “knew nothing of our present situation.”
In fact, Washington knew more about the “present situation” of entrepreneurs frustrated by government hurdles than most legal academics writing for the New York Times could ever “remotely” hope to.
— John Berlau is senior fellow for finance and access to capital at the Competitive Enterprise Institute.
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