The DCB on Herbert Molson

The new Dictionary of Canadian Biography entry on Herbert Molson (1875-1938) is a blockbuster, worth reading even if you have no interest in the scions of old Montreal families  -- Herbert being the fourth descendent of the original Molson brewer of Montreal. It's by Robert C.H Sweeny, the Montreal historian and Memorial University emeritus professor.

I'm ambivalent about the little potted summaries that the DCB has started placing at the top of its biographies. At first glance, I thought this one editorialized a little too much about how it felt about the subject of the biography.

Then I got into the meat of this biography, and boy, it delivers. For his account of Herbert Molson's life and career, Robert Sweeny seems to have tracked every penny that ever went in or out from the Molson's business and in or out from Herbert Molson's personal wallet. It's not a pretty picture. The market rigging! The price-fixing! The tax-dodging! The profiteering! The honours for his philanthropy set against the microscopic share of his income it represented.

In 1909 Molson’s entered into a cartel with its much larger rival. From April of that year through to September 1925, the two firms shared monthly returns on how much ale, porter, and lager each had sold in both Canada and Newfoundland. All sales in excess of a set market share were to benefit both firms, at a fixed profit per gallon. 

... 

It is not clear how Herbert managed to avoid incurring a heavy tax bill on these appropriations. His private ledgers show that in 1928 he paid 25 per cent in taxes on a net income of $311,812, but in 1929 he paid only 2.8 per cent on a revenue of $5,187,519, and in 1930 a mere 1.8 per cent on $4,877,352.

...

Throughout the 1930s he donated only 1.56 per cent of his $17.1 million income to charitable causes.  

Lately the DCB has been engaged in an ambitious fundraising project seeking to build its endowment to the size it needs. One cannot help speculating about how potential major donors might react if they saw this work sample. 

Which is why it's important that the DCB has published it. 

 

Book Notes: Levine on Dollar-a-Year Men

A friend told me he has been enjoying Allan Levine's new The Dollar A Year Men.  I haven't seen it myself but here's a bit from the publisher's summary:

When Canada went to war in 1939, the goal was to provide the British with the ships, planes, and weapons that it desperately needed to defend their island against Nazi Germany. But at the time, Canada had little to offer in terms of military hardware. That was when Canada recruited top business leaders to take charge. In six years, they turned Canada into one of the greatest military powers in the world. They helped to win the war, and in the process they turned Canada’s economy into a modern industrial one. What’s more, they served the country for a dollar a year, or even nothing. This is an inspiring and patriotic story for Canadians in a time of crisis.

Same friend tells me Allan even cited a long-ago piece of my ephemeral journalism for something I said long ago about one of his people. I don't think I have a copy of it anymore.  

History of our embattled southern border

Maybe ... someday

Alex Usher's HESA blog "One Thought to Start your Day" today offers a more trenchant summary of North American geopolitics than most of our news outlets seem able to work out:

A maniac is in possession of our southern border. He wants something from us. It’s not trade concessions; he does not care about softwood lumber or supply management or anything like that. It’s probably not territory (taking territory is one thing, holding it is another). No, it’s more like craven obedience. There is no appeasing this man: the only choice is to resist. Understanding this is key to understanding what our country’s new strategic options are.

Usher goes on to declare we need to re-orient our trade away from the United States. He also laments that "we are bad at selling things abroad.... lazy... timid." He suggests we need better performance from our business schools, whose grads, he says "have left the country with such an anemic business sector."

Okay, he's writing a universities blog, so prodding the business schools make sense. But I'm not sure that's where the blame lies, really. The free trade agreement we signed with the United States in 1988 confirmed what was already evident:  our Canadian business sector is mostly just the American Business Sector (Canada) Ltd.  Who will re-orient our trade away from the United States when vital decisions for most Canadian businesses are taken by head office in the United States? 

It seems to be forgotten that Pierre Trudeau spent much of his time in office trying to diversify Canadian trade away from the United States. His inability to achieve much in that vein set the stage for Brian Mulroney's renewed focus on our American ties. 

Have we a business school that could address that situation? Hmmmm.

Book Notes: Failson Business History in Rogers v Rogers

Some press coverage of the recent agreement between media giants Bell and Rogers -- that gives Rogers control of Maple Leaf Sports and Entertainment, owners of the Toronto Maple Leafs, Toronto Raptors, Toronto Argonauts and Toronto FC -- has suggested that Bell was pushed into selling by the massive debt it has incurred and that the winner in this deal must be Rogers. 

Okay, Rogers probably won't lose money on the deal. There will always be another egomaniacal billionaire ready to push up the price of sports franchises. But I was recently reading a lively business history, Rogers v Rogers: The Battle for Control of Canada's Telecom Empire by Alexandra Posadski.  It doesn't inspire confidence in MLSE's new owner, Edward Rogers.

Posadzki describes how Ed Rogers managed to defeat his mother and sisters to become uncontested head of the Rogers empire -- and to fire a seemingly capable CEO who had disagreed with him once too often on big plans for Rogers' telecom businesses. But in the process she makes it pretty clear that Rogers' main qualification is being the founders' eldest son.  

Sources in her book suggest Rogers Jr. been a bean counter more than a visionary, insecure and combative and too often inclined to strangle telecom innovations at Rogers the moment they became expensive. The chances of him driving away strong and effective management at the sports teams while failing to negotiate the endlessly changing market for sports media are, shall we say, non-zero. And while he plays sportsman, who minds the store at Rogers?  Meanwhile, the cost of purchasing Shaw Media in order to further concentrate the Canadian TV/internet market remains immense.

I don't know if Bell is particularly well managed, but at least it is managed by professionals, not family members. Maybe it has made a smart decision to take Rogers' cash, strengthen its own financial situation, and focus on telecom and media rather than chase the pricy glamour of sports franchises.  

The Leafs lost last night, and Toronto FC the night before. The Blue Jays (he owns them too) lose constantly, and Ed Rogers thinks the Argos are minor league and pines for that NFL franchise to shore up his ego.  

History of gay entrepreneurship

I've been meaning to note -- Pride Week finally gets me around to it -- a lively review in the May Literary Review of Canada by Elspeth Brown of Andrea Benoit's history of the Toronto-founded cosmetics company MAC: Viva M.A.C: AIDS, Fashion, and the Philanthropic Practices of M.A.C Cosmetics. Brown, and Benoit, consider the place of "gay capitalism" in a community generally seen as oriented to social justice and against capitalist exploitation

Now a ubiquitous fixture in high-end shopping malls and consumer-­friendly airport terminals around the world, M.A.C Cosmetics emerged from Toronto’s queer entrepreneurial past. In the 1970s, young gay people created a parallel ­lavender economy where they could both be out and pay the bills. By founding bookstores, restaurants, and bathhouses, business owners did their best to make money while making good and supporting the “community.” These newly out entrepreneurs joined an older queer tradition of gay men, in particular, working in the velvet underground of the aesthetic industries — fashion, hair salons, interior decorating — where being gay was tolerated, so long as no one spoke about it publicly.

Nice cover design, UTP.

History of a move, and of business organization

Since about February, blogger and spouse have been in the process of buying a new home, selling the old home, and organizing a downsizing, a staging, a sale, a purchase, a move, and all that goes with those processes. We actually find ourselves owning both the old property and the new property for a couple more weeks, which means -- this all happening in Toronto -- we are temporarily either rich beyond our wildest dreams, or just more in debt than we ever expected to be at this stage of life. (Mostly the latter.)  It is all remarkably complicated, And time-consuming.

Hence the lighter than usual productivity at this blog over the last few months and particularly the last couple of weeks.

I don't think a history of this move will be forthcoming.  But several times I found myself reflecting on the history of business organization.

We used a smallish real estate agency, about ten people altogether.  We used a local moving company, where the leader of the moving crew had his family name as the logo on the truck. We used a two person law office. All of these were superbly organized, courteous, prompt in executing, and always completely in command of what they had to do.

We also used a major bank (let's give it the initials RBC) for the bridge financing we needed, and a telecom giant (initials BELL) to shift our internet/television from old address to new. The property finance kid at the bank was prompt and competent, and the tech who came to do the telecom installation seemed like a master to me.

But getting the bank's remote Closing Centre simply to hit Send on the crucial financing documents very nearly sank the whole transaction, and finally had us more or less occupying the bank manager's office and refusing to move until we got confirmation that our lawyer had received what she needed.  And the effort it took to get the telecom's service centre to actually make the booking for a tech visit and then ensure that the tech department actually knew about the booking, and...  well, I don't even want to go into it.  Blogging might have been more active had we actually had an internet connection for several days there.

In the history of business organization, the large corporation has decisively beaten the small local one in almost every field. But if that is the case, how is it that the small ones still work so well, and the big ones so badly?

There are still a hell of a lot of unopened boxes around here, and still at least one major banking/legal transaction to bring to a close. (The one scheduled to obliterate all that debt!)  So no promises about the pace of blogging in the near future, but I'm becoming hopeful.  Hey, it's July and we haven't even mentioned the Tour yet.  Stick around.

Move, if it's right for you. We're glad we did.  But don't underestimate the complications!

Update, July 12:  Archivist Charles Levi notes that among the fields not yet dominated by large organizations is librarians.  I tried to counter with the size of the Toronto public library system (not that I have ever found it inefficient, quite the contrary) but Charles insists that because of its branch structure.

Notes on the history of inequality and minimum wages

American babies are 76 per cent more likely to die before they turn a year old than babies in other rich countries, and American children who survive infancy are 57 per cent more likely to die before adulthood, according to a sobering new study published in the journal Health Affairs.

American teens aged 15 to 19 are 82 times more likely than teens in other rich countries to die of a gun homicide.

You have to say, the Republican agenda is working.

Meanwhile, here in Canada, how is it that the operators of Tim Hortons franchises have a union -- the Great White North Franchisors Association -- to negotiate with the boss, but the workers cannot seem to have a union to negotiate with the franchisors?

And if markets are supposed to work, how is it the franchise system establishes that the boss gets to set the prices while the franchisors have to pay the (rising) wage costs?  Is the role of retail franchising in creating poverty a bug in the system, or more of a feature?

The $15 minimum wage, coming into force in Alberta and Ontario but bidding to be a national trend, has provoked furious criticism among business lobby organizations.  But economic analysis seems to be conclusive that increasing working people's incomes to meet a living wage is good for the economy, increases retail activity, stimulates business, etc.  The business groups seem so transparently dependent either on scare anecdotes or on the kinds of "studies" in which the press releases have been drafted before the research is commissioned, that the protests of the lobbyists seem to do more to reduce business credibility than to shift policy. In Ontario, at least, Kathleen Wynne seems to be building her re-election program on wrong footing these critics.

Banking anniversaries: Bank of Montreal and Canadian Imperial

In Canada's 150th year, the Bank of Montreal is marking the 200th anniversary of its own founding in 1817 and the Canadian Imperial Bank of Commerce notes the 100th 150th anniversary of the founding of its earliest components in 1867.

Both banks mostly have contemporary-oriented media campaigns and public-interest projects, in the same way that Canada150 is only peripherally about 1867. The Bank of Montreal is a bit more ambitious about its history this year, with a word-and-pictures book and a peer-reviewed academic history, both by Lawrence B. DeMussio, being published by McGill-Queen's this year. CIBC's historical production this year is a 20 page web-based publication, but CIBC has a long track record in publishing volumes on its own history, with a firm history by Victor Ross that appeared in 1920 and several further volumes having appeared up to 1995, and its corporate history website is substantial.

A completely different anniversary: Dan Francis notes the achievement of woman's suffrage in British Columbia in 1917 -- along, he notes, with prohibition. Women's suffrage has lasted, however.

History on the road

Ryder Hesjedal: new team, plans to make history in the Giro

Andrew Smith's blog The Past Speaks notes an unusual course in business history. The course requirements include joining a 500 km cycle tour to a range of sites of business history around Montreal

An extremely innovative business history class at HEC Montréal may be the right model. This class, which is taught by Anne Pezet and Brian King, has received a lot of attention from AACSB recently.... It’s run in the summer and involves a 500km bike tour to sites of business-history interest (ruins of old factories, etc) plus visits to historic family firms to network with the managers. A van follows the students with their suitcases so that they can change into business attire when they reach their destinations.

German historians used to identify one essential historical skill with the word sitzfleisch, meaning the ability to park one's ass in a chair long enough to get the work done.  What's the German for saddle-flesh?

Image: Cyclingmagazine.ca

History of Tim's

You better start writing it soon, because the Romneyite vulture investors who now own it have begun to dismantle the enterprise. They will be serving instant coffee any day now.

At least we already have a history of the doughnut.

Smith on the history of protection and free trade

Andrew Smith, formerly of Lakehead University, now teaching at the University of Liverpool Management School, often makes the case at his blog The Past Speaks that history matters to business and economic policy.

Further to that proposition, he and Dimitry Anastakis of History at Trent have just published Smart Globalization: The Canadian Business and Economic History Experience, a collection of essays intended to "test claims that wealth comes from either protectionism or free trade."

"With empirical research that spans more than a century of Canadian history, Smart Globalizationdemonstrates that Canada’s success stemmed neither from complete openness to globalization or policies of isolation and self-sufficiency."

History of Banking -- why is it federal?

One. The global financial collapse drew attention to the way Canada's banks -- few, large, and relatively-closely supervised by a national bank regulation system -- avoided many of the pitfalls that created the crisis in many other countries.

Two. Okay, when I get a new Canadian history, I sometimes look myself up in the index first. Last week, at the launch of Joe Martin's casebook in Canadian business history, Relentless Change, I found I am not in the index but deserve to be. Martin writes (page 3):

Section 91 of the British North America Act provided the federal government with powers over currency and banking as well as life insurance. This was an important provision and one that contributed significantly to Canada's development of an effective financial system. Yet an examination of general textbooks on Confederation, or Christopher Moore's 1867: How the Fathers Made a Deal, reveals little discussion of the matter.

It's a good point. In the confederation settlement, many aspects of business regulation became provincial powers along with "property and civil rights." One can see currency being naturally national, but why banking? Martin's quite right that there's no explanation in my book. I wonder what the answer is, or if anyone has really addressed the question.