My Understanding of History and its Lessons - Part I

I am not a historian, nor do I play one on TV. In fact, I didn't even stay at a Holiday Inn Express last night. I did, however, major in the humanities in college and pay at least passing attention in high school. In light of that extensive scant historical training, I'd like to offer a lesson I gleaned from it.

In roughly 1908, Henry Ford perfected a fairly revolutionary idea for his day: assembly line manufacturing. Contrary to popular belief, Henry Ford did not invent the assembly line, but he did perfect it.

To say the least, manufacturing made the fabrication of fairly complex things, like say an automobile, considerably easier and less expensive to do, when done on a large scale and supported by well-capitalized industrialists. While the manufacture of the automobile put many previous artisan car builders out of business (if not immediately, then eventually), it put the automobile within the financial reach of considerably more customers than previously. I don't have the exact figures, but a car made in roughly 1900 cost about $1,000 in 1900 dollars. By 1924, Ford was selling the Model T for about $265 in 1924 dollars . . . a price cut of about 75% in real dollars, not adjusted for inflation.

That is one hell of an innovation, and the ripple effects were clearly far and wide. An automobile suddenly became affordable for the "masses," and was no longer a plaything for the wealthy. As a result, the American auto industry became one of the industrial powerhouses of mankind, and a thing for the country to admire and celebrate. Additionally, the nation responded by constructing an interstate highway system and built out its cities, towns, and counties with car-passable roads. A small town in central Indiana even started an endurance race to see who could make a car go 500 miles the fastest.

Unfortunately, it also had the effect of replacing high-skilled jobs with relatively low-skilled jobs. Previously, building a transmission, for example, was a very difficult thing for one person to know how and be able to do. After Henry Ford, it was still a difficult task, but when you're building 100,000 of them with 500 workers, they get considerably cheaper to build per unit and each person only has to know how to put one portion of it together. The world can have transmissions for much cheaper. Cheaper transmissions mean cheaper cars. More people can afford cars. The trucking industry becomes a thing (to name but a single example). All well and good, except for the guy who used to make a good living hand-building transmissions and now works putting one portion of it together on an assembly line for a fraction of the pay.

Bummer. It is a good thing that, eventually, people came to realize that when every member of the workforce makes so little he can't afford much "stuff," then the builders of that "stuff" can't sell any "stuff." America relied on the benevolence of employers to pay well for awhile until it became untenable, and we started making laws about unions, labor practices, etc. (Mind you, there is a lot of history that I am omitting when discussing working conditions, pay, unionization, worker's rights, etc.) However, we ultimately figured out a way to make it work and have the government and industry working symbiotically in such a manner as afforded the citizens of this country to be balanced in their contentment with their present station in life and able to consume on the one hand, and not becoming idle but instead striving to better themselves and their families through hard work on the other hand.

It sure is a good thing that President William Howard Taft, by no means Mt. Rushmore material, decided that embracing the innovations of Henry Ford, and allowing local governments to work in their own immediate interests to develop roadways, was a better course of action than trying to protect the livelihoods of the hand-made transmission guild or the buggy whip makers.

Because President Taft and his successors understood that innovation is good and allowed Henry Ford to profit from it without seeking to protect the handsome profits of the Pullman Railroad Car Company, to give one example, or the jobs of the buggy whip makers, to give another, the American auto industry was allowed to flourish. Because the American auto industry thrived, we were able to develop the American trucking industry. With affordable coast-to-coast shipping, California vineyards could sell their overpriced Pinot Noir to rich financiers in New York (one example illustrating the point and utility of national shipping).

Lets not forget that things could have gone the other way. We were not destined to be a superpower but became one because we made good decisions along the way. Making good decisions in the future also seems like a good idea. Draw your own conclusions as to what my lesson was. Answer tomorrow.