Innovation in Action, Part 2: More on Clinton and the Entrepreneurs

In Denver on June 27, Hillary Clinton announced a “technology and innovation agenda” that focused in large part on education, yet another sign that for both Democratic and Republican politicians, “education” really only means “job training” for the private sector.

Her proposal included two major education subsidies: $10 billion in aid for students in massive open online courses, or MOOCs, and “vetted” coding academies like Galvanize, Inc., the for-profit Denver school where she made her announcement. Even as MOOCs have come under heavy scrutiny for their shoddy pedagogy and for-profit schools for their profiteering, Clinton has proposed a huge federal investment in what her supporters often shorthand as “innovation.” (If it’s online and someone makes money on it, it’s called innovation.)

The second major subsidy is a student-loan deferment program to “entrepreneurs,” in which the federal government would defer the loans and subsidize the interest of startup founders and “their first 10 or 20 employees” during the first three years of their business. This raised hackles: why is it a “progressive” idea to make student loan debt conditional on your profession or, given the education and family connections of many startup founders, your class position? Why not defer the debt of social workers or nurses or teachers, who don’t stand to reap the financial incentives tempting tech workers? (One possible answer: social workers don’t donate as much to federal election campaigns as Silicon Valley CEOs.)

Perhaps anticipating such critiques, Clinton’s proposal including some do-gooding overtures to “young innovators” working in “distressed communities,” or those starting business that provide “measurable social impact and benefit.” As any debt-burdened English major could tell you, though, a lot depends on what “distressed,” “measurable,” and “benefit” mean.

A lot depends on what “entrepreneur” means, as well. You would expect, as often and as worshipfully as politicians throw the word around, that “entrepreneur” would have a pretty clear definition. The Austrian economist Joseph Schumpeter, first theorist of “entrepreneurship,” used it in alternately humble and grandiose ways. On the one hand, the entrepreneurial function simply “consists in getting things done,” he wrote.

Elsewhere, though, Schumpeter described entrepreneurship with a grandeur that his admiring biographer Thomas McCraw said “came near to being an allegory.” Entrepreneurs are “New Men,” the heroes of the capitalist Sturm und Drang (Silicon Valley entrepreneurs are mostly just, well, regular men).

If used as a model, his classic text Business Cycles might trouble whoever is tasked with drafting a Student Debt Forgiveness for Entrepreneurs Bill in the Clinton White House: “It is not always easy to tell who the entrepreneur is in a given case,” he wrote. “Nobody ever is an entrepreneur all the time, and nobody can ever be only an entrepreneur.” The entrepreneur may be an inventor, or he may work for him; he may be an entrepreneur this quarter, but not the next. In Schumpeter’s account, it’s not a job description—it’s a practice and an ethos.

And it’s obviously tricky to craft federal subsidies for an ethos. Who are the “entrepreneurs” of the tech economy whose support Clinton covets so dearly? Is it the CEO? The venture capitalist, who provides the startup investment? The customer-service rep, or just the boys that write the code? And if the answer is “everyone,” this would seem to present a problem, not only practically but politically: the federal government would not only be deferring the debt of company founders, but also subsidizing a part of their wages and benefits.

In the end, “entrepreneur” in our time, like in Schumpeter’s, means something very specific and impossibly vague. On the one hand, it either means “tech firm executives” or “small business owners.” Clinton observed in her Denver speech that “It’s not an accident that Denver and Colorado have a low unemployment rate,” suggesting that coding academies like Galvanize Inc. are responsible for the robust job market. According to the Colorado Labor Department, the state’s largest job gains over the last year have been in the hospitality, construction, and education fields. Even government employment outpaced business services, information, and finance. (Colorado Parks and Wildlife are hiring.)

In its vaguer, though no less popular sense, “entrepreneurship” is used increasingly to describe any white-collar, profit-making activity, whether financial or commercial, speculative or productive, high-tech or manufacturing. It is still not a profession, but an ethos, a calling, a heroic character in a dull, derivative plot. In our new gilded age, when wealth and its pursuit are treated with such reverence, the biggest meaning of “entrepreneur” is ideological–to celebrate the pursuit of private wealth as a public good, which the public should in turn pay for.