Search This Blog

Wednesday, December 22, 2004

Backyard temps

The temperature seems to be moving in the wrong direction this morning. When I got up, our thermometer reported 0.7F in the backyard; now it's down to 0.0F.

"The Evolution of Manufacturing"

From the email list comes the following. Compare the earliest piece--Henry Ford's 1909 article on "System"--with the NYT article on Dell the other day (see my post on "flexible mass production"):
[Forwarded from AIB-L, a list for the Academy of International Business. Note that the format of this sponsored archive, in which the company selects the articles with which it wishes to be associated, is itself an interesting development. The focus on narratives of technological progress is hardly surprising; others may wish to comment on the specific articles that have been reproduced. Also, from a practical perspective, H-Business members may wish to store soft copies of some of the articles for future use. - ed.]

For those interested in a historical perspective on manufacturing operations in the U.S., there is a collection of original New York Times articles that is being made freely available online for a limited time. The collection consists of 12 articles published between 1909 and 2000. The archive is sponsored by PeopleSoft, and it is not apparent how long it will be available. The articles can be accessed from a link in the Business section of or with the direct link shown below.

The Evolution of Manufacturing
David A. Kirsch
Co-editor, H-Business

Tuesday, December 21, 2004

Capitalism and democracy

This morning's NYT article on the Yukos auction quotes Robert Mabro, chairman of the Oxford Institute for Energy Studies:
"You've got to compare Russia to other oil producers like Iran or Saudi Arabia, not democracies like Denmark or Holland. After 80 years of communism, you don't turn into a liberal democracy overnight. That's a romantic notion that has no historic foundation."
That "romantic notion" likely derives from the theoretical economic determinism that sees capitalism as automatically giving rise to democracy. Certainly there are liberalizing pressures at work, visible in this case in the response of international investors to the Russian government's actions. But historically more accurate is sociologist Theda Skocpol's observation that capitalism has proven compatible with a wide variety of political systems: "capitalism in general has no politics," she notes, "only (extremely flexible) outer limits for the kinds of support for property ownership and controls on the labor force that it can tolerate." (Politics and Society 10 [1980]: 200.)

Monday, December 20, 2004

Flexible mass production

Fordism + scientific management + computers = flexible mass production, aka Dell: Gary Rivlin, "Who's Afraid of China? How Dell Became the World's Most Efficient Computer Maker," New York Times, 12/19/04, sec. 3, pp. 1, 4.

Govt. & business in a global age

The news last week that the Russian oil company Yukos had sought bankruptcy protection in American courts offered an interesting example of the phenomenon of "jurisdiction-shifting," one of several ways of exploiting fractures in a political structure to gain political advantage. In this case, Yukos is seeking protection in U.S. courts from the Russian state, in essence seeking to shift the struggle from one jurisdiction to another in hopes of gaining a more favorable hearing. Other techniques that emerged in battles between railroads and the American states in context of the U.S.'s federal-legislative structure in the 19th century: branch-shifting and level-shifting.

(For more, see Colleen A. Dunlavy, "Bursting Through State Limits: Lessons from American Railroad History," in Private Actors and Public Interest: The Role of the State in Regulated Economies, eds. Lars Magnusson and Jan Ottosson [Edward Elgar, 2001], which was inspired originally by legal historian Harry Scheiber's article "Federalism and the American Economic Order.")

The business of slavery

Catching up on the news . . . (I've been consumed with end-of-the-semester obligations, which included giving an exam on Saturday evening [sic]).

Thursday's New York Times had an article (NYT, 12/16/04, D1, 9) about small steps taken recently to commemorate the slave market in Natchez, which was second in sales only to the New Orleans market. Although slavery is a standard topic in American economic history, the business of slavery has been flat-out ignored by business historians. This is not so surprising, given the historical orientation of the field of business history around big business and mass production, but it is shocking to realize that we know so little about a business that was so signficant and pervasive in the antebellum period, in North and South. Walter Johnson is not a business historian himself, but his book, Soul By Soul: Life in the New Orleans Slave Market (if I remember the subtitle right), does an admirable job of opening up the subject--"must" reading for business historians.

Tuesday, December 14, 2004

In the "holy smokes" category

Wow. The Google-organized project to digitize library materials is breathtaking in its ambitions (NYT, 12/14/04, A1, C3; WSJ, 12/14/04, D1, 4). And what a boon for historians in search of primary sources, since only works on which copyrights have expired will be available in their entirety.

No appreciable snow in sight here in Madison, Wisconsin. This reminds me of Decembers when I was growing up on the farm in Minnesota and worried that we wouldn't have snow in time for Christmas. The temperature this morning reminded us with all the crystal clarity of a sunny-cold morning (11.4 F--"bitter cold" in NY/NJ televison parlance) just how spoiled we've been so far this fall.

Signs of a new era of capitalism?

Noteworthy in the New York Time this morning: Adam Cohen's piece on the editorial page (NYT, 12/14/04, xxx) about efforts to return to the pre-1937 state of regulation in the U.S. Advocates, he reports, refer to the U.S. Constitution before 1937 (by which he means, I assume, before the 1937 Supreme Court decision upholding the Wagner Act) as the "Constitution-in-Exile."

In my last lecture of the semester this afternoon, I talked about some of the changes in the world of American business since the 1970s that strike the eye of a business historian. Regulation is one of several arenas in which, it seems to me, one can discern fundamental discontinuities, radical departures from the patterns of change that have prevailed since the late nineteenth century. The subject of Cohen's article is a piece of that history.

Also of note: the German stock exchange (Deutsche Boerse) is proposing to buy the London stock exchange (NYT, 12/14/04, B1?). The concept of nationality may be losing its meaning faster in the world of business than anywhere else; certainly the best evidence of globalization is to be found in the world of finance. Or we may discover that the nationality of ownership has little to do with political nationalism. Or that corporations have become extremely skilled at disguising their nationality.

Monday, December 13, 2004

Good and poor quality business reporting

Nice article by Steve Lohr this morning in the New York Times on the IBM-Lenovo deal. Just as I thought: "I.B.M. Sought a China Partnership, Not Just a Sale" (NYT, 12/13/04, C1, 6). Too often the graphs that accompany business reporting cover such a brief period of time that it's difficult or impossible to discern the long-term trends. This story offers a nice exception: a chart of the sources of IBM revenue that actually covers 20-odd years (1982-2003). It shows clearly a relative shift away from hardware between 1988 and 1994.

Now if the chart had only presented the data in real as well as current dollars. In current dollars, it shows IBM's total revenue increasing 159% (from $34.4 billion in 1982 to $89.1 billion in 2003), which averages out at 7.57% annually. But in 2003 dollars (deflated with the CPI), its 1982 revenue stood at $65.6 billion, so in real terms its revenue increased only 35.8% or 1.7% annually over the twenty-one year period. Rather a different picture.

Maybe I'm just a bit sleepy this morning but I cannot figure out what Andrew Ross Sorkin's article, "Icahn Accuses A Hedge Fund Of Stock Manipulation" (NYT, 12/13/04, C1, 2), has to do with buying shareholder votes. It refers to the allegation twice, mentioning it in the third paragraph and ending the article with this: "But there has been a long debate about whether shareholder voting rights must be tied to shareholder ownership." But the article never makes explicit how this issue relates to Icahn's dispute with the companies in question.

Last item of note: M.I.T.'s Technology Review has been revamped once again (NYT, 12/13/04, C4). As the reporter, Victoria Shannon, notes, the last go-around in 1998 "injected a cheerleading breathlessness into its coverage that left some academics cold." Its rah-rah approach to technology reporting certainly left me feeling frigid. But what is that at the end of the article? "'The earlier Technology Review was more likely to look at the social and political dimensions of science and technology.' [The Review's editor] Mr. [Jason] Pontin promised a grounded approach this time. 'We want to be skeptical.'" Maybe Pontin was quoted inacurately, but if not, how could he possibly equate attention to "the social and political dimensions of science and technology" with a lack of skepticism? Mr. Pontin clearly needs to spend some time talking with the faculty in M.IT.'s own Program in Science, Technology, and Society. (Is a disclaimer called for here? I'm an alum of the program.) For more balanced coverage, I prefer Wired.

Sunday, December 12, 2004

Sunday morning reading + viewing tips

Recommended reading in the New York Times (national edition) this morning and some viewing tips:
  • Peter Applebome, "Our Towns: How a Working Man's Money Went Into a Closet and Came Out of Fortune," NYT, 12/12/04, 33,
    • on the soon-to-be-auctioned-off currency collection of Malcolm A. Trask (1901-1889), New York subway motorman. The story includes a photo of a $10 note issued in 1878.
    • For more images of currency and coins, try the American Numismatics Association's Virtual Museum.
  • Timothy L. O'Brien and Larry Rohter, "The Pinochet Money Trail: A Dictator's Mysterious Cash at Riggs Bank," NYT, 12/12/04, Sec. 3, pp. 1, 12.
    • Of documentaries on multinationals, producer Larry Adelman's "Controlling Interest" (California Newsreel, 1978) is exceptional for the interviews that he conducted with MNC executives in the mid-1970s.

Friday, December 10, 2004

Corporate governance in China

In my undergraduate lecture course on American business history, I often take a few minutes at the beginning of class to talk about stories in the news recently. Most of those are stories in the New York Times simply because I read it before the Wall Street Journal every morning and some days I don't get to the WSJ until the evening. So today's "harvest" marks a change of sorts: the interesting news seems mainly to come from the Journal.

Case in point: In the "World Watch" column (WSJ, 12/09/04, A14), a brief report entitled "China Gives Minority Shareholders Bigger Role" from Dow Jones Newswires. Unfortunately, it's a tad opaque (incoherent?), so I will have to dig up more/better information elsewhere. But the gist of it is that the Chinese government is limiting the governance power of government investors, who hold "nontradable shares accounting for two-thirds of the value of the average listed company in China," thus enhancing the power of private shareholders. But, interestingly, shareholders cannot vote by proxy--they must actually attend shareholder meetings in order to vote. Here's where the murkiness enters in: it is unclear in the report whether the new regulations establish this practice or encourage companies to permit voting by proxy.

I'll dig up more info on this when I have chance. But first I have to tackle a pile of student paper drafts that need grading. Good task for a dark and wet afternoon in the Upper Midwest. I have my fingers crossed that we'll finally get a few flakes of snow.

Thinking of Thinkpads, etc.

The IBM-Lenovo stories remind me of my ongoing search for an ultra-ultralight laptop. Will anyone ever break the two-pound barrier with a 12" screen so I can live with my laptop in hand (or in purse/briefcase)? The Thinkpad X40 and Panasonic's Toughbook W2 both reportedly weigh in at about 2.7 lbs. But the Thinkpad doesn't have a touchpad, so that's out for me. Now if the Toughbook would just forego its built-in optical drive and beef up its max. RAM to a gigabyte or so, shedding a pound in the process . . . .


How twenty-first century! The most interesting aspects of this cross-border, cross-culture deal are the ongoing entanglements: IBM will reportedly buy 20% of Lenovo, while Lenovo will buy "world-wide service and warranty work" from IBM (on the latter point: WSJ, 12/10/04, B4). Sounds more like a joint venture than a sale.

Most interesting story I've read about the IBM-Lenovo deal: Yale computer science Prof. David Gelernter's column in the Wall Street Journal this morning: "How to Build a Better PC? Don't Give Up." (WSJ, 12/9/04, A16) His basic point: other pathbreaking technologies (automobiles, airplanes) underwent transformations when they were as old or older than the PC, and the PC could, too. I'd love to have all of the (mainly software based) features he envisions, especially the email "acknowledge" function.