Jeremy's Book Blog: July 2018

Friday, July 27, 2018

Reflection on Americana: A 400-Year History of American Capitalism by Bhu Srinivasan

This book is essential reading. One of the best history books I’ve read. If you’re interested at all in American history or economic history or the great inventions of the last 200 years you won’t be able to put this book down. “Americana” covers American economic history in some 30-odd chapters, each named for a product, invention, or economic organization, including tobacco, cotton, steam, rail, unions, flight, and more. Srinivasan writes it in an incredibly engaging way, covering each topic like a novelist telling the stories of boom and bust for inventors and investors, often, as a book about capitalism should do, getting into the nitty-gritty of who was investing in what and when. Overall, it’s the best book I’ve read since “The Looming Tower” or “Maps of Time.” In this post I kind of missed most of the 20^th and 21^st centuries because I got tired of writing but here it is:

The Struggle Between the Free Market and Regulation

The major theme of the book is the eternal struggle between the forces of unbridled capitalism and wealth generation and those of democracy and constraints on capitalism’s excesses. The author makes a nuanced argument and effectively shows that at no point in American history was there ever a truly free market. The greatest successes have balanced the two ideas or chosen one in some places and another somewhere else. Consider the earliest settlers of British America: the Massachusetts Bay Colony and the Virginia Colony:

The first economic system practiced in the Massachusetts Colony was a sort of proto-Communism, with all food belonging in common to the community and company. This failed as no one had a motivation to do work, and once they switched to everyone growing their own, they produced much more food.

In Virginia, the opposite happened. Virginians quickly determined that they could make the most money through tobacco, which became almost the entirety of the crop they harvested. This resulted in food shortages putting them on the brink of starvation. As a result, the answer was economic regulation- the governor ruling that ever man must plant two acres of corn to ensure his entire food supply before planting any tobacco.

The trend continued throughout American history. For example, where would Carnegie’s U.S. Steel have been without the 28 dollar-a-ton tariff on British steel? At the time, Carnegie was selling at 68 dollar-per-ton, so British companies would have had to sell at 40 including shipping, which was impossible.

Many great capitalist successes are owed to government intervention. The steamboat developed out of a monopoly grant, the railroad benefitted from eminent domain, the telegraph was subsidized by the government early in its development, cotton had state-sanctioned slavery, and steel had tariff protection. While the automobile benefitted from no direct government regulations in its earliest development, it did benefit from the regulations the government put on people, requiring licenses and traffic rules. Although these rules made the barrier to entry higher, they increased confidence that the new invention could be safely used, making more want to buy cars.

The Exploitation of Man’s Labor

The earliest major labor force in the colonies was the indentured servant, who agreed to work on a farm for a certain number of years in exchange for the payment of their passage to America and a small parcel of land upon the termination of the contract. In Virginia in 1625, indentured servants made up 487 people in the population of 1,227, or nearly 40% of the population. There were only 23 black slaves. Why so many indentured servants? First, England was very politically volatile from 1625 until the 1640’s due to King James’s death and the English Civil War; second, Spain and the Netherlands controlled the sea and the slave trade, as it was most profitable to send slaves to sugar plantations closer to the equator, which were bigger and closer to Africa- a slave ship could make a round trip journey from West Africa to Brazil in the time it would take to get to Virginia one way. In the first half of the 17^th century, ¾ of the white settlers to arrive in Virginia were indentured servants.

The calculation began to change in the later 17^th century as the political situation stabilized in England and Virginia started to run out of land, as there was only so much good land that could be promised to new settlers each year. By the end of the century the slave population was skyrocketing from just 2,000 in Virginia in 1670 to 16,000 in 1700 and growing fast. As new colonies were formed, they used land grants to attract settlers. South Carolina for example, granted 150 acres per family member, but counted slaves as family members. This dramatically increased the value of having a slave in South Carolina and by 1720 the majority of the colony was African slaves, “a condition that would hold for generations.” Increased cotton production, especially thanks to the invention of the cotton gin, resulted in the rise of Louisiana and Mississippi, and African slaves produced so much cotton for their White planter overlords that the American South was supplying 70 percent of the world’s raw cotton.

Slavery made a ton of money and the Civil War was the only way to end it at the time. After all, the nearly four million slaves in the South were worth $2.8 million collectively, while the longest railroad in America, the Illinois Central, the most valuable industrial asset in the pre-war North, was worth just a billion dollars, slightly over a third a value of the slaves. The country could not pay the Southern Planter class for its slaves because the value was worth forty times the federal budget at the time. The war was about slavery- more for the South than the North. South Carolina’s “official declaration of the causes of secession” explicitly referred to the “election of a man… whose opinions and purposes are hostile to slavery.” Other states, like Mississippi and Georgia did not refer to slaves themselves, but rather to billions of dollars “of our property,” which can only refer to human property being that valuable.

Cotton was the life and death of the South and in the Civil War it was death. Perhaps the biggest reason the Union beat the Confederacy was due to the naval supremacy it used to blockade the Confederates, preventing them from exporting their cotton and funding the war effort. This led to a dramatic increase in cotton production in British Egypt and India, doubling their production in just 6 years. It was so significant that “historians of Egypt still rank the American Civil War among the most crucial events in [Egypt’s] 19^th century history.”

Connecting the Country

The earliest settlements in British America were generally cities based on rivers, such as New York, Boston, and Philadelphia. In the South, there was Charleston, but generally fewer cities, as the area was more agricultural than commercial. Most transport into the mid-19^th century used waterways that were especially plentiful in the Mississippi drainage basin, extending from Western Pennsylvania to states further west like Ohio, Illinois, Nebraska, and Minnesota in the North to Arkansas, Tennessee, and Louisiana in the South. Using steam boats, it was quicker to ship goods from Pittsburgh to New Orleans by river than it was to ship them to Philadelphia by land.

Thanks to massive government investment, the country started to build networks of canals to connect its rivers in the early 1800’s, the most famous of which is the Erie Canal. The canal meant that goods from Cleveland could be in New York in days thanks to the Hudson, connecting the Midwest with the Northern Atlantic States and New England. It allowed a small town named Chicago to grow from just 30,000 people to over a million in 40 years.

The canals gave birth to a new form of transportation, as the steam engines used on steamboats were put to use in the first railroads. Their financial backing, government bonds, was also put to work in railroads, so that steamboats, canals, and railroads all formed as public/private partnerships, with the government “setting in place the infrastructure, reconciling federal and state laws, permitting limited liability, and defining and balancing the conflicts of property rights” enabled a free-ish market to thrive.

Today in American Capitalism

The current state of American capitalism is defined by the last 40 years of running trade deficits and the popularization of neoliberalism, encouraging free trade throughout the world; the two phenomena are closely related. As America is a rich country, it can afford to buy goods more cheaply elsewhere that labor costs are lower, encouraging American money to flow out of the country. The neoliberal theory makes purely economic sense in its prescription to maximize comparative advantage across the world, but economic considerations are just a part of the equation. While all Americans were once producers and consumers, increasingly we are consumers and service providers at best. Because of the open markets that have dominated the last 50 years of world economics, countries have specialized; consumer consume products that they do not produce, and producers produce products that they do not consume. This kills part of the soul. People can’t be so isolated from their own communities. Producing Nike shoes for Americans thousands of miles away cannot be very morally satisfying for a Vietnamese worker as neither is it morally satisfying for the American to buy such a foreign good.

This book has made me reflect on the warped state of the current American political scene, where extremist Reaganites like Ted Cruz and Paul Ryan advocate for eliminating massive parts of government that provide huge benefits to the economy. It’s reminded me that they are far from the mainstream and that they are not “conserving” any older US tradition. The true American capitalist tradition involves significant state spending and intervention, as the democracy wrangles with the market to create something extraordinary. To go to far to one side is dangerous, and those who would attempt to eliminate government’s role are far more radical than those who would attempt to augment it. Increasing the role of government in society has been the most successful economic trend in American history. Making the American worker stronger makes America stronger. Making the American corporation stronger makes America stronger. Retracting government’s role to allow the market to handle itself is reckless, ahistorical, and a radical position that has no basis in patriotism and would weaken us greatly.

Miscellaneous Facts:

The Mayflower left England in September 1620, but not all were religious pilgrims, in fact half of them were settlers that came along for the ride but were not members of the Puritan church. Within 6 months, half of those who came on the Mayflower were dead, including Mayflower Compact author John Winthrop’s wife.
George Washington had a company that attempted to build a canal to link the Potomac to the Ohio River, and therefore the Mississippi, but the plan never came about.
Germany faced revolution, like most of Europe, in 1848, which was a major cause of German immigration to the USA, with over half a million arriving from 1852-1854 alone, when there was no coherent American immigration law.
One of the new phenomena of the industrial age was over-production. In the agrarian age there was rarely such a thing as overproducing food, but in the mid to late 1800’s governments failed to provide “shock absorbers” for over-production.
Why was the Panama Canal needed? After the Mexican-American War, the USA gained control of California and discovered gold in 1849. People flooded in during the gold rush over land. By the turn of the century California and the West were well-populated, but “on sea, the nautical distance from Charleston, South Carolina to Santa Barbara, passing below the southern tip of South America, was greater than the distance from Monterrey, Mexico to Shanghai.
There are many reasons to hate the Compromise of 1850, which included the Fugitive Slave Act, among other things. But I learned that it also incentivized magistrates to rule that ex-slaves should return to their masters, as they were paid 10 dollars for expenses for ruling that one was an escaped slave, but only 5 dollars for ruling that they should be free.
While the saloon died out with Prohibition, until then, it provided a major social element, cashing checks, and serving as a mailing address for new arrivals (immigrants etc). It was a crucial element of machine politics, especially of the Democratic Party.
Andrew Carnegie offered to reimburse the American government the $20 million it paid for the Philippines if the USA would give them their independence.
In 1916, the Model T cost $360, so that you could earn the car in just 72 days of labor.
The government’s budget ballooned in World War One from $734 million in 1916 to $12.7 billion in 1918 and would never again fall below $3 billion. The war also affected the development of the airplane. 416 airplanes were produced in 1916 and in 1918 over 14,000 were made- all but nine for the US military.
The Levitt and Sons homebuilders’ company of “Levittown” fame refused to sell homes to blacks.
The Federal Housing Administration would ask underwriters to appraise residential neighborhood quality, with the primary factor being economic stability and the second OFFICIALLY being “protection from adverse influences” to avoid “infiltration” from “inharmonious racial groups.”
The 1980’s was when the major transition happened where stock ownership became so democratized and decentralized that CEOs, who were managers, had more influence than many stockholders, a condition that continues to this day.

Thursday, July 19, 2018

Reflection on Custer Died for Your Sins by Vine DeLoria, Jr.

This is not like the history books I usually read. Custer Died for Your Sins is a book really of its time, which is late 60’s America and is an effort by a major Indian leader, the Director of the National Council of American Indians (NCAI) to chart the future of the movement for Indian rights. I really liked the way it was written because it was sarcastic and had a lot of personality. There’s even a whole chapter titled “Indian Humor.” It is a little dated but holds up well and isn’t too long, under 300 pages. I’m just gonna put some passages here because I liked them. This post is just not gonna be organized really.

“There are a number of white organizations that attempt to help Indian people. Since we would be better off without them I will not mention them, except to comment that they do exist.”

“People often feel guilty about their ancestors killing all those Indians years ago. But they shouldn’t feel guilty about the distant past. Just the last two decades have seen a more devious but hardly less successful war waged against Indian communities.” (In reference to “termination” pursued by the federal government in the 1950’s and 60’s.”

“Indians are equally certain that Columbus brought anthropologists on his ships when he came to the new world. How else could he have made so many wrong deductions about where he was?
While their historical precedent is uncertain, anthropologists can readily be identified on the reservations, Go into any crowd of people. Pick out a tall gaunt white man wearing Bermuda shorts, a World War II Army Air Force flying jacket, an Australian bush hat, tennis shoes, and packing a large knapsack incorrectly strapped on his back. He will invariably have a thin sexy wife with stringy hair, and IQ of 191, and a vocabulary in which even the prepositions have eleven syllables.”

“The current joke is that a survey was taken and only 15 percent of the Indians thought that the United States should get out of Vietnam. Eighty-five percent thought they should get out of America!”

DeLoria Jr. also talks a lot about the differences between blacks and Indians, often in relation to the Civil Rights Movement, which was active, as he was writing less than a year after King was assassinated. He talks about how whites view blacks as pack animals and Indians as wild animals. He excluded the blacks from the economy, politics and society, not allowing them to rise from their position. With the Indians it was the reverse, forcing them to become white through Christianity and European customs.

Miscellaneous Facts

Scalping was introduced to the Americas by the English in the French and Indian War.
One of the biggest tribal issues of the time was fishing and hunting rights. White sportsmen would hunt and fish for trophies, diminishing stocks that Indians depended on for food and life.
Harry Truman appointed as the Commissioner of Indian Affairs Dillon Myer, who began the termination program in 1950. He had been in charge of Japanese internment camps during World War II and was selected for his experience with minority groups.
Indian tribes can sue the government and win damages, but the government would still decide through legislation how to spend it.
Tribal termination was some really horrible stuff. When Congress would want to terminate a tribe, they would have the tribe hold a referendum to approve it. This did not require any number of members to participate, so a majority could be formed of 50 from a tribe of 5,000. After the referendum, the land would be appraised and sold, so that the Indians would vote on selling before they knew the price because Congress is presumed to act in good faith towards the Indians.
Most tribal names mean the People, First Men, or Original People.

Monday, July 9, 2018

Reflections on Caesar: Life of a Colossus by Adrian Goldsworthy

Caesar is a really complicated guy. He was very talented as a general and in basically everything he did, and I have a lot of sympathy to his populare political moves. Basically, he fought against the Roman aristocracy and helped the poorer people on the fringes of Roman society. He also gave clemency to his enemies and treated people well. However, he committed what we would today call a genocide in what was then called Gaul (France) and Britannia (England). He also had a hand in destroying the Republic, a form of government that is nice; although essentially an oligarchy ruled by the wealthiest, it at least offers a version of democracy. We gotta remember thought that his role was by no means something that only he could have done. The Republic had already been screwed up royally by Marius, Sulla, Saturninus, Cinna, Catiline, etc. and there was always another one of these aristocrats trying to do what Caesar did. Obviously everyone has their own style of doing things, but I cannot imagine that Pompey winning the Civil War would have reverted Rome to its old Republican virtues. Just wasn’t gonna happen. In sum, it’s hard to have one opinion about the guy politically because he would not fall into any of our modern political categories and because its hard to say how he would have been different from other Romans at the time, especially since he was assassinated only having been dictator for like two years.

Reading this has made me feel a lot better about American democracy. When you read through the life of Caesar, what stands out is the insane amount of bloodshed in Rome throughout his life. In the week and a half when Caesar triumphed four times, he claimed to have slain over one million enemies of the republic. Over the course of his life the Republic seems to have spent as many years in civil war as in peace, and you get to see how the Republic ends because all the republican senators are killed during these wars. So, when you look at the USA in 2018 we are still doing much, much better.

As for the book itself, at points it reads like a novel and is spectacular. At about 600 pages though, there are definitely a few parts worth skimming. The highlights for me were the fleshed-out details of the battles and the way the author gives you the fuller context of Roman life in the 1^st century BC. I would recommend to anybody who wants to learn more about the period and Caesar himself. I stopped reading and picked it back up again after a few weeks because I was more interested in the period than in Caesar but I’m glad I returned to it.

Miscellaneous Facts

Caesar was a womanizer on a pretty big level. He banged basically every Roman aristocrat’s wife or sister of that generation. Poor Marcus Brutus, from Shakespearean fame “et tu Brutus,” had a mom and a sister who both had affairs with Caesar.

The book mentions that Alexander the Great, with whom Caesar is often compared, only took part in five pitched battles and three major sieges plus many smaller encounters. Caesar, on the other hand, fought 50 battles in his life, a record that wouldn’t get beaten until Napoleon came around, some 1,850 years later. I almost don’t believe those numbers for Alex though and I need to do more research on that.

Reflections on Battle: A History of Combat and Culture by John A. Lynn

Battle is book with an interesting premise. It’s a history of war but from a cultural perspective, meaning that it talks about some specific battles and tactics but always in the context of how different societies viewed them. Foe example, Middle Ages knights viewed archers and crossbowmen with contempt, but in ancient India, the bowmen were the most honored on the battlefield. The book covers different periods and locations, from classical warfare in Greece, China, and India to the scourge of global terrorism today. The chapters I found the most interesting were on Egyptian military doctrine from the first war against Israel in 1948 until the October War of 1973 and the chapter on the role of cultural differences in the war in the Pacific in World War 2.

“Perfected Warfare”

One theme throughout the book is the concept of perfecting warfare to become a perfect form of combat. The Greeks developed many rules about the conduct of war and battles, essentially restricting it to being fought in the open plains and valleys of Greece, not the mountains, and limiting the number of missile weapons used. In the Middle Ages, Christians developed a sort of “perfected warfare” in the crusades by fighting Muslims, making conflict religious, a guarantor of heaven. Also in the Middle Ages, knights developed the tournament, where they jousted and fought in melees and were rewarded with kisses from ladies. The author calls this the most perfected warfare as it is completely controlled and filled with feasts etc.

The Evolution of Modern Warfare

One of the most interesting features of the book is where it covers the changes from the 18^th to 19^th centuries in warfare, which featured the rise of the citizen army over professional armies. The professional armies themselves, as ruled by Louis XIV-XVI, Frederick of Prussia, and other leaders developed out of the small forces led by aristocrats in the Middle Ages and were still dominated by aristocratic officer who paid for their own units’ existences. There was contempt for common soldiers, as one French minister of war referred to them as the “slime of the nation.”

In these forces, combat was dominated by packed together units of soldiers alternately firing. This happened to prevent soldiers from deserting and to concentrate fire. Weapons were still not accurate as to force soldiers to hide behind cover. The big shift to soldiers becoming skirmishers hiding behind cover was thanks to the “levee on masse,” when all single, young, French men were called to service, doubling the size of the French military and providing French generals (including Napoleon) with a motivated and large force that was less prone to desertion. With this, they would spread out and take cover to fire at enemy forces.

Egypt and Israel

The chapter on Egypt was really interesting to me because it felt very connected to modern day and is deals with an area I’m particularly interested in. After the Six-Day War, Egyptian and Jordanian military forces explicitly reflected that the origin of their problems lay in Arab culture. This happened in a few ways. One was that Arab officers did not want to admit the shame of defeat or at least wanted to mitigate it so they would exaggerate Israeli troop numbers or not even tell their superiors they were defeated at all. The problem was so bad that in the more successful Egyptian effort in the October War, they got their information by tapping into Israeli comms, as the Israelis had the better information about Egyptian troop movements than Egyptians themselves. Another Arab cultural issue that came to the fore was a deference to authority to a fault. Unlike in American military culture, where junior officers are highly encouraged to take initiative and are given much flexibility, Egyptian officers seemed incapable of doing so. They wouldn’t even move tanks during combat, stopping them like stationary pillboxes instead of maneuvering around their enemies. The Egyptians cleverly accounted for this by planning their October 1973 operation to the most minute details, leaving no room for error. They ran the same drills for months in full view of the Israelis so that when the final, real buildup came, the Israelis didn’t expect an actual invasion and the Egyptians had each practiced their part a million times.

Interestingly, we can look at the October War as a victory for both Egypt and Israel as the victory satisfied Egyptian pride and gave Sadat the political capital to negotiate a true peace with Israel with recognition and all. It was a military stalemate that ended up granting political victory to both sides.this

Conclusion

Overall the book was good though a little wordy and academic at points. He also made what I thought was a really picky distinction about cultural differences and racism and what affected what in the Pacific Theater of WWII. It was overall good and a few chapters would probably make good reading for a college class but otherwise this book is pretty esoteric.