THREE CHEERS FOR CAPITALISM

Many years ago, as a recent college grad traveling in England, I encountered a Socialist professor who berated me for being an American. “Aren’t you ashamed?” he demanded. “Your country is rich because it has a grossly unfair share of the world’s resources. But because you won’t share the wealth justly with Third World countries, their people starve.”

I knew the professor’s analysis of the causes of wealth and poverty was flawed. But I found myself tongue-tied when I tried to explain why. Though I lived in the world’s greatest capitalist nation, my education - paradoxically - had never touched on the principles that make its mighty economy tick.

Years later, I ran across a story that revealed the force at the heart of democratic capitalism’s dynamism. Reading it, I saw that my Socialist friend’s single-minded focus on wealth distribution had obscured a more fundamental question: Where does wealth come from in the first place?

The tale in question was the saga of Frederic Tudor, the Ice King, as told by historian Daniel Boorstin in “The Americans: The National Experience.” Tudor was born in Boston in 1784. The New England of his day was the sort of place my Socialist friend would have dismissed as condemned to poverty: few natural resources; thin, rocky soil - nothing but “ice, granite and codfish,” as the old saw went.

In 1805, when Tudor was 21, his brother asked whimsically at a party why ice on nearby ponds was not harvested and sold at ports in the Caribbean. New Englanders themselves sometimes used ice for food preservation, but it was costly and melted quickly.

In fact, in the early 19th century, people everywhere ate a diet of limited nutritional value, monotonous and tied to the seasons. Fruit and vegetables rotted quickly, and meat was either eaten freshly slaughtered, or dried or salted. Everything was spiced to conceal staleness. Disease, needless to say, was rampant.

His brother’s question started Tudor thinking, and he took it as a challenge. Within a year - though derided as a madman - Tudor had invested $10,000 in shipping 130 tons of ice to the tropical island of Martinique. There, he stationed himself shipside, demonstrating how to use and preserve ice, and even whipping up ice cream for restaurateurs. Unfortunately, he lost $4,000 when his whole cargo melted within six weeks.

Tudor understood that the ice trade’s future hinged on solving the technical problems that had scuttled his Martinique venture. What he needed, first, was an icehouse that would function in tropical climes.

Risking yellow fever in Havana, Tudor experimented with every conceivable insulating material - blankets, straw, wood shavings. Watch in hand, he stood by his icehouse, laboriously measuring the melting water hour by hour. In the end, he designed an ice depot that cut melting losses from 60 percent to less than 8 percent.

Next, Tudor had to find a way to harvest ice from New England ponds so that it could be economically transported and preserved. Traditionally, ice had been cut in chunks by hand, or even - at great danger to ship and crew - pried from Labrador icebergs with picks and crowbars. Either way, it was expensive and hard to ship. But with the help of a friend, Nathaniel Wyeth, Tudor produced a revolutionary machine that rapidly cut uniform blocks from pond ice. In this way, he reduced harvesting costs from 30 cents to 10 cents per ton, and ensured that melting during transit would be minimal.

Tudor’s marketing challenges were equally daunting, both at home and abroad. To create a demand for ice, he demonstrated its use in hospitals, promoted ice cream, and sold chilled and unchilled beverages at the same price to develop a taste for cold drinks. Striving to change tropical inhabitants’ eating habits, he offered them tempting, ice-preserved shipments of apples, butter, cheese, milk and meat.

Tudor’s greatest triumph came in 1833, when he sent a ship with 180 tons of ice to Calcutta, halfway across the globe. The ship had to cross the equator twice, and preserve its cargo unmelted for four months. Tudor’s sensational success launched a flourishing ice trade between Boston and the Far East.

It took 15 years for Tudor to establish the ice trade as a paying business. Largely because of his efforts, in the half-century before the Civil War, urban Americans’ consumption of ice grew almost seventyfold. In 1846, Boston shipped 65,000 tons. Ten years later, it shipped more than twice that amount to over 50 destinations in the United States, the Caribbean, South America, the East Indies, China and Australia.

What is the moral of Frederic Tudor’s story? That a nation’s greatest resource is not rich mineral deposits or farmland, but human resourcefulness itself.

Democratic capitalism’s hallmarks are political and economic freedom. Freedom unleashes human intelligence, creativity and drive, and holds out the possibility of reward for effort and risk. Until Tudor came along, ice was essentially worthless. Until human genius produced the oil lamp and the internal combustion engine, petroleum was at best a patent medicine, at worst, a nuisance.

As philosopher John Locke pointed out 300 years ago, the inventors and purveyors of new products and processes - the printing press, quinine - have done more for humankind’s health and welfare than all the givers of alms in history. How strange that today - even in America - if a movie character is a businessman, chances are, he’s a villain. It’s time that we, like my Socialist friend, gave a bit more thought to what powers the economic system that makes our unprecedented prosperity possible.