Salvatore's American Corporation History Blog

Economic Influences of the World

This week’s reading of Lords of Finance: The Bankers who Broke the World was an interesting look at the events that led up to the Great Depression and the major figures of the financial world at the time.  Liaquat Ahamed presents a surprisingly intriguing read on a topic that could very easily be made monotonous.  Ahamed documents the story of several major figures of banking and also presents the dramatic events that led to the financial upheaval of the world’s largest economies, primarily the First World War. 

 

    Reading such a work during our current time, in the midst of a substantial recession, it is disturbing to see how fragile of an entity the world’s financial system is.  Ahamed emphasizes the interactions and correlations between the economies of the large European countries and the United States in his work, and the financial world of our present time is yet far more complicated.  While Ahamed points to the economic trauma of WWI coupled with the reliance on the gold standard as the underlying cause of the collapse of the economy in the depression, it seems that the current situation has far more variables that seem far more obscure.  Also, the influences on our own nation’s market now exceed far beyond that of the major European powers.   We are influenced by manufacturing in Asia, oil from the Middle East, imports from all over the world, and many other powerful economic forces.  The value of our dollar is now influenced by the value of much more than the Pound and the Franc. 

 

    Certainly the recession of the economy in the United States is having a substantial impact on the entire global financial system and the world is feeling it as a whole.  Similar to the turbulent economic relationships between the US and Europe that we observe through Ahamed’s work, our current world is in the midst of strained financial relationships but on a far more global level.  A good example of this can be seen by looking at Dubai, the economic heart of the Middle East.  Dubai has certainly extended itself in over development and now with the recession it is feeling the pressure.  Here is an interesting article from the New York Times about foreigners in Dubai being forced to leave the country due to economic hardship. 

 

http://www.nytimes.com/2009/02/12/world/middleeast/12dubai.html

In the Beginning - Americans Made Corporations

Well, there will certainly be plenty of material to discuss in this class!  One aspect of this subject that I find fascinating is the fact that we are exploring the history of an entity that plays such a profound role in our lives, yet we seldom pay attention to it.  Almost everything we do, traveling, shopping, entertainment, etc, is controlled by some kind of corporate entity.  Like many things that surround us in our daily lives most people know little about the origins of corporations.  Even as a student of history I now realize that I have never thought much about the evolution of this corporate culture that surrounds me. 

 

The readings for this week did well to lay a foundation of understanding for where this concept of the American corporation stems from.  Like many facets of American history corporations began significantly different than what they have become.  The social and political influences behind the incorporation of state functions in post-revolutionary America is an interesting beginning to this hugely influential force in our current world.  As the readings suggest, corporations were created to replace functions often performed by the monarchial governments of the time.  I find it quite interesting that, in the aftermath of rebellion against such a government, early America began establishing a form of economics that would turn out to be in many ways above the law which applied to the common individual.  In a sense corporate entities would become untouchable, similar to the monarchies of Europe that early Americans so distrusted. 

 

Today we are surrounded by debate over corporate regulation, not unlike the debates that raged early on in the first cities that incorporated much of their cervices.  While the early debates were concerned with what role corporations should play in the new republic, the debates surrounding us focus on the need for and extent of corporate reform.  There are many groups dedicated to corporate reform.  One that caught my attention is a website called citizenworks.org.  Here is a link to a series of articles posted by this site.  The first article, written by this group’s communications director, is an interesting overview of the beginnings of corporation that I think fit nicely with some of this week’s reading material-

 

http://www.citizenworks.org/corp/dg/s2r1.pdf