Creative destruction

We like to think that progress is gradual: step by step things get better, no one loses anything, the pie grows larger and everyone gets a bigger slice. The economist Joseph Schumpeter saw that it works differently, and his term for it, creative destruction, is one of those ideas that changes the way you see the world for good. Because progress in a market does not arrive neatly and gradually. It arrives in shocks, and every shock destroys something.

The pattern is everywhere, once you know it. The railway ruins the stagecoach. The car ruins the blacksmith and the horse trade. In a single stroke the smartphone devours the camera, the map, the music player, the flashlight and the alarm clock, entire industries wiped out in a few years by one new device. An entrepreneur introduces a new combination, and that new combination makes the old one redundant. Creating and destroying are not two things that happen one after the other; they are one and the same movement. The new rises by sweeping away the old.

The entrepreneur as a figure apart

In Schumpeter's picture the entrepreneur is neither an accountant nor an owner, but something of his own: the one who breaks the routine. Not necessarily an inventor, often he merely combines what already existed in a way no one had dared to try. But the one who pries the possible out of the existing and forces it into the world against all inertia. It is, when you think about it, a deeply human and almost philosophical role: to impose form on matter, to see what is not yet there and let it be. That is why builders love Schumpeter. He places the maker, not the manager or the owner, at the heart of the whole story.

But whoever celebrates only the creating tells half the story, and it is the comfortable half.

The second face of the storm

For what is called "creative destruction" from above, dynamic, exciting, the engine of prosperity, simply feels like destruction from below. The job that disappears. The craft in which you built thirty years of mastery, that suddenly no one needs anymore. The town that empties out because the factory moved elsewhere. The same wind that lifts one person up knocks another flat. And the temptation is strong to wave that other person away as the price of progress, until you realize they are real people, with real lives, and that their anger is no mystery but a predictable consequence.

That is no reason to stop progress, the storm has brought unprecedented prosperity, and whoever stills it chooses stagnation and poverty. But it is a reason to build with open eyes rather than closed ones. Whoever makes something new would do well to see what his creation sweeps away, and whom. Not out of guilt, but out of honesty. And because the losers of creative destruction, ignored, are precisely the ground on which resentment grows, and the call for someone who will turn it all back.

A thought to carry with you, for those who build: name one thing your work creates. And then name, just as honestly, what it sweeps away, which older thing, which older way, whose work. Not to hold yourself back. To create with open eyes.