Norman Stone - The Atlantic and Its Enemies

Coal and railways were of course the old world. One of these union troubles concerned the new — at that, an immensely important part of the new: the media. The British press had been greatly respected, especially The Times , and it generally managed its affairs with genial informality that somehow, mysteriously, produced results (there was a practice of shutting the leader-writer in a room with a typewriter and two bottles of wine, which went on until one such writer was found slumped over his machine, having typed the word ‘notwithstanding’). Under William Rees-Mogg, in the later seventies, economic journalists such as Peter Jay or Tim Congdon had hard-hitting things to say. However, the paper made severe losses, and there were great economies to be made if new machinery were to be used in printing. The printers’ unions — there were three — resisted and fought each other. After vicissitudes, the newspaper was acquired by a very hard-headed Australian, Rupert Murdoch, who already owned tabloid newspapers that caused some head-shaking as to crudeness, intrusion into private lives and what was soon to be called, in America, ‘dumbing down’. When the Belgrano was sunk in the Falklands War, one headline, ‘GOTCHA’, became famous. However, Murdoch knew how to deal with people, quietly dealt with a rival union altogether, set up a building in the dock areas, which had become derelict because of the dockers’ unions’ ways, and abandoned the original building in central London overnight. The newspapers were instantly produced, by the new methods, without interruption. Early in 1986 there were battles between enraged printers and the electricians or distributors, with police support: not a day’s production was lost, and the printers’ unions came to terms (on television, Murdoch was asked what he would recommend a striking printer now to do, and said, laconically, ‘Find another job’). Some of the journalists took the printers’ part and refused to co-operate, suggesting that a Murdoch Times would betray the newspaper’s status. Others took a different view, and the editor of the Sunday Times , Andrew Neil (like MacGregor a Glaswegian), spoke for many when he took the radical Thatcherite line and advocated an Americanization of the country. Rupert Murdoch astutely used the profits from London to establish an empire all over the globe. He was much hated, but in the end was following an old media pattern: the Manchester Guardian itself had only got away with its moralizing because of the profits made by its sister newspaper, which reported the horseraces. However, here was now an empire based on mountains of debt, with mountains of profit, from media of all sorts which could make or break governments. At around the same time, in London and New York, banks moved into the same world; vast fortunes began to appear from thin air. The Reagan-Thatcher era was associated with a new economy, in which industry of the classic sort meant a degree of backwardness, much as had happened with peasant agriculture in the later nineteenth century. Brazils and Koreas metal-bashed; Turkey produced 90 per cent of the televisions sold in England, and the main road from Istanbul to Kayseri and Antep was choked with container lorries bearing goods to central Europe. London and New York plucked money out of the air.

The tidal change had much to do with technology. Its history proceeds in great leaps. In the middle of the nineteenth century, one of these had involved the railway; electricity had marked another, essentially in the early twentieth century, when it had enabled coal-poor countries such as France and Italy to acquire modern industry (aircraft and motor cars being an obvious instance in both cases). Now came another huge leap, in one view the greatest ever made — electronics, ‘information technology’. In 1980 there was a video cassette recorder in only 1 per cent of American households; by the end of the decade, in three fifths. Cable television, by then, reached half of households — earlier, 15 per cent. Turner Broadcasting survived near collapse and then, by the time of the Gulf War, had become the worldwide network, flattening the old network news programmes. Telephones in 1980 had been very basic, not much beyond the models of fifty years before. Ten years later, there was almost no limit to what they could do, including photography. The old Bell system had encountered some animosity, and in England the national telephone company, like the utilities, was widely regarded as a producer’s conspiracy against the public. Cheap long-distance transmission made for a vast change in this, and the old land-line monopolies were broken (although in some cases they managed to retain a great deal of their power). Cellular phones, fibreoptic cable, flourished, as did the fax machine, which was displacing the, also often despised, earlier methods of post offices. The biggest single item in this technological revolution was the personal computer.

In 1981 there were about 2 million such: seven years later, nearly 50 million — IBM the initial leader, followed by Apple Macintosh in 1984. By 1989 ‘a visiting Russian scientist would be impressed by the computer equipment of his American counterpart, but moved almost to tears by the computer equipment of his counterpart’s secretary’, says Robert Bartley, the Wall Street Journal ’s poet in residence, and eighties consumption boomed, to the point at which American clothing or even food styles ran round the entire globe, even, at least for men, in Iran, where there was a forthrightly anti-American regime. The illustrations are endless. The basis was demand from people in new types of jobs — in the USA the participation of women went up from 51 to 57 per cent: almost 60 per cent of families had two earnings (the average family size declining somewhat, to 2.63 members) and the traditional single-earning family now accounted for one quarter of all households (as against nearly one third in 1980). One quarter of the new jobs came from business services and health care; computer and data-processing services led. Some of this followed economic first principles, as they had been established in the nineteenth century. Depression released energy from labour and capital — perhaps women belong in both categories — that had been poorly used. Interest rates, falling, enabled sharp-sighted businessmen to pay for new technology. This process, in the Atlantic world, had been delayed in the 1970s as governments tried to keep the old going — the old now including their own selves — although their unproductiveness was notorious, whether it was bureaucracy or nationalized public utilities. In the USA that process was not as strongly resisted as in western Europe, and there was a whole new breed of entrepreneur — odd, somehow ungrown-up, unappetizingly dressed and outstandingly successful when it came to the understanding of the strange new technology. Steve Jobs and Stephen Wozniak invented the first personal computer in Jobs’s garage in 1976, and their Apple I and Apple II machines beat IBM itself to market. In 1980 they issued their first public stock, brought the Macintosh onto the market in 1984, and by the end of the decade Apple was ninety-fifth in the Fortune list of 500 companies. Another genius who failed to complete his university course (Harvard) was William Gates, who started a small company in 1975 and bought a computer operating system for $50,000; it became Microsoft Disk Operating System, MS-DOS. In 1986 Microsoft raised over $60m by going public, and by 1990 it had thrown Apple and IBM into a defensive alliance: but Windows software had become so popular that a new version, DOS 5.0, sold a million copies in a month. There were other examples — Mitch Kapor, a former disk jockey and instructor in transcendental meditation (Lotus 1-2-3 in 1983, sales of nearly $700 million in 1990); Philippe Kahn, who came to Silicon Valley in 1983, used a clever ruse to persuade a trade magazine to accept an advertisement on credit, raised $150,000 of sales thereby, and set up Borland International, which, in 1991, was the third-largest supplier of personal computer software. There were many similar examples in other industries. For instance, the possibilities for genetic engineering were already clear, in 1980, when Genentech was the pioneer, raising $300m in the capital markets and, by 1984, putting its synthetic insulin in circulation, with sales of almost $500m by 1990. Frederick Smith had suggested a national overnight delivery service — Federal Express, which struggled for a decade until 1980 and then took off as an American institution, with, ten years later, sales of $7bn. There was also Tele-Communications Inc. for cable TV, with sales of $124m in 1980, $3.6bn in 1990; Turner Broadcasting had sales worth $50m in 1980, but $1.4bn — as CNN — ten years later.