209: Ex Machina: Corporations and Canals


Live which you sound only serves comes from destruction disorder and chaos. Take this empty glad here. It is peaceful. Seraing boring. But if it is. Destroyed. All these little things. So busy now fluid useful. What a lovely ballet, Hugh, so full of forming color. Who? Holy avoid to us. All welcome to special double stuffed addition of critical path X, mocking your host as always Ason co founder and editor Horace, did you? You can also find Horace over at the micro mobility podcast with our at all Bruce. I'm Joe Rubin. Filling in for Anders Brown worth who's running five K today. Horace houria. Well, I usually tell people where I am. When I start these things because I'm usually the different place. Are you allowed to disclose your location? I am I am indeed. I may not be very specific. But I'll last time. I let it slip that I was in vol- the rudder near Lowell Massachusetts, which has been about a week since we spoke last I'm in in Spain in a seaside town. Well, let me give you coordinates on the Mediterranean side. And it's south of Alicante and north of Carta Hanya are you on the water? I'm a few hundred meters from the water. So I'm starting company. I wanted to see it. Maybe you want it to get involved. Is it fair to say that if the weather's nice the sun's app their ton of people who rushed to the beach there are there people with all kinds of devices. Yes. Oh, excellent. So my idea is a shared surfboard service. So you just jump in the water, grabs her Ford hang ten, and when you're done just leave it in the ocean. That's pretty good. I would I would modified slightly by saying probably it's better off if it was on land because in the sea it'll probably right with planets. Yeah. But in the end up being pushed somewhere else in you know, in the things move, but that's how will expand. But they might end up in acceptable places. I would think not a bad idea. You know, you could've veggie PS into a surfboard. And of course, people have been lugging these things around forever. Cars and things ideas here. Totally totally last week. We were talking about company cats, and how many weeks that we all have the world, we're all assimilated into one. And I got an interesting note from a very shy listener about the city of London, not London woman, but the city of London we're corporations get seventy five percent of the votes to at least in some parts of the world. We're already being absorbed by corporations in. Nobody seems to want probably the role that you're citing for the city of London which is indeed not London. That's the current. It's a different entity that the current mayor. But those rules are probably ancient rules, and we're we're put together hundreds of years ago. I would love to see when that happened. But what's interesting what I think we should actually touch on while we're on the subject of corporate entity as a as a potential legal entity in the voting entity and. There you mentioning one thing came to mind as you were saying that there are places in the world where they're more corporations than people. So I think it was lifted Stein. There are more registered companies than residents and their certain cities in the world. I think Switzerland, which is a town small town in Switzerland. Again, having more companies have not corporations registered than people. Now. What's interesting is? Why do we have so many corporations are literally millions of them worldwide? And the, you know, there many tens of thousands. They're publicly traded, but these aren't all corporations we have corporations that are privately held, and they're published much about themselves. Do not have a a ticker symbol that you can read their financial reports and see what's going on there. Just there just private companies. Just like, you might have your mom and pop store, which is a company, but not a corporation. That's -sarily. So what is corporation and the construct? It's an idea that has an implementation. In law, and it was created by the Dutch yet the Dutcher very very important in terms of their. Innovations in the world of finance and the Dutch came up with the idea of corporation. There's somewhere where you can find the origin. Noel copy copy of Shiva ticket of the curse company corporation that was ever created. They go soon, but that the stock exchange which where you could trade these shares now the concept behind a corporation. It was something called, limited liability. And so the idea was that the core of the corporation that owner or owners of accompany worse viable. Yeah. So if you if you were were the company was was bankrupt and owed money that person could go to jail Cristobal, but also could go and have to pay off this debt for the rest of their lives and many times it was it was a burden placed on the family after they died, and so on and so on it was very very onerous thing. And so was there actually in the twelve hundreds. Well, no, bankruptcy protection. Of course, you could go out of business. You wouldn't have a lot of protection for that. If you. The pulse on your loans than you would potentially be. Debtor's which may which is a perverse thing. Because in prison, it's less likely that you will be able to work and pay off the debt. I think you make a lot of license plates. Not no idea of the whole idea of being in. I think it prison was to that. Of course, your family find money to get you out. And so the kidnap you basically kidnapping. Yeah. This is very tough. And as a result, you'd be very careful about launching something or or taking risk because, you know, not essentially you're like would be potentially steak, so how many generations of my family would have to pay off the debacle of my shared surf Ford company. If you had their bind the circle. In the ocean. You if you would have to buy a whole bunch of Sirte ports and put them all over the world, and you would have to take out loans presumably to do this or bind people to to give you this money, and you screwed it up. And then you'd have to. Money to make money horse. Right. But in the old days there was very little that because all on the burden of one individual more. Maybe a couple of people who who who have were personally liable. So you wouldn't give that much money because you knew that they couldn't pay you back up. All ball went went to hell. So what the idea of a limited liability was that people could pull their resources into shared thing called a corporation. And so none of the owners were personally liable, but you could bring a lot of owners together into this this this entity and the corporation. They're poor had responsibilities in its own in its own. Right. So the corporation had to pay for example, that holders poorly paid shareholders. And that's certainly true today company goes out of business, liquidate the assets, and and whatever. Goes to the debt to pay off the debt not to the shareholders, typically, get get zero something goes wrong. So it's it's on one hand, you have limited liability, but you also have somewhat, you know. Zero upside most of the time you get nothing. Most of the time the company's not super super profitable. You're not gonna see any money back. So so so you had an interesting time. This is about, you know, fourteen fifteen hundred sixteen hundreds we were going to talk about the thing companies. And this is interesting that because the duchess senior company was founded in sixteen to. And it it's it's a. Essentially trading. Company. Trading was risky because you have to buy ships have him set off some of them won't come back. And they find cargo ship bring it back on hopefully could sell it at a profit. So every expedition took place to go get some goods and buying by them of corn corn places and sell them in back home, all of these things had a certain risk associated with them. And over time the benishi, we're doing this in the very interesting way. But they were not using this contract of corporation. That Dutch figured out by sixteen hundred how to get get the ice oppose the Venetians. There was a ship owner the owner of the ship would go out there trade, and then they would make money based on on the journey. But in the case of this corporate entity of the East, India company, you could pull all this all these. Small shareholders holdings together and run a whole bunch of shifts, and you would have Tila, and you would you'd go on on seasonal trips of because the winds were we're paper bull. You could set out on the huge journey. And so as a result, you you would essentially get economies at scale with. If you have one ship, and it syncs, you lose everything, but you have a dozen ships in one thinks and the others make a lot of profit you come away better. And so this was the whole idea pooling resources for the purpose of trade. And it wasn't at this time. The Netherlands is only about twenty years old to where did all those resources come from what the history of lenses interesting. It's a curious countries. Similar to Venice in the way. Because you know, there were not in the great location Venice was in the middle of nowhere, relatively speaking. In through on the basis of power in medieval or millennia was land. It was having. Land to grow things and scrum agriculture, the you would get a surplus of Putin more than you need it essentially as a farmer and then sell that off for profit. And so agriculture allowed the construction of commerce and the notion of three enterprise, but of course, centuries from Linea was easy to consolidate that land in through violence through through oppression through. Either slavery assert them or variants bonded, bonded. Labour. And so that really power power concentrated in the hands of Hugh, and there was very little mobility in terms of, you know, people trying to figure out new ways of doing things. In other words, notation it was like, you know, you're tied to the land and all wealth came from the land and all the wars were over land and all the taxes were based on land and everything was recalling land. So if you had warfare was one prince or one one king, wishing to get more leads from another, and that was the whole that was a whole story course hanthropy? Good land. Not good and good land was easier to form the well glowed chrome from landholding. The Dutch word you're saying because they had really crappy land at least you have puke people who are probably not bonded to the land. And they set out and began to to clear new land, which was the. The process of pumping the water out of these lowlands that that's why Netherland it means that lowlands, and so it was like. Started to try to convert marshland into into farmland. And so these people were like banished to some God Chris in place, and then you start to figure out of make productive and in. So doing you begin to actually discover that you have the right technology, which in this in this case was with mill that could be acting as a water pump. And then you would build dikes to keep the water from coming back in you pump out the water. You wouldn't use the canals as a result of the water pumping and dredging to actually facilitate transportation. So you you suddenly had a better better road system than roads. You had you had the land under the water was apparently Kerley Pertile because this was this was a delta at some point in time. And so a lot of nutrients had washed up in that area. And so so great core core growing high quality crops, try. Just weeks, but crew and clouds and things that were requiring highly nutritious soil, and it turns out these guys with hit gold by by figuring how to keep the water out of their lowlands. And so the Netherlands over period of decades. These these new found. Tick, the logically Naple farmers who had essentially their own plots of land. Unlike the Kuettel system that was prevalent at the time these people just suddenly became super rich. It was like the Silicon Valley of its day because they manufactured land out of nothing which was which was a revelation to begin with book could be replicated elsewhere. They just happen to find this very rich. Point of landed and that generated secretion income, and I suppose the magic of it was actually that. No one came in there and. Time to right. Well, people tried somehow early period of time they were able to still keep their the keep people away from them. But eventually when they got secretion well because raise an army and protect themselves presumably there was some time before anybody noticed that they were doing this and no one attack them when they were poor. I just don't know how that happened. I mean that sounds magical to me that. He tension to us probably just look filthy and miserable. And nobody wanted to to go there. You know like in Monty python? When King Arthur comes upon the peasants, and they're like. Just wallowing in mud. And so the thing is that. That period of of of great wealth creation occurring in the Netherlands allow these. These new cone wealthy farmers to have excess capital which then they decided to put into trade. And that's what's interesting is they got into trading then they got into. Financial instrument innovation and eventually one of them came became king of England which was in sixteen eighty eight William of orange was hired literally. But we're talking about about one hundred years later, sixteen eighty eight or or so in the Dutch the Dutch had by then become so powerful in Europe. And so intelligent about things that people wanted them to run things. And also, I would add the. They were also very wealthy in terms. The way you can measure old economies. Like that would be like how many people live in cities. And so the rate of urban is Asian in the Netherlands was was so much higher than anywhere else. And so as a result, I think one of the innovations came coming out of this great period was the corporation. I think the corporation it cell was predated slightly as he said by twenty years by this creation of Dutch is India company, which which was an interesting history because it was so wealthy and powerful and the English copied, by the way, the English and some other countries also copied it how many east. One this weeded the Swedes head when the French had won the Portuguese had won the Austrians built one in the Danish. So pretty much. It was the half the happening way to do business at the time. What was the worst eastern new company? I don't know. Bears annual picnic where all of the company got together who like who was always the last to get invited. Who's an embarrassment? The embarrassing of I think probably the Portuguese. I mean, I don't know because. It was it was I'm looking at it. And it was fun. Founded in sixteen twenty eight it was the punk and sixteenth thirty three. So only about five years. And I think that's pretty pathetic. I mean, the English one I lasted like two hundred years. The British invokes look at this one. So that was actually founded even early sixteen hundred pundit eighteen seventy four so it ran two hundred and seventy four years. Did it really go out of business or did it just become like the navy or something good question? I think the the these these are not proper corporations or maybe they became so much later, but they were there were government monopolies. So the governments at the time, of course, being kings, mostly. Gape charters, and they said, okay, you have the right to do this the right to trade with India or the case as sort of Asia in general, and as a result, the people who invested money were centrally investing monopoly, and it was still it wasn't a matter of competition usually the risk came from possibly other countries. Possibly the weather possibly their trading partners, shunning you and refusing you access and all kinds of other risk factors. But it wouldn't be a competitor in country that was the logic of this system. And by the way, a couple of things that were interesting about the the. They would raise armies they were essentially occupation forces. They were running things in some countries like the English century Ren India through this type of corporate entity or company it. Interesting factoid the American flag. Is is is actually some people say always such a unique Klag because it's got thirteen stripes at the thirteen call these no it's actually a copy of the English East India company plag- with the part where the stars are used to be the Union Jack and the American flag substituted the stars. But actually there was there was an earlier version of the American CLYDE that kept the English plug in its in its so-called, canton, which is part of the quake where the stars is are now. And so that was the person Mary one of the person American flags that was Ross is is a plagiarist is what you're saying. I don't think I don't know anything of a bet three Ross, I think she soda Clive. That's all I know. I think I read that this east. India quagmire was proposed by none other that Benjamin Franklin as saying that we need something recognizable. They didn't. Want to come up with this random? I'm sure lots of people were putting all these like, hey, I got a good idea per plag-. No. He's idea was let's use an existing quiet because it gives us legitimacy. Let's not let's not innovate on. Let's let's let's let's keep it that way. And so they did the stars and stripes with just adding stars to where we're essentially already existing stripes and exactly thirteen of them, by the way, which was interesting. The one thing that that you know, we can claim Incas America's at least that there were many other things again this was around sixteen hundred and America was having a revolutionary war in seventeen seventy four approximately. Right. So that was one hundred seventy four years after the formation of this trading company in England, and by the way, one more little detail the Massachusetts bay colony which was the first successful colony in in. In North America. Was it self corporation it lasted longer than the Portuguese East India compound? But when it was formed, the people who went there on the main flower where essentially created a contract, which stipulated what they will deliver to their investors, and the whole premise was that they would set up a call in the way of making money. So this is very much in the same spirit of the India companies that call in his ation was hand in hand with. With with financial instruments for for, you know, making money. Various ways of doing so, but the the idea of setting up a call the in the new world in this case, the may clower Massachusetts bay colony or corporation at the time was. We think of as as glorious explorations. You know, whether it's. The Mayflower or even Columbus setting often voyages to discover the new world, these weren't some kind of heroic efforts to to obtain glory these were financial expedite these were. These were as as much a startup idea as your surfboard ideas, which is to say that thank you because the time was well. Well, you know, you took a risk. That was half plausible not bully plausible you'd be half. Because you'd say look, we know there's land there. We know there's people living there. We know that they're they've got some well because they know they can go get beepers, and we can get Bieber skins, and we know Bieber skins have a market in this in our home country because people like to have bieber's on their heads, or whatever let's go. Let's go get a lot of beaver Bieber head. Now, how do you do that is is the tricky part? And so you have to execute on the plan. He said, well, you know, in order to trade with the locals we're going to need to have a trading post. And that's what this call was sent off. A ship of cool people. That's an hope they don't die, and you hope that once they land they can protect themselves and hope that, you know, the locals won't won't kill them. All this reasons, the locals to be very upset because probably people have come earlier and have been behaved badly and probably also many of them died from disease by then because you had spread over from the Spanish coming over one hundred years earlier. So I'm using the American history sort of also describe what was happening with a lot of these trading companies that all the European powers at the time. They went off in the age of exploration to go plant the flag all of these locations and not because they said, oh, this is for the glory of God. And for the glory of country. It was more like, hey, there's money to be made here. And the reason everybody wanted to go to India, including Columbus is because there was really valuable stuff. There those lightweight. And here's this is important you go halfway around the world in rickety ship. That leak a lot of water and don't staple in storms. The reason you're gonna go all that way and suffer from disease, especially scurvy. Because you can bring back enough in one ship to pay all of that. And make a lot of people rich who invested in you. Now, the things that you might bring back are not going to be things like wheat or marvel or clower over marble. You're not gonna you're not gonna bring back. Egeland even anything that you can make local you want to get something exotic small or lightweight enough. But but is transportable. So it's not gonna be calories. It's not going to be energy. Like, you think of food is calories. It's rather was compounds chemicals that are very very difficult to procure elsewhere. So it was spices. Spices very important or silk soak is great because it's so lightweight. Right. But think about all these very very. Desirable things where xylitol because they were rare. But also because they were transportable across the world at the time with great bat technology, and so these are the items of the day if you think about it. A Naito today's desirable globally because it's easy to transport. So you can go to Hong Kong Chinese and smuggled Pugh back or go to the United States to to an apple store in the tax trees state and pick up a couple to smuggle back to Europe. I know this because I've seen it done many times in front of is full disclosure actually owned six or seven new iphone stuck inside of one of my surf sports my Ford sharing company. So I this is this huge problem. So that becomes the secondary business me. Give me say spice. Give me an example. I mean, what are we talking talking cardamon sit him in? I think those were were growing in in Europe. But things like pepper pepper was very hard to to. I think. You know, you'd have even these are quite rare today, but nila, oh, sure. Or you would because it only grows like in Madagascar or you would get something like sacra n- or or something sufferance very expensive today as well. It only grows in limited places, and it's hard to, cultivate, eventually we ended up with today's dollars versus old Dame dollars or guilders or whatever we're using would would a kilo of Safran be worth the same more or less than a kilo of cocaine. I would say more. So these guys are the cartels their day. Tangled legal yet, they were there were cartels cartels are legal monopolies. And that's exactly what these were. But they were the cartel grays being applied to to Greg. Companies or drug cartels as we call them. That's actually, not the pri- term enterprises. But they're called cartels retroactively. There's not being truly granted to them allows monopoly. They end up. So because they probably violently killed their opponents. So the point is that yes, you had a government mandated monopoly, and you could go out there. And and trade in these in these things, I'm sure there are other monopoly. We don't hear about there was probably pitching the novelty. So whoever went out to fish Northland thick was not allowed to do this unless they the Cain gave them a charter. And then sure there were people who cheated when fishing without a charter, and you know, hope not to get caught and all kinds of things like that did happen. But but in this case, the Dutch East India and the English East India company, all the companies were out there trying to get stuff out of India core, even though even though and this is what's interesting is happened sixteen. Hundred sixteen hundreds of active discovery of America. And so what happened and goes in this covers American fourteen ninety one or two I think it was. According ninety two I think and and. And like great now what because the Spanish are all over there. The French eventually show up the English show up and they all begin to explore this. But it's going slow, and they don't find anything really valuable. Eventually, you know, they go off and pillage everything everybody and decimate the populations, but they're like most of these cookies doors where out there trying to find we gotta bring it back some money, man. What what are we going to do? And they were like they failed in finding India in the world. Those spices are out there in America looking for spices. As no spices, eventually found some gold, and they stole all of it. And then they found some silver and stole all of that. But that's not really something you can rely on long term. And it's saying it's a pain in the ass to bring it back over the ocean to bring it back home, so hippie. Well, that's right. Well, I'm sure they've found. Okay. They pound corn. And they've found and. They found potatoes. And they've found pumpkins all kinds of edibles turkeys as well in North America. But these are nothing's you're going to send people across the sea. You might what they did do is brought seeds back and began to grow some of it. But you know, whatever could grow back in Europe, they would bring that back so tobacco in. So well, probably tobacco is one of the best things because you know, once you dried, the leaves you could bring it back, and it was fairly waiting get. That's why tobacco really they made a killing with. And I think CoCo from from. Chocolate that that was also very valuable in sugar. Yeah. Corned grew in in Europe. So that was easy to bring back sugar sugar. Here's the sugar trait. Okay. So sugar was grown in through sugar cane because that grew in tropical areas and that did not grow in Europe in Europe sugar could only be harvested from beets which were top to grow very expensive sugar prices were very high. And so they discovered they can get sugar out of sugar cane, but sugar cane had to be processed locally into process of, you know, getting getting molasses, and then you had to find it. And so it was very labor intensive as well. And that's why they ended up bringing slaves across to bandage his sugar cane plantations, and eventually they figured out how to actually turn it from chrome Lassus into rum. And there the business began to take off because once you got rum. It was a lot easier to bring that back than than than sugar. And it was more valuable and this relation of rum actually happened up in Boston. Speaking of Boston, again, they will take molasses from the Caribbean and bring it up to Boston. Still there. And so the rump could go back to England. And then the trade was that this follow the prevailing winds. So you could you could ride the Gulfstream up to you England from the Caribbean. And then you could go back across northern northern Atlantic to to to England to drop off the rum, and maybe some cotton that you may picked up on the long way. And then they actually went south from England to Africa to pick up slaves. They shift from England manufactured goods to Africa. And then they took slaves from Africa back to the Caribbean. A grand circle what trade meant trade between periods. Roughly the discovery of America before that there was the age of exploration. Don't don't forget so trying to make their way to by ship to the east, and it was the Portuguese that eventually where the purse to pop into India. Remember, this is because. Because you'll confidential cutoff silk road. Right. So the silk the silk the silk road was typically the way to get things from Asia. And there were many such place any such silk paths roads, and so on, but but the those were operational thousands of years as the Romans were were trading with with with Asia as well, the pro- the problem was that. Yes, when when consented nopal bell and became stumble. The Ottoman empire was not giving payroll terms traders and as a result. Everybody wanted to find it turns out, it's actually also cheaper to go by sea than to go buy land. But there wasn't really an incentive for a long time to develop the seed sea routes because you had always this trade. And it was it was good enough to get stuff up to Black Sea. And then from the Black Sea or the Red Sea. You could bring stuff to Europe fairly quickly. To try to find a way to Asia by both everybody knew Africa was in the way, and and that was very perilous journey. So why bother I think once once the Ottomans cut off the auction of a good good route, or at least cheap route to Asia by land people began to say, okay, now, we've got a pint away by shipping. That's how the age of exploration to the moment. Win the power base which from being how much land you had how much access to to see and various fourth. Yeah. Even though you had a pint. I would say like this was not even one percent of the the economy at the time. But it was the one percent that was had the highest margins like most people were just farming, and you know, being blacksmiths and picture men and doing whatever things people did all over Europe. Okay. They were just doing going on about their business, but that was very tough business, and you barely stayed alive doing that. And somebody says if we can get a boatload of Sacranie or some some great spice out of Asia going to be set for light one boat load. We have enough money to retire. And that was the thing about a company was like even a tiny amount of money. You could have shares in the in the voyage the praise your ship has come in. And you remember that crazy? Well, your ship has come in your shift, the one that you put some money in and actually came back came back. And now, you're rich you put in one hundred dollars, and you've got ten thousand dollars. It was a huge. Amount of return of empty bottles of Rome. That was the thing is like even today. Well, we searching core is not a subsistence. We don't want to have just a job we want to get rich. And so most people on all kinds of things whether they go to bagels or the stock market. They're like looking for get rich quick schemes, and that was DC scheme that that was was really exciting everybody. And to the extent that you could participate as an individual that was really amazing as opposed to just the king getting rich himself, which is what what most of the time happened. Anyway, anything one of the things for me. That is interesting about the Dutch East, India company was that this was the country. This was the people that had really the first time in in probably a couple of millennia in European history. At least they created this new land reclaimed this lane from the sea that had no feudal lords. They were they were free. They get to keep what they farmed in what they sold it what they made. And but that she's any company was incredibly efficient and either take what they wanted to of land people or killing people sleeve and people. So it's just would you look back on it. Now, a little incongruous. Well. Sure. Then again, it goes back to this point that I'm trying to make maybe overarching this whole series of podcast is that. The political history is one thing the the union we tend to learn who or or which battle or what happened in event events or something that marks the calendar is usually the spine history. But a lot of the really the forces that are acting continuously are much more likely to be the cause of change as opposed to a single event decisive event. So it became dies and the new one takes over that is what's is marked in your history book. But the fact that peasants were we're unable to get out over. The servitude. They had or or if there had been a break in that through some either catastrophe like famine or plague suddenly Labor's creed up in the economy changes, and that would be as big a impact on the on paid of nation, as you know, which king was was in charge. And I think what the story of the Dutch in particular is that you have an economic an economic course at play, you know, people are. Are you suddenly getting rich and are excited about that? But they were not motivated by some as American experiments shows and it's experimented still going on. But the American experiment was that you had people who felt that there were principles. They and we shall polities principles and write a constitution and Bill of rights, and that that idea which was born in the seventeen seventies was not around in earlier this idea America, which was born out of. What we we believe that somehow their guiding principles of enlightenment that that are foundational and that we should all behavior properly because that's what we're we think we're basing our entire existence on these these a very new idea most people in those previous to those. The last two centuries or like out to make a buck. And whatever means they had available. They would do it. And so yes, they they were pre men, but they weren't principled men. It was the enlightenment that brought about America. But there wasn't the Brown. Then we had the renaissance and then meant, hey, the church is going to dominate everything rather we're going to think lot of with our pocketbooks. And that's what was going on. I think in in that period of time. And look the English did more they were more aggressive in conversations than the Dutch. Where mean, the Dutch ended up with Bali in Indonesia, they didn't really go off and take over India, or they were focused on trade. I think the English were saying, hey, we had the whole country trade with a lot easier because the trade. The trade that the Dutch would probably say we would just want to have a foothold because by the way, that's what the Venetians did way back in the day. So the nation's with go and set up a little trading post, and that meant just a bit of a piece of land next to a piece of harbor that was calming up to park your boat in and we just want to keep this little put hold so that people from the the natives can come to us, and we'll trade at the gate of our little court. And then and so that's all we want. Is this little could hold and that actually Hong Kong is like that. And if you go to Shanghai, you see the old give like a warehouse or a building to each of these call in the coal nizing countries that would be their their essential place where trading could take place, and so a lot of this went on into well into the nineteenth. Century. And and we get. The Dutch were like, okay, we need the Benicia had this example in Crimea. They had little little spots in Crimea. Where people who are bringing the silk road goods could stop at the gate, and trade, and then they pick up from there and put it on a ship and go through the Bosphorus, and then they would go into the Adriatic, and and home, and and that was a, you know, they so they needed a place there that needed a place in the attic they needed a place like in. I think in Crete were or somewhere like that in the middle of the Mediterranean. So that they could that was like their their hub terminal. So so the, you know. Ships could unload their and then another ship could take it from there. So there was a lot of logistics. It was but it was they weren't out to conquer an entire land and slave an entire people because that's not their business. Their business was not based on landholding or or agriculture. It was based on trade purely trade just bring what you got. Let me see something I want, and I'll give you the price for it. But but the English were like, oh, no, we'll take the entire. We'll take the entire North America. I in the Kretschmer that way to last week you'd mentioned how while yes apple is now worth over trillion dollars at its peak the duchy East, India company was was worth probably around eight trillion dollars. So are we headed towards another Dutch East, India company? So one of the things that I sometimes talk about is that. We should have a separate episode about this as well as that company today are quite fragile. And in the sense that if you go back and look at the courtroom five hundred from nineteen fifty they're very cute names on that list that still exists today. The fortune five hundred. Which is the largest company companies in the world. It's a list of hundred companies they're the largest hundred these this list has been only compiled since nineteen fifties. But if you if you look at it like, you see the tenure of a company in that list is about these days like fifteen sixteen years with gets on there, and he'll probably come out in fifteen years of Hugh haven't, but the point is simply that we don't expect corporations to last that long. In fact, there's evidence that they're very crucial that they don't live as long as people do. I mean, we were expected to live eighty years on average appear in in, you know. Developed country today probably around that and that's a birth. But the longer you get through life, and you don't die then you probably going to live a little bit longer than than that average. But so so the point is though that corporations don't live that long. I mean, we we have the largest corporations in the world today as we speak our Google, apple Microsoft, Facebook, and Amazon and only apple is like more than forty years old. Well, maybe apple Microsoft are about the same age. Actually, they're about the same age. The others are about teenagers. Exxon is is pretty big walmarts pretty big they've been around for well, but they're not that long either either because it can look at Exxon. I mean that's built on the oil business in the oil businesses only about. Yes. It includes pieces of Rockefeller, I suppose, I don't know exactly. The history of these. He's. Or do you mean, actual pieces of John D Rockefeller? That's very disturbing image. I think I standard oil. Yes. So whatever component created I should say. So. These are maybe at both one hundred years old now in IBM is one hundred years old too. But these are the exceptions, very rare exceptions. And and the two were born out of technologies at the time. You know, IBM was was a technology company. Rockefellers a it was a technology company because believe me oil rigs and things like that. We're pretty cutting edge at the time, and and certainly this chemical and refinement into into liquid that could power car with those those way way, you know, that was rocket science of the time. So what the point is all these these were born out of technologies and technologies fairly new even even the car and the computer, and so it's very rare to find some really old company. Now, the difference with companies we said like that you ran for hundreds of years. Much longer than individuals that they had enormous power. They were able they had the right to call. Nice. They had the right to raise armies. They had the right obviously to kill people. And and they were essentially a law onto themselves. And that the question I asked when I talk about the credulity of companies is that he's actually a good thing that they don't last that long and is. The system that we have today, which is that companies eventually claim out. They just do you can go through the reasons why they might often it's this rupture that occurs comp- competitive pressure and technological innovation at obsolete. S- whatever they ended up doing and therefore so the Exxon DX company, for example, has been a good run one hundred years, or so, you know, probably not going to be relevant. We go to electric cars. So that process of creative destruction as Schumpeter calls it, which is that bent something you develop invention into an innovation dust creating a business invest potentially obsolete. Something that came before it. Yes. Bankrupting a lot of people, but you know, you create wealth in the new way. And so this continues its many ways that destructive process, but it's also creative crosses and this this the precise way Aparna Singh. This clay Christiansen try to put forward Boorda's as the disruptors innovators dilemma, but the. Try to make a cookbook on how to do that. But but the process has been going on for them for quite a long time, the differences that it was happening between sixteen hundred and eighteen hundred because in the pre industrial era businesses were monolithic empires, literally that where where we're given monopoly status by by governments and to the extent that the government's baby had wars with each other. That would be the only thing that would curtail power of these of these entities is because their their champion government was maybe forced to give up some of the trading rights, and so on and so this was running parallel, we know about the political wars that happen. We know about the kings and dynasties, but we don't think about these these business empires imperil, generating wealth typically that allow the the wars to take place in the first place. And so my point, and I think your question and finally coming back to it is that what we have today's infinitely better. What we don't know. However, is that is what we end up with as an information society. So we went we went from a mercantilist, which is this time of of trade driven agragrarian stagnation, followed by sort of exploitation through trade. So these are the two business vase that existed at the time, then we went through industrial revolution. So those became ups elite and industrialization in manufacturing became something for that ran between eighteen twenty two about probably stilted today, but it's sort of moved to the complaints than it used to be. But you know, two hundred years of industrialization. But now that we move into an information society that the wealth is not crum. Exploiting new lands or exploiting people. As was as was Hubel times, nor is exploiting the combination of labor and machines, which is the industrial age, rather, we're moving into an information age, which which the resources computation are infinite and generally free, and and sort of we employees are really expected to to use brainpower mostly and to at least the ones that are most effective and most well paid. So the challenge is in this new environment. How much power accrues to this instrument called the corporation was invented in sixteen twenty and this corporate entity that now is able and it's a such a resilient construct. It's such a resilient thing that it was used to sell shares to trading companies that. When round the world trying to find spices all the way through the industrial revolution. And all the way through the twentieth century. It lived through all of that through wars and different forms of government from. Survived socialism, communism. And and you know, we we call capitalism, but it is in capitalism is a very new idea relatively speaking. This this this is a contract that has predating that that term if you will. So the point is that now we're in the information era, and we'll this construct actually still hold together. It's a great thing we have a constitutional United States with some Bill of rights that are glass the two hundred years. It's got some creaky nece around it. You know, it's not perfect. But it's the oldest system we have in use today as a democracy is a Republic. But but now we'll see how it holds up in information age. We'll we'll have to see how corporations hold up as well. And that's really the I think you ask the exactly the right question. I think we need to explore this. And I think by looking back we have these examples from history, and well, maybe. We get some clues one hundred percent. It's going to be super interesting now for is e will be or we'll have been ending outcast is listen to in New York City to the apple vent on tour thirtieth, and we thought might be to talk about what it is. Specifically that many years ago made New York New York we were there in August. One of your talks aimed shout out to all of friends, we maintain 'specially Portmouth already police officers on in new really is something unique about the city notch just in the United States. But around the world curious thing about about America's that usually near the most wealthy and powerful cities are also it's capital cities. So, you know, London is the capital of do United Kingdom and Paris is the capital of France and Rome is the capital of Italy. And as a young man, I was surprised when my learn New York was not the capital of the United. States. You would think given it's given its power and its its population. It's kale. It was it would be the most populous city was the the most economically successful city. And so on. But it is that's one of the interesting things is that business of New York was business, and it was government. And so the reason New York is so interesting commercially is because it was a it was a gateway to the whole of the United States. And the dating story there is that there's a there's a Hudson river and the Hudson river goes straight up north to Albany and points, north actually Albany being the capital of the state and was also connected. The canal their IRRI canal all the way to Lake Erie which allowed the. The use of waterways all the way to Chicago. The canals are one of these things that have gotten, but it's supremely important in the history of the world and mostly when I say, oh, I'm a big fan of canals people will think of the Panama Canal or maybe the Suez canal, but these are very late comers. To the canal story anals began hundreds of years before then and enabled the development of friends England, Russia, even which. Has vast canal network while in distances and in the United States United states developed, but just the Eureka hill, which is built by twenty-five, but hundreds of other canals throughout throughout the eastern half of the country. So between Mississippi and these coast now, the IRRI canal is most celebrated because it really opened up the mid west to to shipping because again, this was a time when you really didn't have railroads you really didn't have certainly roads of any kind that that you could use people were debating building this canal. But right during the before the American revolution. But let's not get to those weeds. I think what I'd like to point out this that simply if you if you just follow these follow the money for for New York where the money comes from realized the transportation and the placement it's great harbour. It's great. Natural harbor. Had this massive amount of of land that could be turned into the port or or warehouse space, and you compare these availability of those two quantities on New York, Philadelphia or Baltimore it's nowhere near as as as as as great. So so that. Island. You could you could put ports around the entire island or just huge island. Yeah, it's a huge island though. So you have the shoreline following Brooklyn. You have the shoreline of queens, the shoreline of New Jersey all of that combined with the deepwater port that allowed big ships that come all the way in and then of course, you had that that's just district allowing volume to transact at the point of entry. But then you have the giant waterway the Hudson that allows the big ships wouldn't go up the Hudson, they would unload in New York, and then or or load in New York, but other smaller ships with bring things to it and put them in storage warehouses, and they would be transshipped this before containers potatoes are the same idea today is just a lot more efficient in Las faster. But it was bulk and New York was bulking not the container. So both beans, you're either putting. Things pallets in packages and some tax and bags and in. Silos or things like that. So whatever whatever it was the way of doing it in by the way that it was very manual intensive and you had hundreds of thousands of people employed in this unloading and loading and there was the stevedores. I think was the profession the unions and all that stuff they controlled obviously because they were the net critical path. They would also end up being somewhat corrupted by by the opportunity there, but fundamentally I'd like to point out the way that the ships would come down to Hudson. Eventually through the canal all the way over to to which by the way, Chicago's a counterparty to this whole story because Chicago with collect all the things coming from the mid west typically by land rail, but yet, you know, some of the canals may be we're we're we're acceptable to it or rivers. But generally, Chicago was the things were packaged up for transporting to New York and then New York with repackage them yet again for transport worldwide and vice versa. I've seen some of ships that sail across the Great Lakes, and these are giant ships. It would it be that, you know, you can have a giant book Chicago, basically to the mouth of Hudson. And then it gets sort of offloaded or so first of all the ships. You saw these would be modern ships into today. You don't use the Great Lakes to ship grain or? Or maybe do a little bit. But but mostly things go by rail or train. It's a lot more fishing today. But you'll see will the ORs. So these ships carrying like iron ore or some of the of of, you know, basically rocks and dirt which is very very heavy. That would not be officially transported on a train. So I'm sure they do it out in the middle of Colorado. Those places you have no option but to go via train, but in the have you have a ship. You can do these types of trips more efficiently, but but back in the day, you would ship everything on through the IRRI canal. Again, it would be a point where let's say you broke it up yet again to smaller barges that would go on the ear canal. No again in buffalo and buffalo with go to Albany New the once again, the shift over to the Hudson. So some of this record multiple steps, but it was still easier than than than. Having oxen pull a cart. What we're rutted roads for a month? Trying to do the same thing virginity, and that there was a little bit of corruption the stevedores we're near higher along that Eureka. Eerie pirates are actually phenomenon that exists. Because you don't have good law enforcement. So so I'm certain piracy or highway robbery which is landed quivalent. Would have happened for centuries and only way to prevent it would be to have. Police of some kind and they would just catch the bad guys who did it. And there's not many ways to escape the ocean. You can go anywhere. But if you're under river or canal, you're sort of limited you're in your escape routes. I I'm sure people tried, you know, but it's it's unlikely that because that that that waterway would also have the ability to bring all kinds of people back and forth, and they include some form of. All settlements all along the way, and those settlements would be police. And that was the thing is is the highwayman that that that let's say, which is the one you have in mind is Robin Hood, Robin Hood is the story of a highwayman in England. You wouldn't have passing through all these forests in England at the time, you wouldn't have the ability to patrol it easily. And so these men would would be able to sort of do a hold up and then run off into the bushes or the trees or something you couldn't catch them and similar things happened in the wild west. Louche though, the easy too. So. They would disperse so but actually. The sheriff or the police are are unsure and pirates. Piracy and and have their or some wheat or a couple of oxen. The cops still have to have to do. They do. They row out. How do they get at eighteen twenty five? It's question. I don't know. And I don't know any sort of water chases like you might see a car chase you'd have bar choices. You know, the problem is that venture you run into a lock now. Here's an interesting thing about canals canals are not just rivers. They're they're they're they have points where you have to stop and go up and down using something called a lock locked system. More chiseled bunch of doors that open and close and and the area between the doors. The water comes down and and up again, if you let water in that high watermark water in from the top or or or vice versa. And so that the interesting thing about canal just on this point alone. Because it took me a little understand this. But a canal lives on water supply. It is fed and the energy lifting boats, which are heavy right? The energy comes from. Water that's being collected usually at a high altitude, and then it's released so that it can act as this boy and save professors. So I'll give you an example. It's a little easier to picture if you look at Panama the Panama Canal, obviously starts at sea level of both ends. So you have the Pacific end in the end. And then when you look at how the path of follows some of it is cut out of solid rock. You know, this is this is the these are these are manmade passages. But most of it is natural. Most of it is is be big lake that sits on top of the in the middle of this office canal of Panama, so they really cut all the way across Central America. They cut little pieces at the beginning and end typically in the middle. You had this giant lake that the ships can easily traverse and lake is filled. With rain water and water coming from other rivers, it some of it is used to feed the canals of both ends that actually are men made. But that being a tropical area, you always have plenty of water. If you try to build canals in areas where it's fairly dry or seasonal rain. It's very difficult to actually create the app to do a damning operation to to collect the water and allow it to come out at. So that's part of the engineering breakthrough for canals was the lock system, which actually I believe the Vinci invented or at least he he sketched it out so the the locks which which which are clever because the water pressure keeps them shut. There's a whole thing about the fact that they're angled that way again to be cold. And that that definitely does get cold and parts there would be increasing going on. I guess there's just a guy with Iraq to to make sure that the water keeps. Earth. Stick rather. Stick to make sure that the water keeps moving. So the lock the Wadden luck never gets frozen. Good question because I do know that the northern sort of northern didn't have had something about this don't think so because I think you can't do much if you've got freezing conditions the water will crease, and you are stuck with no punk Xinning lock system. But but that's a good question. As to what they did in the winter. Maybe they really had downtime for the remaining health where the pirates maybe that's where the pirates on skates or skis. Maybe. Why didn't New Orleans which is on the Gulf of Mexico, and is obviously in the Mississippi River, why didn't warlords become New York City. Well, the way that was a French possession. And the French expected it to become a New York, and because it controlled Mississippi valley area that was that was a French possession. Right. But they sold it. I think in eighteen ten or right because because the believe in this is interesting to read up on this bit more. But the this is when when you look at the North American continent as much as you could in eighteen hundred which is right right after the US became independent, and or even earlier because people had been exploring for one hundred years earlier, French were already the French were already there, the British were held onto the thirteen call, and these as we know them, and and there was this sort of dispute about Canada because the Canadians have parts of it in the bridge had other parts of it. They're not dispute about Canada. Can the candidates very controversial subject at all times? Then you had so the during the American revolution you had French Canadians up in the Nova Scotia area, which. Which were expelled due to a conduct conflict and the all settled in in Louisiana. And that's that's that's how the word Cajun came about. Because there was. Katya was was part Kennedy were from. But anyway, the the question in this been the the great game between Greek great powers at the time is like, okay, you have this particular part of North America, we have this. And by the way, the Spanish of yet another chunk of it somewhere else. Montana. They had Montana. Florida, but they also had the islands in the Caribbean. They had South America, but they end the Caribbean islands really important, and they were fortified for for many many years because there was considered, you know. Primarily state for trading purposes, but let's not get into the Caribbean for now, you know, there's a lot going on there with with rum and. And. And molasses and sugar cane and things like tobacco. But but basically the big the big land area was was North American up until about the Mississippi. And so the British the British were where later the American colonies where? A little this advantage. Although they had the whole Atlantic. The felt that they had very limited access to the inner parts of the country because like a high, oh because you had the mountains the Appalachian mountains, and you had to the north the Saint Lawrence river was held by the French, and and the prince thought with the Saint Lawrence. They had an easy way to planting. But it turned out not to be the case and Saint Lawrence is not very navigable. The Mississippi is but the but once the Americans built canal the Erie canal, suddenly the easiest way to leave the mid west to ship out of the midwest was via New York, New York was just just slightly better. And then the Mississippi, and as a result, you know, the way economies work is like it always the best Greenwich is the one where everybody goes to. And so you end up with with who we are sort of snow. Fullback the the same way that Los Angeles is where you go to make movies, even though you could make movies elsewhere. But everybody's there who makes movies, and so it's tougher or Silicon Valley the place where you write software because that's where everybody is. Well, New York turned out to have this comparative advantage, and they left the Mississippi in the dust. I mean, there was still going plenty of commerce going on there. But I think the French felt that they weren't getting enough out of it and felt that well, we might as well, I suspect that were more reasons than that. But he probably didn't find. You know? That part of the world to be as valuable as they thought it was, and that's why they gave it up. But. It was it was a this Rupp Shen to see through this technological thing. The canal of the to to kind of have a. Entrant if you will the east coast takeover the midwest, which looked a lot more powerful a lot more more wealthy initially that they were all the land was in the mid west. The Mississippi was was was available to them and yet they lost. And so that's one of the great. Distruptions if you will that the British in the in the east coast ended up controlling the the whole continent. Couldn't it need not have been that way. If there was no canal, the French may have become a New Orleans. We have the come to New York of the world, and the French would have controlled the heart of the United States, and there would have been a border line that they knew Appalachians between the English speaking east coast and the French speaking speaking midwest, which would have split the continent forever. Maybe the Spanish would have held onto the to California and Texas Montana, Montana. I knew we would have had sort of. Three major powers in three major languages in North America. We now we only have two I just did a little googling and Louisiana. Purchase happened in eighteen. Okay. Now wasn't built to twenty five. So French never really gave it a shot. It sounds like or. I hope so quickly. It may have had something to do also with politics of the day. And and the gambling debts could have been other debts that the French had don't forget they had their revolution. Just prior just prior to that. Should occur. You know, like a couple of years after the American revolution. And it was a bit chaotic as a result. I'm sure there were there were. There were all kinds of scandals going on economically. But. The the economic argument for the east coast midwest and the. What the advantage was? It's still there's there's the Saint Lawrence river, which again, the French could not exploit, and maybe they were impatient. And didn't wanna wait for for the the mid west of the Vela belong there lines Washington himself, George Washington wanted to do something about the Potomac as the kind of the the river that would become canal would be navigable in the heat failed at that at that effort. The canal to Erie could have been done earlier, but it was tied up in a lot of politics and committee and so on and funding issues. The British had a canal boom prior to this in in in in fifty years earlier. So this wasn't canals were were like the imagine. It's the internet, and the, you know, the boom was in one thousand nine hundred ninety s in now. Fifteen twenty years later, people are still arguing, you know, why should we have broadband because broadband was was was understood long ago, but it's it took a while for things to to be justified. I guess core for a lot of people in New York. That was the thing if you if you look at any structure of those built whether it's the railroads the. Internet. The, you know, the canal networks and the road network of the United States at the time. It doesn't feel at all. Like, you're doing something that will change the world, and we'll make a lot of wealth happen. Lot of the times. You're losing money. A lot of the times you bets are made on the wrong players. There's a lot of there's a lot of cheating going on a lot of lying going on. And it does it's not at all as we look back. It's an lightened, but it wasn't enlightened at the time. It was brutal. It was ugly. And a lot of people got hurt. So so, unfortunately. Beauty does not come from from a beautiful process. Beauty comes from a painful process. And so in this case, certainly wealth is is. What was created? But it wasn't done in the gateway at all. So anyway, the point is. York and the canal Erie canal are and arguably Chicago all both, you know, all that was possible because of an engineering solution and the engineering was of ancient at the time. It was not a novelty. I mean, maybe some we're talking shovels and horses troubles. But the lock system the surveying. You had to survey the make decision where you're going to do this. And certainly ING surveying in deciding how to efficiently. That was that was something that was not new, but it was necessary. Right. So you had people who were trained just like navigation was a necessary thing for for shipping that was an ancient invention. If you will but used somewhat slowly and the people who surveyed this this canal figured out how to how to take it out efficiently. Another thing that was innovative was how to pull tree stumps and do things around the canal that would would, you know, used to be labor intensive, but they us some some quote unquote technologies to do that more efficiently. Again, this was of course, steam engine. So it was a police system that you know. You had a huge amount of mechanical advantage. But but you did. So with oxen the productivity of digging the canal was perhaps higher at the time that it would have been in England or Kranz fifty or one hundred years earlier. But but again, these are these are minor improvements. The big ones were surveying, and and lock system and understanding the water that when I talk about canals people if I mentioned the importance of canals people will usually think of the Suez or the Panama Canal, but these were just bypassing. Land, but ships would would it was meant to sort of speed up shipping. What what is what Irie canal though, Nabl transportation to begin with? There was there wasn't. There wasn't inland. Waterways were not about speeding up shipping. It was more that it was either gonna take it with a canal or not at all. So one of the payments could house in England. Forgot the name right now. But it was the Bridgewater house. What I'm thinking, by the way, which was built in seventeen fifty nine hundred seventeen sixty one and Bridgewater. Canal was a breakthrough in England and keep in mind, this seventeen sixty approximately seventeen sixty eighteen twenty five was eary canal and one thousand nine hundred was approximately Panama now, that means that Bridgewater. Also was was actor the canal de which was French French effort which started much much earlier built between sixteen sixty six and sixteen eighty one. So, you know, you're dealing with sixty minutes. Sixteen hundreds Bridgewater in the UK mid seventeen hundreds and Erie canal early to mid eighteen hundred. So the French were first British were actually quite a bit late. But once this effort in mid seventeen hundred started in in. In the UK. It just led to a giant bubble. I mean, the boom called by bubble called the bus. So many canals were being built so many speculators poured money into projects that again, we may have been dubious quality or value. So there was a bust already by the time. The Americans were thinking about building their first big canal, which would have been against seventeen fifty US revolution. Seventeen seventy four to seventeen eighty approximately. A lot of these stories about canals are not part of the history lessons and the explanations that exists. It is a question of what was going on in the minds of these people when they made such momentous decisions as going to war. Possibly getting killed having your your family lose its wealth all kinds of trauma that was engaged in many people say, well, it's about freedom. Well, certainly that that is sounds nice. But the truth is that it was there was a lot of economics involved in that decision process. And of course, lots of. So let's say we have we have taxation policy. There was a stamp act, which even preceded this tax tax on tea, and you know, the Boston tea party was this. Fines of t- tax, but the taxes that were placed on the call on these without re presentation because call didn't have member parliament Representative in parliament to argue against the tax and so on and so the, of course, up in arms about it. But the reason the crown England said, well, definitely need to be taxed because the crown had just spent tons of money fighting the French and Indian wars and the French and Indian wars were fought and at the time of kind of in the boonies, but in to prevent the printed Indians to going and actually. Occupying these call in these. So there was sort of on the fringes of the of the colonies, and so the king would argue that look I spent all this money protecting you guys from, you know, India's coming and killing you. Scalping you and all those things, but they're four you need to pay the debt back that I incurred on your behalf. So the colonists. It wasn't that this evil. King was was was just robbing these people he felt very justified in saying, look, I caught a war to save your asses now pay up, and that was that's exactly what was going on sort of late late seventeen hundreds. And but the I'm sure the calling this argue with argue that look, you know, you saved yourself as much as you saved us. And plus anyway, you know, how do you decide how much we have no say in the matter and so on and so the argument went back and forth, and that's the economics. Now when you think about also now, here's where the canal comes into the picture. People have been serving this line. They knew that there was wealth to be had over beyond the Appalachian these great inland. Seas called the grr. Lakes that would get you occur there west, and you could go all the way possible, you know, people that it was a northwest passage, but not you had this this expeditions that would try to find a ways all the way to the Pacific. And you would you would see the opportunity it's like again, the internet days early internet days everybody dreamed that one day, we will all shop online one day, we will all communicate entirely over the internet. Whether it was with voice or video and all goal content would be in the internet. So you saw you saw all ready nine hundred ninety as technology became available. You saw the opportunity so people began to place bets, and you know, you had a certain part of the population that was savvy enough would. Painted and sort of plan for it. And that was the thinking back, then even the middle of the eighteenth century that that America is the land that was largely untapped only. We could figure out how to how to you know. Make make use of this fastness beyond us, and it was all wilderness, and it's like looking at Mars or the moon today and saying boy couldn't wouldn't be great. If we could mine or exploit these these planets and other things and now we're sort of like waiting for technology to allow us to do the cheaply enough. And unfortunately, it isn't cheap enough to send rockets and do this with very very high fuel consumption. But so this was the thinking back then and if somebody steps up and says hang on a second. We're going to make the decisions over in London for for for for the next few centuries. And you really you really can't benefit unless we say so and that was that was the one of the fundamental things. I think that was the pressure the pressure was, hey, hang on a second. This land could Bill onto us in the sense that we are calling this. And or or we could just be agents of the king. And people said, hey, let's go. Let's go grab it for ourselves. We're taking risks and so on and it just it just just made says the time for people to do that. And then you technology canals possibly be the way to do it right by connecting the the Hudson. I'm sure people thought that that we just build a canal in which is going to get rich. That was a that that may have led to the revolution as well. Because the. There was money. People were saw they saw the opportunity will apparently though they didn't tell look feet because French in their chips pretty. That is a bit of a mystery. I must say because I think it has to do with with the revolution in France. And whenever you have this sort of thing. People lose their heads literally and figuratively as well because they weren't thinking straight about about. What what what was possible the Spanish, by the way, also had a great opportunity, but being so the Spanish loss there empire in America's in eighteen ninety eight the Spanish American war. There were many movements to separate away from Spain during that time with bullet and others. But the the interesting thing about Spain took a little bit longer to one hundred years. But once did you realize just how how poor Spain became there wasn't an investment chrome. These colonies there were essentially being Milt puzzles me how could. Spain which discovers the the new world in fourteen ninety two by by eighteen hundred three hundred years later. Right. So like fifteen sixteen three hundred years later is pretty much broke. And they get nothing to show for having control over this gigantic continent on South America and Central America. And it must have been because they just said, okay. We'll just galleons with with gold and silver will bring him home and spend it and how you know. And that's how you end up with with also sort of the Russian empire where nothing's left of it you get because you didn't invest you didn't take the money and invest in building some sort of a two Sion's. I I this is one of these great mysteries that that. How in Pires squander the many ways the? British even though they gave up the call and these in seventeen eighty or so prospered throughout the nineteenth century and the Victorian era where you know, they essentially invented and invested continuously. So that their empire that's even stronger with control all the way to Australia and South Africa Spain industrialized, why didn't they industrialized? They were living at the same time with a huge empire in their hands. The didn't kind of go forward with it. The Germans also manage to prosper with an industry when they had no empire, literally virtually no empire. They try to kind of get somebody didn't didn't work out too. Well, so I mean early on forget about the twentieth century. But like the nineteenth century, you were trying to get something like in the middle of the Pacific, for example in Africa. And it was just not working for them. But they didn't need it in the building days were overall ready. So so the still cashable to think that you're gonna. Make an empire by then. But it was really the point in making those that I think he's really got off the subject of canal. But the canal was one of these things that you can point at say that made New York, and then made actually much of the United States because it was they were, and it was a technological thing. And argue you could argue with France and England being used that technology to also make themselves somewhat prosperous, but it wasn't just. I it's hard to put a scale on this. But the idea that you you you have this catalyst thing. But it's the thing that enables other things catalyst in Cuomo canal that could arguably really be be responsible for for one of the greatest wealth creations in history. Right. The the exploitation of the entire United States continent landmass, so this story of immigration and to New York, but it's not just because because immigrants the country was being being charitable. It was because they really need we need to be Lieberman. You'd extra. It was. It was it was terribly. Didn't get those people wouldn't grow. And that was. Most immigration policies is is due to labor demand shoes. And and so. Yeah. It's fascinating to me. How we remain Cise. So much of New York as as you know, it is a gateway city. It was it was. Patchwork of immigrants, but. Even in that pre early days between even before the revolution for hundred years before. Then there was this. Hudson river that was a gateway at least to the northern parts in the middle of the heartland, but the time the call these and then they got connected up to the mid west, and that meant pretty much go all the way to the Mississippi and tied the whole country together with with water transport is this is why I'm a pass located by these rather mundane technologies that we think about roads and canals and railroads which now are apparently. Currently boring, and and interesting they were so responsible for for so much. And that was the internet of it's time not to mention the Telegraph's. Not to mention. Sailing and steam ships, but just incredible. What are the canals and should be built today? And it could be actual an Ailes or just today's version of bad, you know, in order to get to space easier. Do we build this mythical space elevator is that going to do it? If we ever could do it. If you want to go to space, I think that is that is a very. That's an interesting way. But faces that nice space is very hostile place. It's not all that much to do up. There. Clearly, you do not watch Star Trek. There's a lot of romance about it. But I certainly I certainly enjoy it as a as as as works of fiction or or even or even inspiration as we had with the space program. But the truth is that economic determines a lot of what happens in the world. And the economics of space are not very good as much as you on musk was liked to see call his -ation of other planets. We really have to figure out the you know, how to make a buck before before that's really going to take up. You can go there, and you know. Human nature is such that, we're curious. It will go and explore places, but we can't root feet. But then then what you're used for a few minutes. Then you realize well, you're pretty cold and hungry as well. So they can't take up my. So so the to answer your question. The more interesting things you can do to innovate on technology would change the world. And I'll give one hint now. I mean, maybe is northwest passage which I mentioned if we can cross from crumb from Europe to to Asia by going north. This is this is the planes. Do this do it. So you replying from as I just recently did I clued a San Francisco of crew from Stockholm in direct quite and this was passing almost about the North Pole. We were more or less of Greenland and north and green London and Canada the hallway, and if you could make ships who go similar path is because there's nothing but water, although it's it's an a solid state above. Of the above a Canada. So so then it's possible to go to Japan from by ship chrome, let's say England by by just going north now. The reason that doesn't work today's because there is is on all year round the Russians by the way, try to do this using nuclear powered icebreakers. So this was the idea in the nineteen fifties. Is that a nice break here, by the way is a wonderful thing. I see them in Finland all the time. Although they're not much in use that they're moored were parked right in they nuclear power until they're not they're not because Finland. Radio problem. But the problem the reason they exist is because if the Gulf of Finland would ever would ever frees up they would essentially cut these lanes. And by the way, you you may also need to do this in the Great Lakes, you go through and the ice breaker goes, and then essentially cuts cuts a path that ships can go through core, wile and freezes up again. But that's why that's why I spray kind of has to go back and forth all the time and keep this lane open. But the funny thing was the nuclear reactor powering the propeller or did you just make the front of the vote really really hot? And then it melted. Drove it drove a propeller most icebreakers, by the way, don't work on the basis of Krahn, you know, using its bows to press the right on top of it and crush it with their weight. So the, you know, the idea of of of an icebreaker. Yeah. Is to push the ship up is so has sort of a shallow front end slides over and top of and then crushes the ice. And then moves forward airport needs a huge amount of power and essentially doing a series of belly exactly the violence is that, but just generally crawls and crushes, and and the Soviets idea was because you have abundant energy from nuclear than you'd have these ships kind of keeping the northern part of the Arctic. About about the Soviet Union that free. So that ships could kind of troopers from Murmansk in this case, which is their northern northern port. Which has somewhat. Pre-accident to to water. I mean that doesn't get frozen over. To which is the other end of the Soviet Union, which is sort of near Japan, and you would kind of be able to use that northern passage. They never managed to pull it off. Obviously the the nuclear icebreakers, we're not a hit. But the. Today might be to figure out a northern passage. Another idea would be to. Maybe I don't know if it's in the. In the domain of these ability, but would be to build a tunnel between Alaska, and and the Soviet Union under the Bering strait and then connect North America to to Asia through through the trains could possibly go from from the US straight through the Siberian railroad and maybe connect the via land transport all the way to Europe. And that's been a something debated for because tunnels are actually maybe should have show about tunnels. But tunnels are are are something like the British built between themselves and fans the channel. And that's that's a success. Probably not a conomic -ly as much as as as having done it. But but yeah, so you if you think about these points on the earth where there isn't that much that much water sup. Rating lands. You'll also have oh, there's one more thing. There's one more thing which is which is which is a big surprise to me when I found this out. But there's no way to drive or take a train from north America, South America. You know, there's the Panama Canal, surely, but they're bridges across it. That's not the problem. The there there you can take the Carreira Panamericana, which is a road in Mexico and take it south and make it down through I suppose, Guatemala, and Costa Rica and pay places in between. And yet it's stops. It stops somewhere. North of Panama. The Darien gap. Then though it's in Panama itself. So there's a piece of jungle called the Darien gap. And there's no road across it. And it just all the roads from North America dead end at the Darien gap, and then you can start again, you know, south of the Panama Canal connected up to Columbia, and you points out. And certainly you can enjoy a trip all the way down to the quake. I guess where or the Magellan passage. I don't know. Exactly. But it's basically it's really Chile and Argentina are are are are, you know? Our road there roads there. So here's the thing of Darien. Guess. Okay. So that's the that's that's a great question. Why hasn't there been a road or a tunnel or something, what's so magical? You could build a road. It's it's a it's a terrible place to to build a road. I think it's it's it's tropical jungle it's mountainous. But nothing nothing can stop a good civil engineer. So I think that today especially today. This would not be a big deal. And I think there are several things obviously environmental issues are going to come up. You're you don't wanna miss destroy destroy. What's there? Secondly, I think there are lots of political issues and as usual, but these always been in place, but but it isn't a technical challenge. People have drilled. Huge tunnels in Europe, and in Asia, and in Japan and so on. And tropical the tropical. Tropics have not stopped people recently, by the way. There's also a lot opportunity in Africa less informed about it. But I think this Darien gap would be excellent because if you could cross it by train or by car than it would make an excellent expedition for you to go from Barents straight, Barron straight in the Lasca down all the way to the tip of South America, you'll make rate great road trip. And I'd love to do it someday. The only people have managed to four by fours and really complex kind of rigs. And again, if you build a if you build a canal or tunnel between the Barents Sea and Russia, then you could. Troopers from from Argentina to London or Scotland. Downs getting your feet, wet, right? I think that sounds pretty amazing. But it also sounds like a potential forgetting incredibly loss. Maybe the and gap is basically just to make sure that you know, if you're driving around Columbia. You don't end up medicate that could be I'm going to humbly suggest that because that's a problem. Let's be honest. That isn't probably who knows you and everybody knows in New Jersey miss an exit and next thing, you know, you're in Delaware or something they've learned this. Hardwood. We do want to mention that a lot of what we discussed today we learned from author Peter Bernstein and his book wedding the water for the wedding of the waters. Probably the best book on on. How the canal was built the Eureka now. And a lot of what you heard today was based on. You know, having read the at least part of that book at least part of it. Parts of it. But not haven't gone as far. But it is. It is pretty fascinating stuff. And we we recommend it to everybody. Listen. Okay. Sue Horace, heavy greektown in big city as many of you know, there are a couple of apple happenings this week and Horace will be discussing next time on the critical.

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