- Historic Sites
The 50 Biggest Changes In The Last 50 Years
June/July 2004 | Volume 55, Issue 3
While the feminist movement has had a powerful influence on the attitude toward women in business in the last 50 years, there has been another major factor in increasing the number of women in business rather than the home: domestic productivity. Greatly improved and much more widely distributed household appliances—washing machines, dryers, stoves, dishwashers, microwave ovens, icemakers, vacuum cleaners—make housework far less time-consuming than it was 50 years ago, while the proliferation of prepared and semiprepared foods has made it much easier to get a meal on the table. In 1954 only the new TV dinner was available as an alternative to a home-cooked meal. Today there are hundreds of options, and some of them actually taste good.
A few months before American Heritage first appeared, the last comedy by George S. Kaufman (in collaboration with Howard Teichman) opened on Broadway, and two years later it was made into a highly successful film. It was titled The Solid Gold Cadillac , and it told of chicanery in high corporate places. But while recent scandals have shown that management wrongdoing is still alive and well in American business, if no worse than it was in the past, management compensation has gone through the roof.
TECHNOLOGICAL CHANGE HAS PROVED A FAR MORE EFFICIENT MARKETPLACE COP THAN ANY LAWYERS.
Charles E. Wilson, the chief executive of General Motors before becoming Secretary of Defense in 1953, was paid $652,000 a year, plus some stock options (he took a $580,000 pay cut when he left GM to head the Pentagon). That was a tidy sum in the economic universe of the early 1950s, even though 91 percent of it was taxed away by the federal government. In 2002 the CEO of General Motors was paid more than $12 million in total compensation. He gave over a maximum of 35 percent in taxes, but because much of that compensation came in the form of stock options, he actually paid far less tax than that. Many CEOs did a lot better.
Antitrust was one of the big political issues in the 50 years before American Heritage was born, but it has nearly disappeared in the half-century since. One reason, to be sure, is that mere bigness is no longer perceived as inherently bad, especially as more and more Americans have become stockholders and thus more inclined to see things from the capitalist point of view.
More important, however, has been the accelerating change in the economy caused by the microprocessor, and the glacial pace at which antitrust suits necessarily run. When the outgoing Johnson administration sued IBM under the antitrust statutes in 1969, the company’s dominance over the American computer industry resembled Standard Oil’s over the petroleum industry 70 years earlier.
But by the time the government abandoned the suit, in 1982, IBM’s hegemony was a distant memory, and it was facing the most difficult decade of its corporate existence. Rapid technological change has proved a far more efficient policeman of the marketplace than any army of antitrust lawyers.
The Internet is a communications medium and very much part of the communications revolution. But it is so new—barely a decade old as a popular medium—and so fundamentally important, that it deserves an entry all its own. As the railroad was to the steam engine, so the Internet is to the microprocessor, the most important spinoff of the basic technology. What is perhaps most impressive about it is that it erupted into existence almost spontaneously. Railroads had to be built with iron and wood and sweat. They were very expensive. The Internet costs so little to operate that almost anyone can have a Web site. That is why there are now about four billion Web sites in existence, and tens of thousands more are added every day.
The Internet allows people with common interests to find one another easily, including buyers and sellers. Thus it performs much the same function as a broker. That, in turn, means that all traditional brokerage businesses—real estate agencies, stockbrokerages, auction houses, travel agencies—must change fundamentally or go out of business.
The news business as well is changing rapidly because of the Internet. Bloggers and Internet journalists like Matt Drudge (who uncorked the Monica Lewinsky scandal) can respond to breaking news much faster than can newspapers and TV-news organizations (although now all major news organizations are on the Web as well). And because a Web site is so cheap to set up and operate, every news organization now finds its mistakes and biases mercilessly revealed by what the New York Times columnist William Safire has dubbed the “gotcha! gang.” Retailing as well is moving to the Web, growing at about 30 percent a year. This is very bad news for the printers who produce catalogues and the post office that delivers them.
As we look back on the past half-century of business in America, we see not only change—our restless country has always offered that—but something truly singular, change on a vaster scale than has happened during any 50-year period since the lookout on the Santa MarÍa first sighted land.