Energy and Society: Chapter 4: Sail and Trade
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Some who have attempted to predict the way societies will operate in the future, hold the idea that in the long run men will always make the most effective use of material assets that are available to them. But in fact, people in some societies have continued through a very log time to ignore this pattern of what some call “economic” behavior. They have shown what their values are by their refusal or inability to use energy from the wind and falling water to increase the production of things even when they were aware of the technology required to do so.
It is important for us to know as exactly as possible just what the differences between those societies that did and those that did not make use of sail and falling water were in part because similar decisions about the use of energy are being made in the world today.
The sailing ship provided the energy required to bring about major changes in institutions and their accompanying values, and in the location of geographical centers of power previously developed in low energy societies in many parts of the world. Some of the ways we do things today originated from the use of the sailing ship. On the other hand, a great part of the world, which had no access to this cheap form of transportation continued to operate using patterns of living set by energy from the sun – plant and animal – man system. Later, where they made the transition to the kind of social arrangements required for the use of fossil fuels, they did it without going through the long period of ascendency of the trader’s morality that characterized those regions that did make effective use of the ship and the flowing stream. Much of the conflict we now experience grows out of this fact. I have classified the factors that influenced people to use or not use sail and stream as being geographic, technological, and economic. There is general agreement as to the meaning of the first two, but none as to the meaning of “economic”. At one time “economists” were people who attempted to explain the relationships between people and material things that were scarce and useful (or had “utility”). But today economists deal as often with services or with the results of government control as with materials. In fact, they deal primarily with price-measured things, and services. The claim that economics “laws” determine the most effective use of material goods is obviously exaggerated. The shift to the use of money and price was made largely as a consequence of the substitution of energy from the wind to replace or supplement that of men and animals. So, we need to look at what happened and why.
Low-energy society was characterized by codes of conduct that justified relationships that commonly persisted between groups and individuals. Producers and consumers, artisans and peasants, medicine men and warriors, hunters and gatherers and food raisers lived together in a world where they learned codes of good and bad conduct as they learned the skills that they used. All “good” conduct was socially approved; socially disapproved conduct was “bad.” But the degree to which approval or disapproval was assigned to an act was not determined by whether or not it involved material things. Some acts concerned with materials were of very great concern. Others were a matter of indifference. On the other hand, the violation of a sacred rule that related in no way to the use and disposition of materials might be of the greatest concern. The hierarchy of values that the child learned as he grew up put acts in their socially approved order, from best to worst and it served no purpose to separate those dealing with materials from other behavior.
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Opportunity cost
To take advantage of differences in resources among people living at a distance from each other by using stream and sail transportation, there had to be increased exchange of goods among societies that had different cultures and values. Now, those involved in exchange of goods had to choose between the product of distant lands and articles of services produced locally. Two things otherwise identical might be offered. Acceptance of one would contribute to the survival of things as they were, choosing the other might weaken or destroy them. The peoples who first engaged heavily in trade using the sailing ship, like the Phoenicians and Greeks had to deal with the problems this created. Aristotle provided an explanation of the nature of the new situation which is basic to much of the theory still widely used. For Aristotle, economics meant something akin to what we mean when we say a man is “economical,” that is he makes the most of the resources available to him. But in that endeavor, he has to deal with different institutions. There is the economy of the household, of the Market and the State. Each sets the conditions for exchange within its own sphere, and often the demands on the individual differ. To conform to these claims was then and continues today to be a cause of both overt and covert conflict.
For reasons we shall later develop more completely the term economic slowly came to mean “efficiency” as measure in monetary terms in the market. This was supposed to provide the most effective way to insure the efficient utilization of material goods.
Now within a single cultural system where there is general agreement on the proper sphere of market and the proper role of price this position produces no more than tolerable confusion. But to attempt to make price measure all of the values involved when goods produced in one system are introduced into another that differs in its conception of the proper role of the market does produce such confusion. I will not use as a definition of the term “economic”, price-measured exchange, the production and consumption of material things, or sustenance activities. I use it in much the same way as Aristotle did. The Greeks were very heavily involved in trade among different customers. They had to find means to deal with people whose values differed one from another. Measurement in monetary terms provided a means for exchange. But their societies put limits on what could legitimately be exchanged for money. For Aristotle economizing meant effort on the part of the individual to achieve as many of his values as possible while sacrificing as few of them as possible. Thus the value of anything is revealed by discovering what will be sacrificed to secure or achieve it. These are “opportunity costs.”
What we need to note is that many of the values sacrificed are not measured in the market place in terms of price. Goods bearing a lower price, but costing the sacrifice of other things held by the individual to be more valuable will not be exchanged. In fact, it may be considered immoral or sacrilegious to even offer money for them.
Using opportunity cost in this way, it is easy to see how goods from abroad, even those that could be secured at a much lower price than that of domestic goods might be refused by men who in buying them have to sacrifice other values, such as family ties, local pride, national objectives or social esteem which were to them of greater significance. Very often a system that would permit the extensive use of the ship required that the buyer disregard the sacrifice of such values, and in many cases, the trader was barred because his activities had this effect. When this took place, the society denied itself the opportunity to use the great energy surplus which the use of the ship would make possible.
Often the introduction of new methods and sources of production set up conflict in the society which must result either in reaction which prevented further use of the new materials or methods or in a change in the socially accepted way of doing things. If the former occurred, the old ways continued. However, if the new source or method was continued because the gains proved to be greater, then the costs of adopting it, in time it too became acceptable behavior. New codes making moral such behavior were developed, and the difficulty of substituting still other new ways for this acceptable behavior again became a factor limiting further change. Empirical evidence exists to show that in a great many cases goods “economically superior” in price-measured terms were repudiated and the older, socially sanctioned goods retained. It also shows just how the resistance of those seeking to retain the old ways was broken by those seeking the benefits of the new.
But we must note that whether “progress” or “reaction” triumphed, morals and religion were frequently as clearly involved in producing the end results as were judgments about the physical effectiveness of proposed means of production.
In the low-energy society, because of the limits of which we have spoken, almost all the factors involved in the lives of the people interacted in the local community, and within a very limited geographic area. Thus equilibrium was a result of establishing a stable set of claims on the recurring sources of energy. Such claims were likely to be established in a fairly short time as the various forces resisting change came into balance with those for making change. Even when superior military force required the regular payment of tribute, as in the various empires that rose and fell, the amount which the conquerors could successfully extract was rather quickly set, and the rest of what was locally produced, which could be divided among the local populace, was distributed by them in such a manner as to result in a fairly stable relationship among the locally sharing groups. In time, these arrangements usually came to be expected, if not fatalistically accepted, as being required by some higher order, ordained by a god or gods.
Economics and morality in high-energy society
It is a very different story in the high-energy society. Here the transition to the use of high-energy converters has required the creation of new social units. The social unit which carries out the functions of the family may occupy very restricted space as compared with the area required for the state. The production of some goods may be carried out by the family, while other goods are produced by large corporations. The unit based on religious belief may be entirely separate and distinct from that organized to handle military control or protections. Experiences in such diversified situations imbues the individuals with a hierarchy of values in which the demands of the state, the market, the corporation, the church or other organizations are made supreme, as opposed to those of the family or the local community. Moreover, the particular order in which one of these institutional claims follows the others in the hierarchy of values common to various sets of people may vary greatly among areas that are functionally connected but geographically remote from one another or among groups geographically near but functionally remote from one another. So, people are often not concerned about nor even aware of the way their activities affect the “foreigner.” Under these circumstances, change results in no such immediate and effective reaction as could take place in the local community of the low-energy society. Reaction may be delayed or distorted by the social structure through which it manifests itself, by the lapse of time which is required before the full effect of the change can be observed in all parts of the system in interaction, or by some other factor. Thus, because the attainment of equilibrium in the high-energy society is likely to require accommodations of an entirely different character from those required in the low-energy society, rapid adjustment and the prompt establishment of social equilibrium are relatively rare, and, in fact, may never be achieved.
“Outside” influences
Almost all societies have some outside contacts. As we discussed earlier, such contacts became more numerous as fairly large surpluses came to be regularly produced and were transported over great distances. This increase in contacts became more significant where the flowing stream was used as a cheap means of transportation; it was greatly increased by the use of the sailing ship. There was also a great increase in the separation of production from transportation, which more and more was carried on by specialists adhering to different codes and using different converters from those who participated in production.
To the woman carrying yams from her garden, or the husbandman carting home harvested grain, transportation and production were no more separable than planting and harvesting. To an oarsman manning the sweep on a barge carrying stone to build a pyramid, transportation and production were entirely different things.
The fact that the energy of the flowing stream and the sailing ship were available primarily for transportation created differences which had not previously existed between various goods. Some goods and services, such as garden produce and child care, had necessarily to be provided with the aid of locally produced energy. These could not be replaced by transported goods. Other locally produced goods were often identical with those which came from outside the community. So, low-cost transportation might lead to the introduction of identical products from another region, offered at a cost markedly lower than that sanctioned by the local values. Then, it would become necessary to develop means by which goods produced outside a system could be evaluated in terms of the effects which their introduction would have on values current in the society receiving them.
Prerequisites to trade
As indicated, I am here accepting the theory of opportunity costs, in which the fact of trade is taken as evidence that the goods chosen are considered by those who choose them to be more valuable than the goods that must be sacrificed to secure them. But the theory also implies that trade which seemed initially to maximize the values of an individual often had consequences that weren’t originally foreseen. If these led to judgments that the values sacrificed were greater than the benefits relieved, then trade might stop. For example, if as a result of trade a man found himself shunned by his neighbors, condemned by the church, punished by the state, or banished from his family, it is perfectly possible that as he became aware, he might refuse to continue to trade.
But cheap energy used in transportation makes possible a new and different order of choices. When some goods can be reduced in cost by a lowering of the cost of transportation while at the same time the costs of other goods remain the same, competition and conflict take the place of previously agreed bases of exchange. So to predict whether or not a particular society will permit a change in relationships depends upon a knowledge of all the changes which will take place as a consequence of the use of new converters.
While the introduction of cheap transportation produces a strain leading toward the substitution of the lower-priced for the more costly good by those who stand to gain by the substitution. It must not be forgotten that it also leads to resistance on the part of those who will lose by that change.
“Difference in cost” as between two areas potentially involved in trade as a result of cheaper transportation may represent several distinct kinds of costs. One such difference may reflect geographic characteristics which affect the amount of energy required to secure a given good. Thus, for example, less energy was required to secure a given quantity of commercially pure iron from the rich ores of the Mesabi than from the low-grade ores that exist there or in many other places. But when the geographic advantage of the Mesabi was altered by exhaustion of the rich ores, those who had been buying it had to compare the cost of ore from other places, plus their transportation with the cost of getting iron from deposits of taconite found near where the Mesabi ore was mined. Cheap transportation permitted less-rich natural resources to be continued in use in many cases. Thus, the superior technology of a region may be such that it can produce far more goods per man-hour than a technologically undeveloped country with identical or superior geographic resources. Theoretically, such differences as these will be equalized by free trade. In fact, the diffusion of the culture of a whole region might be required to bring this about and this might be more costly than the gains secured.
A third type of difference in cost represents solely the difference in the alternatives which are available to potential traders. The alternative to cooperation with the trader in one case may be starvation for him who refuses to trade, while another person in the same region, or a whole people in a different place, may be able to turn to other alternatives hardly more or even less costly than the terms offered by a particular trader. So, at one point, failure of trade may mean abandonment of a whole area, while at another, it may simply mean the adoption of alternative occupations.
Thus to introduce trade involves the creation of many kinds of new alternatives – not just consideration of more efficient types of production and transportation as measured in either energy terms, material terms, or price considerations. To repeat, the introduction of trade creates situations in which differences in costs, however originating, operate to change human relationships. Trade, then, can be introduced and continued only so long as it results in such advantage to those engaged in trading as will permit them economically to meet the costs arising from the reactions which the introduction of new goods may produce, whether such costs take the form of overcoming direct physical resistance, the initiation of new types of persuasion, the delivery of goods at lower prices, subsidies to less productive industries or other steps.
If trade is to continue, all these secondary costs must be met, plus all the costs of production and transportation. Since in a low-energy society all energy derives primarily from the use of plants and animals, which yield very limited surpluses, trade initiated between such societies with the consent of the local populace is also likely to be very limited. On the other hand, with the energy surpluses possible from stream and sail, such resistance as is based on the surplus derived from plants and animals may be relatively ineffective and trade may be carried on in the face of it.
Only such systems as produce some surplus can be brought into the trading area. Likewise, only systems that provide sanctions permitting surplus to be taken out of the place of origin can participate. Hence trade arises in systems where the dominant values are such that trading the surplus goods will be more highly approved than devoting them to some other purpose, such as sacrifice to the gods, conspicuous giving, or licentious living. Thus, there are three requisites for the establishment of trade between potential trade areas: differences in energy costs between the areas, the existence of exportable surpluses, and the presence of values that are compatible with trade.
Who could use the ship?
The absence of any one of these precludes the use of the ship and the flowing stream for trade. Some of the great river valleys provide all the geographic conditions required. They are so large that they include a wide variety of soil, climate and topography, and mineralization. Consequently, they also provide a wide diversity of plants and animals. Often, however, the seeming favorableness of conditions is deceptive. For example, it might seem that those in the fertile regions could obtain furs from less productive lands at the cost of less energy, in the form of food for export, than would have to be expended in growing and processing some fiber with equal protective or decorative value as fur, while those in the colder upper reaches of the valley might gather furs at the cost of less energy than they would have to spend in gathering or raising food. If transportation costs were low enough, this could become the basis of exchange. But since most of the world’s rivers run from these colder regions to the warmer and more fertile ones, the use of the stream would provide surplus energy only in the wrong direction. Heavy, bulky grain would have to be moved upstream and light furs would come down, so that the use of the stream would cause a loss of energy rather than a gain. Thus, the specific nature of goods produced and alternatives for them must be examined before the influence of the geographic factor can be clearly seen.
And even when such geographic conditions are actually favorable, it does not always follow that trade will exist. Those who cannot, by reason of their distance from it, share the benefit of the stream are often antagonistic to those who can. Sometimes they have been strong enough to prevent those on the river fringes, who might have used the stream, from developing to the point where they could engage in endeavors not approved by their far more numerous neighbors. Acting alone, such trade-inclined societies were frequently incapable, in the face of the opposition of their hostile neighbors, of developing a culture based on specialization and trade.
In some river valleys the advent of the sailing ship tipped the scales in favor of the trader and against the self-subsistent agricultural community. In general, the greater the distance between two areas, particularly in latitude, the greater the difference in productivity as to specific plants and animals. Mineralization and other geographic factors are also likely to be more diverse. On the other hand, all other things being equal, the costs of transportation rise with the distance traveled. Thus costs of trade and of local production can be balanced one against another and a limited trading area stabilized.
With the introduction of the sailing ship, all other things ceased to be equal for dwellers on those rivers whose mouths would be reached by the ship. With the use of the ship, it became possible to greatly increase the distance traversed and thus to increase the geographic and cultural diversity of products obtainable at a given cost in human energy. Now there could be brought from great distances goods which at their place of origin were low in energy costs but which at their point of sale could be produced, if at all, only with a much greater expenditure of energy. For example, wool and furs which are easily produced in cold climates and which can be produced with great difficulty or not at all in temperate regions where they may be highly useful for at least part of the year, became available in these more temperate climates.
In some areas, climate entirely precludes the raising of plants whose use would save goods otherwise certain to be wasted. Thus, the spices that grew in the Indies could be used in Europe to preserve meat. The production of meat and the waste due to lack of preservatives might add up to the expenditure of more energy than was required to produce and carry to the Indies the goods to be traded and to bring home the spices from their native islands.
So the appearance of the ship-borne trader increased the number of alternatives available and altered the order of the energy costs at which goods could be secured. This frequently put a new strain on the old controls through which local reciprocity was secured. For example, one might, though grudgingly, support a spinster sister-in-law or cousin who spun and wove 10 yards of cloth annually in return for her board and lodging, when the alternative was 12 yards for an equal amount of food secured in trade from a stranger. But if the trader offered 10 yards of cloth for the equivalent of only 2 or 3 months food for the spinster, one’s choice might be different. This was the kind of decision involved, for example, when residents of villages in India were faced with a choice between maintaining the local spinning caste and having only a little cloth, and destroying the livelihood of that caste by trading for quantities of British calico.
Even where the traditional social controls were strong enough to withstand such considerations, the low-energy producers were frequently unable to stand their ground. As we have shown, energy may be used as an inducement. It must not be forgotten that it also represents potential coercion. The sailing ship made it possible to bring into the valley, in the shape of men and guns, force that did not originate there and was not dependent upon the surpluses produced there. It made it possible to bring from distant lands men who could eat only if they established trade, and who could live better by working for the interest of the trader than by remaining attached to the overpopulated lands from which they came. Added to the forces of the townsmen and such of the valley dwellers as were willing and able to profit from trade, they became a force sufficient to create such realignment of the society as trade required. Thus, economic and political factors worked hand in hand to alter the culture of the self-contained village of the low-energy society. Frequently the religious and moral systems of the trader, which justified what was being done, were likewise introduced, the power of the sword being used, if necessary, to convert the infidel.
To make our analysis clearer before we pass on to another point, perhaps we should recapitulate: The sailing ship produced a field tremendously more extensive than that of any previous converter; it operated on a gradient much more gentle, and its costs were therefore much lower than any previous one. It permitted energy to be concentrated in a manner hitherto impossible and made the use of force over large areas much more effective than any previously existing form.
But its use stopped at the shore, except where it could be joined with the use of the flowing stream, which had its own characteristics. Consequently, on land, sail accentuated the characteristics growing out of the use of the stream. These included support for exploitative stratification. The upstream portion of the trade at least was initially likely to be in luxuries, since only in downstream towns and cities could sufficient surplus be concentrated to make it possible for energy which might represent the bread of thousands to be exchanged for luxuries, such as furs and spices, perfumes and ornaments, for a few. Only in an urban environment could the value of goods whose original production carried, in addition to their economic meaning, a host of social implications be transmuted into a neutral medium, money. In the agricultural areas these goods continued to represent merely part of a relationship that must be treated as a whole. Operations to extend trade until it included some of the necessities of life for those in the hinterland depended upon further changing its culture so as to permit removal of some of what had hitherto been claimed for local use, in return for goods brought in through trade.
The use of the ship was also limited by the volume of goods which the region was capable of delivering to it. Areas not traversed by rivers were often not able to produce good which were sufficiently valuable to justify their being carried by man or animal over great distances. Such areas remained unexploited during the dominance of sea-borne trade. Only through the use of a river basin could the surplus of the interior of the continents be made available to the trader, and this most often through the medium of a city.
Changes wrought by the ship
The ability of the sea-borne trader to deliver at the point of contact surplus gathered from elsewhere made it impossible for those not near rivers, seas, and oceans to stop the trade of their coastal neighbors except by a continuous effort. This itself altered or destroyed their culture. Urban civilization, developed upon the seashore, being in part maintained by power developed by the use of sail, frequently became an incubus from which the interior could not escape. Cities often became parasites which drained the hinterland of much of its surplus. After the invention of gunpowder, the ship itself mounted weapons hardly to be matched by fixed guns except at such points as had few, and easily guarded, approaches. The surplus of a whole river basin, or that part which could be reached from the river, became available to him who controlled the sea. Sometimes he came as pirate, privateer, or representative of a “legitimate” monarch bent on plunder. Sometimes he appeared as a tradesman, offering at a high price products cheap in a distant land, in return for the surplus produced by a large population. But always he was limited by the ability of the area in question to produce surplus.
Monopolization of sea trade
The limit on the amount to be traded was fixed not only by the cost of transportation between points, but by the ability of an area to produce goods to be traded. Where only limited goods for trade could be produced even a great reduction in the prices charged by the trader (with resultant loss of profit) frequently resulted in no commensurate increase in his business. Increases in the number of traders often resulted in decreased profits. Under such circumstances the rewards to the trader for monopolistic control over the seas and monopoly of the gains made from the ship were tremendous, and on the other hand, the penalty for uncontrolled competition was likely to be a disaster.
To maintain monopoly, two measures must be taken: first, to secure the gains to the owners of the ship rather than to all those who participated in her building and operation; second, to limit the permitted number of ships to the optimum. To secure the first condition was relatively easy. During long periods the only areas that produced surpluses adequate to build ships were those in which serfdom or slavery operated. To deliver to a ship a hundred or a thousand men was frequently to rid the countryside of surplus population which, if it had stayed, would have reduced the possible energy surpluses available for trade or consumption by the landowner. The lot of sailors was no better, nor much worse, than of other men; as they had not shared increased surpluses produced upon the land, there was no thought that they should do so at sea. Once monarchs became aware of the wealth to be gained from a growing class of merchants, there came into being the maritime counterpart of the conscriptors who had carried men off to soldier on land. It was only when men on the land had gained the power to demand more than subsistence that it became necessary to share surpluses with them upon the sea.
The problem of securing monopoly of maintaining monopolistic competition as between shipowners was one much more difficult to solve. Through long centuries piracy was at least normal, if not moral. But, as we have seen, a vessel that required oarsmen to manipulate it in battle and fighters to protect it lost much of the surplus it might otherwise have delivered. The Phoenicians kept their navigation secrets well and circulated such horrendous tales of the dangers of the sea as to frighten off many potential competitors. But the Minoans and their successors, the Greeks, contested this supremacy, at least in their own waters, and made it costly to trade in that area. With them, for a time at least, it was share and share alike among the crew. As commercial practices grew and merchant capitalism copied from the Phoenician model developed, such sharing was replaced by the concentration of wealth which produced the Periclean age.
It was the Romans, conquering both the Greek and the Phoenician colonies in Africa, who secured a firm monopoly. Through their control over the sea they developed a system which delivered to Rome the surpluses of the whole Mediterranean world, making possible specialization and division of labor and releasing thousands from the necessity of remaining on the land in order to secure food. As we have seen, they were able to produce a true merchant ship which generated very large surpluses. But as their empire faded the Romans lost control of the Mediterranean and it again became infested with pirates, who plied their trade until well into the nineteenth century. This necessitated the arming of the ship and reduced the surplus it could produce.
During the Renaissance the Italian states revived trade under competition and still profited mightily from it. The Portuguese and Spanish, plundering the New World, called upon heaven and a church made new-rich by their exploits to protect trade which their own political and military prowess was unable to monopolize securely.
In the following two centuries the English and the Dutch arose to challenge and defeat the Iberians. Then began the struggle between England and France which was triumphantly concluded at Trafalgar. For almost a century, Britain ruled the seas and largely determined the conditions under which trade upon them could take place. What I particularly want to emphasize is that much of the social organization of the present world, particularly the part which deals with foreign trade, still bears the mark of this period.
Admiral Mahan’s Influence of Sea Power in History, which became the source of so many policies, was based upon an examination of the role which the navy played in making the position of trading nations dominant. It did not occur to Mahan or to his followers that what he was talking about was a statement not of immutable natural law but merely of a consequence of the use of particular converters and the social organization that grew up with their use. Today, a good deal of theory about foreign trade rests upon the assumption that British experience with high-energy converters sets the only pattern for their efficient use. It will become clear when we examine other high-energy converters that this is not necessarily so.
It was the ship that made important, and brought about approval for, the widespread use of money and of exchange based on price. It was with the sailing ship that a few small nations of western Europe developed control over the trade of the world and gained such power as to subordinate many times their own numbers to the political and economic ends they sought. Certainly the ship was no “sufficient” cause to explain all that happened where it came into use, but certainly also there is no reasonable way to explain how such power could have been attained without the use of the energy of sail. It is only now, as the world which was built on the control which sail permitted is evolving into new power patterns, that we can discern some of the reasons both for the rise and for the fall of Western dominance.
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