Quotulatiousness

July 14, 2024

When the Ontario Progressive Conservatives backed away from LCBO privatization

Filed under: Business, Cancon, Politics, Wine — Tags: , , , , , — Nicholas @ 03:00

In the National Post, Terence Corcoran posts an excerpt from last year’s The Harris Legacy: Reflections on a Transformational Premier edited by Alister Campbell:

“LCBO at Parkway Mall” by Xander Wu is licensed under CC BY-SA 4.0 .

Almost 30 years ago, in 1995, the Ontario Progressive Conservative government led by Mike Harris promised to privatize the Liquor Control Board of Ontario (LCBO). “We will sell off some assets, such as the LCBO,” said the party’s famed election document, the Common Sense Revolution (CSR). The LCBO could have been a true privatization — a full-fledged divestiture of a government monopoly into a new open and competitive market, but it never happened.

The failure to privatize the LCBO, lamentable from a consumer and economic perspective, remains a significant lost opportunity to demonstrate the benefits of privatization. If Harris had successfully de-monopolized the alcohol market, the whole concept of privatization would have been given a major boost. Instead, the government backed away from privatization of the alcohol market, preferring instead to allow the corporation to substitute modern marketing and retail razzle-dazzle to give the false impression it was offering the public the best of all worlds.

The LCBO failure is also a demonstration of the degree to which the Common Sense Revolution’s starting principles fell short in grasping the essential benefits of private versus public ownership and control. Neo-liberalism isn’t exactly a fine science. The Wikipedia entry on “Neo-liberalism” is a 30-page effort (including 400 footnote links to hundreds of warring academic papers), reflecting an economic and ideological scramble that dates back more than a century. But when the Harris government came to power, major elements of the free-market model were often overshadowed by fiscal policy objectives. With the LCBO, the Harris government veered off the neo-liberal course in pursuit of standard political objectives.

In 1995, the LCBO was a government owned and operated province-wide corporation that controlled liquor and wine wholesale and retail markets. Another private monopoly player, the Beer Store chain, while owned and operated by the brewing industry, was also essentially a government-sanctioned beer monopoly. The CSR neo-liberal objective should have been to privatize the alcohol market by selling the LCBO, deregulating the Beer Store monopoly and allowing beer sales through supermarkets and even corner stores. More importantly, dismantling the LCBO would allow other corporations to enter the alcohol retail business and provide consumers much more choice, which has been the Alberta experience. Notably, Alberta achieved a successful and deregulated approach without sacrificing provincial revenues.

The neo-liberal objective of privatization is to benefit consumers and enhance economic productivity through competition. Instead, the Harris government fell into the fiscal policy trap that routinely captures politicians, bureaucrats and corporate insiders. Instead of aiming to benefit consumers, the objective soon became how to maximize the fiscal return to government. Never mind the consumer and the market. The objective became preserving — and enhancing — government revenues.

At the time, anti-privatization advocates frantically pointed at the Alberta experience of privatization of their provincial liquor monopoly, which (briefly) generated a lot of retail horror stories that Ontario newspapers gleefully republished (and, likely, emphasized out of proportion to the actual Alberta market). You can still hear Ontarians casting aspersions on the Alberta market as if nothing at all had changed after the initial rough patch. From what I’ve heard from Albertans, they have far wider choices of alcoholic beverages in stores much more conveniently sited with better open hours than anyone in Ontario enjoys. The Alberta government still gets at least as much in tax revenues from alcohol sales without needing to be in the distribution or retail business. It doesn’t seem to be the utter disaster that Ontario media portrays it to be … rather the contrary.

June 30, 2024

The medieval salt trade in the Baltic

Filed under: Economics, Europe, Food, History — Tags: , , , , , , — Nicholas @ 03:00

In the long-awaited third part of his series on salt, Anton Howes discusses how the extremely low salt level of water in the Baltic Sea helped create a vast salt trade dominated by the merchant cities of the Hanseatic League:

The extent of the Hanseatic League in 1400.
Plate 28 of Professor G. Droysen’s Allgemeiner Historischer Handatlas, published by R. Andrée, 1886, via Wikimedia Commons.

It’s difficult to appreciate salt’s historical significance because it’s now so abundant. Societies used to worry about salt supplies — for preparing and preserving food — as a matter of basic survival. Now we use the vast majority of it for making chemicals or chucking on our roads to keep them from getting icy, while many salt-making plants don’t even operate at full capacity. Yet the story of how we came to achieve salt superabundance is a long and complicated one.

In Part I of this series we looked at salt as a kind of general-purpose technology for the improvement of food, as well as a major revenue-raiser for empires — especially when salt-producing coastal areas could dominate salt-less places inland. In Part II we then looked at a couple of places that were all the more interesting for being both coastal and remarkably salt-less: the coast of Bengal and the Baltic Sea. One was to be exploited by the English East India Company, which needlessly propped up a Bengalese salt industry at great human cost. The other, however, was to prove a more contested prize — and ultimately the place that catalysed the emergence of salt superabundance.

It’s worth a brief recap of where we left the Baltic. Whereas the ocean is on average 3.5% salt, along the Baltic coast it’s at just 0.3% or lower, which would require about twelve times as much time and fuel to produce a given quantity of salt. Although there are a few salt springs near the coast, they were nowhere near large enough to supply the whole region. So from the thirteenth century the Baltic’s salt largely came from the inland salt springs at Lüneburg, supplied via the cities of Lübeck and Hamburg downstream. These two cities had a common interest against the kingdom of Denmark, which controlled the straits between the North and Baltic seas, and created a coalition of trading cities that came to be known as the Hanseatic League. The League resoundingly defeated the Danes in the 1360s and 1430s so that their trade in salt — and the fish they preserved with it — could remain free.

But Lüneburg salt — and by extension the League itself — was soon to face competition.

Lüneburg could simply not keep up with the growth of Baltic demand, as the region’s population became larger and wealthier. And so more and more salt had to come from farther afield, from the Bay of Biscay off France’s western coast, as well as from Setúbal in Portugal and from southern Spain.1 This “bay salt” — originally referring to just the Bay of Bourgneuf, but then extended to the entire Bay of Biscay, and often to all Atlantic solar-evaporated salt — was made by the sun and the wind slowly evaporated the seawater from a series of shallow coastal pools, with the salt forming in coarse, large-grained pieces that were skimmed off the top. Bay salt, however, inevitably ended up mixed with some of the sand and dirt from the bottoms of the pools in which it was held, while the seawater was never filtered, meaning that the salt was often brown, green, grey or black depending on the skill of the person doing the skimming — only the most skilled could create a bay salt that was white. And it often still contained lots of other chemicals found in seawater, like magnesium chloride and sulphate, calcium carbonate and sulphate, potassium chloride and so on, known as bitterns.2

Bay or “black” salt, made with the heat of the sun, was thus of a lower quality than the white salt boiled and refined from inland salt springs or mined as rock. Its dirt discoloured and adulterated food. Its large grains meant it dissolved slowly and unevenly, slowing the rate at which it started to penetrate and preserve the meat and fish — an especially big problem in warmer climates where flesh spoiled quickly. And its bitterns gave it a bitter, gall taste, affecting the texture of the flesh too. Bay salt, thanks to the bitterns, would “draw forth oil and moisture, leading to dryness and hardness”, as well as consuming “the goodness or nutrimental part of the meat, as moisture, gravy, etc.”3 The resulting meat or fish was often left shrunken and tough, while bitterns also slowed the rate at which salt penetrated them too. Bay-salted meat or fish could often end up rotten inside.

But for all these downsides, bay salt required little labour and no fuel. Its main advantage was that it was extremely cheap — as little as half the price of white Lüneburg salt in the Baltic, despite having to be brought from so much farther away.4 Its taste and colour made it unsuitable for use in butter, cheese, or on the table, which was largely reserved for the more expensive white salts. But bay salt’s downsides in terms of preserving meat and fish could be partially offset by simply applying it in excessive quantities — every three barrels of herring, for example, required about a barrel of bay salt to be properly preserved.5

By 1400, Hanseatic merchants were importing bay salt to the Baltic in large and growing quantities, quickly outgrowing the traditional supplies. No other commodity was as necessary or popular: over 70% of the ships arriving to Reval (modern-day Tallinn in Estonia) in the late fifteenth century carried salt, most of it from France. But Hanseatic ships alone proved insufficient to meet the demand. The Danes, Swedes, and even the Hanseatic towns of the eastern Baltic, having so long been under the thumb of Lübeck’s monopoly over salt from Lüneburg, were increasingly happy to accept bay salt brought by ships from the Low Countries — modern-day Belgium and the Netherlands. Indeed, when these interloping Dutch ships were attacked by Lübeck in 1438, most of the rest of the Hanseatic League refused Lübeck’s call to arms. When even the Hanseatic-installed king of Denmark sided with the Dutch as well, Lübeck decided to back down and save face. The 1441 peace treaty allowed the Dutch into the Baltic on equal terms.6 Hanseatic hegemony in the Baltic was officially over.

The Dutch, by the 1440s, had thus gained a share of the carrying trade, exchanging Atlantic bay salt for the Baltic’s grain, timber, and various naval stores like hemp for rope and pitch for caulking. But this was just the beginning.

    1. Philippe Dollinger, The German Hansa, trans. D. S. Ault and S. H. Steinberg, The Emergence of International Business, 1200-1800 (Macmillan and Co Ltd, 1970), pp.219-220, 253-4.

    2. L. Gittins, “Salt, Salt Making, and the Rise of Cheshire”, Transactions of the Newcomen Society 75, no. 1 (January 2005), pp.139–59; L. G. M. Bass-Becking, “Historical Notes on Salt and Salt-Manufacture”, The Scientific Monthly 32, no. 5 (1931), pp.434–46; A. R. Bridbury, England and the Salt Trade in the Later Middle Ages (Clarendon Press, 1955), pp.46-52. Incidentally, some historians, like Jonathan I. Israel, Dutch Primacy in World Trade, 1585-1740 (Clarendon Press, 1989) p.223, note occasional reports of French bay salt having been worse than the Portuguese or Spanish due to its high magnesium content, “which imparted an unattractive, blackish colour”. This must be based on a misunderstanding, however, as the salts would have been identical other than in terms of the amount of dirt taken up with the salt from the pans. At certain points in the seventeenth century the French workers skimming the salt must simply have been relatively careless compared to those of Iberia.

    3. John Collins, Salt and fishery a discourse thereof (1682), pp.17, 54-5, 66-8.

    4. Bridbury, pp.94-7 for estimates.

    5. Karl-Gustaf Hildebrand, “Salt and Cloth in Swedish Economic History”, Scandinavian Economic History Review 2, no. 2 (1 July 1954), pp.81, 86, 91.

    6. For this section see: Dollinger, pp.194-5, 201, 236, 254, 300.

June 21, 2024

“Neoliberal ideology is antidemocratic at its very core. Its aim is to give free-reign over our societies to corporations, not citizens”

Filed under: Economics, Government, Liberty, Media, Politics — Tags: , , , , , , — Nicholas @ 03:00

Tim Worstall responds to a recent Medium essay by Julia Steinberger which illustrates that “neoliberal” has joined “fascist” as a generic term to indicate strong disapproval of a person, organization, or idea:

The idea that an adult woman can believe these things is just amazeballs. But here we are. A tweet from Julia Steinberger leads to her Medium essay about what’s wrong with the world.

An upheaval in 10 chapters:

    1. The cause. We know the climate crisis is brought to us by highly unequal and undemocratic economic systems.

Err, no? Emissions are emissions. 100 people emitting one tonne each is exactly the same as 1 person emitting 100 tonnes. Sure, it’s true that a more unequal society will have more people emitting those 100 tonne personal amounts. But a more equal society will have more people able to emit another 1 tonne each. For, more equality is by definition the movement of some of those assets of the richer to those poorer — the economic assets which either allow or do the emitting. Sure, Jim Ratcliffe’s £50,000 private jet flight emits more than my £100 Easyjet one. But if we take the £50k off Jim and give it to 500 folk like me then all 500 of us might spend the marginal income on an Easyjet flight each — which would be more emissions than Jim’s spending of the money.

It simply is not true that economic inequality is the heart, the core or the cause of climate change. It’s idiocy to think it is too.

Of course, we know what’s happening here. Climate Change is Bad, M’Kay? Which it is, obviously. Economic inequality is Bad, M’Kay? Well, there the evidence is a great deal more mixed but whatever. But in the minds of the stupid all bad things have the same cause. So, if inequality is bad, climate change is bad, then they must be the same thing because they’re Bad, M’Kay?

    2. The rise. The recent history of these economic systems, in the Americas and Eurasia, is dominated by the ascendance of neoliberal ideology.

Oh, that is good. Given that I am a neoliberal — a fully paid up one, Senior Fellow at the Adam Smith Institute and all — that’s very good. Given HS2, looming wealth taxation, the increased bite of idiot regulation and all that I can’t say that I see neoliberalism as winning right now but that might depend upon your starting point. If you’re a socialist — or an idiot but I repeat myself — you might well regard the plenitude of bananas in the supermarket as neoliberal. After all, that is something that socialism never did achieve.

    3. The threat. Neoliberal ideology is antidemocratic at its very core. Its aim is to give free-reign over our societies to corporations, not citizens.

And, well, you know, bollocks. The very beating heart of neoliberalism is that corporations need to be controlled and they’re best controlled by the citizens. In the form of free markets rather than voting on which bureaucrats get the gold plated pension, true. But neoliberals are between indifferent and actually against capitalist power. The whole nub of the idea is that markets do the job of controlling capitalists better than bureaucrats, politicians or, obviously, capitalists.

There’s not really any way for her thesis to survive after getting so much of the basics wrong, is there?

But just one more tidbit:

    Hayek and his neoliberal colleagues now needed another, antidemocratic way, to organise society. They didn’t want democracy, but they wanted some kind of self-maintaining organisation — by which they meant hierarchy. Organisation was supposed to be supplied by the market, and hierarchy by competition within markets. (It’s worth noting that neoliberals in the 1950s did not, although they should have, predict that unfettered markets lead to concentrations in monopolies or cartels. They would arguably disapprove of the vast corporations running our current economies, even though their market-above-democracy policies predictably brought them into being.)

Well, that wasn’t actually the last tidbit. But the idea that Friedman, Mises, Menger, Hayek and the rest didn’t worry about monopolies? Jesu C is really bouncin’ on that pogo stick right now. And then the idea that democracy will be better bulwark against monopolies than markets? Can you actually do backflips on a pogo stick?

June 14, 2024

QotD: European “megacorporations” in the east

Filed under: Asia, Britain, Europe, History, India, Quotations — Tags: , , , , , , — Nicholas @ 01:00

The great (and terrible) chartered trading companies offer a more promising historical parallel for the megacorporation, with much larger scope. The largest of these were the British East India Company (EIC, 1600-1874) and the Dutch East India Company (the Vereenigde Oostindische Compagnie or VOC, 1594-1800). The EIC at one point accounted for something close to half of the the world’s trade and the VOC at points had total or near-total monopolies on the trade of important and valuable spices. Both companies were absolutely massive and exercised direct, state-like authority over territory and people.

And the structure of these massive trading companies mirrors some of the elements of a megacorp. While both companies were, in theory, shipping companies, in practice they were massive vertically integrated conglomerates. Conquering the production areas (particularly India for the EIC and Java for the VOC), they essentially controlled the production chain from start to finish. That complete vertical integration meant that the companies also had to supply employees and colonial subjects, which in turn meant controlling trade and production in everything from food and clothes to weapons. Both companies had their own armies and fleets (the EIC boasted more than 25,000 company soldiers at its height, the VOC more than 10,000) and controlled and administered territory.

In short, they were the colonial Dutch and British governments for many millions of colonial subjects. For the people living in territory dominated by these companies, they really would have resembled the megacorps of speculative fiction, operating with effectively impunity and using their vast profits to field armies and navies capable of defeating local states and compelling them to follow the interests of the company (which remained profit-oriented).

(I feel the need to stop and note that “company rule” in India and even more so in the Dutch East Indies was brutally exploitative, living up to – and in many cases quite surpassing – the normal dystopian billing of science fiction megacorporations. At the same time, it seems equally worth noting that the shift to direct colonial rule by the state was not always much better.)

So in one sense, the speculative fiction megacorp has already existed, but in the other, the limits of these historical entities are informative too. First, it seems relevant that none of these companies were creatures of the markets, rather, they were created by state action – they were chartered companies, state monopolies, or both. These massive imperial trading companies (of which the EIC and VOC were the most successful, but not the only ones) were all created by their respective governments, armed with substantial privileges and typically given exclusive rights to certain trade – they were state-sanctioned monopolies (echoes of this also in the Japanese Zaibatsu state-sanctioned vertical monopolies; note that the Roman publicani [tax-farming “companies” of the middle and late Republic] were also state-sanctioned monopolies) whose monopolies were backed by state power to the point that their states (that is, Britain, the Dutch Republic, France and so on) would and did go to war to protect the trading rights of their monopoly trading companies.

Second, these megacorporations, far from being in a position to usurp the states that formed them (as fictional megacorporations often do), turn out to be extremely vulnerable to those states. The EIC was effectively nationalized by an act of parliament in 1858 (after the Indian Mutiny of 1857 discredited company rule in the eyes of the British government) and disbanded in 1874. The VOC was likewise nationalized by its parent government in 1796 and then dissolved in 1799. No effort was made by either company to resist being disbanded with any sort of force; it would have been a pointless gesture in any case. While the resources of the EIC were vast, the military capabilities of the British Empire were far greater. Moreover, the companies simply didn’t have the legitimacy to operate absent their state backing.

This is of course also true for the not-quite-megacorporations, like the great trusts of America’s gilded age (Standard Oil, U.S. Steel, etc.), or the Japanese zaibatsu or even modern super-sized corporate entities. Of the 10 largest companies in the world, four are straight up state-owned enterprises. Even for the private modern massive company, by and large when they try to fight their “home” state, they lose, or at least are badly damaged without seriously inconveniencing the far greater power of the state (just ask AT&T or Microsoft).

Bret Devereaux, “Fireside Friday: January 1, 2021”, A Collection of Unmitigated Pedantry, 2021-01-01.

June 9, 2024

QotD: The biological importance of salt to humans

Filed under: Britain, Food, History, Quotations — Tags: , , , — Nicholas @ 01:00

… regardless of whether it was used in agriculture, for preservation, or for cooking, salt was also essential. The human body is constantly losing salt through sweat, and to a certain extent urine, but it tries to keep the blood’s salt concentrations maintained at a certain level. So as the blood loses salt, the body also ejects water to adjust. Ironically, as you lose salt your body responds by drying you out. Without constantly replacing the salt in your body — which is only ever stored for a couple of days at a time — you will at first feel fatigued and a little breathless, but increasingly weak and debilitated, as though sapped of all energy. The slightest exertion would start to bring on cramps, then problems with your heart and lungs, as your body continually shed water. If these did not kill you — and they probably would — you would essentially die through desiccation. The process would be all the faster if you became ill, rendering even the slightest dehydrating fever or bout of diarrhoea utterly lethal.1

A population deprived of salt was thus one that was weaker and more prone to disease — and at a time when the vast majority of the economy’s energy supply came from the straining of muscle, both human and animal, that weakness in effect meant a severe energy shortage. Although the main fuels for muscle power were carb-heavy grains like wheat, rye, oats, and rice, the indispensable ingredient to getting the most out of these grains was salt — just as how nuclear power uses uranium as its fuel, but also requires a suitable neutron moderator. A population deprived of salt would quite literally be more lethargic and sluggish, making it less productive and poorer too.

Salt’s unique properties made it a serious tool of state. In 1633 king Charles I’s newly-appointed Lord Deputy for Ireland, Baron Wentworth, advised controlling its salt supply as a way to make the Irish utterly economically dependent on England. Given salt was “that which preserves and gives value to all their native staple commodities” — herrings, butter and beef — then “how can they depart from us without nakedness and beggary?” Salt would be a method of control, and a profitable one too, being “of so absolute necessity” that it could be sold to the Irish at inflated prices without much dampening demand: salt “must be had whether they will or no, and may at all times be raised in price”.2 Much like economists today, Wentworth saw revenue-raising potential in taxing goods with such unresponsive or “inelastic” demand.

Wentworth’s scheme to control the Irish never came to be. But a great many other countries did choose to tax it. Given a minimum amount of salt had to be consumed by absolutely everyone, monopolising its sale — and levying what was effectively a tax by inflating the price well above the costs of importing or producing it — could function as kind of indirect poll tax, levied more or less per head of both people and livestock, but without any of the administrative hassle of taking and maintaining an accurate census in order to impose such a tax directly.

When compared to other necessities like grain, salt did not need to be traded in especially large quantities either, meaning that its supply could be monopolised with relative ease. And it could not be produced everywhere. Salt tended to be lacking the further you got from the sea coast, unless there happened to be some relatively rare inland sources like salt lakes, brine springs, or rock salt mines. And it could even be lacking on the sea coast where it was either too humid or too cold to get salt cheaply by evaporating seawater using the sun, or where there was insufficient fuel for boiling the brine. These places were thus prone to being charged inflated prices, while the states that controlled places where the costs of production were low — in warmer and drier climes where the salty water of coastal marshes could cheaply be evaporated using only the heat of the summer sun — could extract especially large monopoly profits from the difference. The revenue from controlling solar salt thus became the basis of many kingdoms, some unusually powerful republics, and even empires.

Anton Howes, “The Second Soul”, Age of Invention, 2024-03-08.

    1. Roy Moxham, “Salt Starvation in British India: Consequences of High Salt Taxation in Bengal Presidency, 1765 to 1878”, Economic and Political Weekly 36, no. 25 (2001): p.2270–74.

    2. George O’Brien, The Economic History of Ireland in the Seventeenth Century (Maunsel and Company Limited, 1919), p.244, which has the transcription of Wentworth’s proposal

March 11, 2024

Google’s “wild success and monopolistic position has made it grow fat, lazy, and worst of all, stupid”

Filed under: Business, Media, Technology — Tags: , , , , , , , — Nicholas @ 03:00

Google has long been the 500lb gorilla in the room as far as search engine dominance is concerned, despite a significant and steady drop in the quality of the search results it returns. Niccolo Soldo suggests that Google has gotten fat and lazy in the interval since the release of its last huge success — Gmail — and the utter catastrophe of Gemini:

It’s become passé to complain about Google’s search engine these days, because it’s been horrible for years. We all recall its early era when its minimalist presentation effectively destroyed its competition overnight. Only us olds remember AltaVista‘s search engine, for example. So ubiquitous is its core function that the word “google” entered our lexicon.

Roughly 85-90% of the readers who have subscribed to this Substack have used a gmail address to do so. It’s a great product, although it could be better. Like many of you, I have several gmail addresses, and use email services from other providers like Protonmail. Gmail is incredibly easy to use, and works very well on all the devices that we operate on a daily basis.

Google is a tech behemoth, and is in a monopolistic position when it comes to both of these services. It has used this position to hoover up an insane amount of cash, taking a battering ram to many other businesses in the process, especially news media outlets that rely on advertising revenue. Yet it has not scored any big victories since its rollout of gmail all those years ago. Pirate Wires says that it hasn’t had to for some time … until now. The explosion of AI tech means that its core business is now at threat of extinction unless it can win the AI arms race. Its first foray into this war via its rollout of Gemini has been an absolute disaster. Mike Solana chalks it up to many factors, primarily the “culture of fear” that seems to permeate the tech giant.

The summary:

    Last week, following Google’s Gemini disaster, it quickly became clear the $1.7 trillion-dollar giant had bigger problems than its hotly anticipated generative AI tool erasing white people from human history. Separate from the mortifying clownishness of this specific and egregious breach of public trust, Gemini was obviously — at its absolute best — still grossly inferior to its largest competitors. This failure signaled, for the first time in Google’s life, real vulnerability to its core business, and terrified investors fled, shaving over $70 billion off the kraken’s market cap. Now, the industry is left with a startling question: how is it even possible for an initiative so important, at a company so dominant, to fail so completely?

The product rollout was so incredibly botched that mainstream media outlets friendly to Google (and its cash) are doing damage control on its behalf.

Gemini’s ultra-woke responses to requests quickly became a staple of social media postings.

Multiple issues:

    This is Google, an invincible search monopoly printing $80 billion a year in net income, sitting on something like $120 billion in cash, employing over 150,000 people, with close to 30,000 engineers. Could the story really be so simple as out-of-control DEI-brained management? To a certain extent, and on a few teams far more than most, this does appear to be true. But on closer examination it seems woke lunacy is only a symptom of the company’s far greater problems. First, Google is now facing the classic Innovator’s Dilemma, in which the development of a new and important technology well within its capability undermines its present business model. Second, and probably more importantly, nobody’s in charge.

It’s human nature to want to boil issues down to one single cause of factor, when it’s usually several all at once. We humans also have a strong tendency to zoom in on one factor when presented with many, mainly because the one that we focus on is something that we know and/or are passionate about.

Of course, Google’s engineers didn’t do this accidentally. They’ve been very intently observed by the most woke of all, the HR department:

As we all know, HR Departments are the Political Commissars of the Corporate West.

Stupid stuff:

    Before the pernicious or the insidious, we of course begin with the deeply, hilariously stupid: from screenshots I’ve obtained, an insistence engineers no longer use phrases like “build ninja” (cultural appropriation), “nuke the old cache” (military metaphor), “sanity check” (disparages mental illness), or “dummy variable” (disparages disabilities). One engineer was “strongly encouraged” to use one of 15 different crazed pronoun combinations on his corporate bio (including “zie/hir”, “ey/em”, “xe/xem”, and “ve/vir”), which he did against his wishes for fear of retribution. Per a January 9 email, the Greyglers, an affinity group for people over 40, is changing its name because not all people over 40 have gray hair, thus constituting lack of “inclusivity” (Google has hired an external consultant to rename the group). There’s no shortage of DEI groups, of course, or affinity groups, including any number of working groups populated by radical political zealots with whom product managers are meant to consult on new tools and products.

March 9, 2024

Salt – mundane, boring … and utterly essential

Filed under: Books, Economics, Food, Health, History — Tags: , , , , , , — Nicholas @ 05:00

In the latest Age of Invention newsletter, Anton Howes looks at the importance of salt in history:

There was a product in the seventeenth century that was universally considered a necessity as important as grain and fuel. Controlling the source of this product was one of the first priorities for many a military campaign, and sometimes even a motivation for starting a war. Improvements to the preparation and uses of this product would have increased population size and would have had a general and noticeable impact on people’s living standards. And this product underwent dramatic changes in the seventeenth and eighteenth centuries, becoming an obsession for many inventors and industrialists, while seemingly not featuring in many estimates of historical economic output or growth at all.

The product is salt.

Making salt does not seem, at first glance, all that interesting as an industry. Even ninety years ago, when salt was proportionately a much larger industry in terms of employment, consumption, and economic output, the author of a book on the history salt-making noted how a friend had advised keeping the word salt out of the title, “for people won’t believe it can ever have been important”.1 The bestselling Salt: A World History by Mark Kurlansky, published over twenty years ago, actively leaned into the idea that salt was boring, becoming so popular because it created such a surprisingly compelling narrative around an article that most people consider commonplace. (Kurlansky, it turns out, is behind essentially all of those one-word titles on the seemingly prosaic: cod, milk, paper, and even oysters).

But salt used to be important in a way that’s almost impossible to fully appreciate today.

Try to consider what life was like just a few hundred years ago, when food and drink alone accounted for 75-85% of the typical household’s spending — compared to just 10-15%, in much of the developed world today, and under 50% in all but a handful of even the very poorest countries. Anything that improved food and drink, even a little bit, was thus a very big deal. This might be said for all sorts of things — sugar, spices, herbs, new cooking methods — but salt was more like a general-purpose technology: something that enhances the natural flavours of all and any foods. Using salt, and using it well, is what makes all the difference to cooking, whether that’s judging the perfect amount for pasta water, or remembering to massage it into the turkey the night before Christmas. As chef Samin Nosrat puts it, “salt has a greater impact on flavour than any other ingredient. Learn to use it well, and food will taste good”. Or to quote the anonymous 1612 author of A Theological and Philosophical Treatise of the Nature and Goodness of Salt, salt is that which “gives all things their own true taste and perfect relish”. Salt is not just salty, like sugar is sweet or lemon is sour. Salt is the universal flavour enhancer, or as our 1612 author put it, “the seasoner of all things”.

Making food taste better was thus an especially big deal for people’s living standards, but I’ve never seen any attempt to chart salt’s historical effects on them. To put it in unsentimental economic terms, better access to salt effectively increased the productivity of agriculture — adding salt improved the eventual value of farmers’ and fishers’ produce — at a time when agriculture made up the vast majority of economic activity and employment. Before 1600, agriculture alone employed about two thirds of the English workforce, not to mention the millers, butchers, bakers, brewers and assorted others who transformed seeds into sustenance. Any improvements to the treatment or processing of food and drink would have been hugely significant — something difficult to fathom when agriculture accounts for barely 1% of economic activity in most developed economies today. (Where are all the innovative bakers in our history books?! They existed, but have been largely forgotten.)

And so far we’ve only mentioned salt’s direct effects on the tongue. It also increased the efficiency of agriculture by making food last longer. Properly salted flesh and fish could last for many months, sometimes even years. Salting reduced food waste — again consider just how much bigger a deal this used to be — and extended the range at which food could be transported, providing a whole host of other advantages. Salted provisions allowed sailors to cross oceans, cities to outlast sieges, and armies to go on longer campaigns. Salt’s preservative properties bordered on the necromantic: “it delivers dead bodies from corruption, and as a second soul enters into them and preserves them … from putrefaction, as the soul did when they were alive”.2

Because of salt’s preservative properties, many believed that salt had a crucial connection with life itself. The fluids associated with life — blood, sweat and tears — are all salty. And nowhere seemed to be more teeming with life as the open ocean. At a time when many believed in the spontaneous generation of many animals from inanimate matter, like mice from wheat or maggots from meat, this seemed a more convincing point. No house was said to generate as many rats as a ship passing over the salty sea, while no ship was said to have more rats than one whose cargo was salt.3 Salt seemed to have a kind of multiplying effect on life: something that could be applied not only to seasoning and preserving food, but to growing it.

Livestock, for example, were often fed salt: in Poland, thanks to the Wieliczka salt mines, great stones of salt lay all through the streets of Krakow and the surrounding villages so that “the cattle, passing to and fro, lick of those salt-stones”.4 Cheshire in north-west England, with salt springs at Nantwich, Middlewich and Northwich, has been known for at least half a millennium for its cheese: salt was an essential dietary supplement for the milch cows, also making it (less famously) one of the major production centres for England’s butter, too. In 1790s Bengal, where the East India Company monopolised salt and thereby suppressed its supply, one of the company’s own officials commented on the major effect this had on the region’s agricultural output: “I know nothing in which the rural economy of this country appears more defective than in the care and breed of cattle destined for tillage. Were the people able to give them a proper quantity of salt, they would … probably acquire greater strength and a larger size.”5 And to anyone keeping pigeons, great lumps of baked salt were placed in dovecotes to attract them and keep them coming back, while the dung of salt-eating pigeons, chickens, and other kept birds were considered excellent fertilisers.6

    1. Edward Hughes, Studies in Administration and Finance 1558 – 1825, with Special Reference to the History of Salt Taxation in England (Manchester University Press, 1934), p.2

    2. Anon., Theological and philosophical treatise of the nature and goodness of salt (1612), p.12

    3. Blaise de Vigenère (trans. Edward Stephens), A Discovrse of Fire and Salt, discovering many secret mysteries, as well philosophical, as theological (1649), p.161

    4. “A relation, concerning the Sal-Gemme-Mines in Poland”, Philosophical Transactions of the Royal Society of London 5, 61 (July 1670), p.2001

    5. Quoted in H. R. C. Wright, “Reforms in the Bengal Salt Monopoly, 1786-95”, Studies in Romanticism 1, no. 3 (1962), p.151

    6. Gervase Markam, Markhams farwell to husbandry or, The inriching of all sorts of barren and sterill grounds in our kingdome (1620), p.22

February 27, 2024

The Company that Broke Canada

Filed under: Business, Cancon, Economics, Government, History, Technology, USA — Tags: , , , , , , , — Nicholas @ 02:00

BobbyBroccoli
Published Nov 4, 2023

For a brief moment, Nortel Networks was on top of the world. Let’s enjoy that moment while we can. Part 1 of 2.

00:00 This is John Roth
02:04 The Elephant and the Mouse
12:47 Pa without Ma
26:27 Made in Amerada
42:15 Right Turns are Hard
57:43 Silicon Valley North
1:07:37 The Toronto Stock Explosion
(more…)

February 8, 2024

North American newspaper economics

Filed under: Business, Cancon, Economics, History, Media, Railways, USA — Tags: , , , , , — Nicholas @ 04:00

Tim Worstall discusses some of the issues ailing Canadian and American newspapers which are not easily solvable (government subsidies, as attempted in Canada, just turn the recipients into an underpaid PR branch of the governing party … not a good look in a democratic nation):

“Newseum newspaper headlines” by m01229 is licensed under CC BY 2.0 .

So, as a little corrective, a quick jaunt through what actually ails American journalism. The concentration is upon the big newspapers because that’s where the problem is worst. The conclusion is that it’s gonna get a lot, lot, lot, worse too. Because the industry is facing a base economic problem that it’s not willing to actually face up to. Or, at least, all the journalists writing about it aren’t — there’s the occasional sign that some of the business side of the equation grasp it.

[…]

Before Y2K American newspapers were segmented along geographic lines. The size of the country, the lack of a long distance passenger railroad network, meant that this was just so. If you’re printing a daily paper then you’ve got to deliver it daily. On the day it’s meant to refer to as well. If Chicago is 1,100 miles (no, I’ve not looked it up but that’s within an order of magnitude of being right, which is better than many newspapers manage with numbers) from New Orleans then the same newspaper is going to find it difficult to print and deliver to both markets. Add in the fact that trains take a week to traverse that distance, passenger trains – anyone who has ever travelled Amtrak will say it feels that long at least — included.

You could not and therefore did not have national newspaper (USA Today, with satellite printing plants, was an attempt to deal with this and slightly earlier than our cut off date but doesn’t change the basic story) distributions. What you had was a series of local and regional monopolies. Each one centred on a large population centre and serving the area around it that could be reasonably reached by truck overnight. Chicago and Cincinnati, not 1,100 miles away from each other, did have entirely different newspapers.

By contrast, and just as an example, the British newspaper market was national from pre-WWI. We simply did have overnight at worst passenger rail that covered the country. Partly it’s a much, much, smaller place, partly the passenger rail system was just different. So, printing overnight (and some maintained separate Scottish editions and plants) meant that those papers that came off the press in London at 8pm were on sale in Glasgow at 8 am, those that came off the press in London at 4 am were on sale in London at 8am. That’s not exact but it’s a good enough pencil sketch.

Cincinnati newspaper(s) served Cincinnati. Chicago, Chicago and New Orleans the area of New Orleans. There simply wasn’t a “national press” in the US in that British sense.

OK. But this also meant that American newspapers were much more like a monopoly in their local area than anything else. Network effects still exist even before computer networks after all. The most important of which was the classifieds.

As with Facebook, we’re all on Facebook because everyone else is on Facebook. So, if we’re to join a social network we’re going to be on Facebook where everyone else is — except those three hipsters who are where it isn’t cool yet. This applies to classifieds sections. Folk advertise in the one with the most readers, the widest market. Readers buy the one with the most ads in it, the widest market. You advertise the bronzed baby shoes, unused, where there are the most people looking for bronzed baby shoes, unused.

So, the dominant paper will suck up the classifieds in any particular market. Classifieds, fairly obviously back in the days of prams, cheap used cars, waiters’ jobs and so on being geographically based.

No, this is important. A useful pencil sketch of American newspaper revenues pre-Y2K was that subscriptions produced some one third of revenues. They also, around and about, covered print costs and distribution. They were, roughly you understand, about a face wash in fact.

Display ads produced another one third and classifieds the final one third. Classifieds were also wildly profitable — no expensive journalists to pay, no bureaux, just a few women waiting to get married on the end of the phone line.

January 20, 2024

The British Empire would have failed a proper cost-benefit analysis

Filed under: Africa, Asia, Britain, Economics, History, India — Tags: , , , , — Nicholas @ 05:00

At the Institute of Economic Affairs, Kristian Niemietz is working on a paper on the economics of empire that, as he shows in this article, indicates that the empire was never a winning economic proposition for Britain as a whole, no matter how well certain well-connected individuals and companies benefitted:

The British Empire in 1914 (via antiquaprintgallery.com)

But is it actually true that imperialism makes countries richer? Does imperialism make economic sense?

This question was already hotly debated at the heyday of imperialism. Adam Smith believed that the British Empire would not pass a cost-benefit test:

    The pretended purpose of it was to encourage the manufactures, and to increase the commerce of Great Britain. But its real effect has been to raise the rate of mercantile profit, and to enable our merchants to turn into a branch of trade, of which the returns are more slow and distant than those of the greater part of other trades, a greater proportion of their capital than they otherwise would have done […]

    Great Britain derives nothing but loss from the dominion which she assumes over her colonies.

He believed that Britain would be better off if it dissolved its Empire:

    Great Britain would not only be immediately freed from the whole annual expense of the peace establishment of the colonies, but might settle with them such a treaty of commerce as would effectually secure to her a free trade, more advantageous to the great body of the people, though less so to the merchants, than the monopoly which she at present enjoys.

The liberal free-trade campaigner Richard Cobden agreed:

    [O]ur naval force, on the West India station […], amounted to 29 vessels, carrying 474 guns, to protect a commerce just exceeding two millions per annum. This is not all. A considerable military force is kept up in those islands […]

    Add to which, our civil expenditure, and the charges at the Colonial Office […]; and we find […] that our whole expenditure, in governing and protecting the trade of those islands, exceeds, considerably, the total amount of their imports of our produce and manufactures.

If imperialism was a loss-making activity – why did Britain and other European colonial empires engage in it for so long?

Smith and Cobden explained it in terms of clientele politics (or Public Choice Economics, as we would say today). Somebody obviously benefited, even if the nation as a whole did not. And the beneficiaries were politically better organised than those who footed the bill.

This proto-Public Choice case against imperialism was not limited to political liberals. Otto von Bismarck, the Minister President of Prussia and future Chancellor of the German Empire, hated liberals in the Smith-Cobden tradition, but he rejected colonialism in terms that almost make him sound like one of them:

    The supposed benefits of colonies for the trade and industry of the mother country are, for the most part, illusory. The costs involved in founding, supporting and especially maintaining colonies […] very often exceed the benefits that the mother country derives from them, quite apart from the fact that it is difficult to justify imposing a considerable tax burden on the whole nation for the benefit of individual branches of trade and industry [translation mine].

In his writing about the economics of imperialism, even Michael Parenti, a Marxist-Leninist political scientist (who is, for obvious reasons, popular among Twitter hipsters), sounds almost like a Public Choice economist:

    [E]mpires are not losing propositions for everyone. […] [T]he people who reap the benefits are not the same ones who foot the bill. […]

    The transnationals monopolize the private returns of empire while carrying little, if any, of the public cost. The expenditures needed […] are paid […] by the taxpayers.

    So it was with the British empire in India, the costs of which […] far exceeded what came back into the British treasury. […]

    [T]here is nothing irrational about spending three dollars of public money to protect one dollar of private investment – at least not from the perspective of the investors.”

This leads us to a curious situation. Today’s woke progressives disagree with their comrade Parenti on the economics of empire, but they do agree with Britain’s old imperialists, who argued that the Empire was vital for Britain’s prosperity.

November 26, 2023

Ontario’s beer market may see radical changes soon

Filed under: Business, Cancon, Government, Wine — Tags: , , , , , — Nicholas @ 03:00

For beer drinkers outside Ontario, the province’s weird beer retailing rules may seem to be from a different time, but that’s only because they are. Until fairly recently, the only place to buy beer was from one of two quasi-monopoly entities: the provincially owned and operated LCBO or the foreign brewery owned Beer Store. LCBO outlets were limited to single containers and six-packs, while Beer Stores sold larger multipacks and also handled bottle deposits and returns. In the last few weeks, the Ontario government has indicated that long overdue changes are coming:

“The Beer Store” by Like_the_Grand_Canyon is licensed under CC BY-NC 2.0

The only thing we really know at this point (and it’s been reported by the Toronto Star and now CBC, and earlier by this website, all from sources) is the horribly unfair deal The Beer Store has had since 1927 in Ontario is about to come to an end. It’s expected that The Beer Store will be given notice by the end of December under the Master Framework Agreement (MFA) that the deal will be all but dead. They will have two years to wrap things up while a more modern system of booze retailing is fine-tuned and prepared for implementation. There’s a new era dawning in Ontario, one that would seemingly benefit grocery and convenience stores, local brewers, Ontario wineries, and obviously consumers who will get wider selection, more convenience and competitive pricing.

“The MFA has never been about choice, convenience or prices for customers, it has always been about serving the interests of the big brewing conglomerates, and that’s what needs to be addressed,” Michelle Wasylyshen, spokesperson for the Retail Council of Canada, whose board of directors includes members from Loblaw, Sobeys, Metro, Walmart, and Costco, told Mike Crawley of the CBC.

The end of The Beer Store MFA in whatever iteration it will look like will have a cascading impact on local VQA wine. Ontario wineries hope that it’s a positive impact and are cautiously optimistic that wide open beer and wine sales at grocery and convenience stores means more sales and less levies for their products.

As the CBC pointed out in its story, the looming reforms “pit a range of interests against each other, as big supermarket companies, convenience store chains, the giant beer and wine producers, craft brewers and small wineries all vie for the best deal possible when Ontario’s almost $10-billion-a-year retail landscape shifts. And — this is a biggie — the LCBO lobbying efforts to keep its antiquated system of monopoly retailing intact, which seems to be a big ask with what we now know from sources. Something must give.

Some key bullet points from the CBC report:

  • Will the government shrink the LCBO’s profit margins, including its take from products that other retailers sell?
  • Will retailers such as grocery and convenience stores be required to devote a certain amount of shelf space to Ontario-made beer and wine, or will they have total control over the inventory they stock?
  • Will small Ontario wineries get any help in competing against big Ontario wineries whose products can contain as much as 75% imported wine?

The government has been listening to all stakeholders in the booze industry in Ontario for over a year now. Three key associations — Ontario Craft Wineries, Tourism Partnership Niagara, and Wine Growers Ontario — joined together to commission a report titled Uncork Ontario. That report, which concludes that the Ontario wine sector is well positioned to drive sustainable economic growth for the region, the province, and the country and has the potential to drive at least $8 billion in additional real GDP over the next 25 years, launched a campaign to lobby the government for radical changes to reach those lofty goals, or at least put the wheels in motion.

One of the big issues for Ontario wineries is a punishing 6.1% “sin” tax charged on every wine made in Ontario but not foreign wines. It’s a tax that’s been hurting Ontario wineries for years even though a grant was issued to wineries to help pay that tax back. To this date, the tax has not been cancelled and wineries keep remitting the tax owed monthly and can only hope the grant keeps getting extended. Ontario wines are among the highest taxed in the world with up to 73% of every bottle sold going to taxes and severe levies at the LCBO.

August 23, 2023

QotD: “Megacorporations” of the Roman era

Filed under: Bureaucracy, Government, History, Quotations — Tags: , , , , — Nicholas @ 01:00

The definition of a megacorp differs a bit, work to work. They are, of course, megacorporations in the literal sense; massive, vertically integrated companies that often have monopolistic control over multiple markets. But more fundamental to the definition of the megacorp is that they typically employ their own armed forces and either enforce their own law or are at least able to ignore the law more generally. It is not enough for a company to be big, it has to generate the sort of wealth to which M. Licinius Crassus famously quipped “no one was truly rich who could not support an army at his own expense” (Plut. Cras. 2.7).

Which is to say that what really defines a megacorporation is that it trespasses into domains usually occupied by the state: military, police and judicial functions – the use of force. A megacorporation is, simply put, a corporation so large and powerful that it begins to act as a state, be that in the form of the private armies of Cyberpunk 2077, the privatized police force of the Robocop franchise, or the straight-up corporate governments of Stellaris (which in turn channel things like the Spacer’s Guild or the Ferengi Alliance) And that is core to the generally dystopian leaning of megacorporations – they are meant to reflect capitalism and corporate empire building taken to an extreme, to the point where it has swallowed the entire rest of the society.

Taking that definition to history, we can actually see a fair number of megacorporations; they are by no means common, but they do exist. Going very far back, the Roman societates (lit: “fellowships”, but “business association” or “company” is an accurate enough rendering) of the publicani (businessmen who filled public contracts) exercised close to this sort of power in some of Rome’s early provinces. During the Middle and Late Roman Republic, the job of extracting tax revenue from the provinces was too administratively complex for the limited machinery of the Republic, so instead the senate directed the censors to auction the right to collect taxes. Groups of Roman businessmen (and often silent patrician partners) would group resources together to bid for the right to collect taxes from a province – any taxes they took in excess of that figure would be their profit.

These companies could be very large indeed. For instance, parts of the lex portorii Asiae (the customs laws for the Roman province of Asia) survive and include regulations for the relevant company including a slew of customs houses and guard posts (the law is incomplete, but mentions more than 30 collection points – all major ports – to which would also need to be added posts along the land routes into the province). From other evidence we know that the staff at customs posts included armed guards along with the expected tax collectors and bookkeepers. And we know that publicani were sometimes delegated local or Roman forces to do their work (e.g. Cic. Ad Att. 114, using Shackleton Bailey’s numbering). They also maintained the closest thing the Roman Republic had to a postal service (Cic. Ad Att. 108). It’s not clear exactly how many employees one of the larger tax collection companies might have had (and those for the province of Asia – equivalent to the west coast of Anatolia – would have been some of the largest), but it was clearly considerable, as were the sums of money involved.

To the cities and towns of a province, such Roman companies must have seemed like megacorporations, especially if they were in with the governor (which they generally were) and thus could call down the forces of Rome on recalcitrant taxpayers. And we certainly know that these publicani often collected substantially far more than was due to them under the law (the reason why “tax collector” and “sinner” seem to be nearly synonymous in the New Testament, a fact that gave Ernst Badian’s study of them, Publicans and Sinners, its title). At the same time, we see the clear limitations too: such companies were clearly subservient to the governor and to the Roman state. Administrative changes beginning under Julius Caesar and brought to completion under Augustus did away with some of the largest tax contracts and the influence of the societates publicanorum with them.

Bret Devereaux, “Fireside Friday: January 1, 2021”, A Collection of Unmitigated Pedantry, 2021-01-01.

June 12, 2023

“The more recent four or five years at Indigo have been a disastrophe”

Filed under: Books, Business, Cancon — Tags: , , , , — Nicholas @ 03:00

In the latest SHuSH newsletter, Ken Whyte outlines the rise and fall of Canada’s biggest bookstore chain that stopped trying to be a bookstore chain and now appears to be looking for a new identity to assume in the wake of several board resignations and the announced resignation of Heather Reisman, the founder and public face of the chain:

“Indigo Books and Music” by Open Grid Scheduler / Grid Engine is licensed under CC0 1.0

Indigo opened its first bookstore in Burlington in 1997 and quickly expanded across the country in competition with the Chapters chain, which it bought in 2001. Heather’s husband, Gerry Schwartz, provided much of the financing in these years. Gerry is the controlling shareholder of Onex, a private equity firm that now has about $50 billion in assets under management.

Influential in Ottawa, the Schwartz-Reismans managed to convince the federal government to approve Indigo’s purchase of Chapters and also keep the US book chain Borders from moving north into Canada — a double play that cleared the field of meaningful competition and wouldn’t have happened in a country with serious antitrust enforcement.

Heather, as Indigo CEO, cast herself as the queen of Canadian literature, making personal selections of books to her customers, hosting book launches, interviewing celebrity authors, etc.

From a financial perspective, Indigo took about five years to get rolling after the Chapters acquisition. It looked steady through the late aughts and into the teens when Amazon showed up in force. Indigo’s share price caved. Unable to convince Ottawa to push Amazon back across the border, Heather adopted a new strategy, backing out of books and recasting Indigo as a general merchandiser selling cheeseboards, candles, blankets, and a lot of other crap to thirtyish women. “We built a wonderful connection with our customers in the book business,” she famously said. “Then, organically, certain products became less relevant and others were opportunities.” This charmed investors, if not the book community, and Indigo’s share price hit a high of $20 a share in 2018. By then, books, as a share of revenue, had fallen from 80 percent of revenue to below 60 percent (they are now 46 percent).

The more recent four or five years at Indigo have been a disastrophe. With its eighty-eight superstores and eighty-five small-format stores, the company lost $37 million in 2019, $185 million in 2020, and $57 million in 2021. Things looked somewhat better in 2022 with a $3 million profit, but its first three quarters of 2023 (Indigo has a March 28 year-end) resulted in an $8 million loss and its fourth quarter featured one of the most spectacular cyberhacks in Canadian commercial history. The company’s website was breached and its employment records held for ransom, resulting in a ten-day blackout for all of the company’s payment systems and a month-long outage in online sales. The share price is now $2.00 or one tenth the 2018 high.

ANALYSIS AND IRRESPONSIBLE SPECULATION

Given everything Indigo has been through over the last several years, and especially the last several months, it’s not surprising that Heather wants to pack it in. She’s seventy-four and super wealthy. There’s nothing but a desperately hard slog ahead for her money-losing company. Why stay?

Still, this has the feel of something that blew up at a board meeting, or in advance of a board meeting. It’s highly irregular for a company to lose almost half its directors in a single day. If these changes had been approached in conventional fashion, there would have been more in the way of messaging and positioning, especially regarding Heather. For all intents and purposes, she is Indigo. It wouldn’t exist without her. They ought to be throwing her a retirement parade and presenting her with a golden cheeseboard. Instead, all she’s getting, for now, are a few cliches in a terse press release.

It’s also weird that this all happened days before we get the company’s year-end results (they were out by this time last year). My guess is that the board got a preview, that the picture is ugly, that there are big changes afoot, and that the directors were nudged out as the start of a major retrenchment or given the option of sticking around for a bloodbath and chose instead to exit.

May 1, 2023

Britain’s first embassy to India

Filed under: Britain, Business, History, India — Tags: , , , , , — Nicholas @ 05:00

In The Critic, C.C. Corn reviews Courting India: England, Mughal India and the Origins of Empire by Nandini Das, a look at the first, halting steps of the East India Company at the court of the Mughal Emperor Jahangir early in the seventeenth century:

The late Sir Christopher Meyer, the closest thing modern British diplomacy has produced to a public figure, enjoyed comparing his trade to prostitution. Both are ancient trades, and neither enjoys a wholly favourable reputation. Any modern diplomat will discreetly confirm that the profession is far from the anodyne, flag-emoji civility and coyly embarrassed glamour they project on Twitter.

Whilst none of our modern representatives are working in quite the same conditions as their predecessor Sir Thomas Roe, they may well find uncanny parallels with his unfortunate mission.

The fledgling and precarious East India Company, founded in 1600, had sent representatives to the Mughal court before, but they were mere merchants and messengers. The stern rebuff they received called for a formal representative of the King.

After the company persuaded James I of the necessity, Thomas Roe (a well-connected MP, friend to John Donne and Ben Jonson, and already an experienced traveller after an attempt to reach the legendary El Dorado) was dispatched to the court of Mughal Emperor Jahangir in 1615. He remained there until 1619, in an embassy that the cultural historian, Nandini Das, describes in Courting India as “infuriatingly unproductive”.

The company kept rigorous records, and Roe meticulously kept a daily diary. Professor Das uses these and the reports of other English travellers to narrate Roe’s journey, as well as contemporary literature and, more importantly, their Indian equivalents. It is not so much the diplomatic success that fascinates Das about Roe’s embassy, but the mindset of the early modern encounter between England and India.

In a boom time for histories of British colonialism, this is an intelligent and gripping book with a thoughtful awareness of human relationships and frailties, and a model approach to early modern cross-cultural encounters.

The privations suffered by Roe’s embassy are striking. Only three in ten people had a chance of coming home alive from the voyage to India. Das’s recreation of the journey out is as intense and claustrophobic as Das Boot, with rotten medicine, cruel maritime punishments and untrained boys acting as surgeons. Dead bodies onboard would have their toes gnawed off by rats within hours.

In India, the English sailors excelled themselves as uncouth Brits abroad: drinking, fighting and baiting local customs, such as killing a calf. A chaplain was notorious for “drunkenly dodging brothel-keepers and engaging in half-naked brawls”. For most of his time, Roe — seeking to keep costs down — lived with merchants and factors already in India, in a cramped, filthy, dangerous house.

April 30, 2023

David Howarth’s history of the East India Company

Filed under: Books, Britain, Europe, History, India — Tags: , , , , , , — Nicholas @ 05:00

Robert Lyman reviews David Howarth’s recent work Adventurers: The Improbable Rise of the East India Company:

It is the human detail of the EIC and the ultimate triumph of its trading endeavours despite the best efforts of Portugal, the Dutch Republic and of the vicissitudes of Neptune that holds great fascination for me, and which is the triumph of Howarth’s intimate and intricate portrayal of the EIC in the first century of its existence. His great achievement is both to bring the dusty tomes of the Company back to life, not just to humanise one of the greatest trading ventures of all of human history, but to interpret the early years of the Company (his book spans 1600 to 1688, though most of the narrative is pre-1650) as a peculiarly human rather than an institutional endeavour. Is this important? Yes. Humans have agency; institutions consume or act upon the determining agency of human beings, not the other way around. Too much of modern (post 1880) history is based upon determining the perspective of organisations and movements (as interpreted by later historians, many with their own ideological baggage) rather than of actual, real live people making decisions for themselves in the peculiar and particular context of their lives and times.

The means through which Howarth paints his story is by the decisions, actions and activities of actual people, some influential decision-makers and many others who were not, all of which makes up a remarkably vivid tapestry of human intercourse. Each chapter, for instance, is constructed around a person or group of people. One powerfully tells the story of the men of the Peppercorn, an EIC East Indiaman, as it seeks out the riches of a world on the extreme periphery of the consciousness of most Europeans. The ultimate triumph of European expansion into Asia is not difficult to comprehend. Europe was pursuing an adventure, aggressively, relentlessly and determinedly, to bring the riches of the world back to its own shores. At no time did the Chinese, Japanese, Indians or inhabitants of the Spice Islands return the favour. The energetic persistence of Sir Thomas Roe, for instance, the Company’s ambassador to the Mughal court (1615-1619), is easily compared to the intellectual (and alcoholic) indolence of the Great Mughal with whom Roe was attempting to interact. Roe was there, in India: Europeans were interested in the “East” and with travelling to the other side of the world for purposes of human engagement, adventure, patriotism and, yes, greed and selfish self-interest. The Great Mughal, by contrast, was also driven by greed and self-interest, but he just wasn’t interested in exploring. He certainly wasn’t interested in Europe. He was already, in his view, at the top of the human tree and had no need for either the ideas or the money of the red-haired barbarians who came from across the sea, a sea that incidentally few Mughal emperors had (amazingly) ever even seen. Fascinatingly, the Mughal shared with King James I an abhorrence with “trade”, though James knew he needed grubby merchants like Sir John Lyman [the reviewer’s ancestor] as they gave him coin. It wasn’t just about the merchants: Kings and governments needed the money that the merchants delivered by the bucket load because they couldn’t create it themselves. Howarth astutely observes that the “EIC belonged to the globe of politics as much as it did to the sphere of commerce”. Indeed, something of a symbiosis between the two in Tudor and Stewart England created a sense of nationhood – in the face of the resistance of others, in Europe and further afield – for the first time. The Mughal Empire was ultimately swallowed up as a result of a dynamism by European politicians and merchants working in unison which it never bothered to replicate by undergoing the reverse journey.

And power? No. Howarth is remarkably clear that the primary task of the EIC was to make money, not to accrue territory, create power in foreign territories or aggrandise native populations. The role of the executive arm of the EIC (its ships, sailors and factors) was to make money for its investors, many of whom were the very merchant adventurers in the little ships travelling east over vast oceans. The great game of mercantile expansion took place because those who had most to lose were also sailing the ships, negotiating with foreign emissaries, fighting the Portuguese and the Dutch and placing their lives on the line. Amazingly, in 1570 England had only 58,000 tons of marine tonnage compared with Spain’s 300,000, and was very definitely the minnow in the rush to conquer the seas. The men who built and sailed its boats came from a long way behind, and yet in time were to build a seagoing commercial empire which more than rivalled all its competition. Its early growth was fuelled by the wealth provided by spice rather than slaves and, in contradistinction to what some modern historical moralists are keen to tell us, by a “reluctance to use violence and vigilance to avoid land commitments”. Indeed, unlike that of the Dutch, and despite what one might assume if we were to read the British national anthem back into history, “expansion in England happened with no appeal whatever to national glory”.

The amazing thing about the EIC was just how chaotic and disorganised it was. There was nothing inevitable about its rise as a monolithic mercantile overlord destined for instance, in the due course of time, to rule India. Second guessing history is only possible for historians able to look backwards and identify trends and features, convictions that didn’t exist for those when history was happening trying to make their way through the fog of an uncertain and troublesome future. The EIC proved simply to be better organised than the Portuguese, and not distracted as the Dutch were in their long war against Spain. Luck and serendipity played as much a role on the eventual survival of the EIC as did its ability to raise massive amounts of money from venturers in England (every raise or round of financing was heavily over-subscribed) for its adventures and to recruit adventurers to take its ships to sea. The EIC was phenomenally successful in raising voluntary capital to fund its ventures relative to other European states. By comparison, “although Iberian barns might have looked well built and better stocked, once they were given a good kick the rusted hinges flew off”.

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