Goodbye and Good Luck, Rome – It Happened Today, January 17, 2017

Theodosius I

There’s this joke in a book we bought at the Roman Baths in Bath this summer that goes “How do you divide the Roman Empire? With a pair of Caesars.” And it’s a good January 17 joke (no, really) because it was on that date in 395 that the heirs of Theodosius I permanently split it into the Eastern Empire under Arcadius and the short-straw crumbling Western bit given to the hapless Honorius.

I can sort of imagine the meeting where they said look, everything’s falling apart, barbarians are everywhere hacking and slaying, we were world beaters a century ago and now we can’t cope, what should we do? And some smart-aleck says maybe admit defeat, sort of, and hack off that bit of the Roman Empire with whatchamacallit in the middle, you know the place I mean, a pretty famous city, I think it’s, um, Rome, that’s it, Rome. Let’s… ditch Rome. It’s probably on fire anyway. And everybody looks at him funny and then there’s an awkward pause and the chair says “Has anybody got a better idea?” and nobody has so they do it.

It sounds like a counsel of despair. Surely they needed a bold stroke, something to fix the problem, not give in to it. But in fact it was a counsel of wisdom, following a rule that’s easy to state but hard to implement in the press of events: Reinforce success not weakness.

In statecraft, in military matters, and in business it’s far too easy to deal with a problem in the short term by drawing away resources from something that’s working to prop up something that’s not. But the more you do it, the fewer resources you devote to things that are working and the more you devote to those that are not and you spiral downward into defeat, bankruptcy or whatever particular form of ruin you were trying to stave off in the first place.

In fact the result of amputating the rotting western bit was that the Eastern Empire, later Byzantium, lasted more than 1,000 more years though the last four centuries were ignominious and those that preceded it were often squalidly magnificent, with intrigue and decadence behind a shimmering façade. The East badly missed the political and civil culture of the West once it was gone. On the other hand, refusing to face facts would probably have dragged the East down far faster without doing as much for the west as the separation did.

In the short run, the Eastern Empire was able to regroup, husband its resources, and make several determined efforts to recover the West after the Fall of Rome. In the second, the West liquidated its failing arrangements and rebounded dramatically.

I’ve often thought the Fall of Rome was much more of a political and headline event than a truly major historical development. The rule of law remained stronger there than even in Byzantium, let alone elsewhere, Charlemagne did resurrect the Holy Roman Empire by 800 AD and while there is much to criticize about the nature of government even in Western Europe after the 5th century, and many waves of barbarians difficult to stop, it’s hard to think of anywhere you’d rather have lived even then. Especially if you pick the right part, Britain, an important part of the Western Empire for almost four centuries, where humanity later got both Parliamentary self-government and the slow but increasingly effective separation of Church and State in practice that have both eluded almost everyone else to this day.

So take another page from the Romans’ playbook and reinforce success not failure. Mind you, even in the failing enterprises you’d ideally put someone less useless than Honorius in charge.

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Making a Fizzy Splash – It Happened Today, January 15, 2017

You know all those internet-era stories about if only I’d put a few hundred bucks into that garage venture by those two awkward jokers I used to know, I’d be a billionaire today? The problem being to figure out which jokers are actually Steve Jobs, Bill Gates or Mark Zuckerberg. Well, would you have gambled on the Pemberton Medical Company back in 1889?

If not, maybe stick to broad-based mutual funds. If so, you’re arguably just plain lucky. Because, you see, the PMC incorporated in Atlanta on January 15 of 1889 went on to become the Coca-Cola company. And obviously if a morphine-addicted Civil War veteran reacts to local Prohibition by removing the alcohol from his mixture of cola nut and cocaine extract into a gooey sweet brown health tonic and accidentally mixing it with soda water, you’ll make a fortune, right? Like a music player with no off switch or a Quick and Dirty Operating System. Can’t miss. (I should mention that Coca-Cola may not have contained much cocaine to begin with and certainly had only minute traces after 1891, and none after 1929.)

Like many giant purveyors of non-health food, the company has been battling economic headwinds recently. But it remains true that if you’d bought a single share in 1919 for $40 and reinvested the dividends, you’d have had $9.8 million by 2012, more than 10% a year real returns (that is, adjusted for inflation). Plus the company more or less gave us the modern image of Santa Claus, and his less famous helper Sprite Boy. No, really.

The point is, capitalism is wonderful at creation and its disquieting cousin creative destruction. The marketplace allows things to succeed that sound absurd or revolting at first blush, things that would never get a grant or the central planners’ stamp of approval. But that’s precisely why entrepreneurial success is inherently unpredictable, at times even inexplicable in retrospect (think pet rocks). So don’t kick yourself if you didn’t foresee that a web site where you could post every inane thing that drifted into your head for the benefit of hundreds of friends you don’t know and nothing was sold could make some guy so rich you couldn’t count all his money in a lifetime.

Or that business with the fizzy syrup.

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Wish I’d said that – January 11, 2017

“If something cannot go on forever, it will stop.”

“Herbert Stein’s Law” coined by economist and chair of the U.S. Council of Economic Advisors Herbert Stein; often rephrased as “Trends that can’t continue, won’t.”

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Washington Watches a Balloon – It Happened Today, January 9, 2017

Regular readers of this feature will know that I have a soft spot for the incorrigible enthusiasts for hot air balloons, dirigibles and all those lighter-than-air craft that preceded the airplane, were rudely shoved aside by it, and yet whose backers continue to dream. You just can’t keep a hot air balloon down.

It is also remarkable that for some reason the French were especially keen enthusiasts. I won’t make any hot air jokes here. But I will note that French pioneers included Jean-Pierre Blanchard, who in 1785 boldly demonstrated the value of a parachute in escaping a troubled hot-air balloon by … um… throwing his dog out wearing one. (See “It Happened Today” for October 22, 2016.) Dogs being what they are, the pooch was probably enthusiastic about it. But I do not suggest you try it with a cat or it may well sharpen its claws on your balloon before your next flight. Or on you as you seek to ease it out of the contraption or into the parachute.)

Blanchard’s interest in the subject of escaping alive from a balloon gone bad was doubtless stimulated by his own very nearly lethal trip from Dover to Calais on January 7 of 1785 in which (see “It Happened Today” for January 7, 2016) he and his co-lunatic only escaped a plunge into the Channel en route by jettisoning all the ballast they could think of including Blanchard’s pants. And the danger was very real; an effort by another Frenchman, Pilâtre de Rozier, to cross the Channel the other way later that year ended in a fatal crash.

Well, on January 9, 1793, Blanchard was at it again. No, I don’t mean the animal cruelty stuff or the mid-air striptease. I mean a historic balloon flight. The first in the Americas, taking off from the yard of Walnut Street Jail in Philadelphia and reaching Deptford in New Jersey. Which may not sound like the acme of glamour. But in fact the flight was witnessed by America’s first, incumbent President George Washington along with her future 2nd president John Adams, 3rd president Thomas Jefferson, 4th president James Madison and 5th president James Monroe.

Sadly, Blanchard suffered a heart attack and fell from a balloon in the Hague in 1808 and died about a year later from his injuries. And his widow continued ballooning demonstrations until she too died in an accident. And it’s also sad to see how France, which was somehow still a world leader in many ways at the turn of the 19th century despite a long tradition of bad government that was about to get worse, has gradually faded as excessive if no longer vicious government seems gradually to have stifled much of the French genius for bold innovation.

Obviously ballooning continues to have adherents, and I cannot look up on a beautiful day and watch balloons cruising over Ottawa without wishing I were in one. But given all the passionate commitment, interest and courage that went into their early development I do hope that one day that somehow the first and most graceful form of manned flight will become more important relative to the dominant, convenient but loud and increasingly tawdry airplane travel that dominates today.

Who knows? Maybe they’ll even serve good food. Especially if the French are involved.

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Jamestown Plays With Fire – It Happened Today, January 7, 2017

On this date in history the Jamestown settlement burned down. As if they didn’t have enough problems already. Mind you it wasn’t much of a settlement back on January 7 of 1608. Basically a fort full of fools who didn’t know where they were, how to grow crops or almost anything else you’d want in the old tool kit if you were, say, moving to a new continent in the age of sail.

Be that as it may, there was a lot more there before the fort burned down than afterward. For instance a fort in which to take refuge if the locals attacked you because of something you had done like steal from them or lie to them or show up looking ominous, or just because they had a habit of attacking anyone handy. (Correct answer: all of the above; despite PC versions the first deadly aboriginal attack occurred within two weeks of their arrival.)

Undaunted, they rebuilt the fort and lounged about in it during the “starving time” in which nearly everybody died after eating boot soup (less from the quality of the boots than the insufficient quantity) and various expeditions from England brought more food and more fools. Indeed, just five days before the fire a ship showed up without enough food and 70 more mouths to feed.

Nevertheless John Smith did pull them through the worst of the crisis including abolishing socialism and discovering that people did more work if the benefits were fairly distributed, of all things. And Jamestown prospered and flourished and so did Virginia and then the United States with all its great virtues and some scary defects.

It remains amazing that such a ludicrous venture could in fact succeed despite everything from bad preparation if any to the hostility of the far more numerous locals to choosing a swamp as your ideal site to the worst drought in 700 years to carelessness with fire in your only building. As with many things in history, we should not take it for granted just because it did happen. Certainly if you’d been standing among the blackened timbers on January 7, 1608 you’d have been likely to say “OK, that’s it, I’ve had it, where’s the ship home?”

Only to be told it was one more thing we didn’t really think of.

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Common sense on carbon taxes

In my second video for Canadians for Energy East, a project of the Economic Education Association of Alberta, I explain what opponents should not say about them and what supporters should.

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Why the Energy East pipeline makes sense

In my new video for Canadians for Energy East, a project of the Economic Education Association of Alberta, I explain why Energy East is the right practical answer to the actual choices we face in energy policy in Canada.

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