The Rivers of Life

An Interlude

Please forgive the lateness of this entry. After writing what was to be the next chapter I realized I had neglected a vital piece of the puzzle. This entry is that piece. I will follow on with the regular installment two days from now, and then we will be back on schedule.

Now, on to today’s installment…

Before we get on to exploring the actual process and effects of the Institutional Centralization, a brief digression is in order, because, although it is not the only factor at play, it’s an unexpected key to both everything that has happened in our story so far, and everything that’s coming in the story and in the hazy future beyond. It is also part of the ground beneath our feet, but unlike most of the other parts of that ground, this one does not shift much—even its meaning changes little.

Consider, for a moment, the computer you’re reading this newsletter on. Consider what it takes to make such a thing. The silicon that makes up the chips is grown from solution into a particular structure in bar form, which gets sliced into wafers, which get etched with billions of tiny transistors, which then gets sandwiched into a microchip, which then gets soldered to a Printed Circuit Board (which is manufactured along analogous lines and populated with other chips that are similarly constructed). Each component is like that, and all of it must be designed, matched, and mashalled into the extraordinarily complicated system that makes up your desktop computer. And each step of that process—from the engineering and design, silicon mining, pressing and forming, slicing, etching, sandwiching, solder manufacture, soldering, PCB fabrication, assembly, packaging, design, and delivery—all of it was done by someone else.

In fact, every single one of those steps was done by a collection of hundreds of different someone elses, and each of those steps were separated by hundreds or thousands of miles, entire languages and cultures, all brought to you both by the Institutional Centralization (which, I promise, we’ll explore in the next installment) and by a far more basic truth that we’re all aware of deep in our bones, but rarely think about. Even more rarely do with grapple with what it implies.

If you’ve ever tried to do anything outside of your accustomed wheelhouse—plant a garden, fix a computer, repair a vehicle, make a crate for keeping things in, build a shed, cook a new recipe—you’ve got an idea of how difficult those things are. Every skill takes practice, and the amount of expertise it would take to be fully self-sufficient is so vast it’s impossible to overstate. The moment you try to take on a new skill [especially if learning things is not your area of specialization—see my forthcoming book Reclaiming Your Mind: An Autodidact’s Bible for more on how to do this] you’re brought smack into the single reality that underlies all economics:

All wealth comes from trade.

Actually, it goes deeper than that. It’s not just wealth that comes from trade. Life itself comes from trade.Merely by virtue of your very existence, you are reaping the benefit of the labor of other beings—the plants and animals you eat, the billions of foreign microbes in your gut that digest your food for you, the insects that pollinate those plants, the parents whose sex cells joined to create you, the dead plants and animals whose remains have decomposed (often after having passed through a digestive tract) and who then fertilize the soil in which the next generation of plants grow, which animals (including you) eat, etc.

Whether you’re a hunter-gatherer eking out a subsistence living or a tycoon jetting around the world for the latest investment opportunity and dining at all the best restaurants, everything you have, everything you do, and everything you are depends upon the labor of others. You are reaping the benefits of what they have done.

They, of course, are also reaping the benefits of your existence, to one extent or another.

Life is trade.

But trade isn’t just the exchange of goods, services, and the products of same. To engage in exchange, you must also transport those goods and services from the producer to the consumer, and somehow negotiate payment between them. For trade to happen, whether between countries or countrymen, neighbors, or organs inside one’s own body, transportation must happen. When it doesn’t, ports pile high with export goods, prices go out of whack, supply chains seize up. Whether the cause of that stoppage is a political temper tantrum (i.e. a war or an embargo) or a heart attack, the flow of goods ceases, and the supply chain dies.

It follows, then, that if you can figure out how to get things from Point A (point of production) to Point B (point of purchase), and/or if you supply the materials necessary to facilitate such transportation and exchange, you’re going to get fabulously rich (think oil companies, car companies, and shipping companies). And if you can do it cheaply, the people for whom you’re doing it will also get fabulously rich.

It also follows that if you can move cargo cheaply and speedily, then just as the bloodstream in your body delivers life-sustaining oxygen and nutrients, and the roadways that run through your town deliver the food and fuel that you need to survive, then the bloodstream can also be a highway down which Covid and Ebola and HIV can reach all your organs, and the roads in your town can just as easily bring an army of police, peacekeepers, gangsters, and foreign invaders to your doorstep.

Which brings us to the reason why all that power wound up on the desk of the American President in the early 1990s—and, also, the root cause of the American Civil War.

Even with a road system in place like the US Interstate Highway System (built with the main purpose of moving armies in the event of Russian invasion, but designed to be used by the civilian population in order to make the project popular), moving things across even level ground is spectacularly expensive compared to the alternatives. With road systems in place, transport across level ground costs twelve times more than moving the same cargo over water. Water is more-or-less friction-less, so it takes a very small amount of effort to move a very large cargo. Even the smoothest road—faster though it may be—is an energy-intensive nightmare by comparison.

Not surprising, then, that the European countries who found a way to circumvent Ottoman tolls on the Silk Road wound up conquering the world—all the money and investment in develop blue-water sailing technology earned itself back very quickly once the spice cargo started returning from the Far East. Nor that the Brits, who live on an island, went from dirt-poor European backwater to rulers of the waves in a shockingly short time. They then turned their maritime instincts by building canals where other countries built roads, and this lubricated their internal trade to such an extent that they were able to become a unified country with a common lingua franca and a more-or-less common culture far earlier than were the French, the Germans, or the Spanish (the French, for example, didn’t have a universal common language within their own borders until well into the 20th century). Their internal interconnections via water and their numerous deep-water ports put them ahead of the game from the start, and their canal network sealed the deal.

They were in a situation where, in the long term, they could not lose...until they let the Americans revolt. At the time, America was a small theater in World War Zero (i.e. the Hundred Years War between the British and the French, though other players got in on the action). At stake was dominion over the global seas, and America was only really interesting for its eastern seaboard and the crops it grew. At the time, Britain had no idea what lay further inland:

More interconnected waterway overlaying more arable land, connecting to more natural harbors for sea ports than all the waterways, farmland, and seaports in the rest of the world combined.

The Great Accident

This accident of geographic confluence meant that if the fledgling United States could somehow secure sea access to the Mississippi River System, it would be the wealthiest, most secure country in the history of the world. The United States realized this early on, and in 1780 drew up plans for a canal to connect the Great Lakes (part of the Mississippi system) to the Atlantic Ocean through New York, and also prioritized conquest of the flat-lands west of the Appalachian Mountains (work on the canal finally started in 1817). Then, in 1803, Thomas Jefferson leveraged his (very) personal relationships with officials in the French Government, convincing them to sell their claim to a great swath of land from New Orleans to Washington for a stupidly low price in order to pay off their war debts. America was the savior of France’s economy—and officially in control of all year-round access points to the Mississippi River system (the St. Lawrence Seaway freezes over in the deep winter most years, and 18th century shipwrights didn’t have the ability to build icebreakers yet—even today they can’t always keep things open).

Because the arable land is overlaid by tens of thousands of miles of navigable waterways, a 19th century German could land in New York City, spend the equivalent of $20k in today’s money on a Conestoga wagon and supplies, ride west to the plains, and be shipping grain down the Mississippi to alleviate the famines brought on by the Napoleonic Wars within a year. America became the breadbasket of Europe.

This left America with a problem: slavery. This problem was geopolitical in nature. I’m not saying that slavery wasn’t uneconomical and wasteful of human and material capital (it was), or that it wasn’t a violation of all of the natural rights upon which America was founded and which the British Empire was making an international issue of at the time (it was), or that the political football it evolved into didn’t endanger the viability of the American project (it did), or that tens of thousands of people weren’t tortured and raped and selectively bred and bought and sold like cattle (they were), or that this oldest of institutions isn’t a massive blight on our history as a species (it is). I’m just saying that none of that was quite enough to really bring the issue to a head in the US.

It was clear by 1820 that slavery would only end with the bankruptcy of the slaveholders, and that was going to take a generation or two longer than anticipated thanks to the invention of the Cotton Gin (ironically invented in an attempt to hasten the end of slavery). The only way slavery would end sooner was if the Southern States seceded from the union.

Let me say that again:

The only political action anyone could have taken to end slavery in the United States was to convince the southern states to seceded from the union...

...assuming they took Louisiana with them.

Well, they did. Controlling the Port of New Orleans meant that the Confederacy controlled all international traffic out of the Mississippi Basin for half the year, and the bulk of it for the rest of the year. They could have acted as the Ottomans did, and squeezed the traffic for all the fees it could bear, turning the agricultural wealth of the Union into a massive liability. Those tolls could have created a wealth transfer substantial enough to build up a geopolitical rival on the southern border—one that had the favor of France and other international allies who depended upon its cotton and tobacco (even while they loathed the slavery employed to produce said products).

The South seceded in order to protect itself from the gathering political storm over slavery—and in so doing, it guaranteed that the North would fight to the last man in order to prevent the South from establishing itself as a viable nation.

From Accident to Superpower

Rebuilding the United States from the ashes of the Civil War did not just change slavery. It changed the way America looked at itself. What had previously been a collection of countries united by a common defense and trade regime (like the EU, but with less bureaucracy and more accountability) and had been called “these united states” quickly became a single nation which called itself “the United States.” This union, and its control over the most concentrated and productive minerological, agricultural, industrial, and maritime wealth on the planet made it the kind of nation that could rule the world without giving a good goddamn about whether the rest of the world became heaven or went straight to hell.

And, beginning in 1946, that’s exactly what the United States decided to do—both within its own borders, and across the world.

We will explore the effects of this great centralization of power in the next installment: The Institutional Forces of Centralization.

In the meantime, I invite you to post any corrections or arguments in the comments, or send them directly to me at