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Let’s consider how Kalanick treated his Uber taxi drivers in New York. When he was trying to convince them to break the law to boost Uber’s footprint in the city, Kalanick offered yellow cab drivers free iPhones and promised to “take care of” any legal problems they encountered with the TLC. A few short months later, when the service was forced to close, those same drivers received a message to come to Uber HQ. Reports the Verge… Multiple drivers said Uber called them into headquarters, claiming they needed to come by in order to get paid and would get a cash bonus for showing up. When the cabbies came in, Uber surprised them by asking for the device back, informing them that taxi service was no longer available in New York. That’s classic Rand right there. The more replaceable the worker, the more they can be treated like total shit. After all, if they’re so damn special, they can always leave and find another job.

“The notion that there some sort of deal or arrangement or whatever was just not the case,” said Kalanick in an interview with the Washington Post. How embarrassing, then, when the Post uncovered documents proving that Uber had indeed tried to make under the table arrangements to operate in DC. Or as the Post’s Mike DeBonist put it: “If you’re going to be dismissive of backroom deals, it behooves you to stay out of backrooms.”

A Disruptive company might very well succeed in exposing government crooks lining their pockets exploiting outdated laws, but that’s only so the Disruptor can line his own pockets through the absence of those same laws. A Disruptive company may give you free candy in your 50-dollar cab but, again, that’s only because doing so is good business. If poisoning that same candy suddenly becomes better business (like encouraging New York cab drivers to be distracted by their phones, or putting vulnerable people at risk of attack is better business)… well maybe that’s an option worth exploring too. After all, food safety legislation is just another attempt by the government to drive Disruptive businesses off the road.

For a long time, I was misled by the fact that 90% of the available books frame globalization and the emergence of modernity in terms of the nation-state as the fundamental unit of analysis, with politics as the fundamental area of human activity that shapes things.

But the more I’ve thought about it, the more I’ve been pulled towards a business-first perspective on modernity and globalization.

Culture is the most mysterious, illegible and powerful force.

But one quality makes gravity dominate at large space-time scales: gravity affects all masses and is always attractive, never repulsive.  So despite its weakness, it dominates things at sufficiently large scales. I don’t want to stretch the metaphor too far, but something similar holds true of business.

On the scale of days or weeks, culture, politics and war matter a lot more in shaping our daily lives.

Business though, as an expression of the force of unidirectional technological evolution, has a destabilizing unidirectional effect. It is technology, acting through business and Schumpeterian creative-destruction, that drives monotonic, historicist change, for good or bad. Business is the locus where the non-human force of technological change sneaks into the human sphere.

Culture is suspicious of technology. Politics is mostly indifferent to and above it. War-making uses it, but maintains an arms-length separation.

It is business that creates the world of magic, not technology itself. And the story of business in the last 400 years is the story of the corporate form.

What was new was the idea of a publicly traded joint-stock corporation, an entity with rights similar to those of states and individuals, with limited liability and significant autonomy

In politics, Mercantilism led to balance-of-power models.

In business, once the Age of Exploration (the 16th century) opened up the world, it led to mercantilist corporations focused on trade

The forces of radical technological change — the Industrial Revolution — did not seriously kick until after nearly 200 years of corporate evolution (1600-1800) in a mercantilist mold.

Smith was both the prophet of doom for the Mercantilist corporation, and the herald of what came to replace it: the Scumpeterian corporation.

The corporate form therefore spent almost 200 years — nearly half of its life to date — being shaped by Mercantilist thinking, a fundamentally zero-sum way of viewing the world.

The Black Hills Gold Rush of the 1870s, the focus of the Deadwood saga, was in a way the last hurrah of Mercantilist thinking. William Randolph Hearst, the son of gold mining mogul George Hearst who took over Deadwood in the 1870s, made his name with newspapers. The baton had formally been passed from mercantilists to schumpeterians.

for America, corporations employed less than 20% of the population in 1780, and over 80% in 1980, and have been declining since

Certainly corporations today seem far more powerful than those of the 1700s, but the point is that the form is much weaker today, even though it has organized more of our lives. This is roughly the same as the distinction between fertility of women and population growth: the peak in fertility (a per-capita number) and peak in population growth rates (an aggregate) behave differently.

a useful 3-phase model of the history of the corporation: the Mercantilist/Smithian era from 1600-1800, the Industrial/Schumpeterian era from 1800 – 2000 and finally, the era we are entering, which I will dub the Information/Coasean era

To a large extent, the history of the first 200 years of corporate evolution is the history of the East India Company. And despite its name and nation of origin, to think of it as a corporation that helped Britain rule India is to entirely misunderstand the nature of the beast.

At a broader level, the EIC managed to balance an unbalanced trade equation between Europe and Asia whose solution had eluded even the Roman empire.

For this scheme to work, three foreground things and one background thing had to happen: the corporation had to effectively take over Bengal (and eventually all of India), Hong Kong (and eventually, all of China, indirectly) and England.

The background development was simpler. England had to take over the oceans and ensure the safe operations of the EIC.

eventually, as the threat from the Dutch was tamed, it became clear that the company actually had more firepower at its disposal than most of the nation-states it was dealing with. The realization led to the first big domino falling, in the corporate colonization of India, at the battle of Plassey.

The EIC was the original too-big-to-fail corporation. The EIC was the beneficiary of the original Big Bailout. Before there was TARP, there was the Tea Act of 1773 and the Pitt India Act of 1783. The former was a failed attempt to rein in the EIC, which cost Britain the American Colonies.  The latter created the British Raj as Britain doubled down in the east to recover from its losses in the west. An invisible thread connects the histories of India and America at this point. Lord Cornwallis, the loser at the Siege of Yorktown in 1781 during the revolutionary war, became the second Governor General of India in 1786.

But these events were set in motion over 30 years earlier, in the 1750s. There was no need for backroom subterfuge.  It was all out in the open because the corporation was such a new beast, nobody really understood the dangers it represented.

The East India bubble was a turning point.

Over the next 70 years, political, military and economic power were gradually separated and modern checks and balances against corporate excess came into being.

It is not too much of a stretch to say that for at least a century and a half, England’s foreign policy was a dance in Europe in service of the EIC’s needs on the oceans.

Mahan’s book is the essential lens you need to understand the peculiar military conditions in the 17th and 18th centuries that made the birth of the corporation possible.)

arguably, the doings of the EIC and VOC on the water were more important than the pageantry on land.  Today the invisible web of container shipping serves as the bloodstream of the world. Its foundations were laid by the EIC.

I call this the “most misleading table in the world.”

corporations and nations may have been running on Mercantilist logic, but the undercurrent of Schumpeterian growth was taking off in Europe as early as 1500 in the less organized sectors like agriculture. It was only formally recognized and tamed in the early 1800s, but the technology genie had escaped.

The Schumpeterian corporation was about colonizing individual minds. Ideas powered by essentially limitless fossil-fuel energy allowed it to actually pull it off.

it is probably reaosonably safe to treat the story of Schumpeterian growth as an essentially American story.

In many ways the railroads solved a vastly speeded up version of the problem solved by the EIC: complex coordination across a large area.  Unlike the EIC though, the railroads were built around the telegraph, rather than postal mail, as the communication system. The difference was like the difference between the nervous systems of invertebrates and vertebrates.

If the ship sailing the Indian Ocean ferrying tea, textiles, opium and spices was the star of the mercantilist era, the steam engine and steamboat opening up America were the stars of the Schumpeterian era.

The primary effect of steam was not that it helped colonize a new land, but that it started the colonization of time. First, social time was colonized. The anarchy of time zones across the vast expanse of America was first tamed by the railroads for the narrow purpose of maintaining train schedules, but ultimately, the tools that served to coordinate train schedules: the mechanical clock and time zones, served to colonize human minds.  An exhibit I saw recently at the Union Pacific Railroad Museum in Omaha clearly illustrates this crucial fragment of history:

For all its sophistication, the technology of sail was mostly a very-refined craft, not an engineering discipline based on science.

Steam power though was a scientific and engineering invention.

Scientific principles about gases, heat, thermodynamics and energy applied to practical ends, resulting in new artifacts. The disempowerment of craftsmen would continue through the Schumpeterian age, until Fredrick Taylor found ways to completely strip mine all craft out of the minds of craftsmen, and put it into machines and the minds of managers.

Blitzeconomics allowed the global economy to roar ahead at 8% annual growth rates instead of the theoretical 0% average across the world for Mercantilist zero-sum economics. “Progress” had begun.

Two phrases were invented to name the phenomenon: productivity meant shrinking autonomously-owned time. Increased standard of living through time-saving devices became code for the fact that the “freed up” time through “labor saving” devices was actually the de facto property of corporations. It was a Faustian bargain.

Many people misunderstood the fundamental nature of Schumpeterian growth as being fueled by ideas rather than time. Ideas fueled by energy can free up time which can then partly be used to create more ideas to free up more time. It is a positive feedback cycle,  but with a limit. The fundamental scarce resource is time. There is only one Earth worth of space to colonize. Only one fossil-fuel store of energy to dig out. Only 24 hours per person per day to turn into capitive attention.

There is certainly plenty of energy all around (the Sun and the wind, to name two sources), but oil represents a particularly high-value kind. Attention behaves the same way.

There is a lot more money to be made in replacing hand-washing time with washing-machine plus magazine time, than there is to be found in replacing one hour of TV with a different hour of TV.

. To get to Clay Shirky’s hypothetical notion of cognitive surplus, we need Alternative Attention sources. To put it in terms of per-capita productivity gains, we hit a plateau.

When Asia hits Peak Attention (America is already past it, I believe), absolute size, rather than big productivity differentials, will again define the game, and the center of gravity of economic activity will shift to Asia.

Once again, it is the oceans, rather than land, that will become the theater for the next act of the human drama. While American lifestyle designers are fleeing to Bali, much bigger things are afoot in the region. And when that shift happens, the Schumpeterian corporation, the oil rig of human attention, will start to decline at an accelerating rate. Lifestyle businesses and other oddball contraptions — the solar panels and wind farms of attention economics — will start to take over.

Coasean growth is not measured in terms of national GDP growth. That’s a Smithian/Mercantilist measure of growth. It is also not measured in terms of 8% returns on the global stock market.  That is a Schumpeterian growth measure. For that model of growth to continue would be a case of civilizational cancer (“growth for the sake of growth is the ideology of the cancer cell” as Edward Abbey put it).

Simply put, once you actually see laissez faire capitalism and greed-is-good extremism at work, it doesn’t look as nice as it sounds in Rand’s works. On the contrary, as Saunders implies, it makes “Fountainhead Shrugged” look less like serious treatise than bad young adult fiction, with all the corresponding misguided parables and oversimplified conclusions.

If the anti-slavery folks in the North had figured out a way to disband - or even move out of the state - those southern militias, the police state of the South would collapse.  And, similarly, if the North were to invite into military service the slaves of the South, then they could be emancipated, which would collapse the institution of slavery, and the southern economic and social systems, altogether.

Their main concern was that Article 1, Section 8 of the newly-proposed Constitution, which gave the federal government the power to raise and supervise a militia, could also allow that federal militia to subsume their state militias and change them from slavery-enforcing institutions into something that could even, one day, free the slaves. 

Henry then bluntly laid it out: "If the country be invaded, a state may go to war, but cannot suppress [slave] insurrections [under this new Constitution]. If there should happen an insurrection of slaves, the country cannot be said to be invaded. They cannot, therefore, suppress it without the interposition of Congress . . . . Congress, and Congress only [under this new Constitution], can call forth the militia."

"In this state," he said, "there are two hundred and thirty-six thousand blacks, and there are many in several other states. But there are few or none in the Northern States. . . . May Congress not say, that every black man must fight? Did we not see a little of this last war? We were not so hard pushed as to make emancipation general; but acts of Assembly passed that every slave who would go to the army should be free."

James Madison, the "Father of the Constitution" and a slaveholder himself, basically called Patrick Henry paranoid. "I was struck with surprise," Madison said, "when I heard him express himself alarmed with respect to the emancipation of slaves. . . . There is no power to warrant it, in that paper [the Constitution]. If there be, I know it not."

His first draft for what became the Second Amendment had said: "The right of the people to keep and bear arms shall not be infringed; a well armed, and well regulated militia being the best security of a free country [emphasis mine]: but no person religiously scrupulous of bearing arms, shall be compelled to render military service in person."

While the money that they’ve picked from each individual American’s pocket is small, the aggregate is huge for the rent-seeker. And this in turn deepens inequality.

FARM subsidies were much more sensible when they began eight decades ago, in 1933, at a time when more than 40 percent of Americans lived in rural areas. Farm incomes had fallen by about a half in the first three years of the Great Depression. In that context, the subsidies were an anti-poverty program.

Some three-quarters of the subsidies went to just 10 percent of farms. These farms received an average of more than $30,000 a year — about 20 times the amount received by the average individual beneficiary last year from the federal Supplemental Nutrition Assistant Program, or SNAP, commonly called food stamps.

More than 80 percent of the 45 million or so Americans who participated in SNAP in 2011, the last year for which there is comprehensive data from the United States Department of Agriculture, had gross household incomes below the poverty level.

Historically, food stamp programs and agricultural subsidies have been tied together.

The Nobel Prize winning economist Amartya Sen has reminded us that even famines are not necessarily caused by a lack of supply, but by a failure to get the food that exists to the people who need it. This was true in the Bengal famine of 1943 and in the Irish potato famine a century earlier: Ireland, controlled by its British masters, was exporting food even as its citizens died of starvation.

A similar dynamic is playing out in the United States. American farmers are heralded as among the most efficient in the world. Our country is the largest producer and exporter of corn and soybeans, to name just two of its biggest crops. And yet millions of Americans still suffer from hunger, and millions more would, were it not for the vital programs that government provides to prevent hunger and malnutrition — the programs that the Republicans are now seeking to cut back.

While they encourage overproduction, they pay little attention to the quality and diversity of foods our farms produce. The heavy subsidization of corn, for instance, means that many unhealthful foods are relatively cheap.

This is part of the reason that Americans face the paradox of hunger out of proportion to their wealth, along with some of the world’s highest obesity rates, and a high incidence of Type 2 diabetes. Poor Americans are especially at risk for obesity.

Indian friends I met that day and in the following week were puzzled by this news: How could it be that in the richest country of the world there was still hunger?

Their puzzlement was understandable: Hunger in this rich land is unnecessary. What my Indian friends didn’t understand is that 15 percent of Americans — and 22 percent of America’s children — live in poverty.

Someone working full time (2,080 hours a year) at the minimum wage of $7.25 would earn about $15,000 a year, far less than the poverty threshold for a family of four ($23,492 in 2012), and even less than the poverty level of a family of three.

In his famous 1941 “four freedoms” speech, Franklin D. Roosevelt enunciated the principle that all Americans should have certain basic economic rights, including “freedom from want.”

And those numbers increased drastically with the onset of the Great Recession. The number of Americans on food stamps went up by more than 80 percent between 2007 and 2013.

In 2012, for example, two in five SNAP recipients had gross incomes that were less than half of the poverty line.

The amount they get from the program is very small — $4.39 a day per recipient.

The Center on Budget and Policy Priorities estimates that SNAP lifted four million Americans out of poverty in 2010.

with American consumption diminished from what it otherwise would be and production increased, food exports will inevitably increase.

By cutting back on food stamps, we are ensuring the perpetuation of inequality, and at that, one of its worst manifestations: the inequality of opportunity.

What does it mean that supposedly thoughtful voices in the corporate world continue to deny the simple fact that irresponsible behavior should be addressed head on, and the rules of conduct altered sufficiently to permit a sound foundation for future economic growth?

In the men's room of a Beijing subway station, I watched a man walk past the urinal, lift his three-year-old son into the air and instruct him to pee into the sink – the one we were supposed to wash our hands in.

It was while eating my second duck tongue that the man at the next table hacked up a loud wad of phlegm and spat it on to the floor. "I think I'm done," I said.

I remember reading a few years ago about a restaurant in the Guangdong province that was picketed and shut down because it served cat. The place was called The Fangji Cat Meatball Restaurant, which isn't exactly hiding anything.

It's like eating poultry but taking a moral stand against those chocolate chicks they sell at Easter. "A sea horse is not related to an actual horse," I said. "They're fish, and you eat fish all the time. Are you objecting to this one because of its shape?"

This, for many, is flat-out evil but the rest of the world isn't like America, where it's become virtually impossible to throw a dinner party. One person doesn't eat meat, while another is lactose intolerant, or can't digest wheat. You have vegetarians who eat fish and others who won't touch it. Then there are vegans, macrobiotics and a new group, flexitarians, who eat meat if not too many people are watching.

I'll say that for China, though – offer to pay and before you can stab a rooster with a rusty screwdriver someone has taken you up on it. I think they want to catch you before you get sick, but whatever the reason, within minutes you're back on the street, searching the blighted horizon and wondering where your next meal might be coming from.