Posts Tagged ‘business’
“How dare you try to hog all the continent!”*…
Historian Richard White on the greed, ineptitude, and economic cost behind the transcontinental railroads of the 19th century, and what that says about the development of infrastructure today…
Politicians love a good historical analogy. That’s why Joe Biden has compared his infrastructure law to the construction of the interstate highway system and the transcontinental railroad. The president, of course, means such comparisons in a flattering light. For those who have studied these revolutionary policy choices, however, the consequences are not so unblemished.
Ten years ago, historian Richard White catalogued the greed and ineptitude of railroad executives and the policymakers who blindly enabled their schemes. In Railroaded: The Transcontinentals and the Making of Modern America, he explored the history of corporations that have gone down in American myth as corrupt but ultimately productive and necessary.
White argues that the transcontinental railroad companies were not necessary for stitching the young country together; they were simply an example of “dumb growth” that hurt more than it helped. Sped along by state subsidy and paid-for politicians, these corporations built in places where there were no markets. They never made money. The entire enterprise was a vast Ponzi scheme, and its periodic turmoil threw the nation into repeated economic crisis. Their selfish flailing scourged wildlife, oppressed Native Americans, and spread new settlements to areas where they could not be sustained (and after long suffering were not).
Instead of an all-powerful “octopus” engulfing the country, he saw the railroad men as a collection of myopic and unintelligent executives who could not have survived year to year without government subsidy. Instead of a monstrous kraken, he suggested a better analogy would be “a group of fat men in an Octopus suit fighting over the controls” of a train going off the rails…
Governing (@GOVERNING) talks with White about lessons for today’s infrastructure programs: “Breaking the Myth About America’s ‘Great’ Railroad Expansion.”
See also: “Years of Delays, Billions in Overruns: The Dismal History of Big Infrastructure” “These days, the bigger the company, the less you can figure out what it does.”
* Collis Huntington (lead investor in the Central Pacific Railroad) to “Doc” Durant (V.P., and operating head of the Union Pacific Railroad) in 1862
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As we learn from our mistakes, we might recall that it was on this date in 1845 that President James K. Polk, citing “Manifest Destiny” in a State of the Union message, proposed that the United States should aggressively expand into the West.
It was the 22nd anniversary of President James Monroe‘s declaration of the New World as a sphere of influence off-limits to intervention by Old World (colonial) powers, and suggesting that any such incursion would be deemed an act of aggression against the U.S. From 1850, this policy has been known as “the Monroe Doctrine.”
“You only need two tools in life — WD-40 and duct tape. If it doesn’t move and should, use the WD-40. If it shouldn’t move and does, use the duct tape.”*…
The fascinating history of WD-40, a chemical substance with an unusual origin story and a rust-fighting ability that has become a standby of households and workbenches the world over…
In the early years of the 1950s, the Rocket Chemical Company was on a mission. They wanted to make a line of solvents and degreasers that would prevent rust in the aerospace industry.
The first fifty years of the aerospace industry were marked by innovation and change. From the Wright Brothers’ first flight in 1903 to their 1908 military contract, it picked up interest in a big way. Aircraft played a role in the First World War and prompted an era of evolution and development for the industry. According to The Encyclopedic History of the Aerospace Industry, seven firms built more than 22,500 of the 400-horsepower Liberty engines that eventually laid the foundation of what became an incredibly efficient industry. They were also led by only two companies: Wright Aeronautical Company and Curtiss Aeroplane and Motor…
Most types of metal—including the ones used in the construction of those early aircraft—have a tendency to rust over time (although there are a few that don’t). Painting, maintenance, cleaning, and hangar storage help attenuate rust issues, but they are sometimes difficult to prevent entirely. Exposing the metal to the oxygen in the air around us causes paint to wear off and rust to build up (the process is known as “uniform surface attack”). Other parts of the plane—like the landing gear and engine—can also develop corrosion over time. Then there’s the issue of moisture building up in crevices and eventually causing rust. A rusty plane is not a good thing. Even so, rust-prevention wasn’t a high priority early on for some sectors of the industry. All that changed as the industry evolved.
[In 1953] the Rocket Chemical Company stood on the precipice of that change with their attempt to solve the problem once and for all… After forty attempts to create the formula, they famously came up with the right one on their 40th attempt. The name WD-40 stands for water displacement, formula 40. It’s first application came as a coating for the Atlas missiles made by Convair in the 1950s.
As their product began gaining traction, it exploded in popularity. Everyone loved it. And much like stealing office supplies, employees of the original WD-40 manufacturing plant inevitably snuck some of the stuff out for home use. So it wasn’t much of a surprise that five years after its invention, the miracle substance appeared on the open market in 1958…
The origins– and impact– of America’s most versatile household product: “The Can That Always Can,” from David Buck (@saltyasparagus1) in @readtedium.
* Anonymous
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As we spray it on, we might recall that it was on this date in 1913 that Gulf Refining Company opened the first “drive-in filling station” in Pittsburgh. It was the first architect-designed station and the first to distribute free road maps; it also offered tube and tire installation, free water and air, and crankcase services.
“Fortune sides with him who dares”*…
Understanding the origin of the modern concept of risk…
Lately, we have all become risk assessment and risk management experts, thinking, talking and Tweeting about the chances we take when we engage in once-mundane activities. It’s hard to imagine doing without risk: the analytical instrument we use to calculate the advisability of undertakings that can result in gain or loss. Yet when the word risk entered the languages of western Europe during the 12th century (at roughly the same time as other words used to jigger the scales of Fortune: hazard and chance), it took some time to catch on. Niccolò Machiavelli (1469-1527) and Francesco Guicciardini (1483-1540) – the two great writers of the Italian 15th and 16th centuries who wrote about contingency and power while everything was collapsing around them – did not use the Italian rischio in the works for which they are best remembered, even though the Italians were early adopters of the word and the speculative behaviours it names.
The first known usage of the Latin word resicum – cognate and distant ancestor of the English risk – occurs in a notary contract recorded in Genoa on 26 April 1156. The captain of a ship contracts with an investor to travel to Valencia with the sum invested. The contract allocates the ‘resicum’ to the investor. In a typical arrangement, the captain received 25 per cent of the profit at the end of the journey. The investor or investors pocketed the resicum payout: the remaining 75 per cent. This contract also reminds us that the medieval Italian ship’s crew was an egalitarian society. It specifies that the voyage would be extended from Valencia to trade at Alexandria before returning to Genoa, but only if a majority of the men on board agreed.
Resicum worked a kind of practical magic in these early contracts. Canon law forbade the payment of interest on loans in medieval Europe (as Islamic law did in the eastern and southern Mediterranean). By inventing a bonus paid to the investor in the event of the successful completion of a journey, the resicum provided a workaround for venture capitalists and for the captain seeking capital. It also gave those who could not journey an opportunity to earn investment income. A small but significant proportion of the investors in these maritime contracts were retired seamen or women. Finally, it parcelled out the risk assumed by those who undertook the trans-Mediterranean journey…
The fascinating story in full: “How 12th-century Genoese merchants invented the idea of risk,” from Karla Mallette (@karlamallette) in @aeonmag.
See also: “Genoa: The Cog in the New Medieval Economy” source of the image above.
* Virgil (reminding us that a sense of contingent peril and prospect predated the Middle Ages)
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As we roll the dice, we might recall that risk came in a variety of forms in Medieval times: it was on this date in 1307 that Wilhelm Tell (or we tend to know him, William Tell) shot an apple off his son’s head.
Tell, originally from Bürglen, was a resident of the Canton of Uri (in what is now Switzerland), well known as an expert marksman with the crossbow. At the time, the Habsburg emperors of Austria were seeking to dominate Uri. Hermann Gessler, the newly appointed Austrian Vogt (the Holy Roman Empire’s title for “overlord”) of Altdorf, raised a pole in the village’s central square, hung his hat on top of it, and demanded that all the local townsfolk bow before the hat. When Tell passed by the hat without bowing, he was arrested; his punishment was being forced to shoot an apple off the head of his son, Walter– or else both would be executed. Tell was promised freedom if he succeeded.
As lore has it, Tell split the fruit with a single bolt from his crossbow. When Gessler queried him about the purpose of a second bolt in his quiver, Tell answered that if he had killed his son, he would have turned the crossbow on Gessler himself. Gessler became enraged at that comment, and had Tell bound and brought to his ship to be taken to his castle at Küssnacht. But when a storm broke on Lake Lucerne, Tell managed to escape. On land, he went to Küssnacht, and when Gessler arrived, Tell shot him with his crossbow.
Tell’s defiance of Gessler sparked a rebellion, in which Tell himself played a major part, leading to the formation of the Swiss Confederation.
Tell and his son (source)
“They said I was a valued customer, now they send me hate mail”*…
Is shopping therapy… or an occasion for therapy?…
… Throughout the coronavirus pandemic, videos of irate anti-maskers screaming, throwing things, and assaulting employees at big-box and grocery stores have become a social-media mainstay. As Americans return en masse to more types of in-person commerce, the situation only seems to be declining. At its most violent extreme, workers have been hospitalized or killed. Eight Trader Joe’s employees were injured in one such attack in New York, and in Georgia, a grocery-store cashier was shot over a mask dispute. Far more frequent are the accounts of short-fused shoppers becoming verbally abusive or otherwise degrading over slow service or sold-out goods. Earlier this month, a restaurant on Cape Cod reportedly was so overwhelmed with rude customers that it shut down for a “day of kindness.”
America’s ultra-tense political climate, together with the accumulated personal and economic traumas of the pandemic, have helped spur this animosity, which was already intense and common in the United States. But it’s hardly the only reason that much of the country has decided to take out its pandemic frustrations on the customer-service desk. For generations, American shoppers have been trained to be nightmares. The pandemic has shown just how desperately the consumer class clings to the feeling of being served.
The experience of buying a new television or a double cheeseburger in a store has gotten worse in your lifetime. It’s gotten worse for the people selling TVs and burgers too. The most immediate culprit is decades of cost-cutting; by increasing surveillance and pressure on workers during shifts, reducing their hours and benefits, and not replacing those who quit, executives can shine up a business’s balance sheet in a hurry. Sometimes, you can see these shifts happening in real time, as with pandemic-era QR-code-ordering in restaurants, which allows them to reduce staff—and which is likely to stick around. Wages and resources dwindle, and more expensive and experienced workers get replaced with fewer and more poorly trained new hires. When customers can’t find anyone to help them or have to wait too long in line, they take it out on whichever overburdened employee they eventually hunt down.
This dynamic is exacerbated by the fact that the United States has more service workers than ever before, doing more types of labor, spread thin across the economy—Uber drivers; day-care workers; hair stylists; call-center operators; DoorDash “dashers”; Instacart shoppers; home health aides; Amazon’s fleet of delivery people, with your cases of toilet paper and new pajamas in the trunk of their own car. In 2019, one in five American workers was employed in retail, food service, or hospitality; even more are now engaged in service work of some kind.
For people currently alive and shopping in America, this economic arrangement is so all-encompassing that it can feel like the natural order of things. But customer service as a concept is an invention of the past 150 years. At the dawn of the second Industrial Revolution, most people grew or made much of what they used themselves; the rest came from general stores or peddlers. But as the production of food and material goods centralized and rapidly expanded, commerce reached a scale that the country’s existing stores were ill-equipped to handle, according to the historian Susan Strasser, the author of Satisfaction Guaranteed: The Making of the American Mass Market. Manufacturers needed ways to distribute their newly enormous outputs and educate the public on the wonder of all their novel options. Americans, in short, had to be taught how to shop.
In this void grew department stores, the very first of which appeared in the United States in the 1820s. The model proliferated in cities as the 20th century neared and industrial manufacturing expanded. By consolidating sales under corporate auspices in much the same way that factories consolidated production, businesses such as Wanamaker’s, Macy’s, and Marshall Field’s hinted at the astonishing ways American life would change over the next century. But consolidation also created a public-image issue, argues the historian William Leach in Land of Desire: Merchants, Power, and the Rise of a New American Culture. Corporate power wasn’t especially popular in fin de siècle America, where strike-breaking industrial barons taught those without wealth to mistrust the ownership class. People were suspicious of new types of big business and protective of the small dry-goods stores run by members of their communities.
Department-store magnates alleviated these concerns by linking department stores to the public good. Retailers started inserting themselves into these communities as much as possible, Leach writes, turning their enormous stores into domains of urban civic life. They hosted free concerts and theatrical performances, offered free child care, displayed fine art, and housed restaurants, tearooms, Turkish baths, medical and dental services, banks, and post offices. They made splashy contributions to local charities and put on holiday parades and fireworks shows. This created the impression that patronizing their stores wouldn’t just be a practical transaction or an individual pleasure, but an act of benevolence toward the orderly society those stores supported.
With these goals in mind, Leach writes, customer service was born. For retailers’ tactics to be successful, consumers—or guests, as department stores of the era took to calling them—needed to feel appreciated and rewarded for their community-minded shopping sprees. So stores marshaled an army of workers: From 1870 to 1910, the number of service workers in the United States quintupled. It’s from this morass that “The customer is always right” emerged as the essential precept of American consumerism—service workers weren’t there just to ring up orders, as store clerks had done in the past. Instead, they were there to fuss and fawn, to bolster egos, to reassure wavering buyers, to make dreams come true. If a complaint arose, it was to be resolved quickly and with sincere apologies.
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The efforts that Leach identified among turn-of-the-century department-store owners to paint their businesses as the true sites of popular democracy have been successful beyond what they probably could have imagined at the time. Most Americans now expect corporations to take a stand on contentious social and political issues; in return, corporations have even co-opted some of the language of actual politics, encouraging consumers to “vote with their dollars” for the companies that market themselves on the values closest to their own.
For Americans in a socially isolating culture, living under an all but broken political system, the consumer realm is the place where many people can most consistently feel as though they are asserting their agency. Most people in the United States don’t exactly have a plethora of opportunities to develop meaningful identities outside their economic station: Creative or athletic pursuits are generally cut off when people enter the workforce, fewer people attend religious services than in generations past, and loneliness and alienation are widespread. Americans work long hours, and many of those with disposable income earn it through what the anthropologist David Graeber calls “bullshit jobs”—the kind of empty spreadsheet-and-conference-call labor whose lack of real purpose and meaning, Graeber theorizes, is an ambient psychological stressor on the people performing it. What these jobs do provide, though, is income, the use of which can feel sort of like an identity.
This is not a feature of a healthy society. Even before the pandemic pushed things to further extremes, the primacy of consumer identity made customer-service interactions particularly conflagratory…
“American Shoppers Are a Nightmare“– and as Amanda Mull (@amandamull) explains, customers were nearly this awful long before the pandemic.
* Sophie Kinsella, Confessions of a Shopaholic
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As we reconsider commerce, we might recall that it was on this date in 1939 that The Wizard of Oz premiered at the Strand Theater in Oconomowoc, Wisconsin– one of four Midwestern test screenings in advance of the Hollywood premier at Grauman’s Chinese Theater (on August 15).
Considered one the greats in the American film canon, it was of course based on the work of L. Frank Baum… who, before he created Dorothy and her adventures, was a retail pioneer. An accomplished window dresser (the equivalent at the turn of the 20th century of television commercial director), he founded and edited a magazine called The Show Window, later known as the Merchants Record and Show Window, which focused on store window displays, retail strategies, and visual merchandising; it’s still being published, now as VMSD.
“A town isn’t a town without a bookstore. It may call itself a town, but unless it’s got a bookstore, it knows it’s not foolin’ a soul.”*…
Behold, a behemoth…
Take a look at this graph. The blue is Amazon’s share of book sales in the past six years. The orange is where we are headed if their average growth rate (8%) continues. If nothing slows their momentum, Amazon will control nearly 80% of the consumer book market by the end of 2025. Every single book lover should worry. After we’re done worrying, we must change the way we buy books.
Books are a fundamental social good that have an outsized impact on our development, individually and collectively. They move us forward. They have been fundamental to our moral and social evolution, our inner lives, and our understanding of ourselves, others, and the world. What they give us is too precious to trust to a single entity for whom they are ultimately just a product, and whose algorithms value them only by the revenue and customers they bring in.
Popular books are so deeply discounted on Amazon that other bookstores have found it hard to compete. Why does Amazon sell books at prices so low they lose money? Cheap books are a loss-leader that devalue books to drive competitors out of business and help Amazon gain control of the market, leaving them with near-monopoly power.
What is lost if at the end of 2025, Amazon sells 80% of books in the US? If one mega-retailer has unprecedented control over what everyone reads?
For one thing, diversity. The vast majority of people will be reading the same top-selling books, as determined by Amazon. On Amazon, as The New York Times puts it, “Best Sellers Sell the Best Because They’re Best Sellers”. Amazon is algorithm driven; the books promoted by Amazon are the ones that are already selling well. That makes it very difficult for new authors to build audiences. It keeps lesser known, unconventional books from reaching the readers who would appreciate them. It narrows our national conversation down to a very fine point, and sands the edges off of human ideas and creativity. It excludes marginalized voices. It does to our culture what losing biodiversity does to our environment.
Authors and publishers need to worry. Once Amazon dominates 80% of the book market, who are authors working for? Authors will effectively be producing content for Amazon to sell on commission, and Amazon will have control over the terms. Everything we’ve seen from Amazon indicates that when they have leverage, they use it to squeeze the most profit for themselves at the expense of their partners.
Local bookstores are essential to a healthy culture around books. Independent bookshops are crucial for emerging authors, who find passionate advocates in the booksellers who hand-sell their books and can make their careers. They are where authors meet readers, where book clubs form, where children discover a love of reading, and where schools and businesses partner to increase the impact of worthy books. Every bookstore is an activist for the importance of books in our culture; they ar ethe fertile grounds where all kinds of wild narratives are nurtured and grow.
f Amazon succeeds in putting bookstores out of business, readership will decline and the importance of books in our culture will diminish. Books will not thrive without the advocacy, passion, and resourcefulness of our booksellers.
Booksellers are people so taken by the imagination and insights of books that they have dedicated their working lives to them. Only a very special person makes that choice, and independent bookstores are filled with remarkable people. People with enthusiasm and curiosity, who can press a new book into your hands that you would never have discovered otherwise. We need that humanity in the book market, not algorithms.
I created Bookshop.org, a public benefit corporation, to help independent bookstores compete for online sales. Bookshop.org has just hit a major milestone — in the past 16 months we’ve helped bookstores earn $15,000,000 in profit, providing a lifeline for many stores. We’ve made progress, capturing about 1% of Amazon’s book sales. But it’s not enough. We need to shore up the culture around books against the forces of consolidation and big business. We need to make this a movement…
“Every Book Lover Should Fear This Graph“; Andy Hunter (@AndyHunter777) reminds us to take our book buying where it matters.
Note that the effect of Amazon’s growing monopoly power on competition isn’t the only concern for readers…
You may own a Kindle full of books, but in reality, the only thing you truly own is the Kindle. Buried in the spaghetti code that is Amazon’s Kindle license agreement is the truth: your eBooks are not yours. You have a license agreement to view those books, and Amazon can revoke it at any time…
Technology Review
And of course, even as we support our local booksellers, we must also support our libraries, both local and global.
* Neil Gaiman, American Gods
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As we vote with our dollars, we might send historically-accurate birthday greetings to James MacGregor Burns; he was born on this date in 1918. A historian, political scientist, presidential biographer, and authority on leadership studies, received both the Pulitzer Prize and the National Book Award in History and Biography for his work on Franklin Delano Roosevelt, America’s 32nd president, Roosevelt: The Soldier of Freedom.
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