Latest / Comps List Radio / Episode 7: Alfred Chandler, "The Visible Hand," 1977 with Dr. Richard John

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Episode 7: Alfred Chandler, "The Visible Hand," 1977 with Dr. Richard John · Comps List Radio

• Robert Ferguson: Hello and welcome to HPOL's COMPs List radio. ⁓ We are back and I want to thank everybody once again for listening in to our members of the HPOL community who's liked and subscribed. We've had a tremendous response so far. So we're truly grateful for that. Today we've got a very, very special episode. Maria's back. And we are joined by a very important guest, Richard John, who is a distinguished research professor at Columbia University School of Journalism. Is that correct, Richard? That's right. And in the history department. and the history department. OK. For those of us who've read histories of economic development, business history, and particularly in the progressive era, ⁓ We've all most of us have encountered Richard John over the years, and he's been exceptional in the way that he has ⁓ mentored and helped graduate students and young scholars. So and as part of that, he's agreed to join us today. So we're really grateful for that. Thank you. ⁓ Today, we're going to discuss ⁓ a book at Richard's suggestion that I had in mind, but I was. thinking we would do it much later, but I'm so grateful you brought it forward because actually it fits into what we're doing so well. And that is Alfred Chandler's visible hand. ⁓ And it the last couple of episodes, you know, we did a couple of consensus historians and then ⁓ Grant and I did William Appleman Williams in the last episode. And so ⁓ it's this interesting kind of mid 20th century ⁓ point that we've been really looking at in historical scholarship. I think Chandler, even though it written in the late 70s, I think it really speaks to that and is really a part of that theme. ⁓ So Richard, let me start by asking you this question. Do you know of a book that is more important to a field as the visible hand is to business history? That's a good question. It really did create the field as it's currently constituted. Environmental history, labor history, E. Thompson's Making of the English Working Class, environmental history, ⁓ Cronin's Nature's Metropolis. But ⁓ those books were all part of an ongoing tradition, whereas Before the Visible Hand was published, business history was really only of interest to a very small and select number of historians who often flew under other banners. But with the Visible Hand, the field of business history, for better or for worse, took off. Al Chandler always thought of business history as an important ⁓ field within economic history. And ⁓ Marie, I know you're not a business historian. But ⁓ the book is not just business history, of course. I'm assuming this probably was not on your comps list, Visiblehead. No, no. Spreading the News was on my comps list and I really enjoyed it, but not Chandler's work. So as somebody who's not a business historian, Marie, what were some of your initial, like what were some of your takeaways from the book having reading it this time? think that the idea of the managerial class forming in this era and how important it was. And even though it's not as though, I mean, it's it's business history. It's not billed as political history in any way. But the idea that they become so important in the business world. it bleeds over to the political world. There's no way to separate the two. I think that comes across reading it from, ⁓ you know, as a political historian, I think that comes across fairly well. And I would love to hear your thoughts ⁓ on this as well, Dr. John. Al Jander was trained at Harvard ⁓ by Frederick Merck, who was a student of Turner. And he was influenced by progressives, only because he was an editor on the Theodore Roosevelt papers. In fact, one of the essays he wrote ⁓ ended up in the Theodore Roosevelt papers, were cited by Richard Hofstadter in his Age of Reform. And Al Jander later ⁓ was an editor of the Eisenhower papers, which is to say that he is very engaged with debates in American political history. And I was working in his papers recently, and he taught a course at MIT on American political economy in 1959. But as a student ⁓ and having read his work and spent some time thinking about it, we know that he was very critical of the way American political history had been taught. Thomas Cochran's famous essay about the presidential synthesis was in his mind. It doesn't make any sense to go one president to another. I that was recently revived in a sophisticated form by Skaronik or not that recently. It is possible to organize around presidential administrations, but Al didn't think that made a lot of sense. And he was committed to a vision of American history that would emphasize material transformation. And Maria, as you so astutely observe, the creation of this new class. Mid-20th century historiography was, particularly in sociology and social thought, was concerned with the emergence of this new class. Daniel Bell lectured about that, 1970s. Remember, and C. Wright Mills was interested in new class. And James Burnham had published his Manage Your Revolution. So the book had its origins really in his graduate student years. Took him about 30 years to get it into its final form. In this paper, as you can see, he's mulling it over. He worked with trade press editors. He was trying to find a way to make a single statement. that would be powerful, that in my view puts him squarely within the progressive synthesis. Charles Beard in 1927 in his presidential address for the American Political Science Association emphasized the enormous influence of technology works by Thorsten Veblen, who popularized the concept of technology, were some of the only social scientific works that were in Al Chandler's library, as he gave it to Harvard. He wasn't that interested in social theory. He was really interested in the progressive project of comparative institutionalism. the political power of the managerial class was something that he was very aware of. But of course, it was not exerted through elections. It was exerted through their ability to transform that material environment and to transform really the institutional structure of American American economic activity. That was his larger project. He felt that was of enormous importance. He recognized it was a narrow topic. He recognizes it's not democratic, but he felt it was important in the post-war world that historians pay more attention to it. He would often say that 95, 5 % of the historians work on 95 % of the problems. And he thought the emergence of this new class was one of those problems. If only because, and this is just a PS, ⁓ he was very concerned in the 1970s, which I suppose was early, fossil fuel. He was very concerned the need to wean the country off of fossil fuel, which referred to as the devil or Mephistopheles or the evil. ⁓ And in his view, we needed an educated, professional, managerial elite that understood how the institutional arrangements of the modern economy were structured in order to undertake tasks such as that. That was really what engaged him the most in the last 15 years was the paths of learning or how creativity could be manifest within large-scale enterprise. And it's pretty easy to see the analogy. between large-scale enterprise and business or large-scale enterprise and university or large-scale enterprise in some kind of think tank. That became his great quest. So to kind of uncover and unleash, I mean, this is going to sound like an oxymoron, but I don't mean it to sound like an oxymoron, bureaucratic energy. ⁓ to harness these various bureaucratic classes that are being created both in government and business primarily. And how to ensure their prominence, know, maybe predominance, but certainly prominence and their ⁓ ability to to solve the world technology had created a world that only they could solve problems at the scale necessary and to Understand how they were doing it and therefore to put them in a position to continue to to do so in future so that's sort of the Political project at Chandler's. Yeah, that that's very well put in invisible hand And let's talk about that for a moment. Scale and stow is a little different and strategy and structure is a little different. But this was intentionally plotted. So there's Act 1, 1790s to 1840s. That's before the ⁓ exploitation, mobilization of anthracite coal, which was transformative because you have high speed flow of resources that makes possible and you need developments in iron making. concept of the economies of speed was important in Visible Ham, which he later drops. The second act is the creation of the basic infrastructure, which he called, I think it is, come to see somewhat misleadingly as business, that is to say, railroad electric telegraph. And then the third act was when you have the coming together mass distribution and mass production in the modern business enterprise. And the story is over by 1917. And I emphasize that because Industrial research, as we know it today, was just beginning at that time, certainly as Al Chandler saw it. And the major forces then that were being harnessed, or that's an interesting metaphor, harnessing the horse, but there was technology and markets, technological imperatives, market demand. And he saw them both as external to this managerial project. You could do it well, you could do it poorly. And you would do it within a political context, for example, the ⁓ railroad managers tried to ⁓ legalize pooling. So the courts would support ⁓ their efforts to redistribute revenue from ⁓ the shippers in a way to limit competition. Well, the courts refused to do that. The courts had an anti-monopoly agenda. And because of that, They then had to do something else and they overbuilt. They became empire builders, which was always a negative for Al Chandler. And then many of them went into bankruptcy in the 1890s. So politics mattered, but more often than not, politics mucked things up. Tom Hughes had a similar, this is not my view, but this is Al's view and that was Tom Hughes' view. Politics mucks things up and it comes about at the end. So implicitly had the court sanctioned pooling. railroad development would have been less exceptional, less unusual, less distinctive, and perhaps more ordered. ⁓ So yes, the management is operating within political constraints, but the major challenge is to find a way to take advantage of market demand and to mobilize technological imperative. And he used the language of technological imperatives. He didn't like to be called a technological determinist, ⁓ but he has many affinities with the Marxian historians. And he greatly admired the Marxian historians, including, say, Gabriel Kolko, with whom he corresponded, or left-leaning economists like Alfred Eichner. Of course, one of his protege is Bill Lazonek, who's a very prominent Marxian economist today. And the concept of technology, should be perhaps underscored is one that only found its way into American historiography, beginning Veblen and then Beard, ⁓ and then a relatively small number of post-Second World War historians. He really made technology central to the story. And he also, think in a way that in retrospect is somewhat problematic, the idea that when Adam Smith talked about the invisible hand, as the visible hand is paired with the invisible hand, that the invisible hand was a reference to the market, which isn't at all clear. That's what Adam Smith had in mind. In fact, that interpretation of the invisible hand, which was not an important metaphor in The Wealth of Nations, it only occurs once, it only occurs three times in Smith's writings, that that interpretation, that metaphor got a big boost from Paul Samuelson in his Principles of Economics in 1948, a macroeconomic history. So to just emphasize the main theme, politics mattered for Al. but it was on the fringes and it was far less important, say law, ⁓ regulatory agencies, less important than the challenge of mobilizing technological imperatives and ⁓ market demand. He calls his unit of analysis the enterprise, invisible hand, and not the corporation. If you called it the corporation, you'd be more directly engaged with legal debates, but he really wasn't. He wasn't interested. His book came out at almost exactly the same time as Horowitz's, what was it, Transformation of American Law, Volume One. It came out at the same time as that. And interestingly, they both shared this sense that there were these economic forces that were impinging upon either the legal order or the administrative coordination of economic activity, economic institutions. Yeah, OK, that's fantastic. ⁓ I mean, that gave me a very different, you know, a really a much better understanding, having just read the book, a much better understanding of, know, what where it was engaged at the time, especially. ⁓ Are you able to give us maybe a little bit for people who have not read the book? We've touched on the argument in a few places, but maybe maybe we can just be a little clearer about actually what the I mean, he he lays out eight claims or eight, you know, propositions at the beginning. what's the, for somebody who's never read the book, what is the overall most important takeaway from the book? know, mention those propositions is important. And they've often been, it's often been read as a social scientific ⁓ kind of research report. And I'm come around to view that's not the best way to understand the visible hand. I think of it more like say Beard's rise of American civilization or say ⁓ Turner's essay on frontier or ⁓ writings of Bancroft or going all the way back to Thucydides and Herodotus who Chandler studied. It is an epic about creative intellect that is coordinating these forces that are almost ⁓ biblical or they're like Greek. ⁓ the forces of the Greek gods would contest with in order to accelerate the flow of resources through the economy in order to ⁓ really create ⁓ kind of productive potential and realize productive potential on a scale that had been never before understood in world history. In other words, this is one of the really big transformations in the last 15,000 years, what he called the manager of revolution, which for James Burnham, writing in 1941, was a successor to capitalism. So he's a supersessionist, Burnham was. In other words, capitalism was doomed, said Burnham, and something called the manager of revolution is going to take its place. And that was a very influential idea for the English writer George Orwell. who drew on it in 1948, he published having read James Burnham. For Al Chandler, capitalism is in a way perfectly congruent with and kind of a complement to the development of organizational capabilities. Now, what do I mean by that? It's not a phrase he used in this book, but that's the idea. You can coordinate economic activity he contended really in one of three ways. You can coordinate it through the market. And in Act 1 of the Visible Hand, the market is the main mechanism. And that's because there are no real advantages to coordinating administratively. So for example, textile mills never got that concentrated. Shoe factories never got that concentrated. There were lots of them. manufacturers, the owners of those enterprises, and those owners had a proprietary stake in the business. That is to say, they own shares. They could go bankrupt. The owners were mostly price takers, as he saw. In other words, if you priced your shoes higher than someone else's shoes, the customers were going to buy someone else's shoes. And you did not market. So you were you did not develop a marketing apparatus. So you are a single unit enterprise. Textile mills did not ⁓ brand their own cloth for the most part. They sold it through jobbers. So he's very interested in what the different institutional forms are. Now, after 1840, with the speed up in the flow of resources, and he's exemplified by the railroad and the electric telegraph, it became conceivable to produce on a much larger scale following the Adam Smith dictate that the size of the market limits the division of labor. And you have to coordinate the flow of resources. You don't want the railroads to bang into each other. You've got to find some way, if you're manufacturing steel, to ensure that you have a market for your steel. Or say you're manufacturing sewing machines or reapers. that your purchasers of those goods will be confident that what they're buying, which is expensive, will work and will not ⁓ break down, then you begin to integrate forward into distribution. So an example that he would often give is of the Singer sewing machine shop or the ⁓ harvester McCormick Reaper would have, ⁓ they'd have factory workers who would go out into the fields during the harvest because it was during the harvest that it was extremely important that the Reaper work properly. So you shut down the factory and you send the workers out there. the concept of flow of resources was very important to Al's conception of this middle stage. it begins with distribution. The country is very large spatially, much bigger than Britain. And he argued that in Britain, you don't have to develop these formal institutional mechanisms, can be done informally, but it's smaller. is the argument, United States is big spatially, is the ternarian dimension. So the challenge of mass distribution then leads to challenges within mass production that include the development of management, kind of the three M's, marketing, manufacturing and management to coordinate the flow of resources or material or whatever. whatever it is. So the oil industry would be a classic example for Chandler because the standard oil was ⁓ important, not because it kept prices high, but it brought the prices down and it sold at international market. And that created a big problem for the independent oil producers and it created a problem for barrel makers and lots of other intermediaries. But that was a high volume throughput business, which you'd call kind of a kind of a Chandler firm. Now there are criticisms of this argument, it, like say ⁓ Nature's Metropolis by Cronin, it has a kind of an analytic power, almost a romantic power, a power as myth that makes sense. At least it made sense to me when I first read it in 19, was an economic class around 1978. It made much more sense of how large scale enterprise operated Then the stories about, robber barons, industrial statesmen, or good fellows, or bad fellows, that there was a transformation of the material world that was being coordinated. And for Chandler, it's over. It begins before the Civil War and it ends before the United States enters the First World War. And he's very carefully plotted that. Unlike Lewis Mumford, he downplays the role of technological paradigms in shaping a business strategy. doesn't want, excuse me, not technological, but a military in shaping a business strategy. He believes that the role of the military is easily exaggerated. Of he fought in the Second World War. He was in John F. Kennedy's class at Harvard. And he's very impressed with the role of the military after the Second World War. And he wrote about that in his correspondence. And in some ways, that's the great theme of American economic history in the 1950s, 1960s. But he did not see that to be a central theme in the earlier period. some sense of, and just the social science propositions, I think, have confused readers. He really cared about specific individuals making decisions. ⁓ He didn't tell you about the private lives of his managers. He didn't tell you, didn't do prosopography. He wasn't interested in... you know what they ate for breakfast, but he was very interested in the decisions that they were making. In that sense, it's distinguished from economic history as it's evolved, which is much more concerned with kind of large scale processes or monster abstractions. Chandler didn't, he wasn't interested in monster abstractions. He wanted to be able to determine how specific individuals made decisions that affected specific groups. And those specific individuals, Marie, you said, so well, we're part of a class. This is a class argument in the same way that, you know, Marxist capital is a class argument. It's an argument about a managerial class which had a particular vision of the world, which he saw as quite narrow and he saw as largely unrestrained by the political process. And he has a famous statement about that toward the end of the book. We have to find some way to make these men accountable. And just such a basic proposition that I get on the table that these men are not like proprietary capitalists, owners. That is to say, ownership and control were separate by the end of his story. He's not interested really ⁓ in the Vanderbilts or in the Jay Goulds. He's not interested in the kind of last generation, the great proprietary capitalists. ⁓ argument they come back in our own day. He was interested in the men who are managing on salaries, who may have some kind of ownership stake, but that's not why they're in it, who have a long-term investment in the enterprise because they see their careers as bound up with it. They see the lives of the communities in which they live as bound up with it. They see it as sort of their life's work. And in the 50s, when it was still, it was common for young men to go into a business for which they would remain for their careers, that was a much more, it was a plausible kind of origin story for that world. Now that's not the world we're living just, this was in a lecture where I was informed that young people today can expect to have 13 different jobs in their lives. Well, that's not the world that Al Chandler envisioned. He envisioned men and it's all men. although he was very, had lot of women graduate students, very interesting women, but they're all men who were working their way up. And the heroes in many ways are not the top managers, but the middle managers. And I think about, I thought about this in the seven, think about today, we have nuclear stockpiles in this country. You get on an airplane, you're buying food. An awful lot of people have made decisions to make sure that the airplane doesn't blow up or the food is safe. or the nuclear stockpiles aren't somehow putting us all in harm's way. Somebody is doing that. And the people who are doing that are Chandler's heroes. It's not about abstractions, it's about specific individuals, part of a social class who are in effect making what we would consider to be civilization or daily life or whatever it is, the promise. an American dream possible, somebody has to write about them. And that's what Chandler did. And I think you did an excellent job with this. I think too often, even now, we look at history from the Vanderbilt perspective or from that big man history when we talk about political history. And what really drew me in was the creation and the explanation of these young career professionals. And that comes out of this progressive like progressivism in the historiography. And, and Robin, I've talked about this with some of our other books, but he's certainly influenced by that idea that the future is in the hands of these young career professionals. I agree completely. Yes. Yeah. And it comes across so well in this, even from the perspective of a straight political historian. I see that I like that argument as a political biographer myself, I want to know what they ate for breakfast sometimes. I want to know, know, a little bit more about these men, but overall the decisions that they make, especially with railroads, I think he does such a good job and we often learn the importance of railroads in doctoral programs. they're already, students are already going to have that foundation. And so seeing how that managerial class really ⁓ creates the system that wrote in the political powerhouse that railroads become. was a really interesting and important part of this work as I was reading it as well. Well, his first book was a biography of Henry Varnum Poor, who was his great grandfather. Henry Varnum Poor is not known today to many people, except the name Poor lives on in standard in Pours. His poor was a financial journalist who edited the American Railroad Journal, which is one of the most important trade press publications. And after he wrote that book, he thought he might become a historian of the financial press. That was a way in. he said, well, who would ever do that? Well, in some ways, that's a sort of career trajectory of an Adam Tooze who began by studying German statistics and then moved on. So that was his subject. He did ⁓ co-author a monumental biography of Pierre S. Dupont. So he's capable and he's very interested in writing. biography, but even there it's not so much about Pierre Estupont's relationship with his wife and with his children. In his view, other people have done that. And it's a matter of temperament, but he was a very modest man. He was very dogged. He was very focused on the sources that he could get a hold of. And he felt he had a mission to tell this story about what he come to call the managerial revolution and to tell it in a way that was different. from the way that Burnham had told it. So this is not a book filled with kind of a blizzard of abstractions, even though that's how some might read it if you started with those propositions. It is instead a traditional history about describing how and explaining why events took the course they did in order to set the record straight. That's his very similar project, say, If you were studying political operatives, if you were studying campaigns, or if you were studying lobbies or how particular issue networks are formed, that's the world. So it's a comparative institutionalist approach to the study of the economy, understood as the interplay of economic institutions. Now, a lot of institutions don't get emphasized, small scale enterprise, mom and pop stores. He's not that interested in... He is interested in Macy's and Sears, but he's not that interested in how advertising developed, other than to say it did develop. So there's been many, many topics that have emerged out of... course, he's not interested in organized labor. He just leaves that for others. He's not opposed to organized labor. It's just not his subject. He'll always emphasize what a narrow topic he's chosen. and that is an internalist project. Other historians are contextualist. He did not have a contextualist temperament. And by the way, he's not really a number cruncher at all. He suffered from dyslexia. He had great difficulty adding up columns of numbers. This is not a book filled with numbers. It's not a book in which there's any real discussion of profit, whatever profit is. ⁓ It's a book about the marshaling of resources in order to... facilitate their flow from natural world to users, whether they be producers or consumers. In that sense, it's an epic. it's also an origins tale that legitimates the emergence of this new class. In some ways, the origins of the English working class, like by E. Thompson, is a similar project. Of course, it's a very different book. But in some ways, that is an interesting counterpoint. because it's a class analysis and it's a group that he saw as the winners and as a dominant group. Now, since the 1970s, that is no longer the case. Managers are still with us, but they were challenged with the rise of shareholder capitalism, Michael Jensen, with the development of new kinds of networks. And now with this, an plutocratic class of public figures slash businessmen who are implicated in government contracting who don't see themselves so much as building organizational forms that will endure, but see themselves as a kind of Schumpeterian entrepreneur. Schander was impressed by Schumpeter, but he saw Schumpeterian entrepreneurship really as a function not of individuals, but of the class as a whole. And he disagreed with some of his counterparts there. He disliked conglomerate mergers intensely. He has very little patience with or interest in bankers or finance. thought bankers and finance were enormously exaggerated as players. He does not believe there was a stage in American history called financial capitalism. He has an anti-investor, anti-financial bias or whatever word you want to use. And that was very clear as a student in his teaching and it's pretty clear in ⁓ Visible Hand 2. J.P. Morgan, one of the main roles he plays is he He wants to set up this international mercantile marine company that fails. It's not ⁓ driven, this is not an account driven by bankers. And he had no patience at all for that canard that sometimes historians still use, the Gilded Age. thought that was, he was almost as critical of the Gilded Age as was C. Van Woodward. ⁓ They both thought it was just an absolutely terrible way to talk about the late 19th century. And unfortunately, That metaphor has continued in American history. We just can't get rid of it. I'm going to be attending a conference in June called the Society for Historiums of the Progressive Aaron Gilded Age, right? it's... I'll send you a link, Robert, to a letter to George Fredrickson by C. Van Woodward in which C. Van Woodward just... I mean, there's nothing to be said for the concept of the Gilded Age after Woodward has finished with it. And he's hoping that Fredrickson, of course, would write the volume in the Oxford History of United States to put the concept, you know, to kill it, to put it to bed. But Fredrickson didn't write that book. And if he's not a very fine distinguished historian, but in my view, he made an interpretive stake, I certainly would would have thought so, by keeping alive those old stories about Gilded Age and Progressive Era. That's Richard White. And Richard White wrote a very different history of railroads than did Al Chandler. For Al Chandler, the normative railroad was Pennsylvania. Of course, for Richard White, because his story was transcontinental railroad, the normative story is Union Pacific and Southern Pacific, which are very different railroads. Al didn't think that they were particularly well-run. He didn't feature them. He'd feature the Great Northern or the Pennsylvania. And he is interested kind of in best practice. But that has brought us back to an emphasis on things that happen, corruption, malfeasance, insider trading. But for Alde, just weren't as important as the creation of this nationwide transportation and communication infrastructure. And he certainly deplored what he saw as the overemphasis on those quote unquote colorful figures. And those colorful figures, the good fellows, the bad fellows, the robber barons, industrial statesmen, those live on, I'm convinced in part because they were featured by journalists, particularly journalists who were pioneering in chromolithography, caricatures. How do you caricature a businessman? And that has led to, it's an easy way to get through that period for undergraduates to focus on a very small number of individuals and to say they stand for the age rather than talking about the apocal transformation. Sven Beckert recently has argued This is the second great divergence, the rise of the United States. Europe was the first great divergence, challenging China in the 18th century. The second great divergence is the United States between the of the Civil War and the First World War. And that second great divergence can be called managerial revolution or can be called the second industrial revolution, a phrase that Al Chandler did not use in Invisible Hand, but that he later picked up on, a phrase that has its origins in the writings of the Glasgow-based ⁓ urban planner Patrick Geddes, who was very interested, as was Al Chandler, in the transformations in big cities in the late 19th century with electrification, electric lighting, ⁓ street cars, and then the telephone, the development of new kind of infrastructure that would have been absolutely inconceivable 40 years before. Those big changes ⁓ are very... genial second industrial revolution, Sven Beckert's ⁓ second great divergence, or Al Chandler's managerial revolution. We can talk about some of the problems with the thesis, which I've written a lot about and I've thought about, but sometimes it's too easy just to dismiss a book and say, ⁓ it doesn't deal with X or it doesn't deal with Y. Instead, Marie, of having the response that you did was this is really, it's quite a magnificent landscape that is presented before you, which I think is what great works of history do. Absolutely. Yeah. I'm just going to say, you know, one of the things for people listening who don't again, maybe haven't had a chance to read the book yet. And this conversation has inspired you to read it, but I don't know what can. But, know, the the the anthrocycline, cool tech, you know, technology ship, which is, you know, kicks this off this process off. You know, one of the ways that Chandler describes the importance of that shift is that if you'd had a like a 15th century Florentine business blown into the United States in the 1830s and they were expected to practice business or commerce after a few days, they'd be able to figure it out. Yep. Because that business practices had not evolved that much beyond. the business practices of 15th century Florence. however, the same thing could not happen in 1875 or 1885. So that's what he's talking about when he's talking about this massive epochal transformation and the way that enterprises operate in the creation of this class. has changed business from the way that it had essentially operated for at least six or 700 years. Yes. Overnight or relatively overnight into the modern firm where there's beer. Whereas as Richard mentioned, there's, you know, there's salaried managers, there's middle managers, there's upper management, you know, one of the distinctions between middle management and upper management is middle management is dealing with the allocation of current resources while upper management is dealing with the allocation of future resources. Right? So you've got these divisions of labor, salary, manager, sub units everywhere. And then most of the quote market behavior that's happening, according to Chandler, at least is between units, which therefore marginalizes the the romantic notion, the Smithian market. because it's not determined by supply and demand, it's purchasing logistical decisions made between subunits of the same company. That's right. hearing you say that, I'm reminded Al Chandler's colleague at Hopkins, was he taught at Hopkins for many years before he came to Harvard, was Frederick Lane, who was a historian of Venetian business. And he worked closely and edited a book together with Stuart Bruchy, who wrote about colonial merchants. He took courses with Arthur Schlesinger, senior at Harvard, who wrote about colonial merchants in the coming of the American Revolution. So he was, I like what you said, Robert, about units. He's very institutionally minded. He's a comparative institutionalist. I've often thought you can distinguish historians with those who write about individuals, those who write about groups, those who write about institutions. And Marie, you're absolutely right. He wrote about a social class. but it was a social class that was embedded within a set of institutional arrangements. And there's a politics to that. ⁓ I've written myself about Chandler's neglect of how governmental institutions shaped business strategies. So instead of business strategy shaping organizational structure within the firm, I've argued that the political strategy of lawmakers is shaped business structure. In other words, business is embedded within a political economy. And that was not ⁓ that important for Al in part because so many of the historians of his generation were political historians and he worked very closely and was admiring of Lee Benson. ⁓ He was admiring of, well certainly, I I wasn't just seeing you as a social historian, but he was interested in political economy and merchants. He was swimming in a sea in which political history, say John Blom at Yale, in which political history was quite central. Or C. Van Woodward, who he contributed an essay for in his comparative method in business history. ⁓ it was a different age. was very fresh to write about. Remember, you could write about certain things, then you're not going to write about other things. And so he didn't talk about, say, how infrastructure helped make possible the rise of these enterprises. He didn't talk about law. He didn't talk. He comes slowly to just treat railroad as a business instead of, an infrastructure or a platform or a network or a utility, other metaphors that we'd have today. And that became really confused things because the railroad wasn't just a business like any other business. It had a very specific place in political conflict. A recent work of Noah Magor has shown so well how state legislatures forced railroads to develop in certain ways that in fact helped explain why there are so many mid-sized Midwestern cities that were manufacturing centers. It didn't happen in other countries. Richard Benzal in his political economy of American industrialization has shown how judges helped to limit the power of state governments to restrain businesses from operating in interstate form. Those are political choices that were made. And of course, My own work on the telegraph and telephone, I shared how an anti-monopoly political economy created the world in which Western Union could thrive, and then a progressive political economy in which the presumption was competition, even though you didn't get competition in the end, and then a progressive political economy centered on municipal franchising created the world in which telephone ⁓ thrived, which is paradoxical because early on the Republic, post office and with early telegraph, federal government's the key arena, then it's state government, the telegraph is municipal government. Al's model didn't accommodate that kind of an argument because he thought of technology and markets as completely separate and outside and independent. And he thought that world had changed by the Second World War. So that after the Second World War, you couldn't write. He didn't see this as a book about all times and all places. That's one of the... I think unfair criticisms of the Visible Hand, you criticize it for many things. You criticize all works of great history. But it was not an account of all things that have ever happened or a single model of economic development. It was a model that made sense because the United States was so spatially extensive, a ternarian element, and because the technological transformations were so momentous, which is the Beardian element of his 1927 American political science review presidential address. We stop reading Beard as academic historians with the book on the Constitution. I think that's a big mistake. If you read Beard in the 1920s, you see the influence of Evelyn, you'll see this sweeping narrative about technological torrent, he called it. That's a world that Al Chandler understood. And to be honest, I think it's a world that students of American history understand. So just step back and ask the... make the kind of observation, Robert, that you did, how the world has changed. Henry Adams' insights in his education about how the world of his childhood was so different from the world he was living in now. Those are big changes. If historians are going to deal with the big changes in our world, we need to develop a historical imagination that is comparable to Al Chandler's. And very few historians are up to that task. I gave you Bill I gave you Bill Cronin as an example. The book in many ways is very much influenced by Al Chandler's visible hand. ⁓ But it's plotted on a similar scale and too few works of US history are. They fall in these tired categories, Reconstruction, Gilded Age, they talk about certain groups and what goes on out in the West and the South. You miss what's going on in the center. And it's important to keep your eye sometimes on the key actors' right in the cockpit of history. So, Marie, let me ask you, you know, we're both Southern historians and you you are a Southern historian of the 20th century. know, Chamber does not ignore the South and he, you know, especially in his first in the first part of his ⁓ epic, particularly he relies quite a bit on talks a lot about cotton and talks a lot about ⁓ enterprise development, business development in the South relies a lot on Harold Woodman, who's a great historian of that. But yeah, just thinking about the South, you know, I imagine you were thinking about the South a little bit while you were reading this book, because we both do. Whenever we're reading a book. ⁓ What what did this get you thinking about in Southern history? In this book, like how did it help you kind of understand maybe Did it help you, it help you understand or contextualize what's happening in Southern history in the late 19th and 20th century at all? ⁓ that's a good question. I'm not sure I was thinking about it in that context enough to articulate a good answer to that question on the fly here. ⁓ Yeah, I would love to hear what Dr. John thinks about the relation to the South. Well, Al Chandler's undergraduate thesis was on South Carolina in 1877, and he thought he was going to become a Southern historian. He went to the University of North Carolina, and I've often wondered what would have happened if he'd taken a course with Howard K. Beale, who was a very dynamic teacher, know, the teacher of William Atman Williams and C. Van Woodward and Alice Hawley, but he didn't. as far as I can tell, Beale was not offering courses in the year that Chandler was there and he was interested in Harold Odom. think Odom was there, some sociologists. And then he comes, he goes, Nora, that's of course where he's gone to college. But he does, he's very interested in the extent to which the plantation agriculture was lucrative. And that, for example, I think he has a footnote in which he talks about where conduct, where was the food coming from, from the South? The argument was it was more lucrative for them to import the food because they were making more money on cotton. And at one point, I remember he was very intrigued to say that the Brits almost gave up Canada in order to hold on to Pierre, what is it? Martinique. Yeah, Martinique and the other island. Guadeloupe and Martinique, because they were so lucrative. He had a sense of the power in the same way, say, that Sven Becker will today of the cotton economy. But cotton goods were all then marketed, of course, through New York City. And New York then was tied to the South. That's a story that Sven Beckert tells. He did not believe, ⁓ unlike Caitlin Rosenthal, that there's really any relationship between modern business enterprise and the accounting practices on Southern plantations. And he did not, he was very interested in the extent to which those plantations were efficient. And he didn't believe there were middle managers, which for Chandler is always a key question. There are managers, but they're not middle managers. They were just overseers. I remember in my first book in the post office, I convinced him, at least to my satisfaction, that there were middle managers in the post office in 1800. That's to say, managers who were managing other managers or themselves. ⁓ But he didn't think the plantation was a particularly... ⁓ It didn't require... ⁓ Excuse my words carefully. It did not require the kind of administrative coordination that say the railroad would. And like Leo Marx, in many ways a very Chandlerian book, The Machine and the Garden, the railroad just bursts onto the scene for Chandler in the 1850s. And it is a very different, you're in a very different world. Other rifts on the South. Yeah, mean, if you look at the maps, Mark Peterson has it in his most recent book coming out, if you look at Richard Benzel's map, the great investment in the South, of course, is enslaved persons, not in land. And that investment is just wiped out in the Civil War. And the South is very poor. you know, there's not a lot of innovation of the kind. I the Louisville and Nashville Railroad, which Maury Klein wrote about, would be probably an exception. He was very interested in Louisville and Nashville. I think Fink worked on that railroad at the time, Russian railroad engineer. But he didn't write much about Texas, oil. He didn't write much about ⁓ rides in Atlanta. ⁓ And of course, he'd be fascinated with the work being done now, historians on Phoenix and on the Southwest. But that just wasn't his subject. And to be honest, I didn't grow up in New York. I grew up in Massachusetts, I lived in Illinois. But what happened in New York and Pennsylvania and Ohio is really, really important in this period. you can't, like Richard White just says, really nothing of consequence east of the Mississippi matters in the 18th century. mean, that's an exaggeration. It's an impressive book. But when he talks about the anti-monopoly, for example, it's all west of the Mississippi and South Ohio, it's just not true. The center of the country was in still in the Northeast, the core. New York was a pivotal state politically throughout this period. And ⁓ Chandler understood that, and that helps to explain some of the interpretive choices he's made. And he's just, not a regional. I mean, he's not writing about the distinctiveness of regions. He's writing about business. I will say, this is a, I just thought of this, but of course he is very interested in James Duke and in the Bonsack machine. for making cigarettes. So that would probably be the logical connection between Chandler's work and the work, say, of Southern historians who are interested in the rise of the New South. Yeah, I mean, think that's great. mean, what I was reading is that, you know, all I could think of is the, when I was thinking about the South, is that the traditional enterprise just stays dominant. Yeah, really in the South in well into the 20th century. Yep. Right. And this at the Chandlerian enterprise, you know, in the South, maybe maybe we could call it a Cocian enterprise. But like in the champ, there's a Chandlerian enterprise, Chandlerian firms, I should say, are, you know, have have created a visible hand in the north that is not there. in the South. I mean, it's in pockets, but it's not there in the South. Had there been literature on Coca-Cola, he probably would have written about Coca-Cola. Remember, he's writing on the existing monographs. Sure. And there weren't, and there's now a good literature on Coca-Cola. And that's an interesting, know, there's some elements there with the distribution ⁓ of that water. But that's right. He was interested in the leading sectors. He's interested in what he took to be the largest enterprises with a high volume throughput. So very distinguished historians like Phil Scrabble have spent his entire career challenging. Why do we focus on mass production rather than flexible specialization? That's a good question. It's just a different way of seeing the world. Al was very interested in kind of the mass production enterprises that brought the United States to the center of the world economy by the First World War. and then were so important in the Second World War and its aftermath. He didn't think that Ford was well-run, of course. He thought that Ford was an empire builder and that it made a lot of disastrous decisions. But GM under Sloan was well-run. And that's kind of an archetypal managerial firm that develops what he called the multi-national, excuse me, the multi-divisional form. It also was operating in international markets. So that the... functional firm gives way to the multi-divisional firm, and that'll be an important subject. It was in his earlier book, Strategy and Structure, and in his later book, Scale and Scope. But it's the functional firm, Robert, you emphasize so well, in which you have middle managers who are coordinating flow of resources with marketing, with manufacturing. That's what he wrote about, Invisible Hand. That's what he wanted to put into the historiographical landscape. Maria, I'm going to let you, we're running out of time here. Maria, I want to let you ask the, a chance to ask the last question. Oh, well, I had two more for you, but I will end on this. Well, first was throughout the series that we've done, we've always talked about how the authors are influenced by the time in which they're writing. And so he's publishing this in 77 where you do have a rollback of the bureaucracy. Is he, how is he influenced or is he influenced since he'd been working on this so long, the archival research is very impressive in this book. So if you could just comment on that. Yeah, well, I've worked in Al Chandler's papers and it's very clear that the genesis of this project goes back to 40s and 50s when he in graduate school and he was at the Center for Entrepreneurial History at Harvard Business School. So it is by no means influenced by immediate developments of the 1970s. I think if you wanted a decade, it would be really the 1960s and he's legitimating the organization man. He's the man in the gray flannel suit going back to 50s. He's legitimating this world in which the United States is at the center, in which US ⁓ business ⁓ insights are being sought around the world in which Business schools are developing ⁓ expertise in general management ⁓ and in which one of the burning questions is how did the United States ⁓ successfully become the arsenal of democracy in the Second World War? That I think is the world. I've seen it as very much in keeping with the American Century famous essay by Loos in which before the United States entered the First World War. So it's that world that he is trying to legitimate. He believes the United States and Soviet Union are on parallel paths. ⁓ There's a lot of differences between the States, but they're both dealing with technological imperatives. So that's not the difference. So in some ways you could say it's a Cold War book. It's a book that is... It's skeptical really of the parochialism of political history, which was dominant in American historiography at that time. That we just don't need more biographies of second rate politicians. And remember, they weren't studying so much political process. They were just studying the preferred form for many PhD students who were just writing a biography. And those works are valuable. I use them all the time. But he just didn't think that's what American history was about. So it was a way to make economic history more realistic, a word that Chandler used a lot, to make it more grounded and to make it more institutionally ⁓ self-aware. I think that would be what I would say. So I wouldn't put it in the 70s in some ways. It came out just at the moment when the world he was describing was collapsing. Like all great histories. Yeah, like all great histories. Exactly. Yes. So the other question, and this has taken us a little off topic here, but I really was influenced by Spreading the News. I think that that was I think that was a great book. And so I would just like, since you were a Chandler student, to know how you were influenced or how you push back against his work in your own work. That's a very generous question. Thank you very much. Spreading the News was a doctoral dissertation, Al Chandler and David Donald. So there were two very different historians but had a very similar sensibility. So I went into it looking at kind of organizational changes. 1836 was supposed to be an important moment. And then working in the archives, I realized that 1836 really wasn't that important, that there were changes that occurred earlier that were changes that were bound up with political decisions. And I was in the American Civilization Program and I was a little more interested in than Al was in not just, I'm not saying it's in the people, but in the context. I was a contextualist from the beginning and I was trying to bring to the study of governmental institutions some of the same analytic tools that he brought to the study of business institutions so that I was very interested in how the flow of resources through the institution was managed, how the means of transportation coordinated. I asked questions like that. And I was very interested in what the enterprise bumped up against with slavery and then the saboteurian controversy, the controversy over the mass parties. So it's a very generous question. And it was a book that he saw as congenial. And many of my mentors at Harvard thought it was a terrible topic, if not the worst possible dissertation topic to write about, which I was told by several. it fit very well into the comparative institutionalism that he trained me and it worked very well with David Donald's ⁓ kind of astonishing ⁓ knowledge of political parties, institutional arrangements, and the kind of political culture of the early republic. So it is in some ways a Chandlerian book, but I do make the argument that middle management occurred earlier than He thought it didn't, of course, I also make the argument that governmental institutions have been, can be, and remain agents of change, which is something that he downplayed. Governmental institutions with agents of change. And that was in some ways an homage and a critique, though a very gentle critique of a brilliant historian, a great mentor, and a true gentleman who no one I have ever met had a bad word to say about. He was one of the greats. Yeah, I mean, sorry, this, ⁓ I mean, I, I very briefly breezed through visible hand when I did my comps and, know, and part of this project, I think for both Marie and I has been the real joy in it has been sometimes there's books that were not on our comprehensive exams lists that we know are important. And that's really part of the idea of this project is to make sure that students today who are influenced by a very different era in historiography are, you know, reminded of or at least given easy access to these historians and these works that predate the current era. And, ⁓ you know, how can you work them into your just because they predate the current era doesn't make them irrelevant. Huh? Makes it it more relevant some way. Yeah. Yeah. In many ways. Yeah. In many ways. Yes. One quick note on that. Both David Donnell and Alfred Chandler believed and taught their students to be aware of and engaged with great works of history going back to the 1880s, if not before. And that's something I think we've lost sight of, that they saw themselves as part of, and after all, they're both trained in the, probably in the late 40s, early 50s. It was just a half century ago, and half century before now is like 1970s. But they saw history as a distinctive project that had been professionalized at particular moment in time, and they saw themselves as the heirs to that project, which is one reason I'm so confident in calling Chandler a progressive historian and emphasizing his links with Turner and Beard. Well, again, we can't thank you enough for jumping on here, Dr. John. ⁓ Marie, great to see you back. This has been a lot of fun. yeah, so for those people who might be listening, you don't have to listen to this at a given time. But if you're listening to it when I happen to publish it, good luck with the last sprint of the semester and grading exams and hopefully some really good research papers. Yes, yes, thank you. Well, thank you, bro. That was a lot of fun. I really enjoyed the questions and the opportunity to talk about Al Chownin.