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The acquisition of the Washington Post by Amazon founder Jeff Bezos has predictably generated all sorts of commentary about what the price paid means for the future of print media, whether Bezos will seek to inform the Post’s coverage of news events with his personal ideology, and perhaps most important of all, what this relentlessly visionary entrepreneur will do to revive one of the world’s foremost newspaper brands.
Most of the commentary has been interesting and insightful, Fortune magazine senior editor-at-large Allan Sloan’s recent essay a powerful exception. Indeed, it would be hard to find a more obtuse bit of analysis on the Bezos acquisition anywhere, let alone a more absurd 750 word insult to Op-ed on seemingly any subject under the sun.
Addressing speculation that (horrors!) Bezos is a libertarian, Sloan recalled intense laughter when recounting the first time he heard the latter. As Sloan opined:
“Bezos’s company, after all, is based on the Internet, which was created during the Cold War by a military research-and-development arm of the federal government, the Advanced Research Projects Agency. No Arpanet, no Internet. No Internet, no Amazon, no $25 billion personal fortune for Jeff Bezos.”
Ok, so absent our minders whose wages we pay in the federal government, we’d all be living in caves, unable to order books and TVs, let alone read or watch either absent the prior benevolence of federal officials spending our money. It’s scary to contemplate.
Back to reality, lost on Sloan is the simple and undeniable truth that the federal government decidedly did not create the internet. It’s perhaps hard for him to grasp what is tautological to the mildly sentient in our midst, but the federal government has no resources. To the extent that the feds created the internet, they were only able to do so insofar as private sector exploits have for too long given the political class the ability to tax and borrow promiscuously against non-governmental productivity in order consume all manner of capital. Put plainly, there’s no Arpanet absent the entrepreneurs on whose shoulders Bezos stands providing the feds with the means to create things. The private sector created the internet by virtue of its profits being forcefully shifted to the greedy hand of government.
Of course, assuming that which is laughable, that minus the guiding hand of government we’d still be acquiring obscure books via snail mail a la the classic film 84 Charing Cross Road, it’s worth asking what the now indispensable internet would be like were federal bureaucrats overseeing its evolution. To achieve some semblance of an answer it’s best to look back to the old Soviet Union.
As writer Geoffrey Bocca noted in his 1976 book, The Moscow Scene, a tiny number of lucky Russians actually owned a Trabant, the car manufactured by the state. Nearly impossible to get despite being terribly unreliable, Bocca recalls that in the Moscow of the ‘70s “two windshield wipers” were “prestige symbols that indicated” an individual actually owned an automobile. Why, readers might ask, would the rare car owner display windshield wipers on a restaurant table in the way that those who didn’t own car phones still put fake antennas on the rear car window in the late ‘80s? The answer is simple: so inept was the state at manufacturing autos that ownership of even a horrid one conferred prominence in the way that a private jet does in a society like ours that properly elevates entrepreneurs over government officials.
Think about the above for a moment, and then consider what the internet might be like absent entrepreneurs like Bezos. As the great George Gilder stresses in his latest book, Knowledge and Power, economies are driven by information provided by entrepreneurs. Entrepreneurs take the proverbial leap, and whether they succeed or fail, their exploits tell the productive in a free society where capital and innovation are needed.
If readers wonder what the internet might look like without Bezos and others like him, it’s a near certainty that we wouldn’t be accessing it to buy the staggering plenty that only a capitalist society can provide. Sans Bezos and other futurists the internet would run like the ghastly Trabant, and would likely have as many users as the happily forgotten monument to state ineptitude had owners.
What’s comical and sad at the same time about the delusional droolings of Sloan is that the federal government, far from a driver of technological advancement, has undoubtedly restrained the evolution of the very internet that its apologists in print media falsely claim it created. More to the point, nosebleed government spending in the decades leading up to Arpanet no doubt delayed the near certain creation of it in the private sector (does Sloan really believe those federal researchers whose genius he lionizes would have sat on their hands absent a government paycheck?), not to mention all sorts of other advancements that were held back for government being so wasteful with capital not its own. To understand why this is true, we need only go back 100 years to when Henry Ford, the Bezos of his time, was building
As Mark Spitznagel writes in his soon-to-be-released book, The Dao of Capital, “Ford Motor Company would not have prospered had the founder not committed to continuous long-term investment in improvements and roundabout production.” Spitznagel goes on to write what is a blinding glimpse of the obvious to individuals actually participating in the real economy; simply that “the advantages and gains that are realized today are due to capital that was invested previously.”
Ford didn’t invent the automobile, but thanks to his maniacal dedication to reinvesting the profits earned building cars, he reduced the manufacture of his eponymous car to something that could be measured in seconds. The latter made Ford staggeringly rich, but as is always the case when individuals grow wealthy, their fortunes greatly shrink lifestyle inequality.
Ford’s genius made the former luxury that was a car a commonplace necessity, but imagine if the federal government had been as obnoxious then as it is now about taxing away the wealth created by society’s greatest benefactors? We’d still have cars, but they most certainly wouldn’t be anywhere near as plentiful or advanced as they are today. Applied to the internet, the ‘seen’ is the crude origination of it created inside government by individuals using resources taken from the private sector, but the sick-inducing ‘unseen’ is how much more advanced and lifestyle enhancing the internet would be today minus the aggressive corporate taxation authored by a political class lustily cheered on by commerce's ankle-biters in the mainstream media, not to mention taxes foisted by that same political class on capital gains earned through intrepid investment in the stock and bond income streams representing wealth that doesn’t yet exist.
Happily for all of us who still lovingly caress the printed word in newspapers, magazines, and books, one of the world’s greatest-of-all-time capitalists in Bezos is soon to lend his genius to a limping newspaper industry. Thank goodness for that, and what fun it will be to see the evolution of his news vision.
Indeed, it’s perhaps apocryphal, but Bezos allegedly once said, “If the government hadn’t invented the Internet, private enterprise would have done it.” If he uttered those words Bezos was surely correct, and all we can hope for is that someday, hopefully sooner rather than later, some other entrepreneur observes that absent Bezos, “someone else in the private sector would have saved print media.” If so, one can only hope that Sloan emerges from his shallow pond and apologizes for his hit piece, while profusely thanking Jeff Bezos. For now, all one can conclude is that Sloan surely doesn’t deserve him.
