Did You Spot the Austrian Economist Tending Bar in ‘Silver Circle’?September 26th, 2013
Each Thursday on this blog, we point out one of the hidden references, called Easter eggs, that have been placed throughout the film for observant fans to find. Keep your eyes peeled for them as you watch Silver Circle on --> -->DVD or Blu-Ray --> -->. Today’s installment features a historically-crucial Austrian economist whom you might notice tending bar during a scene at the bar called “Perennial Gale.”
Joseph Schumpeter was a thought-leading mind in economics who launched the term “creative destruction” into the public consciousness. The concept is sometimes referred to as Schumpeter’s gale, referencing a quote in which Schumpeter compared the market’s process of creative destruction to a “perennial gale.” In Silver Circle, the fellow depicted below, who looks a lot like Joseph Schumpeter, is serving drinks behind the bar at an establishment named after his famous quote.
Creative Destruction As a Perennial Gale
Economic innovation often disrupts the status quo. Sometimes, scientists develop technological advances that drive entire career pursuits into obsolescence. Newer, more efficient businesses constantly rise up and unseat older corporations that no longer meet the market’s needs.
In Capitalism, Socialism, and Democracy, Joseph Schumpeter compared this process to a powerful wind, “The opening up of new markets and the organizational development from the craft shop and factory to such concerns as US Steel illustrate the process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one … [The process] must be seen in its role in the perennial gale of creative destruction; it cannot be understood on the hypothesis that there is a perennial lull.” However, Schumpeter saw this destruction as beneficial to mankind.
Marx Versus Schumpeter on Creative Destruction
Joseph Schumpeter developed his views on creative destruction after reading the works of Karl Marx. Though the Marxist sociologist Werner Sombart is credited with coining the term, Schumpeter is associated with popularizing it and reshaping its definition. Marx viewed the market’s tendency to destroy obsolete businesses as a failure. Schumpeter, however, viewed the process in terms of the cycle of innovation.
To Schumpeter, the Perennial gale is only destructive from the perspective of those individuals who inevitably must lose their wealth as newer, more efficient businesses elbow them out of the marketplace. However, innovation itself clearly benefits humanity as a whole, as technological advances and efficient business practices improve the quality of life of mankind. Schumpeter used a socialist critique of the market to tout one of its best qualities.
During his life, Joseph Schumpeter worked and lived for a while in Cambridge, Massachusetts, where the Silver Circle team was headquartered throughout production. His ideas were influential on the sound money movement from which the film’s rebels descend. As such, the bar in the movie was named after Schumpeter’s signature discovery, the “perennial gale” that would later be described by academics as Schumpeter’s gale. Also, you may notice that the man behind the bar bears a striking resemblance to the late Austrian economist. Silver Circle Director Pasha Roberts also wanted the bar scene to feature a drink called “Schumpeter’s Ale,” but that pun didn’t wind up fitting into the plot.
Watch out for this week’s Easter egg, a tip of the hat to Austrian economist Joseph Schumpeter, as you are watching Silver Circle.
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