DOC TAYROC'S [UNSOLICITED] ECONOMICS HOT THOUGHT

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Marx and the Death of the Author Part XVI: Capitalism in Crisis Part II: Rail Mania

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In last week's entry, I discussed capitalism's inaugural economic crisis, the infamous Dutch Tulip Mania of 1634-37. If you recall, we were metaphorical minutes into the rise of capitalism as a distinct economic mindset and already we began to see the weakness in holding capital for capital's sake, with the promise of (imaginary) future money. This promise of future money from current money, as we will see again, encourages both the hoarding of capital as well as the wild speculation that will lead to the trademarked boom and bust cycle that is distinctive to capitalism. When Chaucer was writing his political critiques of the Britain of his era, he had no concept of the English economy being regularly ravaged by the wild speculation of the merchant class. Although, it is clear he isn't very fond of the merchant class regardless, but the merchant class of his era didn't have nearly the political might that they have in ours, nor even that the merchants of the Dutch Republic in the 17th century had.

That said, the 'Dutch Golden Era' isn't that interesting to me, outside of the creation of the economic system that has a half decent chance of killing us all. What is interesting to me, as a stereotypically autistic British person, is the advent of the modern railway system. However, as lovely as trains are, and as much as I love touring Britain's heritage railways and enjoying a good session in a vintage compartmentalised passenger carriage of reading my books or writing essays, I regret to inform you that to understand the economic underpinnings of the impressive British mainline rail network, we have to go back to the Trans-Atlantic slave trade. Too many British stories go back to slavery sooner or later. Too many capitalism stories in general, it's almost like this whole system is built on obtaining surplus value from labour regardless of silly things like consent and payment.

The 'triangle trade' as it was known was one of the key facets of the 'first and second phases' of the British Empire (1583 - 1783). These phases, as you may have guessed, started with the early English and Scottish colonisation of the Americas and India under English Queen Elizabeth I, and Scottish King James VI. James would ultimately also become king of England, Wales, and Ireland after Elizabeth's death, unifying the crowns and putting the 'British' in 'British Empire'. Elizabeth I established the 'Honourable' East India Company and James' grandson, Charles II would establish the Royal Africa Company, putting into play the main villains of today's story. Also established in this era was the Virginia Company, the Hudson Bay Company, and a myriad of other colonial companies established to settle and exploit the 'new world'. (The Virginia Company and the resultant Virginia Colony/US State named after Queen Elizabeth I, 'the virgin Queen').

As established previously, one of Britain's main contributions to international trade was the textile industry. If you've ever been to the British countryside, especially parts of North Yorkshire, the Cotswolds, and (in)famously Wales, you'll know that Britain's choice of fibre for centuries was wool. Wool is great if you're in northern Europe, northern North America, and/or other cold bits of the planet, but less appreciated in southern Europe, India, Africa, and other places that Britain was seeking to establish not only trade, but the kind of unequal trade agreements that immensely favour the more powerful country and allow it to extract raw materials and labour from the less powerful country at profit. As such, it would need cheap but desirable commodities that could be traded with indigenous communities and undermine their economies in order to create a system of economic dependence on Britain. As established, wool wouldn't do the trick, but cotton based cloth was far more desirable in Africa and Asia. Whilst cotton could not be cultivated in Britain itself, it could be cultivated in this newfound Virginia colony, as well as its neighbours throughout the southern present-day US. To cultivate cotton here, however, vast amounts of labour would be required, and there were not enough Irish or English 'criminals' in debtor's prisons across the Empire to press into service.

As such, began the triangle trade, enslaved persons kidnapped from west Africa, taken against their will to work on the sugar and coffee plantations of the Caribbean and the cotton plantations of the southern 13 colonies. The raw materials from these plantations were then taken back to Britain, where they were refined into cheap consumer products, which in turn were used to overrun the West African economies with said products, reducing the capacity of these economies to function without constant interference and investment from the British traders. The capital accumulated from the slave trade as well as the surplus of cheap cotton, all centred in the Lancastrian city of Liverpool, mixed with the desire to outproduce the cotton looms of the mighty Mughal Empire, which had previously dominated the international textile trade, created the perfect conditions for the British Industrial Revolution.

For the majority of the 17th and 18th centuries, the average British person was not aware of many of the cruelties being committed by their government and the bourgeois class in the colonies, as they were too busy surviving the cruelties committed by the government on behalf of the aristocracy and bourgeois class at home. In a pre-internet, pre-radio, pre-television era, most of the 'news' consumed by most people was as local as possible. If you were born in Halifax, Yorkshire, then Yorkshire would be the majority of your world. Even London might feel like a distant, even foreign locale. Nonetheless, as the printing press continued to be refined, and print media became more readily available to the masses, and literacy was also becoming more widespread, it wasn't long before more and more British people began to learn of the slavery happening in the colonies. From the mid-to-late 18th century, the abolitionist movement in Britain had been gaining momentum, with an increasing number of Britons protesting the conditions forced African labour was being put into. Of course, not all of this was born of altruism. Some British labourers viewed slaves as 'unfair competition' due to the not being paid. Some racial purists worried that close proximity to Blackness would result in the end of 'whiteness'. (Some things, unfortunately, never fucking change). Regardless of the motives, by the time noted slaver George Washington and his lot were seeking to distance themselves from the British Empire, abolitionism had reached critical mass in the British metropole. Soon after the Americans left, in 1803, British Parliament began the process of abolishing slavery. I say 'began the process' because the slave-owning and trading class, both in Britain itself and in the Caribbean, dragged it on for as long as they could, and moderate 'reform not revolution' pushers agreed to this compromise, as it wasn't their lives that were compromised by the compromise.

Of course, complicating Britain's abolition were the crazy misadventures of proto-fascist Napoleon, and the resultant Napoleonic War (1803 - 1815), but even after the Napoleonic War, Parliament and the bourgeois class dragged their feet, and it wouldn't be until 1833 that slavery was finally abolished in the British Empire, and the Royal Navy set about enforcing Britain's newfound anti-slavery policies, even on non-British countries, such as Spain, the United States, and Brazil, countries whose capacity to look at immense human suffering right in the eye, and go, 'yeah we know no one else likes this, but hey it's profitable', allowed them to drag slavery on long enough to make the British Empire look speedy and progressive, which is really saying something.

What does all this have to do with the railways, you might be asking, and here's where our story takes a remarkably British turn. I'm not the biggest fan of Napoleon 'Let's bring back slavery and put the women back in their place' Bonaparte, but even a morally bankrupt, self aggrandising clock is right at least twice a day. The particular thing that Napoleon was right about, Britain is a nation of petty shopkeepers. Or more accurately, a nation controlled by the bourgeois, both at the time that Napoleon fought against Britain, and today. One of the many compromises reached to abolish the British slave trade was to give reparations to the previous slave owners, for 'lost property'. The loan the British government took out to pay these reparations was finally paid off in 2015. So much was paid to the former slavers, that it was 40 per cent of outgoing transactions of Her Majesty's Treasury in 1837. Let this be a reminder to you, the government always has the money to do things, it's just a question of political desire to do it. This money could have been spent helping the former slaves get a better life, wiping out the debts of millions of Britons, or directly into improving British infrastructure. Instead, it went into the hands of the already wealthy plantation class, at the expense of nearly two centuries of British tax payers, including many of the formerly enslaved and their descendents. Good fucking times.

As Dennis (2020) points out, it was this sudden surplus of capital from the 'reparations' into the hands of these well established bourgeois families that set into motion the madness that is about to follow. You see, years ago when I was doing my undergraduate in Chicago, I nearly hit a classmate. What triggered such a potentially violent outburst from our otherwise beloved and serene tayroc, you might ask? Undergraduate tayroc wasn't that far from his very proletariat upbringing, in relative poverty, a poverty caused by the abrupt death of the steel industry leaving his mill working father unemployed for much of the 1990s. Poverty, it turns out, causes trauma. Who knew. Anyway, classmate who frequently discussed his wealthy father and drove to class in a Jaguar asked the class why poverty even still existed, after all if the poor just invested like his dad did, they wouldn't be poor any more, so really it's their fault.

Young tayroc had to excuse himself from the room before a probably lawyered-up classmate became a temporary, if poorly thought out therapy exercise. Reflecting on this memory over a decade later, I know was gobsmacked at the time at how comically unaware this kid was, but several similar encounters over the rest of my undergraduate and post-graduate experiences (albeit usually slightly less tone-deaf) have shown me that this mentality not only persists, but also underlines a not insignificant amount of public policy and discussion. What this kid, and so many others fail to grasp is that the only reliable predictor of future capital is present capital. You need money to invest, especially since not all investments provide returns. Contrary to popular narrative, rail mania was not led by 'small' investors, but rather by the big investors, the recipients of the reparations, because they could afford to invest and afford to lose, or even declare a loss (even if it had public utility) and run away.

Fans of Britain's trains, rather it be mainline or local commuter trains, or the various undergrounds, know that Britain’s rail network, despite being one of the longest in the world, is also a disjointed mess. The first regular passenger service in the UK, the Liverpool-Manchester Railway, launched in 1830. It was the first modern rail service, with double track, allowing trains to run in opposite directions at once, it was time tabled so passengers could wait at stations, and it was pulled exclusively by steam engines, liberating the resident horse population to become things for drunken aristocrats to bet on in races, and ultimately shoot. The modernity and success of the Liverpool-Manchester Railway was impressive, a sign of technological progress that could bring 'fast' (30 miles per hour!) reliable transport to the masses.

The masses, who you could sell tickets to.

A time table, and passenger capacity that allowed you to calculate exactly how many tickets can be sold and how many people can be serviced.

Passengers, whom you could also sell hotel stays, food, and other 'holiday' experiences. For profit.

And lo, thus began another speculative bubble, around a new and relatively untested technology. A technology with clear practical uses, that was still widely misunderstood by the masses, and so remarkable promises could be made without full scrutiny because the train itself still felt magical. A new machine that could connect previously far-off places, and make distant London feel less distant.

Rail Mania swept the British bourgeois, with everyone and their brother promising investors railways to connect places that had never been connected before. Modern British Rail enthusiasts remember a few big names from this era, as a fan of the modern East Coast Main line, I mostly read about the Great Eastern Railway, the Great Central Railway, the Great Northern Railway, the Great North of Scotland Railway, the North British Railway, and the North Eastern Railway. All of which serviced eastern Britain, from London to Edinburgh being the most desired route in this part of the country, resulting in miles of redundant track, beyond the point of good critical redundancy, I might add, incompatible lines, lack of uniformity in service and signage, a plethora of booklets for the avid train enjoyer of the era to ingest to familiarise themselves with the ins and outs of the redundant services, and a considerable amount of proverbial service cannibalism as the various services constantly ate at each other's resources, diminishing the usefulness, and (gasp) return on investment for the owners. And these were the railways that survived long enough to merge into the famous London and North Eastern Railway (LNER) in the 1920s, under threat of nationalisation by the British government when the inefficiencies of having so many incompatible networks side-by-side became apparent during the First World War. Of course, the LNER's unwillingness to invest in fixing the mess, due to a lack of profitability you see, mixed with damage done to the lines by the Blitz during the Second World War, would see the government carry out the threat in the 1940s, with the formation of British Railways.

But the key to railway mania's madness isn't any of the rail networks mentioned above, as again, those were the survivors. No, the key to rail mania's madness is the myriad of tiny and or impossible railways that didn't make it long enough to become a vital concern for the British government. You see, a lot of rail mania was scams. Grift. Theft. Lies. A lot of people promising railways that would never be built, would never go the route that was promised, or because of technical limitations of the era simply couldn't be realised, but were sold anyway, again because of wild speculation over what trains might be able to do. This is to say nothing of the many railway fatalities that occurred during this time because corners were cut to maximise profit and push trains, tracks, and bridges past their physical limits to meet wild goals, resulting in wildly preventable deaths and life-altering injuries on unsuspecting workers and passengers alike, all because the rail barons didn't want to wait, or didn't want to pay, for a proper engineer to do the job right, or worse, tell them that the job couldn't be responsibly done. We associate the Victorian era with a large amount of preventable industrial deaths, but we don't, in my opinion talk enough about how early unions and engineers of the era complained constantly about the wildly and unnecessarily unsafe working conditions to a wildly apathetic bourgeois class. There's a reason Marx thought the revolution was inevitable, and it wasn't because everyone was feeling the benefits of industrialisation.

Contrary to the assertions of Lorentz, Friedman, and other hack right-wing activist economists, the market didn't self-correct itself out of rail mania. The instability and unsustainably of these railway companies, mixed with the increasingly price-inelastic nature of rail infrastructure across Britain meant it was the British government that had to correct the mess. In typical British fashion, this was first done in compromise, with the government forcing the myriad of small rail companies to merge into the 'big four', the above mentioned LNER, the Great Western Railway (GWR), the London, Midland, and Scottish Railway (LMS), and the Southern Railway (SR) by act of Parliament in 1921. This compromise was not unlike a public-private-partnership you might've seen from the Blair years, and so was rife with corruption, laziness, a lack of investment, and extreme extraction of wealth from the British tax payer by private entities given special permission by the British government to act as if they were part of it. So just like the PPPs of the Blair years, and today.

And just like that compromise is currently and utterly failing in front of our eyes today, the 'Big Four' also failed, in entirely predictable ways, and thusly were nationalised in 1947 into British Rail, which would last until Thatcher and Blair got their hands on it and tried and failed the PPP thing again, which failed again, and brought us back to the 'new' Great British Railways (stupid name, just call it British Rail you cowards). Because it turns out vital infrastructure should probably be publicly owned and not turned over to 'for profit' private entities.

You probably already see some overlap between this and issues we have with the modern internet, or the tulips and issues with AI. You're mostly right, but no one has started a literal cult around trains or tulips yet. Next week is going to be fun.