tag:blogger.com,1999:blog-2880793859979767322024-03-13T04:23:00.126-07:00the iron pantheonNotes on the Decline, Death and Re-Birth of American manufacturingsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.comBlogger26125tag:blogger.com,1999:blog-288079385997976732.post-46659623575826743342012-10-02T11:34:00.002-07:002012-10-02T11:35:10.012-07:00Patneral Capitalism - The Glided SecretThe real secret of American manufacturing success in the Glided Age maybe paternal capitalism. Liberals will scream but paternal capitalism with government regulation is the best fit for democracies. Socialism over promises, delivers little, and a the cost of personal and religious liberty. it takes a strong moral and religious society to grow paternal capitalists. It maybe that the failures of capitalism are the result over declining moral education.<br />
McGuffey Readers in one room schools is the most common factor of our great industrialists.<br />
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READ childrenofsheen.wordpress.com/ (blog Children of Sheen)<br />
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MY LITERARY PANTHEON OF BUSINESS BOOKS<br />
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<br />steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-9563552616252023682012-09-02T06:30:00.002-07:002012-09-02T06:30:19.195-07:00The Space Program and Economic NationalismThe American space program is one of the best models of business, industry, and government cooperation. It was typical of past economic projects of the old Whigs, which us the Erie Canal, our railroads, and the Panama Canal. The program impacted all phases of American business. On October 4, 1957, the Russian satellite Sputnik rocked the United States. Sputnik galvanized and strengthened America’s resolve to compete with the Soviet Union in a space race. The nation’s fears and security became channeled in the Cold War space race, which united the nation’s resources. In 1958, the government created the National Aeronautics and Space Administration (NASA), and launched its first satellite. The real race began in 1961. With America continuing to fall more behind, President John F. Kennedy announced America’s goal to reach the moon. Outside of war, rarely has a nation been so set on a national goal as America in the space race. The space race would increase business and commerce for every tax dollar spent. The manned space program was the largest government investment, surpassing the Panama Canal; but unlike the canal, commercial value was measured in spin-offs versus the end goal. The commercial spin-offs included solar batteries, new materials, computer advances, improved communications, new robotics, and weapons systems. The program made major advances in manufacturing design and management approaches to product improvements. NASA’s organizational infrastructure of process and project management proved highly successful to coordinate private (schools and industry) and military enterprises. Millions of Americans at factories across the USA were proud of their role in making the thousands of parts. Never since have we had the leadership of Kennedy in a version of the old Whig idea of economic nationalism. <br />
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NASA estimates that for every dollar spent in the space program, the country receives $7 in increased jobs and income. There is no question that the space program has proven to be the best economic stimulus of American business. Spin-offs became a new business-government model. Its impact went far beyond directly measured benefits. There was an inspirational factor not seen in projects like the Panama Canal and the Hoover Dam. Today a simple 2 million dollar robot race challenge created priceless technology for the Defense Department. The point is that well planned and focused government investment can strengthen our nation. Unfortunately, today we waste billions with negative returns. Americans need leadership and real goals not endless spending. <br />
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steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-74846437314063622512012-08-17T07:08:00.001-07:002012-08-17T07:08:50.340-07:00Economic NationalisnOne belief of all the great American industrial barons had in common was economic nationalism. What is it? A belief that America was exceptional and its success would be a beacon of light to change the world. Not by supplying the world fish but teaching them to fish. It was a combination of scientific tariffs, realizing that trade is never free. Currency differences was one reason but more important was the fact that American products carry the internal costs of liberty and freedom as well as worker social costs- pension and health. We have been taken in by the idea that "free" is necessary for capitalism. It is our "free" trade that promotes slavery and socialism around the world. My brother conservatives once carried the flag of economic nationalism, but now the flag has fallen. Some one needs to pick it up and pronounce the the "free trade" economists are not wearing clothes. Capitalism is national - ONLY the states demonstrate truly equal and free trade.<br />
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my new book on the Carnegie Boys is out - that shows how American capitalists once beleived in economic nationalism of Alexander Hamilton, Henry Clay, Abraham Lincoln, and William McKinley -- and taught in our schools by William McGuffey<br />
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steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-34900361337039523692012-07-16T07:03:00.001-07:002012-07-16T07:03:31.024-07:00The One Common Factor of the Industrial BaronsI have written 15 biographies of America's great industrialists- the amazing common denominator is they came from families with Whig Party backgrounds, believing in the economic manifest destiny of the United States. <br />
The American System of the Whigs and of the writings of Henry Clay and later Abraham Lincoln was summarized best by Historian Edgar Jones and is far different than the platform of either of today’s parties. That summary is:<br />
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<strong>1. A high protective tariff</strong> [Federalist Paper No. 11 justification]<br />
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<strong>2. Internal Improvements</strong> [ Eire Canal, National Road, Railroads, Hoover Dam, Interstate highways]<br />
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<strong>3. A loyal adherence to the constitution of the United States</strong><br />
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<strong>4. Ardent support of the union</strong><br />
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<strong>5. Passionate patriotism and a belief in the lofty destiny of America </strong>[underlying principle]<br />
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Where are the Whigs today?<br />
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read my pantheon of biographies <br />
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<br />steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-28000207019370721522012-06-24T05:45:00.000-07:002012-06-24T05:45:58.878-07:00Lessons of the Robber BaronsLife as a Challenge and Roadblocks as Motivation<br />
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[Successful Characteristics of the Robber Barons---A SERIES]<br />
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The term "Robber Barons "is hardly a fair characterization of many of these greats like George Westinghouse, H. J. Heinz, Andrew Carnegie, Henry Ford, and Harvey Firestone. It was never about the money for them; mansions, cars, and trips were merely ancillary rewards of a deep seeded quest. It was achievement that drove them and the more difficult the track the better. Winning a fortune in the lottery as a road to riches would have been shameful. It would be an empty road to success. Money was only a mile marker of achievement for them. They loved their poor beginnings, and almost relished the opportunity to start again in their many bankruptcies. The bigger the challenge the better- old age, lost of face, personal bankruptcies, lost of family, war, etc. Henry Ford bankrupted two companies prior but started over enthusiastically to form Ford Motor Company. George Westinghouse lost his Westinghouse Electric in his fifties and loved the new challenge to start again. Frank Seiberling, founder of Goodyear, lost the company at age 63, and built a new one that became the world’s seventh largest rubber company. Those that didn’t lose their companies or fortunes, like Andrew Carnegie, lamented the fact that they wanted to go back and start over. They missed the challenges of rising and succeeding. The “40” millionaires of the early Carnegie Company (see my book “The Carnegie Boys,”} meet every year after and these reunions lamented the old days have having nothing but a burning desire to succeed. <br />
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<br />steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-68052175335648005922012-06-12T06:02:00.000-07:002012-06-12T06:02:34.951-07:00A New Look at Great DepressionStock Market Crash/Great Depression 1929
While the stock market crash of 1929 did not cause the Great Depression, it is the most remembered harbinger of America’s worst financial crisis. The depression that followed would be a decade of unemployment and hard times. Unemployment became a way of life for as many as 25 percent of the American workforce. National gross product 30 percent and industrial production dropped by 40 percent. The nation’s steel mills worked a 2-3 day weeks for years. Corporate investment went negative with capital investment being below depreciation. The depression also exhibited a “double dip” returning in 1937 after some improvement. Unemployment from 1929 to 1941 was above 10 percent and underemployment was as high as 50 percent. The homeless estimated in New York city alone was 15,000. The stock market dropped over 50 percent. The depression changed American psyche and economic thinking to this day. The Keynesian economic approach, named after John Maynard Keynes, which emphasized government spending and consumers, became the dominant approach. Tariff policy would be changed after centuries of tariff protection because of fear of trade wars. The Depression would also initiate a decade of social and economic legislation to build a safety net. Banking laws were strengthened to protect consumers, and the union movement was strengthened to help workers. The depression also changed the political landscape of the nation into this century. An endless array of laws was implemented to address the causes and effects of the depression, including stock market controls.
The stock market crash did contribute to it. Stock market losses did cause a pull back in consumer spending and the Federal Reserve to increase interest rates. The roots of the Great Depression go back to a few years earlier and resulted from what many consider the perfect economic storm. Factors included the business cycle, over-speculation, a stock bubble, massive crop failures; trade wars, and government intervention. Still most would agree that the taproot and beginning of the Great Depression was the stock market crash of 1929. The beginning of 1929 saw a nation in a boom economy with a record GNP. Car production had doubled in 1929 from its 1923 level. Real income per capita had reached new highs and the newspapers were filled with stories of excessive spending. Speculation was also at an all time high. Margin leveraged accounts were at record highs as well. To facilitate investment, the Federal Reserve for years had been following a strategy of easy money. Consumer credit was rising dramatically. Interest rates for margin accounts were moving higher reaching over 20 percent. Many small investors were speculating as many stock were selling over 30 times earnings. People were talking of a new economic model were all would become rich in the endless growth of the American economy. Clearly there was a stock market bubble.
On September 3, 1929 the Dow Jones industrial average hit a record high of 381. The Federal Reserve had issued warnings of over speculation and had started to tighten money, unfortunately, the New York Federal Reserve broke ranks injecting massive amounts of cash for margin stock accounts (this type of rogue behavior would be addressed after the depression). The availability of call money made big investors over confident about the stock markets setbacks in September of 1929. Market started to show true signs of instability in October of 1929. On Black Thursday, October 24, the market moved lower on record thirteen million shares traded. The big and mostly widely traded companies lost an average of over 10 percent, triggering the first wave of calls on margin loans. The President and major industrialists jumped in with positive statements. Then on Black Tuesday, October 29, 1929, the market crashed to 40 percent of its high a month earlier. As banks recalled loans panic set in and the great crash entered into American legend. The Federal Reserve, business leaders, and politicians made the right moves to stop the economy from going over the cliff. Things did stabilize as the economy moved into 1930.
The quick easing of money put off the banks till later 1930. There was even a brief recovery in the first six months of 1930. However, the indicators were showing a decline in economic activity. By the end of 1930 and into 1931, bank failures and panics started with the now famous lines of panicked depositors. Bank failures were 659 in 1929, 1,350 in 1930, and 2,293 in 1931. The banking problems spread in 1931 with a doubling of bank failures and mortgage bankruptcies. The New York money crisis had once again spread across the country and Europe as seen in previous panics. Deflation rapidly lowered house prices and reduced grain prices, which hurt farmers. Farm prices had dropped 40 percent from their 1926 high. The government tried to pour money into creating demand. Social problems started to mount as unemployment hit 17 percent in 1931. Congress passed the Smoot-Hawley Tariff Act creating historic tariff rates. Still, it was not the American tariff rates so much as a rush by all countries to protect their home markets. The combination of deflation, low farm prices, and tariffs cut imports 40 percent. In 1932 as the Dow hit 95, America looked for a political solution with the election of Franklin Roosevelt and the New Deal Democrats.
Roosevelt in 1933 imposed a bank holiday to stop panics and build new confidence in the banking system. More dramatic was the creation of the National Recovery Administration, which had sweeping powers to control wages and prices. The NRA created a national industry, similar to that of Stalin in Russia. The NRA would be found unconstitutional in 1935. In hindsight, most economics today see it as ineffective and a mistake. Still it at least stabilized unemployment and confidence. The Dow moved up from a low of 58. The Civilian Conservation Corps hired over 250,000 young men and at least prevented social unrest in the worst of the depression. From 1933 to 1934, Roosevelt used the time to implement sweeping social legislation such as National Labor Relations Board, which enforced the use of collective bargaining. Roosevelt tried a long array of approaches moving off and on the gold standard, credit regulation, mortgage aid, work projects, trade laws, reduced tariffs, increasing taxes, new banking regulations, and expand credit programs. In 1935, the New Deal Democrats looked for long-term social safety net, enacting the Social Security. The National Labor Relations Act of 1935 created unionization of the steel, rubber, and automotive industries, and wide spread collective bargaining. The government had successfully moved into energy production with the Hoover Dam and the Tennessee Valley Authority.
Things never really improved and in 1937, the economy slipped into a “depression within a depression.” This set back came as the multitude of social programs took large amounts of money out of circulation. Taxes slowed capital investment. And union-creating laws had caused wages to jump 11 to 33 percent, making things costly and bringing down demand. Another complication was the devastation of American agriculture by the Dust Bowl. The climb out of this second dip was slow. Unemployment went from 18 percent in 1938 to 14 percent in 1940, as war production would finally bring American industry back to life. Arguments and analysis of the causes and solutions for the Great Depression continue to this day. Its impact on the nature of American business was however deep and lasting.
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http://www.amazon.com/Most-Significant-Events-American-Business/dp/0313398623/ref=sr_1_10?ie=UTF8&qid=1339505966&sr=8-10&keywords=skrabecsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-11578568553982060502012-05-21T07:20:00.000-07:002012-05-21T07:20:17.077-07:00Lessons from America's Golden YearsMy twenty years of research and literary pantheon of books on American industry begs the question – can we return to the glory days of the industrial barons? Are there any young barons out there? The following characterization is based on the historical facts. It will not please Democrats or Republicans nor liberals or conservatives. The answer is yes there are young Firestones and Carnegies, but that’s not the real question. The question is America capable of bringing out these young barons, and the answer is no. So what changes would be needed to return and why aren’t we trying. The solution is not as many suggest political, in fact, neither party has the whole answer and that is what limits us. Each party has part of the components of the age of barons but is so polarized that no one can bring the necessary segments together.
First we would need to create the early educational environment of the barons. Surprisingly, the educational system of the barons lacked hard science and advanced math, but was rich in the basics and American and heroic history. Education was a local community responsibility and tended to be one-room, poorly lighted, and cold, lacking many physical amenities of today. The only wall decorations were pictures of Washington and Lincoln. Homework seemed endless. Men like Firestone while not great students found inspiration their in McGuffey Readers. It was a highly competitive classroom and playground. Much of the discipline and playground behavior would be banded today! The other characteristic of the educational system was endless stories of the greatness of America. Self-reliance and the need to help the less fortunate, which seemed to build a foundation for paternal capitalists was the basic lesson plan.
What of the government and society? Society was self-reliant and competitive reflecting the training of the educational system. The political system was low taxation and highly protective. While they detested government involvement in unionization, they relied on tariffs and government efforts in a national road or transportation systems. The government favored a nationalistic, paternal, and regulated approach to capitalism. Tariffs were as high as 40 percent but that came with heavy, daily regulation by a standing committee of congress. The industries of the barons were protected as long as profits were put back in the expansion of factories, job creation, and to some degree community improvements. The barons themselves were highly patriotic and while expanding internationally, no effort was made to be transnational; in fact, they were more typical of the “ugly” American bringing American methodology to other countries. They believed fully in American exceptionalism. It would be difficult to close an American factory and move off shore for two reasons: (1) they were nationalists above all and (2) Congress would strip them of protective tariff status. Politically, they were Whigs, believing all political platforms should be based solely on the growth of America economically.
There was also a belief that America was too unique to be considered as a mere member of an international community, and we didn’t play well with other countries. The barons while expanding internationally for more profits tended to be isolationists. They tended to be pacifists such as Harvey Firestone, Henry Ford, and Andrew Carnegie. Another somewhat surprising characteristic was their hatred of bankers and in particular, the international bankers of New York. They preferred to finance through stock and bond issues. Of course, at least the first part of their careers was in a world of no personal or corporate taxes. They were religious and charitable. Many espoused Christian principles in their management styles.
In the workplace, they believed in loyalty and results over higher education. They even forced their sons to at least work through the various levels and departments. While they reflected society’s biases of the time, they generally put results of the person above all else. Youths were given as much responsibility that they demonstrated they could handle. They preferred paternalism to unionism, although, they came to at least tolerate unions while reluctantly giving up authority. Finally, they were flawed humans, requiring government regulations and over site (often demanding it).
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http://www.amazon.com/s/ref=nb_sb_noss_1?url=search-alias%3Dstripbooks&field-keywords=skrabecsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com1tag:blogger.com,1999:blog-288079385997976732.post-40268778036027179242012-03-16T06:21:00.000-07:002012-03-16T06:21:32.057-07:00The Delince of American Manufacturing is due to the great mythAmerican Capitalism today was become the object of political debate but its meaning, history, and nature has been lost, co-opted, and distorted by both sides of the debate. Capitalism came from the marketplaces of democratic societies, not from philosophers, political parties or economic professors at universities. It, like democracy itself, is of the people. It is at the heart of our history of our nation and it has its share of the good, the bad, and the ugly just like the people of this nation. Our theoretical debates on capitalism are at the very root of our indecision and lack of progress. To understand capitalism requires an objective look at its history. Some of these premises of capitalism have been made truth by both the left and right in recent decades must be overcome. The FREE Trade myth seems accepted by all!If you can’t get by the fact that American capitalism is not interchangeable with tariff free trade like many on the right, you will not understand capitalism. In fact, the greatest years of American capitalism came under decades of protectionism. Similarly on the left, you must realize immigration of cheap labor not only reduces local wages, but impedes innovation. And yes we need regulation, but the real question is what kind and how much. Capitalism has been defined by freedom and bound by the regulation of its abuses just as our society itself. Is wealth distribution the real source of unrest with Americans? History shows Americans tolerate inequality in wealth distribution as long as class mobility is high and the playing field level. Inequality of wealth distribution is the very much the touch mark of all human society, but what made America different was class mobility and opportunity with a foundation of free education. Is government inefficient in the market place? Not always, the national road, Erie Canal, our railroad system, Panama Canal, Hoover Dam, and space program tell a different story. What we need to understand is the history of these successful government programs, so we can emulate them.steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-40464511391383021402011-11-06T05:54:00.000-08:002011-11-06T05:57:41.376-08:00IS THERE A MANUFACTURING CANIDATE?Mitt Rommey-- kicked of his campagin at the very symbol of American manufacturing-- Greenfield Village<br />
he is the first true manufacturing canidate since William McKinley<br />
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As President, he pushed for reciprocity arrangements through treaties in the 1897 Dingley tariff. Debated at the time, reciprocity gave protectionist America a perception of fairness. Many conservatives were concerned that McKinley’s reciprocity arrangements would lead to an erosion of protectionism, but McKinley believed it was necessary for the future. American surplus was becoming an issue, and McKinley wanted to allow for a boom in exports. In his last speech at Buffalo, McKinley defined his vision: “A system which provides a mutual exchange of commodities is manifestly essential to continued and healthful growth of our export trade. . . Reciprocity is the natural outgrowth of our wonderful industrial development under the domestic policy now firmly established . . . The expansion of our trade and commerce is a pressing problem. Commercial wars are unprofitable. A policy of good will and friendly trade relations will prevent reprisals. Reciprocity treaties are in harmony with the spirit of the times; measures of retaliation are not.”<br />
Statistics for the 1890 to 1900 decade support the conclusion of McKinley’s success that prices came down, profits rose, capital investment went up, and wages held or slightly increased (real wages clearly rose). Average annual manufacturing income went from $425.00 a year and $1.44 a day in 1890 to $432.00 a year and $1.50 a day in 1900. The average day in manufacturing remained around 10 hours a day. Heavily protected industries such as steel fared slightly better with wages. The cost of living index fell during the decade from 91 to 84 or about 8 percent. The clothing cost of living dropped even more from 134 to 108 or 19 percent. Food stayed about the same but the cost of protected sugar dropped around 25 percent. The bottom line is that real wage (adjusted for cost of living) index rose from $1.58 a day to $1.77 a day in 1900 or about a 12 percent increase. Invention flowered during the period as companies invested in research and development to meet congressional oversight of profits. The success of this period of managed trade depended on government oversight, business cooperation, and labor support. The list of companies that built their foundation and expanded included Libbey Glass, United States Steel, Standard Oil, ALCOA, H. J. Heinz (there was a 40 percent tariff on pickles) and Bethlehem Steel to name a few.<br />
http://www.amazon.com/William-McKinley-Apostle-Protectionism-Quentin/dp/0875865771/ref=sr_1_17?ie=UTF8&qid=1320587757&sr=8-17steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-32765733704496293702011-09-29T05:43:00.000-07:002011-09-29T05:44:04.571-07:00Al Gore created the interent is closer to truth than man-made global warmingARPAnet (Earliest Internet) Formed 1969<br />
The Advanced Research Projects Agency Network (ARPAnet) set the infrastructure that would become the Internet. ARPAnet began as a network of connected university computers. The ARPAnet was funded by the Defense Advanced Research Projects Agency. The original basis was to develop a network for military command and control after a nuclear attack. The computer network was based on telephone lines and required a new technology known as packet switching to move data on telephone lines between computers. After its startup in 1969, ARPAnet evolved into several innovations in the early 1970s such as email, a file transfer protocol, which allows data to be sent in bulk, and a remote connecting service for network computers. This network grew to connect universities across the nation with defense funding. When the Defense Department pulled out of the project in 1990, it had laid the groundwork for today’s worldwide Internet. Universities continued the old network as NSFnet as it expanded to individuals with the advent of the Personal Computer.<br />
The roots of the ARPAnet go back to the funding of the Defense Advanced Research Projects Agency (DARPA) formed in 1957 as a response to the launching of Sputnik. DARPA was created as a very special research group for the Department of Defense. The name was changed in 1958 to Advanced Research Projects Agency (ARPA). ARPA had an annual $12 million budget and much flexibility on spending it. Its first project was to look at a communications network that could operate after a nuclear attack on the United States. This bombproof network would allow distant military centers to communicate. ARPA adapted the early work of the 1960s of Paul Baran of the Rand Institute. This early network research had been financed by the Air Force. Baran’s work was on a packet switching system that would allow information to be routed on any available electronic lines such as telephone lines. The packet switching concept of Paul Baran was a revolutionary idea of breaking data or messages in packets to flow along available lines and then be reassembled at the designation machine. This differed from a traditional phone call that used circuit switching to form a dedicated circuit for the duration of the communication session. Packet switching allows data to flow on a fractured network unable to develop a dedicated or “direct” hook up. Packet switching is a special computer protocol allowing computers to exchange information (network control protocol). <br />
Baran’s packet switching network offered another possibility of connecting universities involved in research for the Defense Department. At the time computers even in the same room could not talk to each other let alone at different universities. Packet switching along telephone lines would be a necessity to move large blocks of research data. These connections would allow huge amounts of data to be transported between universities. Beyond packet switching, some hardware to handle the messages had to be developed. Since ARPA was a small core group, it contracted out the work to BNN Technologies. To connect distance computers, each location required a gateway computer known as an Interface Message Processor (IMPs or routers as they are known today). The first IMP was built by Honeywell and could service four local computers. The first network connected computers at UCLA and the Stanford Research Institute in September of 1969. UCLA and Stanford both had SDS computers. Initially after typing “login,” the system shutdown, taking another month to work out the bugs for a message, which was ultimately sent at 10:30 p.m. October 29, 1969. <br />
By the end of 1969, an IBM 360 at the University of California, Santa Barbara, and a DEC at the University of Utah were added to the network. MIT was added to the network in March of 1970. In 1971, the first e-mail was sent; and by 1973 with over 40 sites, e-mail made up 75 percent of the traffic, which augured the future of the Internet. To send a message on the ARPAnet required a computer to break the message into packets using an Internet Protocol (IP). The packets also received a digital identification because individual packets might take different paths. Individual packets are routed based on traffic. When the individual packet envelopes reach the destination computer, Transmission Control Protocol (TCP) reassembled the message in correct order. The network was slow running at 50 to 200 kbit/second. The year 1971 also brought the use of a Terminal Interface Processor (TIP) capable of adding over 60 slave terminals to the host computer. By the mid-1970s, huge databases were being passed between universities using File Transfer Protocol (FTP). The ARPAnet had achieved its goal and was supporting both military and civilian research applications. In 1983, the ARPAnet was split into National Science Foundation network (NSFnet) and the classified military network (MILnet). <br />
ARPAnet continued as a communication system between certain research pockets at various universities until most of the IMP routers became obsolete in 1989. <br />
The NSFnet used Local Area Networks (LANs) to link whole universities internally and externally. The NSFnet started to look for more funding as the ARPAnet shutdown in 1990. In 1991, Senator Albert Gore crafted and the Congress passed the High Performance Computing and Communication Act. The bill created and funded a super information highway for research, which evolved into the Internet of today. Today’s Internet is made up of the same infrastructure of routers and protocols. The Internet, regardless of its government origins, remained firmly rooted in the private industry.steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-7283299098628131272011-08-13T06:25:00.001-07:002011-08-13T06:25:19.091-07:00American Capitalism is not exceptional but Different<br />
Much has been written of the source of capitalism, but that was the capitalism of the Great Enlightenment and Scottish philosophers such as Adam Smith, not American capitalism. American capitalism was that of the Scottish bastards known as the Scotch-Irish. American capitalism was never an ideology or philosophy; it was a quest for opportunity and economic rewards. It embodied furs, ginseng, tobacco, and whiskey for cash and required rivers and trails to bring these resources and cash together. It brought the Indians, frontiersmen, bankers, plantation owners, and Europe into a global market. For them the exploitation of nature created money, not the other way around. They wanted this exchange to be unfettered by government. It was similar to the capitalism of Smith in that it was self-serving on an individual level, but it differed in that it was also self-serving on a national level. American capitalism was not anti-government, but viewed government as a facilitator not as a regulator or generator. A simple democratic thought that government should serve the people, in this case frontier capitalists and plantation owners. <br />
These Scotch-Irish and other colonists saw capitalism not as part of democracy but a result of it. Few knew of Adam Smith and likewise Adam Smith knew little of these frontiersmen, colonists, and settlers. Smith saw capitalism through the profitable British merchants and wholesalers of Glasgow, which had the world’s best resources of finance, technology, and education. The American capitalists were hands on forced to create their own finances, technology, and education. They wanted the freedom to prosper and were self reliant for their needs and government was to aid in obtaining these goals. It is not surprising that the capitalism of aristocratic Europe evolved differently that of democratic America. American cared little for theory, philosophy, or economic policy and would change all for prosperity. The early New England colonists had shown this flexibility in government to support prosperity. To that extend it was even more greedy than that of European capitalism. <br />
American capitalism not only absorbed the politics of the country but its religion as well. They were greedy but not heartless. The pursuit of prosperity was elevated to a right. It challenged the rights of kings to inherit prosperity. If you had the right to prosper, it appeared that all other rights had to be in place. The right to prosperity runs so deep that some used religion as a justification for their unabashed pursuit of money. This view of economic freedom was the real idea of America. It would put individual motivation above the mechanics of economics. Allow Americans to prosper and they would build their government on that foundation. They not only broke from England but also within the first years of the new American government challenged it with resistance on a tax on whiskey, known as the Whiskey Rebellion. Americans with all their virtues to this day vote more often their pocketbooks. <br />
steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-45005082160272671232011-05-23T06:26:00.000-07:002011-05-23T06:33:40.292-07:00The World's Most Forgotten Major InventionThe Owens Automated Glass Bottle making Machine 1904 <br />
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Edward D. Libbey’s Toledo Glass Company was the developer of the automated bottle machine. Michael Owens gets the credit (rightfully so for the invention), but its full development and implementation required the organization of Toledo Glass, and Libbey gets credit for that. Glass making had hardly changed in three thousand years until the invention of the bottle-making machine. The automatic bottle-making machine would be a true manufacturing revolution compared to the Eli Whitney’s cotton gin in the cotton industry. Even more, the bottle machine changed society and culture. A fifteenth century Venetian would have felt right at home in an 1870 glass house prior to the automation of Libbey and Owens. The automatic bottle machine led to a revolution of packaging such as milk bottles, beer bottles, pop bottles, baby bottles, and glass jars. Business friends, Libbey Adolphus Bush and H. J. Heinz, were pioneering glass packaging in beer and vegetables but lacked volume glass bottle suppliers. The first costs of production using the bottle machine was around 10 cents a gross (144 bottles) versus $1.52 per gross for hand production of bottles. The lowered costs quickly opened up new markets for the use of glass bottle and jars. The automated bottle machine led to automated filling machines in industries such as ketchup making. The bottle machine guaranteed standard and equivalent weights and measures, paving the way for the Pure Food and Drug Act of 1906. An ancillary effect was the eventual elimination of child labor in the glass industry.<br />
Libbey built Toledo Glass to do development work, and without it, Michael Owens could not have made the bottle-making machine commercial. Libbey hired the draftsmen, mechanics, and engineers needed to build the machine. Michael Owens, working from a model he developed while at the Chicago World Fair of 1893, functioned as project manager. The bottle machine was every bit an organizational triumph as an engineering triumph. It required an army of technical experts and Libbey’s leadership.<br />
The bottle machine had near 10,000 individual parts, while the 1907 Model T had less than 3,000 parts. These parts had to be designed and manufactured. Every part required a two-dimensional blueprint, so it could be machined or cast. Amazingly, Michael Owens could not read blueprints. If more than one machine was to be made, it would require standardized parts, blueprints, and processes. Blueprints allowed Libbey to standardize his parts supply chain. Owens was incapable of such an engineering task, but Libbey supplied the necessary engineering backup. It was a huge undertaking beyond that of any individual. It was Libbey’s organization and Edward Libbey the CEO that allowed for the invention of the bottle machine to progress. Libbey not only held the organization together but also funded the vision when the board of directors wavered. The bottle machine as well as later inventions were the first real team inventions. It marked the end of the lone Victorian scientist making a breakthrough. Edison had an organization as support, while Libbey had a true developmental organization integrated into the effort. Libbey approached research and development as a craft, with engineers being innovation craftsmen. Libbey’s developmental company would become the model for corporate development in years to come.<br />
The development of the automated bottle took years from 1898 with Michael Owens’s first semi-automated machine. The semi-automatic process could make bottles at 75 cents a gross (144 bottles). The commercial version in 1905 known as machine A could produce twelve beer bottles per minute or 17,280 in a 24-hour period. Compare this to hand production of 2,880 per day using a crew of six men and boys. Such production capacity and lower costs quickly opened up the beer and ketchup bottles markets. The national market in 1900 was about three million bottles of ketchup alone. These were hand blown bottles, and since ketchup was sold in barrels as well, the potential market was probably near seven million bottles. The beer bottle market in 1900 was about twice that size. Libbey made the decision not to become a machine manufacturer or bottle manufacturer, but developed a different business of forming a company manufacture and lease machines to end users. Leasing was a revolutionary business model, which Libbey perfected.<br />
The first license of the machine was with Baldwin-Travis (Thatcher Manufacturing) in September of 1904. Thatcher was licensed to make milk bottles only. It cost Thatcher $250,000 for the license. The payment was made in $150,000 cash, $50,000 in preferred stock, and $50,000 in common stock. Royalties were based on a per bottle calculation of labor savings from the machine. One-half of the savings would go to the Owens Bottle Machine Company. Libbey would select companies exclusively for beer bottles, ale bottles, wine bottles, soda pop bottles, brandy bottles, etc. The royalties in 1904 were 50 cents a gross for Thatcher. The Thatcher machine required modifications for their thick walled square bottle. In addition, Libbey would supply Michael Owens to help in the machine start-up and installation. Owens quickly became a thorn in the side to a broad segment of the glass industry.<br />
Licensing was the most important of these strategic issues of Libbey. Libbey personally took to selling licenses. Robotics companies are using the Libbey model of licensing and leasing today. Libbey and Owens believed the machine had a major advantage in longneck bottles favored by beer bottles. Iron City Brewing in Pittsburgh had been one of the first to come to Toledo to see the machine. In 1903, Libbey was in negotiations with a group of Pittsburgh beer bottle manufacturers but was getting nowhere. The group had negotiated as a group, fearing that the machine would give anyone of them an unfair advantage. Libbey secretly approached one of them, Edward Everett, after negotiations broke down. He started a secret letter exchange of letters using fictitious names. Libbey and Edward Everett joined together to take over three bottle plants in Ohio (Newark, Massillon, and Wooster). The new company became Ohio Bottle Company. Ohio Bottle Company was then given exclusive license for beer, porter, ale, and soda bottle bottles. This company would be the major supplier to Pittsburgh Brewing Company (Iron City Beer). So by 1905, Libbey controlled a complex web of glass companies, which had avoided the image of a monopoly. <br />
Libbey would become America’s most adept monopolist, controlling the bottle market, while the government seemed unable to understand his control. Leasing gave him market control, which he could sell as a premium to companies. Once a company had first leasing rights such as Thatcher in milk bottles and Heinz in Ketchup bottles, Libbey refused to lease to their competitors. With Kent Machine as his manufacturing company, Libbey had started a process of vertical integration controlling the supply chain, but his horizontal integration of markets was overwhelming. In 1905, Libbey had control of the cut glass, bottle, and container markets. In the bottle and container markets, he was in a position to control pricing and production. He realized that the automatic bottle machine had the potential to cause disarray in the marketplace. Libbey chose to slowly change the market while maintaining price levels. This would also allow for an orderly transfer of skilled glass blowers and gathers to machine operators. Still, Libbey’s tactics were every bit as monopolistic in nature as those of J. P. Morgan. Libbey, in fact, had the power to decide segment winners because he sold exclusive rights in segments such as beer bottles, vegetable jars, milk bottles and other segments. <br />
Libbey also moved quickly on expanding licensing to Europe with trips in 1904 and 1905. Owens European Bottle Machine was formed to sell licenses. Beer King Adolphus Busch who had first seen the machine in 1903 became a stockholder in the European Bottle Machine. Other than Busch and Julius Prince of Germany’s Apollinaris Company, the board of Owens European Bottle was the same as Toledo Glass. Owens European had exclusive rights for Europe, Central America, South America, Africa, Cuba, and Australasia. One of the unexpected results of the Owens bottle Machine was a huge reduction in child labor. A typical glass factory might have 100 boys working at low wages to make bottles. Wages were from 30 to 50 cents a day, often with room and board not included. While a boy might make $3 to $6 a week, he might be charged $2 to $3 a week for room and board. Company boarding houses were common in Ohio. Orphans were often shipped from eastern cities to take the jobs in the glasshouses of Ohio where labor was in short supply. The Owens Bottle machine effectively reduced the process to high paid machine operators. In 1910, Libbey would repeat the developmental and marketing process with the invention and application of an automated flat glass machine. <br />
see new book -- Amazon EDMUND LIBBEY http://www.amazon.com/Edward-Drummond-Libbey-Biography-Glassmaker/dp/078646335X/ref=sr_1_8?ie=UTF8&qid=1306157247&sr=8-8steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-82541384989744557892011-04-05T06:56:00.000-07:002011-04-05T06:56:30.038-07:00history of income taxThe United States, having been born in part from a tax revolution, was slow to implement any form of taxation. Over 90% of the early federal government was financed by tariffs. The first use an excise tax on whiskey had resulted in a military action in 1794 to enforce it known as the Whiskey Rebellion. The government did expand sales and excise taxes to finance the War of 1812, only to have all of these repealed in 1817. Congress was considering an income tax for the War of 1812 when it ended. From 1817 to 1861, the United States was funded by tariffs on incoming goods and to a small part excise taxes. The Civil War, however, required huge expenditures by the federal government. The Revenue Act of 1861 imposed an income tax on all incomes over $600. The tax rate was 3 percent graduated up to 5 percent for the very few that earned over $10,000 a year. This income tax targeted the very wealthiest of Americans and accounted for only a fifth of the necessary income for the war. This tax was repealed in 1872. During the 1880s, many states passed inheritance taxes, which had popular support. Surprisingly, the inheritance tax and a luxury had the support of wealthy industrialists such as Andrew Carnegie and John Rockefeller. <br />
In 1894, Democrats in Congress were able to pass first peacetime income tax as part of the Wilson-Gorman Tariff. The Democrats reduced tariffs at the same time to help farmers, who complained of the high price of sugar and household products. Tariffs were considered a “tax” on the average consumer who paid more for imported products. This income tax was 2 percent on incomes over $10,000, which addressed less than 10 percent of households. In 1895, the United States Supreme Court, in its ruling Pollock v. Farmers’ Loan and Trust Company, held such an income tax as unconstitutional. The court ruled the income tax a direct tax, which was inhibited by the constitution under Article I, Section 9 that “No capitation, or other direct tax shall be laid, unless in proportion to the census.” With tariff incomes rising in the late 1890s, Congress decided not to challenge the court decision with a new tax initiative. The reduction of tariff rates in the early 1900s and a rising public awareness of the wealthy excesses created pressure again for an income tax. This was consistent with the progressive movement of the time in both political parties. Congress first passed a corporate income tax of 1 percent of income over $5,000 (about $110,000 today). In 1913, there was a clear demand to reduce tariffs and impose an income tax. The Underwood Tariff Act of 1913 ended the protectionist tariffs that had existed since the earliest days of the United States. With popular support, Congress moved to have the 16th Amendment passed by the states. <br />
The 16th Amendment stated: “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.” Politicians sold the amendment saying it would result on a tax only on America’s wealthiest (a pledge quickly forgotten once the power was given to tax). The 16th Amendment was ratified in 1913 and Congress passed the Revenue Act of 1913. This act levied a 1 percent tax on incomes above $3,000 with a surtax of 6 percent on those with incomes above $500,000. This meant a top rate of 7 percent. At the time roughly 2 percent of the population paid the income tax. The 1916 Supreme Court decision Brushaber v. Union Pacific actually expanded the meaning to profit and gain from any source. The needs of the government to finance World War One quickly caused the top rate to increase to 77 percent. Democrats created an excess profit tax for corporations as well to finance the war. Total tax revenues increased to over a billion dollars in 1918. Popular support eroded as the government began to expand taxation on all fronts for the war, but the genie was out of the bottle.<br />
The government became a series of hundreds of bills over the years to adjust the tax for various groups and types of ‘income.” The first of these created progressive steps of income to be taxed at increasing marginal rates. The top marginal rate was cut to 58% in 1922. From 1913 to 1921, capital gains were taxed as ordinary income. Many argued that this treatment took away the incentive to invest in American stocks. The Revenue Act of 1921 allowed for assets held for two years to be taxed at 12.5 percent instead of top rates of 77 percent. Capital gain taxes were adjusted and excluded with various laws until the present day. These treatments became very complex as economic models used taxes as incentives for government economic intervention. These economic uses of taxes to control behavior were popular with followers of John Maynard Keynes. The 1930s brought more taxation by the federal government, including a progressive tax on business profits.<br />
Major changes came during World War Two when the income tax expanded to the middle class. Franklin Roosevelt also increased the top marginal to 91 percent. The system was still very disorganized and full of tax fraud. Roosevelt increased enforcement as a means to increase revenue. The passage of the Revenue Act of 1942 was considered the most expansive in our history. Congress also enacted payroll withholding with the Current Tax Payment Act of 1943. Congress also increased the base and rates with a “surtax.” Rates ranged from 13 percent on the first $2,000 of income to 81 percent on $200,000 up to a maximum of 91 percent. The withholding tax, while extremely unpopular, greatly increased revenue. It was sold a patriotic sacrifice during World War II. Taxpayers went from 3.9 million in 1939 to 42.6 million in 1945 or 60 percent of households paid an income tax. For the same period collections went from $3.2 billion to $35.1 billion. Politicians wisely called this broad expansion of taxing and rate as a “defense tax.” Corporate taxes were also increased to 50 percent. <br />
Taxes have become a political issue with the tax code used to affect the economy and control consumer behavior. The 1940s saw the expansion of a tax code of exemptions, deductions, and credits making the collection and maintenance of the system complex. With this complexity came business opportunities such as H&R Block to help taxpayers. Today the income tax (Internal Revenue Service) falls under the Department of the Treasury. It represents one of the government’s largest bureaucracies. Today because of the huge government expenditures of maintaining, managing, and enforcing some politicians are arguing for a flat tax on sales. This had actually been considered during the debate over the Revenue Act of 1942.steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-61864476951958328272011-02-18T06:38:00.000-08:002011-02-18T06:38:13.456-08:00Read the Pantheon of CapitalismThe Pantheon<br />
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The American Pantheon is a result of years of research into the Golden periods of American business and capitalism. It has produced a number of iconic biographies. At the seat of Jupiter is President William McKinley, who developed a managed approach to American exceptionalism in manufacturing and industry. On his right side are business innovators such as H. J. Heinz, George Westinghouse, Andrew Carnegie, and Michael Owens. On the left there are William McGuffey, America’s educator, and Henry Clay Frick corporate organizer. The Pantheon of books includes tributes to the many developers of early industry in general (The Pig Iron Aristocracy, Boys of Braddock, and Iconic Lessons of Operations Management). The many industrial laborers are honored in the book A Genealogy of Greatness. Over twenty of these “gods of business” are interviewed and questioned about today’s problems in the book-Interviews with the Titans of Business. <br />
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America’s greatest capitalists and industrialists – can lead the way back to greatness. The literary pantheon preserves the memory for our youth.<br />
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Read the full Pantheon<br />
Other Books by Quentin R. Skrabec Jr., Ph.D (The Literary Pantheon)<br />
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The Boys of Braddock ISBN 0-7884-2516-1<br />
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George Westinghouse: Gentle Genius ISBN 978-0-87586-507-2<br />
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The Metallurgic Age ISBN 0-7864-2326-9<br />
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Michael Owens ISBN 978 1 58980 385 5<br />
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In Search of the Lost Grail of Middle Management ISBN 0-7618-2551-7<br />
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Glass in Northwest Ohio ISBN 13 978-0-7385-5111-1<br />
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Labor Productivity and Profits ISBN 0-7414-3890-9<br />
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St. Benedict’s Rule For Business Success ISBN 1-55753-254-0<br />
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Iconic Lessons in Operations Management ISBN 0-7414-2893-8<br />
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Saintly Lessons and Divine Concepts for Business ISBN 156072845-0<br />
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William McKinley: The Apostle of Protectionism ISBN 978-0-87586-577-5<br />
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A Genealogy of Greatness ISBN 978-1-934209-46-2<br />
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The Pig Iron Aristocracy ISBN 978-0-7884-4515-6<br />
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Interviews with the Titans of Business ISBN 0-7414-4536-0<br />
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H. J. Heinz: A Biography ISBN 978-0786441785<br />
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William Holmes McGuffey ISBN 978-0875867267<br />
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Henry Clay Frick<br />
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A Manufacturing Manifesto ISBN 978-0741453310<br />
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Edward Drummnod Libbey new at Amozon pre order<br />
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Theironpantheon.com<br />
Or Search “skrabec” on Amazon.comsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-75468774481505861142010-12-29T06:31:00.000-08:002010-12-29T06:34:42.463-08:0023. Abraham Lincoln establishes Protectionism (1860)<br />
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Lincoln is most often remembered for freeing the slaves, but many consider his contributions to business on an equal par. Lincoln, a former Whig, actually ran on a strong economic policy of American protectionism. Lincoln had been the first national candidate since Henry Clay to have the united support of the labor and manufacturers. That alliance would include the manufacturing districts of Illinois, Pennsylvania, Ohio, Kentucky, and Virginia that carried Lincoln to the presidency. It was no surprise that the Republican would be born at a 1856 convention in Pittsburgh. Lincoln carried industrial Pittsburgh’s Allegheny County by a record 10,000 votes. Lincoln called the concentration of votes in this manufacturing area “the State of Allegheny.” Pittsburgh had finally overcome the divides of the 1794 Whiskey Rebellion and turned solidly to the new Republican Party. Lincoln’s winning margins were similar in the iron districts of Ohio, where Iron Whigs and protectionist Democrats had found a new home in the Republican PartyIn western Virginia, the Pig Iron Aristocrats’ (iron manufacturers as they were known) support of the protectionist Lincoln split the state and created West Virginia. These Pig Iron Aristocrats had forged an alliance with iron labor as well. A strong pig iron industry was necessary for both management profits and labor employment. The German and Irish immigrants of the 1840s came for economic opportunity and they united with wealthy Scotch-Irish to form a new Republican machine in the iron districts of the middle states. Industry growth took priority over unionism and profits. These districts knew the recessions caused by free trade policies, believing the still lingering Panic of 1857 was a result of Democrat’s passing lower tariffs. As a result of war and protectionism, the pig iron industry would see great advances in technology. The Pig Iron Aristocrats were rewarded for their votes with the 1862 tariff act, which was the highest ever on pig iron at 32%. As the Pig Iron Aristocrats responded with massive investments in industry, the Congress moved the rate to 47% in 1864. The pig iron industry grew an amazing 65% during the Civil War. By the end of the war, the Pig Iron Aristocrats were a real national political force with wealth and the ability to employ tens of thousands. The American pig iron industry was the world’s greatest. <br />
Besides technology, tariffs would drive pig iron production, and there is no demand such as that of war. As much as 25% of the union’s artillery (15% at Fort Pitt Foundry alone) was made in Pittsburgh. At least 80% of the union’s naval iron plate for ships. Most of the union’s armor plate was rolled in Pittsburgh. All of the artillery carriage axles and most railroad axles were forged in Pittsburgh. But most of the raw pig iron, however, came from Ohio. In 1860, Cleveland, Ohio had no iron foundries, but after the war, Cleveland had over 50 foundries. The Pig Iron Aristocrats were not only the ones who won the war, but also the ones who profited the most. The Republican tariffs assured a boom in national production for years to come. The great iron triangle of Ohio, West Virginia, and Pennsylvania saw growth as never before. The war would also simulate huge heaps in pig iron technology, railroads, and manufacturing. The huge profit margins in the pig iron related businesses assured those profits were poured back into the businesses. Just as important the pig iron end users such as the railroads experienced similar growth. The expansion of American industry during the war would be the infrastructure in place to make America the premier industrial nation. Lincoln took chances by promoting infant industries rather than buying off European sources. It proved not only smart business, but by war end the Union controlled its own destiny immune to foreign boycotts or pricing. In the end, Union manufacturing overwhelmed the South. <br />
Lincoln used tariffs to raise money for the war as well, which was a basic use of tariffs as proposed by the Federalists earlier. Lincoln’s economic advisor, Henry C. Carey was a huge supporter of Clay’s American System. Carey became a key political ally of Clay, forming the Pennsylvania Society for the Encouragement of Manufacture, as well as the American Industry League. Carey was prolific writer in support of tariffs throughout his career. Carey requires some note because he was the most influential economist of the 1850s, 1860s, and 1870s. He was for easy money and strong tariff support; ideas supported by both Henry Clay and later in the 1890s by William McKinley. Carey understood the nature of the money supply as a stimulus, and supported the printing of greenback dollars. Today, of course, he would be considered an inflationist, but he argued while inflation hurt the bankers, it helped the manufacturers. He correctly identified the “enemy” as the eastern banking concerns as banking monopolists who favored importing and trade. Carey argued that these bankers were actually hostile to American industrial enterprise. Carey also predicted the banker’s takeover of the railroad industry to control trade. His writings foreshadowed the rise and dominance of J. P. Morgan in the McKinley era. Carey was the major influence on Lincoln’s tariff policy that would become the policy of the Republican Party for many decades. Carey’s disciples in the Congress such as “Pig Iron” Kelley, James Garfield, William McKinley and Thaddeus Stevens carried the protectionist banner in the time period between Henry Clay and Herbert Hoover. These men also demanded Congressional oversight to assure profits gained from tariff protection were invested back into the industry creating employment.<br />
The Lincoln presidential victory of 1860 was by his success in the old “Iron Whig” districts of Ohio and the other Pig Iron Aristocracy districts in Pennsylvania, Maryland, Connecticut, and western Virginia. Lincoln’s protectionist assured these districts would remain Republican for many decades. The vote in these districts set new majority records as Lincoln’s protectionism played as well as his anti-slavery stand. The election would bring war to the nation, but prosperity to the iron districts of the North and the Midwest manufacturing districts. It would build a long-term Republican majority. The Congress passed the highest iron tariffs ever along with an increase in tariffs across the board. At the time the government’s main source of income was tariffs (not income taxes). Almost all industries benefited, but iron, glass, textile, and mining boomed. The protectionist representatives wrote the tariff bill, assuring iron received the highest level of protection. This political alliance would assure Republican protectionist policies for the next seventy years. Lincoln’s protectionism and policy of Amercian ecomonic growth would peak in 1890 with the McKinley Tariff Bill.<br />
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http://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Dstripbooks&field-keywords=skrabec&x=18&y=21steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-58479923407736952952010-11-24T06:23:00.000-08:002010-11-24T06:23:53.834-08:00Were the Pilgrims Capitalist Pigs?1623 Privatization of the Plymouth Colony- The Roots of American Capitalism<br />
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The Plymouth Plantation while short-lived has a special place in the history American business history. The Plymouth colony of the Pilgrims started in the November of 1620. The Pilgrims were a group of Christian Separatists from the Anglican Church of England that have first moved to Holland, but found little freedom for their religious practices. The Pilgrims had left Holland to obtain freedom of religion, but they were financed by a group of wealthy venture capitalists, which hoped to use them to achieve a profit in the New World. These capitalists were a joint stock known as the Virginia Company of London having a royal charter issued in 1606. The Virginia Company had been behind the failed Jamestown colony, which by 1620 was paying some small dividends with a cash tobacco crop. The Virginia Company hoped for a similar trade profit in New England with furs, fish, and crops. The Pilgrims were considered by the company as indentured servants, although, the Pilgrims did negotiate a profit sharing deal after seven years. They initially argued against communal ownership but were left with no choice. The Pilgrims for their part never viewed themselves as indentured servants but as paying taxes to the company. It was an unclear and disputed vision, but all property was under communal ownership. Even the houses they built were considered communal property and could be reassigned. This initial model of ownership has been called both exploitative capitalism and communism. Contrary to some, the communal pact was not based on their religious beliefs but forced on the Pilgrims by the company. Privatization of property would prove to evolutionary in the colonies. <br />
The Pilgrims came to New England on the Mayflower and Speedwell. In total there were 120 Pilgrims with a smaller group known as the “strangers.” The “strangers” were hired managers of the company, which included Myles Standish as the colony’s military leader and Christopher Martin as Royal Governor. The first year proved the most difficult, arriving in late fall with no growing season left. Nearly half the colonists died the first winter. It was only by the aid of the local Indians that allowed for a solid planting of corn in the spring. They managed to construct a common house for living quarters. William Bradford kept a dairy of the plantation (Of Plymouth Plantation), detailing social breakdown under the communal ownership system. Initially, the Pilgrims were forced to beg and steal from the Indians, but even the first planting and building of houses proved disastrous. Bradford described a culture of “free-riding.” Older, sick, young, and women soon excluded themselves from communal labor. Others tended not to pull their weight under the communal economic model. Even the most able men were soon angered by having to support free riding and reduced their effect. William Bradford decried the communal system as the root of the problem. Bradford noted in hiss dairy: “For the young men, that were the most able and fit for labor and service, did repine that they should spend their time and strength to work for other’s men’s wives and children without any recompense. The strong, or man of parts, had no more division of victuals and clothes than that of the weak and not able to do a quarter the other could; this was thought an injustice.”<br />
The Pilgrims were surely aware of the limited success at Jamestown when the colonists were given a small plot of land to work as their own. By 1621, the Jamestown colony had limited private property but the communal system still required a tax on private earnings and a requirement for communal work of several months a year. Bradford and Plymouth faced a crisis point in the spring of 1623. The colony was down to four adult women and dependent on the Indians for daily survival. Bradford made the decision to fully convert to private property. Bradford reported the amazing success: “For it made all hands industrious. . . . The women now went willingly into the field, and took their little ones with them to set corn; which before would allege weakness and inability.” The new system made the colony profitable and would be the new model for future settlements. The system also proved compatible with their religious beliefs as the colonists give freely of their surplus to help the less fortunate. The model would augur the American system of capitalism and philanthropy. The taxation model of the colony would also be a model for government role in communal needs. Home ownership strengthened and motivated house building in the colony. It would also augur the failure of collectivized agriculture by 20th century communist nations.steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-32367229562902579252010-10-09T06:38:00.001-07:002010-10-09T06:38:55.924-07:00America's Political GhostToday America’s Midwestern Democrats, big city Democrats, “Reagan” Democrats, Southern Republicans, heartland independents, conservative Democrats, and conservative Republicans, sometimes, feel something is missing. Part of their spirit is someplace else. The spirit is often alluded to by the line- “It’s the economy, stupid”. Few realize there is an American ghost in their spirit. These struggling and politically ambivalent Americans are dominant in the Ohio Valley, Western Pennsylvania, the heart of the industrial Midwest, industrial cities throughout America, and Western states. They feel the presence of a real ghost. That ghost is nationalistic and hard working. It is a spirit of ambivalence. It doesn’t feel fully comfortable in either of today’s political parties. It is confused by the economic arguments on free trade, wanting only to see America working. It is confused by America’s international role. While highly nationalistic, it often questions war as unnecessary involvement in others’ affairs. It is more economic than global. It believes in American exceptionalism and revels in American success at all endeavors. It is proud. It wants to buy American but often shops at Wal-Mart to save money. It believes America should always be bigger and better than the rest of the world. It believes in bigness as an American icon and is disappointed when a taller building, bridge, ship, or airplane is built elsewhere. It is that of the American worker and industry. It hates big business’s greed but is proud of its industrial might. That spirit finds pride in working for America’s industrial giants, but deplores their methods at times. American Big Business is a devil but it’s their devil. It believes that if a devil must be in charge, then it should be an American devil.<br />
The spirit today is an amalgam of our American spirit. It is part of a forgotten political party. It was a spirit that was forced to divide over years for various issues. It is an alloy that no longer can reflect earlier and more basic political views. Today’s American spiritual amalgam is forged like Damascus steel by folding and hammering layers of issues into a sword. It often is strongly partisan but can find common ground in nationalism, yet that very nationalism can blind it. It is American but does not fit neatly into either of the beliefs of today’s political parties. It is a mainstream spirit and thus has two choices but feels there should be another. The other choice is America’s ghost, and it is layered in the fiber of today’s spirit. This ghostly spirit often sees presidents- Reagan, Kennedy, Truman, Eisenhower, Teddy Roosevelt, and FDR as their presidents. That spirit has forgotten heroes of Alexander Hamilton, Henry Clay, James Garfield, and William McKinley. Abraham Lincoln is a forgotten voice of that spirit. It is a ghost that haunts the steel valleys of Ohio and Pennsylvania, the coalmines of Illinois and West Virginia, the old factories of Michigan and Indiana, and the Connecticut Valley of New England. It has helped elect many of our presidents.<br />
This restless and homeless spirit is that of America’s Whig Party. The Whig Party was born out of opposition to Andrew Jackson in 1832. Its platform, however, was economic bringing in a strange mix of opposites united by economic issues. This mix included Democrats, Anti-Jacksonians, Anti-Masons, “Know-Nothings,” abolitionists, and old Federalists. Similarly, its American economic approach fused diverse geographic regions such as New England, the Midwest, Mid-Atlantic, and the South. It united class lines such as rich and poor, blue and white collar, and union and owners. It formed economic alliances with opposing religious, social, class, and philosophical factions. The Whigs were passionate about dinner table issues, but they lacked the fire of the dominant social issues of the time. Its ghost, however, is purely economic and nationalistic as was its founding. The ghost is that of “bread and butter” issues. It is a ghost that punishes political parties that stray too far the bread and butter issues. It is a ghost awoken in hard times.steelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-57721403180627291942010-09-18T08:01:00.000-07:002010-09-18T08:01:15.703-07:00REBIRTH OF THE WHIG PARTYAmericans who believe like the early Federalist ,Alexander Hamilton, that government was a role to encourage economic development for the defense of the country, have no home in either political party today. The Democrats want government ownership and control. The Republicans hold stubbornly to the one world concept of “free trade.” The result is the valley of death for Americans who believe American prosperity comes first. The vision of Alexander Hamilton and Henry Clay’s “American System” brought us the Whig Party. The Whigs formed the political might in the Midwest manufacturing belt (from Chicago-Cleveland –Pittsburgh) and the New England Manufacturing crescent (Connecticut Valley, New York, and Boston), bonding management and labor into a common party. These manufacturing areas would propel the young Whig Abraham Lincoln to the head of the Republican Party and the presidency. American Manufacturing policy as Hamilton had envisioned would rule until the 1920s. Progressives in both the Democrat and Republican Party would reject this nationalistic view and slowly insert a world view which took hold after World War Two. There are Whigs emerging again in some factions of the Tea party and right wing Republicans such as Buchanan. Maybe this recession will lead more conservatives to reject the “Chicago and Austrian School” of “Free Trade” economics, which has dominated both parties and western world governments. (see William McKinley by Quentin Skrabec)<br />
Read more about the American Whigs in my Iron Pantheon of American capitalists<br />
Search books by skrabec --- Amazon.comsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-63987494401603507012010-09-02T12:48:00.001-07:002010-09-02T12:48:30.229-07:00Alexander Hamilton Sept 18Alexander Hamilton is truly the founding father of American Manufacturing. In 1794 he became the nation’s first Secretary of Treasury under George Washington. Hamilton, a Federalist, believed the Federal Government had responsibility for defense and the economic welfare of the nation. In fact, he saw them as interrelated and symbiotic. Unfortunately, neither political party today functions as a Hamiltonian advocate of American manufacturing. As an officer on General Washington’s staff, Hamilton saw battles lost for lack of American manufacturing capability. A true American conservative, Hamilton remains in “no man’s land” today because of his support of a national bank. Hamilton, however, realized that agrarian America lacked a means to supply capital to business. Private banks can perform that function today but then western cities lacked banks to grow industry. Hamilton believed (like Adam Smith) that defense industries needed tariff protection as well. Hamilton envisioned a manufacturing nation and that economic warfare would be part of America’s future. Hamilton’s founding ideas would be embodied in Abe Lincoln’s protectionist policy that dominated America for 80 years and ushered America into its Golden Era of Industry, science, and invention. Hamilton was always denounced by the Jeffersonians, Jacksonians, Democrats, and today by Republicans, but his economic ideas, especially support for a protective tariff and a national bank, were promoted by the Whig Party and after the 1850s by the newly created Republican Party, which hailed him as the nation's greatest Secretary of the Treasury.<br />
See William McKinley: The Apostle of Protectionism by Quentin R. Skrabec<br />
See my Wall Street J quote http://online.wsj.com/article/SB10001424052748703428604575418680197041878.html?mod=googlenews_wsjsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-77823852148780598612010-08-27T07:47:00.001-07:002010-08-27T07:47:13.700-07:00The Pantheon<br />
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The American Pantheon is a result of years of research into the Golden periods of American business and capitalism. It has produced a number of iconic biographies. At the seat of Jupiter is President William McKinley, who developed a managed approach to American exceptionalism in manufacturing and industry. On his right side are business innovators such as H. J. Heinz, George Westinghouse, Andrew Carnegie, and Michael Owens. On the left there are William McGuffey, America’s educator, and Henry Clay Frick corporate organizer. The Pantheon of books includes tributes to the many developers of early industry in general (The Pig Iron Aristocracy, Boys of Braddock, and Iconic Lessons of Operations Management). The many industrial laborers are honored in the book A Genealogy of Greatness. Over twenty of these “gods of business” are interviewed and questioned about today’s problems in the book-Interviews with the Titans of Business. <br />
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America’s greatest capitalists and industrialists – can lead the way back to greatness. The literary pantheon preserves the memory for our youth.<br />
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Read the full Pantheon<br />
Other Books by Quentin R. Skrabec Jr., Ph.D (The Literary Pantheon)<br />
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The Boys of Braddock ISBN 0-7884-2516-1<br />
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George Westinghouse: Gentle Genius ISBN 978-0-87586-507-2<br />
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The Metallurgic Age ISBN 0-7864-2326-9<br />
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Michael Owens ISBN 978 1 58980 385 5<br />
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In Search of the Lost Grail of Middle Management ISBN 0-7618-2551-7<br />
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Glass in Northwest Ohio ISBN 13 978-0-7385-5111-1<br />
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Labor Productivity and Profits ISBN 0-7414-3890-9<br />
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St. Benedict’s Rule For Business Success ISBN 1-55753-254-0<br />
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Iconic Lessons in Operations Management ISBN 0-7414-2893-8<br />
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Saintly Lessons and Divine Concepts for Business ISBN 156072845-0<br />
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William McKinley: The Apostle of Protectionism ISBN 978-0-87586-577-5<br />
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A Genealogy of Greatness ISBN 978-1-934209-46-2<br />
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The Pig Iron Aristocracy ISBN 978-0-7884-4515-6<br />
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Interviews with the Titans of Business ISBN 0-7414-4536-0<br />
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H. J. Heinz: A Biography ISBN 978-0786441785<br />
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William Holmes McGuffey ISBN 978-0875867267<br />
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Henry Clay Frick<br />
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A Manufacturing Manifesto ISBN 978-0741453310<br />
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Quentinskrabec.com<br />
Theironpantheon.com<br />
Or Search “skrabec” on Amazon.comsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-2098545187435496522010-08-09T05:44:00.000-07:002010-08-25T13:14:05.120-07:00Henry Clay Elected to Congress September 4Henry Clay of Kentucky was elected to Congress on 1812, September 4. Alexander Hamilton, Henry Clay, and Matthew Carey can be considered the founding fathers of American manufacturing. They believed the government was responsible for creating an economic environment for manufacturing. Clay in 1825 introduced his “American System,” which stated that no political system could last without a government backed economic foundation. Clay argued for a system of protective tariffs to promote manufacturing, government investment in manufacturing infrastructure, and government backed banking and capital for manufacturing. Henry Clay would be a force in manufacturing politics until his death in 1852, and the founder of the Whig Party, which would dominate future manufacturing centers of Western Pennsylvania, Ohio, Illinois, and New England. Clay’s “American System” would be the basis of American manufacturing dominance for over hundred years.<br /><br />see Amazon.com search Skrabec for referencessteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-41664992985000385542010-07-31T06:20:00.000-07:002010-07-31T06:25:27.867-07:00August 8 Edison's MimeographEdison patented his mimeograph on this date. There is much research today on bringing back the creativity of the Edison period of 1850 to 1920. Most are focusing on shortcomings in our education system and lack of critical thinking today, but few look to the structural and infrastructure of our society. Edison often spent months researching the potential economic gains of an invention before launching a research project. Financial rewards drive invention, and taxes are a deterrent. Capital gain taxes are also a deterrent. Capitalism is the driver of invention. Edison like Westinghouse, Bell, Bessemer, and others of the period were driven by the rewards of inventing. Another problem is declining corporate income as imports flood in. Companies are not willing to invest in long run research as they struggle in declining markets. The great Republican tariffs of the 1800s assured a future market for glass, steel, electrical, and manufacturing in the 1800s, allowing companies invest confidently in the future.<br />A Manufacturing Manifesto ISBN 978-0741453310 go to Amazon --also search “skrabec” on Amazonsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-31742624168774856762010-07-21T06:07:00.000-07:002010-07-22T06:15:47.823-07:00July 30 Henry Ford's BirthdayHenry Ford more than anyone knew creativity and capitalism had a symbiotic relationship---both dependent on each other. Ford created his own network of creative friends including Thomas Edison, Bucky Fuller, George Washington Carver and many more.<br />Greenfield Village remains today a "Mecca" for manufacturers, inventors,educators, and artists--- it should be an annual pilgrimage-- read my industrial biographies of H J Heinz and William McGuffey<br /><br />Myth of the Month- small business "creates" most jobs in US---- yes but Big Business creates most small business-- for every one job in big business-- 10 are created in small businesssteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-22747892910953935102010-07-15T06:17:00.000-07:002010-07-15T06:22:02.632-07:00Moon Landing July 20The Founding manufacturing fathers such as Alexander Hamilton and Henry Clay believed government had two roles -- defense and promoting manufacturing!<br />the 1820 canal system, a National Bank, and a railroad system an our space program were successful applications of that vision.<br />see A Manufacturing Manifesto on Amazonsteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0tag:blogger.com,1999:blog-288079385997976732.post-24686063578391530992010-07-13T06:50:00.000-07:002010-07-13T06:53:31.270-07:00July 14 Bastelle dayall revolutions are not equal- the American Revolution gave us capitalism -- the French Revolution gave us socialism<br /><br />thought for the day-- the only example of free trade is that between Michigan and Ohiosteelmanhttp://www.blogger.com/profile/00469607934710500796noreply@blogger.com0