Part II

Trade

A Historical Perspective

When business people talk about history many discussions cite Henry Ford, the great U.S. automobile industrialist, who is credited for his statement, “History is bunk.” Many senior executives echo Ford’s remark in their strategic planning and decision-making circles as they proclaim the need to chart new courses of action, reminding their shareholders and organization teams that the world is changing and so must they. But if one takes the time to review his entire statement given in an interview published in the Chicago Tribune on May 25, 1916,¹ his words demonstrate that we can understand nothing except through the application of the surrounding context. What he actually said was, “History is more or less bunk. It’s tradition. We don’t want tradition. We want to live in the present and the only history that is worth a tinker’s damn is the history we make today.”² Ford’s commentary was given in the middle of the World War I and his reference was to the dangerous devotion to the customs of the past preventing one from grappling with the present environment. He was pointing that European leaders knew history yet they still blundered into war and their mistake was relying on tradition as a guide to the future. Ford’s point was that beliefs and customs based on ritual thinking is the problem, not history. Ford would probably agree that if one studies history, one would learn something valuable. Still many quotes negate looking backward before proceeding forward.

John Nance Garner, vice president of the United States from 1933 to 1941, the period just preceding World War II, purportedly exclaimed that the lessons of history are worth a pitcher of warm piss. The value of studying history is even questioned in our modern cultural music, as evidence by the song History Will Teach Us Nothing, made popular by Sting in 1987 from the album Nothing Like the Sun.³ On the other hand, Confucius wrote, “Study the past, if you would define the future.”⁴ This profound observation was echoed by Winston Churchill centuries later when he stated, “The further backward you look, the further forward you see.”⁵ The study of history is like looking in a car’s series of mirrors. Unless one plans on backing up they are rarely useful. But if one wants to pass a car ahead of them as the driver negotiates the competitive traffic conditions around him they become useful environmental assessment tools, as the combined overhead and side rearview mirrors contributes to a 360 degree view and a safer, more carefully orchestrated future maneuver. Today’s global managers need an introduction to business history as it provides a valuable foundation of reference to understand and appreciate the framework that the modern world is constructed on. How the world commercial system developed, the players involved, and the political, social, and economic nuances it handled over time provide the clues to handing today’s complex global environment. While history does not always repeat itself its lessons provide for a better understanding for the managers of tomorrow. The Chinese have a saying: “If you don’t have an old man, go out and buy one.” The past is a valuable alley for appreciating the present. It is the parchment on which the history of today is written.

A historical business view of the ancient world reveals that many areas of the globe were in fact touched by the trading practices of ancient merchants and they all had a hand in establishing a number of the guiding principles that modern-day managers have come to use. Today’s managers work in the modern era of globalization. To successfully lead their far-flung geographical enterprises, they must become good global citizens. They would be well advised to heed the 1400-year-old refrain attributed to Socrates when he declared he was neither an Athenian nor a Greek but should be considered a citizen of the world.⁶ The Greek-inspired philosophical idea that while one’s feet should be planted in a specific country, one’s eyes should survey the world shows us that, even today, managerial knowledge and understanding must encompass a broad view. It needs to include a historical perspective of how trade relationships around the world developed as it is upon such prior associations that the current ones will be based. How commercial models, trade systems, and business approaches were first used provides a platform of appreciation on which the current principles can be better constructed and used.