The agent of globalization

5 min read Original article ↗

It can be reasonably argued that prehistoric times really gave way to history when humanity invented towns. Of course, we did not invent them per se: it just turned out that it’s nice to have people who don’t produce food but rather contribute to society in some other way. Naturally, these people had to be fed by the rest of the community in exchange for the goods they were producing. It also turned out that if you were producing anything remotely complex, you needed to build your supply chain and try to live and work as close to your vendors and customers as possible to improve your productivity and profits. Additionally, such clustered societies had many political and military benefits compared to purely agrarian ones that were thinly spread across the farmland, so this lifestyle innovation stuck.

As soon as the dust settled, a big drawback of towns became evident: suppose you live in a town with a maximum of 1000 potential customers. How can you grow your business faster than the population of your town? Obviously, there are other towns out there, and maybe there’s even a market for whatever goods you are producing, but between you and your customers in those towns lies wilderness, and a 100 mile trip would take a couple of weeks, which may be an unacceptably long time (especially if your goods are perishable). You can’t realistically reduce the distance between your towns without a warp drive, so humanity scratched their collective heads and invented roads. Roads didn’t reduce the distance you had to travel (and sometimes they actually increased it!), but dramatically reduced the time required for the trip. In essence, they did bring the towns closer together. Fast forward a couple of thousand years, as cargo vehicles and roads kept getting better all around the world — except in Russia, which apparently still hasn’t received the memo:

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Some towns had an easier time thanks to being located on the seashore. Access to the sea implied plentiful food resources and a transportation method which a) did not require constructing roads and b) allowed to travel to towns that would be hopelessly unreachable otherwise.

Then came the railroads. Then came the steamships. Then came the trucks. Although all these improvements kept making the world a smaller place — leaving distances intact but decreasing transportation times, two technological innovations deserve special attention.

First, the intermodal container. As late as the 1950s virtually all cargo transportation required long, arduous loading and unloading procedures, with plenty of goods lost, damaged or stolen. Thanks to the wits and good fortune of Malcom McLean, that changed with the introduction of containerization. The benefits of containerization turned out to be vast and the transformation of global trade dramatic — in fact, it became truly global for the first time in history. Buying an Italian-made washing machine in Chicago would be a serious challenge in the 1930s; today, we don’t even blink an eye. The globalization of the late 20th century, with supply chains built across borders and oceans, was only possible thanks to the humble metal box and the infrastructure constructed to handle it anywhere. Essentially, this translated into allowing overseas blue-collar workers in the manufacturing segment to get remotely employed by foreign companies, redistributing wealth and labor allocation around the world and turning out to be a win-win. Arguably, containerized global logistics turned out to be the second most important invention in the history of humanity.

Second, the telegraph. Before the telegraph, private and commercial communication was essentially just a segment inside the bigger transportation market: you had to have someone to physically carry your mail, which still took rather a long time when you were trying to communicate across the continent. However, the introduction of the telegraph allowed these two industries to diverge, making communications a top-level market in its own right. Fast forward one and a half centuries, and we have the web, Steam, Google Workspace, AWS and so on. Among the infinite amount of good stuff brought to the world by the Internet, this development translated into allowing overseas white-collar workers to get remotely employed by foreign companies, which also turned out to be a win-win. And I might be a bit myopic here, but I think that in terms of all the gains already realized as well as the future gains, the Internet is definitely the most important invention in the history of humanity.

Now, the interesting question is: could we use the biggest invention in the history of humanity to optimize the second-biggest invention in the history of humanity? If you look at the list of successes of the modern tech industry, you may immediately notice that a substantial portion of the biggest tech companies — Amazon, Uber, Google, AirBnB — have made their name and fortune by establishing Internet marketplaces where vendors can find customers in as frictionless a manner as possible. So if we wanted to utilize the strengths of the Internet to improve upon or establish a new marketplace in the most impactful way, what would we do? I think that the answer should be obvious by now: we should allow overseas blue-collar workers in the transportation segment to get remotely employed by foreign companies. Not only can a manufacturer use foreign labor to build its products on foreign soil, but it can also use foreign labor to transport its products on domestic soil. Trucks, warehouses, last-mile delivery, portal cranes — everything that involves a vehicle can be operated remotely, bringing about a better redistribution of wealth around the world.

We, Phantom Auto, are more than a scrawny startup trying to find a niche market or to raise another investment round just to stay in the game. We are more than yet another fashionable “Uber for X”.
We are the agent of globalization.