| What follows is a recent speech by a Mr. Eric Savage. Mr. Savage is
said to be an authority on international business and world economies.
It is long, but is worth every minute spent reading. It explains a lot!
------------------------------------------------------------------------------
James J. Hill by Eric Savage
Now, I will tell you the story of a working-class brother, James
J. Hill. He was a railroad pioneer back in the mid-1800s, and his
story is brought to light in a book called, "Entrepreneurs Versus
The State" by Burton Folsom.
Let's travel back in time to the 1860s. America was experiencing
its first railroad boom. Railroads were being built all up and
down the East Coast. Well, as Mr. Folsom identifies in his book,
two classes of entrepreneurs exist: market entrepreneurs and
political entrepreneurs. Political entrepreneurs are what Mark
has been calling lazy political businessmen who are part of the
parasitical elite. Political entrepreneurs make their money by
seeking government subsidies, by getting special government
rights of way, and by accessing political clout. Indeed, they
seek their success through political clout with government
officials.
During America's railroad building boom in the 1860s, an
opportunity arose for the parasitical-elite class. The political
entrepreneurs seeking easy money got together with congressmen
seeking popularity, and together they wove a deception. The
deception was that only the government could finance the building
of America's first transcontinental railroad. That deception 100
years ago is still promoted today. I remember reading about it in
my history text books in school.
But that was a deception woven by the parasitical-elite class: by
political entrepreneurs so they could line their pockets with
lavish government subsidies and by congressmen so they could
boost their self-worth and soak up self-glory by spending money
that they controlled but did not earn. They could parade around
and say, "Look how important we are. Look how we benefit the
American public. We, the government, are building this
transcontinental railroad and opening up the interior and west
coast of America." ...A perfect setup for the parasitical-elite
class to come together -- political entrepreneurs joining hands
with power-seeking politicians.
So a deception was woven: only the federal government could
finance the building of the transcontinental railroad. The public
bought it, and with great fanfare, Congress went ahead with it.
There were two companies: Central Pacific started building
eastward from the West Coast and the Union Pacific started
westward from the East Coast. The government paid those companies
by the total miles of track they built. So what did they do?
Instead of being bound by the disciplines of a bottom line, they
were getting lavish subsidies from the government for the total
miles of track they built. So they rushed into the wilderness to
collect government subsidies.
But because they were being paid by the mile, these companies
purposely built the longest, most circuitous routes they could
possibly justify so they could get more government money. And
they rushed construction to collect their per-mile subsidies.
They rushed ahead with poor construction and poor planning into
the wilderness.
Remember, the congressmen were spending money that they did not
earn but controlled, and they wanted to reap the self-glory for
spending that money. Those politicians, always trying to justify
their jobs, always trying to show that they benefit the American
public, got into the railroad business where they had no business
being in the first place. Controlling tremendous amounts of money
they didn't earn, they reaped all this self-glory that comes with
spending the money. Now they could say, "Look how valuable we
are; we're financing the building of a transcontinental railroad
across America!"
But those bogus-job congressmen were part of the
parasitical-elite class. They were not interested in getting out
and exerting the nitty-gritty effort that business does when it
spends money. They were glad to spend the money, large amounts of
money, and reap the glory, but they weren't about to get out
there and exert the nitty-gritty effort to put the controls on
spending to make sure that money was spent right. They were not
about to get right down into the details themselves to make sure
that they were buying the right quality goods and that the
railroad was being built over the right routes...not like a
businessman would who is spending that money out of his own
pocket.
So the whole program was laced with fraud to begin with. The line
managers set up their own supplier companies selling their
railroads substandard quality rails and ties at exorbitant
prices. For, there was no control over the government money.
In addition, because they were getting paid by the amount of rail
they built, each company was racing to build as much track as it
could before the other one...to get the most money from the
government. So instead of taking the proper time to carefully map
out the best routes, especially vital for building over hills at
the lowest uphill grade, they instead just raced forward and paid
no attention to vital planning and surveying. No time to be
wasted on planning and surveying, they built track over uphill
grades that were far too steep. They didn't take the necessary
time to do anything right. When winter came, they just kept on
building over the plains, right over the ice! Because they wanted
to build as much as possible, they did not wait for the ice to
melt -- they just kept on laying track. When summer came, they
had to tear up thousands of miles of track and rebuild it, before
they could open the line! And to get more money, the two railroad
companies built the longest routes with under-quality material.
...You can just imagine what the future operating costs this
transcontinental railroad would endure.
Indeed, when the Union Pacific was complete, from day one it
could not make a profit because it's operating expenses were too
high. First of all, thousands of miles of shoddily built,
under-quality track had to be constantly replaced. Second of all,
because they took the extra long route, and it wasn't built over
the lowest grade hills, they had to pay a lot more money in fuel
costs, wage costs, and it took a lot more time to haul freight
across the country. So the operating expenses were so high, from
day one the Union Pacific was never able to make a profit.
Therefore, the government had to continue to subsidize the
transcontinental line once it was built. Union Pacific had to
continue to receive more and more government money or it would
have gone out of business and stopped running. Indeed, Congress
had just spent a fortune financing the building of the
transcontinental line. Now Congress could not let their prize
transcontinental line declare bankruptcy and close down. So, the
government continued financing it.
After the Union Pacific was built, other political entrepreneurs
got together with glory-seeking politicians in their areas of the
country and said, "The federal government financed the Union
Pacific, therefore they have to finance a transcontinental
railroad in our region."
So Congress went ahead and financed the building of a
transcontinental up North called the Northern Pacific, and one
down South called the Santa Fe. Of course, both of those had the
same results. They built extra long, circuitous routes; they
turned into an orgy of fraud, substandard quality material used,
no time taken to select the lowest grade hills. So right from day
one, the other two transcontinentals lost money, and they had to
receive government subsidies just to continue operating.
In the meantime, there was this young man, James J. Hill. He was
born in a log cabin in Ontario, Canada to a working-class family.
His father died when he was a young boy, so he had to get a job
to support his mother. At seventeen, he moved to St. Paul and got
a job for a shipping company. He started in an entry-level
position, but he loved the transportation business. He really
applied himself; he began making contacts, and he began moving
up. Before long, Hill started integrating. He began making
partnerships in local railroads that were being built in his
area. Eventually, Hill started major integrating. He decided that
he was going to build the first completely privately financed
transcontinental railroad way up along the U.S. and Canadian
border, which at that time was all wilderness with no settlers.
Well, from day one the idea was labeled Hill's Folly, and you can
see why. How could someone build a railroad that could possibly
compete when he had to pay all the building costs himself, and
there were three others that existed farther South that had all
their building costs paid by the government? Moreover, Hill's
railroad was going to be way up North where no one lived. Those
other three government-financed railroads were located in the
main population areas of the U.S. In addition, once Hill did
complete his railroad, how could he compete with the other three
railroads when they continued to receive government subsidies and
Hill had to pay his expenses through his own bottom-line profits
-- and the three other lines proved that no profits existed!
Well, Hill went ahead with his plans anyway. Hill had to obey the
disciplines of a bottom line. He couldn't go rushing into the
wilderness to collect government subsidies. He had to build his
line out West one extension at a time. He'd build westward into
the wilderness a few hundred miles at a time. Then he would send
agents back East to advertise to farmers in the East. Hill
offered to move the farmers for free into this western wilderness
so they could settle and start their farms. Then Hill would give
them free rates to ship their crops back to the markets in the
East for a couple of years until they got established.
This worked. For each extension West, he brought in farmers; he'd
build up his track, and after awhile his extension West made
money. From those profits, he'd finance another extension
West...a few hundred miles at a time. He never stopped. He
settled the entire northern border of the United States with his
railroad. And, lo and behold, in 1890 the first American
transcontinental railroad was built without one penny of
government money. He reached the Pacific Ocean, and he did it
without one penny of government money!
What an accomplishment! But most amazingly, one man did it! Not
the entire might of the U.S. Government -- one lone man! One man
and his integrated thinking was raising the prosperity of an
entire nation! But, now that he accomplished this amazing feat,
could he make it work? Here Hill was with his transcontinental,
way up North when the population base was farther South; he was
competing against three transcontinentals farther South that had
all of their expenses paid for by the government. So, what would
happen to Hill's transcontinental?
During the building of Hill's railroad, since it was his personal
money that was being spent, he personally dug into the tough
nitty-gritty details. With unyielding disciplines and efforts, he
put controls on everything: He personally surveyed the routes; he
made sure the shortest, most direct routes were built. When the
track had to go over hills, he would spend time with the
engineers and make sure they picked out the lowest grade hills.
He personally supervised the buying of materials to make sure
they got the highest quality rails and ties for the lowest cost.
...So what happened to Hill's Folly? Well, from day one, when it
was completed, he made a profit! He ran circles around the three
government-financed lines because his operating expenses were so
much lower. In addition his freight took a lot less time to reach
the West Coast. From day one, Hill made a profit. From day one,
the government-subsidized transcontinental railroads never, ever
turned a profit.
One man was running circles around the almighty U.S. Government!
Of course, the incompetence and greed of career politicians could
never bring values to the people. But one market businessman can
raise the standard of living of a nation. ...Just think of the
power behind Mark Hamilton's Great Replacement Program in which
market businessmen lead our country and build our economy!
Anyway, back to J. J. Hill:
This one integrated thinker's advantages kept building momentum
and left Congress's follies in the dust. Hill was one real man
from the working class with the competence to build jobs and
values for everyone. He kept rising up. Congressmen, by contrast,
are fakes with no business competence whatsoever. Thus, Hill left
them all in his dust.
Hill built up the whole industry of the Northwest. He built
feeder lines. For example, if copper were found a hundred miles
north, he'd build a feeder line, move in a copper company so they
could start mining and shipping the copper over his line. If
lumber were discovered up in the mountain, he'd feeder line up
there, move in a lumber company, and they'd start shipping the
lumber over his lines. If there was a good clearing for cattle
ranching a few miles south, he'd build a feeder line.
...Railroads discovered that feeder lines became a main source of
profit.
But consider Congress's lines built for their own glory and
self-worth. Because those railroads were receiving their money
from the government, they would have to get Congress's permission
to build a feeder line. Well, of course, everyone knows what
happens when the government has to make a decision. A simple
black-and-white decision to build a profitable feeder line that
should be made overnight would be tied up for months, even for
years. All the incompetent congressmen would get up and debate
over it to get in the spotlight and appear needed and important.
...They cared only about themselves, not about what's best for
America.
So Hill's railroad ran circles around the three
government-financed railroads from day one. In addition, Hill
brought civilization and industry to the Northwest: mining,
lumber, apple farmers in Washington, wheat farmers on the plains.
He built up the whole region along his railroad line.
Once Hill completed his line to the West Coast, he did not stop
there. He kept integrating out. Hill started integrating out
toward the Orient. What about trade with the Orient? Hill did
some calculations: if one major province in China substituted an
ounce of rice a day for an ounce of American wheat, that would
mean 50 million bushels of American wheat would travel over his
railroad to China every year! American farmers exporting huge
shipments of wheat to China -- what a possibility! So Hill sent
agents to Japan and China to begin promoting American trade, the
same way he had done during the building up of his
transcontinental railroad.
In the meantime, we had these political entrepreneurs in America
still running around wondering how to get more government
subsidies to line their pockets. Yet one working-class brother
was integrating out, pushing up the lid, creating jobs by the
thousands. Indeed, Hill sent his agents to Japan and China to
start promoting American products, and he went out and bought his
own steamship line. He raced his ships back and forth between
Japan and China and America. Hill built up American trade with
Asia the same way that he built up business along his line. He
would send products for free to the Japanese and Chinese if they
would just try them out. Then once they tried them out, if they
liked them they would come back, and Hill would build up the
business.
Every day Hill filled his ships with American grain, and with
copper from Montana, lumber from Washington, cotton from the
South, textiles from New England, rails from Pittsburgh, apples
from Washington. He would send them all free to the Far East. The
Asians would try these American goods, and if they liked them,
then they would come back for more.
In fact, Hill went to Japan, met with Japanese businessmen, and
proposed that he would buy southern cotton, pay for it himself,
ship it to the Japanese for free, and give it to them free. Hill
would buy the southern cotton out of his own money if the
Japanese would just try this cotton in place of the cotton they
normally got from India. Well, the Japanese took him up on his
offer; they liked it, and soon Hill's box cars were full of
cotton, travelling from the South to the North to the Pacific
Coast and then on to a steamship to Japan.
Hill used this strategy to build up all kinds of business. In
1900, Japan started a railroad building boom. Hill recognized the
potential of railroads throughout Asia. At that time, the world's
suppliers of rail were England and Belgium. But there were a few
American rail makers in Pittsburgh. So Hill went to Japan; he
purposely underbid the English and the Belgian, paid the
difference out of his own pocket just to get the Japanese to try
rails made in Pittsburgh. His strategy worked: Japan started
buying all their rail from Pittsburgh, which built up the
fledgling rail industry in America.
What happened in the 1890s was nothing short of a miracle: When
Hill started his push into Asia, trade with Japan was seven
million dollars a year. Nine years later, with Hill in charge of
this American mission into Asia, American trade with Japan alone
was 52 million dollars! And he was now pushing into China as
well! Hill was causing geometrical increases in American
commerce. He was spearheading 100 years ago an American dominance
of trade in Asia! In the meantime the political entrepreneurs,
Hill's so-called rivals, were still running around Washington
trying to figure out how they could get more subsidies. And Hill
just kept on integrating and pushing out into Asia, spearheading
a geometrical increase of American commerce in Asia. This was 100
years ago.
As time went by, the other three government-financed
transcontinentals continued to lose money. The government kept
pouring taxpayers' dollars into financing them. No, career
politicians can never serve the people and provide values to
society; career politicians can only drain the people by spending
taxpayers' money incompetently. The public started getting fed up
with this. In addition, as time went by, the fraud committed by
the political entrepreneurs started to surface - things like
setting up their own companies to sell substandard material at
overcharged prices. The American public had to continue to pay
subsidies into this hoax just to keep these other three
government railroads running. The public finally had enough. So
Congress, nothing but glory-seeking politicians, started
self-righteously parading the corrupt political entrepreneurs in
front of Congress and the nation, forming special-investigation
committees.
Well, once again, Congress wove a deception: They presented
themselves as protectors of the American public. They would nobly
project, "Look how great we are; look how needed and important we
are; we're going to protect the American public from those greedy
and corrupt railroad executives." Yet, the root cause of the
problem was Congress itself. Congress was the culprit! Congress
spent other people's money in a railroad business where they had
no business being in the first place. ...Incompetent politicians
in the railroad business -- c'mon!
So instead of getting up and confessing, "Look, the problem was
us. We now realize the problem was us getting into the railroad
business in the first place. We had no business in there, so now
we're going to get completely out." They could have been honest,
but they were not. No, they didn't want to say that because that
would have exposed their bogus jobs. Instead, they saw a chance
to increase their bogus jobs and to increase their popularity and
political power for re-election. They instead self-righteously
projected, "Look how we earn our jobs. We're protecting the
American public." Congress self-righteously started parading
those corrupt railroad executives in front of the nation.
Congress made the railroad executives solely to blame for the
transcontinental fiascoes. And then, to "protect the public,"
they proposed to form the ICC, the Interstate Commerce
Commission, and to pass Sherman Antitrust legislation to further
get in there and regulate the railroads.
Well, Hill knew what was going on; he knew what the story was
here. So Hill moved to Washington. He set up residence in
Washington, D.C. He personally talked to the congressmen. He
testified before their special committees. He told them what was
going on: the root cause of the problem was the government
getting in there where it had no business being in the first
place, financing these railroads, spending other people's money
on rails. That caused the corruption. Hill gave the example of
his railroad. He didn't accept one penny of government money
while his railroad built up all the industry in the Northwest.
And now his line was promoting an explosion of American trade
into Asia while the three government-sponsored lines were sinking
in corruption.
Now, the congressmen were intelligent men. They were college
educated. They knew what Hill was saying. They knew it all made
sense. They knew it was the truth, but they didn't care because
they wanted to justify their bogus jobs. So they ignored him.
They ignored Hill, and they went on to pass the ICC and the
Sherman Antitrust legislation, which enabled them to get in and
heavily regulate and punish the railroads.
Hill even wrote a book on this whole ordeal and circulated his
book to the congressmen, explaining the situation. He presented
all the evidence that showed how Congress was doing the wrong
thing. But the bogus-job fakes in Congress ignored Hill because
they wanted to advance their own power. This clique of people
went ahead and passed the ICC, passed the Sherman Antitrust
legislation. And what did that do? Those regulations made it
illegal for railroads to make any kinds of deals with customers.
They had to charge the same standard rate to all customers.
Therefore, the dynamics Hill used to build up his railroad, to
move in people for free, to ship their freight for free or for a
low cost until they got established...was now illegal! Those same
dynamics that he was now using to spearhead an American dominance
of trade in Asia were all now illegal! Bam! Hill was a
working-class brother who discovered integrated thinking, and he
was rising up faster and faster, pushing up the lid to lift all
the world into a jack-in-the-box explosion -- and BAM! The
parasitical elite smashed him down. Hill's drive into Asia was
over.
The year after the ICC's legislation passed, America's trade with
Japan alone dropped by 40%. Now remember, Hill was spearheading a
geometrical increase in trade. Trade with Japan and China was
increasing geometrically. Now Congress passed this legislation
and, plop, everything dropped 40%.
Hill was forced to sell his steamship lines, he got out of trade
completely with Asia, and he was so frustrated, he retired.
Suddenly, the miracle was over. Now, this was a hundred years
ago! Let's stop and look at the implications of this. Let's
stretch this out to see what Congress really cut off a hundred
years ago. It was bad enough they cut off Hill's trade with Asia
back then, but let's project that into the future to see what
they cut off today:
Today, you hear our President and top CEOs and top economists
saying that America's greatest danger economically is its trade
imbalance with Asia, and our lack of international
competitiveness. But who the hell knows that a hundred years ago
Hill was spearheading an American dominance of trade throughout
all of Asia? That trade dominance was cut off by pip-squeaks and
clowns in Congress. Who even knows that? Nobody mentions that
today, but everyone is warning about "the greatest economic
danger facing America today". Americans are losing their jobs by
the thousands, being outcompeted, factories being closed down.
Yet who knows that one hundred years ago this one integrated
thinker, one man, learned how to start doing integrated thinking,
started pushing up the lid on this jack-in-the-box, started
spearheading an American dominance of trade with Asia increasing
geometrically, then WHAM! It was all smashed back down by a few
pip-squeaks and clowns in Congress strutting around with
superiority complexes a hundred years ago!
The politicians back then knew what they were doing. They were
intelligent men. They were college educated. Hill went and
explained the facts to them. But no, they wanted to increase
their power. They wanted to justify and advance their bogus jobs.
So they ignored Hill, and they cut off something magnificent a
hundred years ago.
Hill was not only spearheading an American dominance of trade
with Asia a hundred years ago, trade that was increasing
geometrically, but Hill was also spearheading an
industrialization of Asia, of Japan and China. He was getting the
American trade in there; he was bringing in railroads, causing
the railroads to be built up, causing factories to be built. He
was causing American industry to follow its natural course and
start flooding in and dominating Asia, which would have caused
Asia to industrialize, Japan to industrialize, China to
industrialize.
So what does that mean? Consider the spread of Communism in Asia.
Communism cannot take over an affluent, industrialized nation.
Communism never has; it can't. Communism only takes over poor,
unindustrialized peasant countries.
Well, a hundred years ago Hill was spearheading a geometrical
increase of American commerce in China. This was causing China's
industrialization. But because he was cut off in the bud a
hundred years ago by a handful of self-serving politicians, all
that trade and industrialization was cut off. Forty-five years
later, China was still a backward, peasant, unindustrialized
country waiting for Mao.
So what happened? Communism swept through China; Mao killed 30
million people. Thirty million people! In addition, Communism
spread into Korea and Vietnam, costing 110,000 Americans lives.
Why? Because a hundred years ago a few self-serving politicians
in Congress, trying to fake manhood, cut off something
magnificent, smashed down this integrated thinker who was causing
the industrialization of China. He would have prevented Communism
in Asia and the deaths of 30 million Chinese and 110,000
Americans...history's unforgivable tragedy.
The full tragedy will never be known. For instance, imagine the
dynamics that were cut off a hundred years ago: A century later and
China is just now beginning to pull itself up from the bootstraps. A
nation of one billion people, a fifth of the world's population, until now
contributed nothing, nothing to the world economy! China, full of
naturally high-energy productive people, contributed little to industry,
nothing to technology, nothing to medicine, nothing to
science...absolutely nothing because China was a backward,
unindustrialized peasant country. Those good high-energy people have
been completely stagnated, completely smashed down by Communism.
But what if Hill were free from our destructive Congress to continue
spearheading an industrialization of China a hundred years ago? That
entire part of the world would look far different than today. The whole
world would be a far better place. Until now, a fifth of the world's
population contributed nothing to the advancement of civilization. Why?
Because a hundred years ago Hill's miracle was killed by self-serving
politicians who cared only about promoting themselves and cared not
about what was good for the people. A hundred years later, China was
totally stagnated with backward peasants. But what kind of powers
would have been released? What kind of creative energies and new
technologies would have been released from those billion people if they
had industrialized a hundred years ago?
You can really get a sense of what should have been when you look at
the little-dragon countries in Asia, those little countries around China
that did not get swept away by Communism -- South Korea, Taiwan,
Singapore, Hong Kong. Those are little fragmented countries with a
similar race and culture that did not get swept away by Communism.
Therefore, they industrialized after World War II and they made major
contributions to the world economy. The little-dragon countries have
made major contributions to technology, major contributions to science
-- those tiny countries that have just a few million people. China has a
billion people! China dwarfs those little-dragon countries in Asia today.
In addition, consider Japan. Japan has a similar race, a similar culture
to the Chinese, they have a similar history, similar backgrounds. Japan
industrialized right before World War II and then had to reindustrialize
after World War II. Japan has 150 million people. Japan is the world
leader today. Japan is the world economic power. Japan makes mighty
contributions to the world economy, to technology, to science, to the
arts, to culture. Japan is dwarfed by China. China is seven times bigger
than Japan. Just think! But China was completely stagnated and held
down because it never industrialized. Communism swept over China.
Japan today is the number-one contributor to world advancement.
Number one, and it's physically dwarfed by essentially the same people
-- by China.
Just imagine: What if Hill had not been cut off a hundred years ago?
What if Hill had not been smashed down? What if Hill had spearheaded
the industrialization of China? One billion people like the Japanese.
Where would civilization be now? We would probably have cures for
cancer and AIDS. We may be building space cities on Mars or the
moon.
The contributions that the Chinese would have made to science and
technology and to the world economy -- it's just mind boggling. But no
way! All that was smashed down a hundred years ago by a handful of
self-serving politicians -- by incompetent clowns causing their burden on
advancing technology. A billion people stagnated, pushed down,
happiness killed, 30 million Chinese killed, 110,000 Americans
killed...all because a handful of lazy people with power a hundred years
ago wanted to exercise their feelings of superiority!
One man a hundred years ago, one man learned how to integrate...James
J. Hill. He started integrating; he started moving up. He learned how
business worked; he learned how the American economy worked; then he
learned how the world economy worked; then he learned how the whole
up-bringing of civilization worked. One ordinary man a hundred years ago
was in this jack-in-the-box; then he learned how to integrate. Therefore,
he began pushing the lid up. If he had been left alone, if he had not
been cut off, he would have opened that lid. China would have
industrialized. All of Asia would have industrialized. The whole world
led by America would have been pushed up, China would have been pushed
up, good-bye communism. The jack-in-the-box would have flown up, and it
would have taken everyone with it! It would have taken the whole world up
with it! Good-bye all the problems today. America would have been the
dominant trade of this huge upswinging in Asia. Good-bye all America's
problems, good-bye thousands of people losing their jobs, good-bye
unemployment, good-bye Communism in Asia, good-bye Korean war,
good-bye Vietnam war, good-bye starving people in the third world!
This jack-in-the-box would have swung up. All our problems would
have been whisked away. Everyone would have gone up with America
because of one man! Because one man learned how to integrate a
hundred years ago. But no, bam! He was smashed down because this
one man started pushing up the lid.
There is a parasitical-elite class: the politicians and the political
entrepreneurs. And whatever threatens to expose their hoax, threatens
their bogus jobs, then no, BAM! They smash that down.
|