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Who thinks that they can subdue Leviathan? Strength resides in its neck; dismay goes before it. It is without fear. It looks down on all who are haughty; it is king over all who are proud. These words inspired PJ Wehry to create Chasing Leviathan. Chasing Leviathan was born out of two ideals: that truth is worth pursuing but will never be subjugated, and the discipline of listening is one of the most important habits anyone can develop. Every episode is a dialogue, a journey into the depths of a meaningful question explored through the lens of personal experience or professional expertise.
PJ (00:00.935)
Hello and welcome to Chasing the Viathan. I'm your host, PJ Weary, and I'm here today with Dr. Philip Stern, Associate Professor of History at Duke, and we're talking about his book, Empire Incorporated, The Corporations That Built British Colonialism. Really excited about this topic. Dr. Stern, wonderful to have you on today.
Philip Stern (00:20.054)
Thanks, PJ. It's really great to be here. Really appreciate you having me.
PJ (00:23.903)
So let's start off with, you know, just as a first question, why this book? Why do we need a history of the British Empire from the corporation's standpoint?
Philip Stern (00:36.814)
Well, I can tell you, I mean, that's a good question. So why do we need it? I'll tell you a little bit about where I'm coming from, why I wrote it, and then maybe I can give you a few clues as to why I think we need it. So I wrote a book about a dozen years, 10, 12 years ago, I published a book called The Company State, which was a history of the British Empire in India, is a work that looked at the early history of the East India Company, which historians had long taken to be
story about how a commercial company had suddenly, sometimes accidentally turned into an empire in India in the middle of the 18th century. This story didn't quite sit well with me. It didn't make a lot of sense. As I looked back into it, the story I ended up writing in that book was a story about how actually by its nature as a corporation and by its nature as a kind of early modern trading enterprise, East India Company was founded in 1600.
really expanded as a territorial empire in the late 18th century, so 150 some odd years later. What I argued in that book and looked at were the ways in which the company, by its nature as a corporation and its nature as a transnational commercial entity in an early modern world, was by its nature political in a form of governance. This company in the 17th century minted coins, it flew flags, it built forts, it maintained an army.
But most importantly, it governed over people, made laws, even governed over whether they lived or died and these sorts of things. And so this was, I started that book, I did that book as a historian of the British Empire and India, not as historian corporations, but that kind of converted me in some way. I got kind of really interested. And then I've said this to people before, after I finished that book, I started looking to see where those ideas would go. And I started to have a...
a kind of existential crisis because I just saw corporate states everywhere. These ideas, I couldn't miss them. It was like when you learn a new word and then you can't stop seeing it everywhere. But what was interesting about it as I got more into it was I also kind of challenged myself because I'd written a book about the company state. This concept has been taken up by other scholars as well. But it turned out that not all the companies I was seeing looked like company states. The East Indies company was both...
Philip Stern (02:58.474)
typical in a larger ecology of hundreds and hundreds and hundreds of these companies over time, but it also was different. There were companies of all different shapes and sizes. Many failed, many imploded, many were just scams from the outset. There was just a wide variety of this phenomenon that seemed to really be fueling colonial expansion. I wanted to look at that.
and sort of explore that across a much longer period of time than that book had covered about 80 to 100 years. This one covers about 400 and much more across the globe looking at this phenomenon in a variety of different ways. So that's why I need the book. Why do you need the book or why does someone else need the book? I mean, I would give a couple of answers to that question. One is that I wrote this book because I am very interested as a scholar in thinking about the ways we naturalize certain assumptions about how the world works.
and looking at whether those assumptions are true and whether we want to, how we might see, say, past that, past those assumptions by using the past to understand the present. And in this case, it's about looking at the ways in which bodies outside the state, what we might think of as private power, though I think they often thought of themselves as very public institutions, really do exercise forms of governance. Our
are forms of political community, are forms of government, and in many cases, forms of sovereignty. Except in the modern world, we tend to think that's only states, nations, countries that do that kind of work. And so by looking to the past, all of these things where maybe we can see clearly, maybe it's something we look to the present and are able to maybe understand a little better how various forms of institutions have control and authority and jurisdiction over our lives. And we give that kind of authority to them.
And so if we kind of break down our assumptions that companies do business and trade, commerce, and states do governance and politics, and see that they're really intertwined and overlapping, then it really helps us to see how power works much more clearly, I suppose. I'd say more inside baseball, when it comes to the history of the British Empire, what I was trying to do with this, and European empires more generally, what I was trying to do
Philip Stern (05:22.538)
kind of unseat some of the assumptions historians tend to make about the narratives, the patterns that history follows. They tend to divide that history into kind of say, often we hear about a first and second British Empire, one that like in the 17th and 18th centuries it focused on America. And then after the American Revolution, sort of shifted East, famous historian in the mid 20th century called it the swing to the East. It became like by the 19th and 20th centuries as sort of Asian and African empire. But in fact,
transition is not nearly as abrupt and it's not nearly as complete as one might expect. I was particularly interested in this book in upsetting distinctions in the literature about empires that distinguishes between what you might call formal and informal empires. For years, we've had this idea that there were two kinds of empires going on. One that was formal, that is to say, boots on the ground, painted red on the map, forms a colonial government, and then kind of informal empire.
empires of influence, backed by financial power, maybe with the threat of violence, but really operating through other kinds of institutions. What I saw was a much more pockmarked and hybrid kind of entity, places like in Latin America, where the British Empire was said to have only informal influence. You saw actual real forms of governance. They were small. It was localized. Maybe it wasn't territory in the shape you might imagine. It might be over the corridor of a railway.
leading from one coast to another. It might be on a mahogany plantation or something like that. But this was actually real power that operated on real lives. What I like to say is that, informal empire didn't necessarily feel informal to the people who were subject to it, right? And there's other things I'm sort of interested in thinking about, but the bottom line is that by shifting the gaze in the book, I kind of call it like, think of it like a minor character narrative. If you take a, like,
Rosencrantz and Guildenstern or Grendel or Wicked, I think might be the one that's most popular to those people where you take a minor character in a normal narrative, put them at the center of the story and you show what the story looks like from their perspective. And it changes how you feel about the story. And in this case, it creates a much more continuous if fragmented kind of story, because it's about all these different institutions at war with each other, in conflict with each other. And that's probably the final, the last thing.
Philip Stern (07:49.922)
that I would say in my little extended monologue, I'm sorry for going on for so long, which is that I think that one of the things I was tracing was how the British Empire was built in many respects, it were with itself, if you can think about it that way. And that story is not meant to minimize or dismiss violence against other Europeans, particularly against indigenous peoples, it's actually to show how the internecine or the internal violence permitted, enabled,
was paved the way for those forms of dispossession and violence because it naturalized conflict. The colonial American period, for example, a lot of listeners may be familiar with that, there really wasn't a quote unquote British colony that didn't have some major conflict, including violent conflict with its neighbor over its borders and boundaries in a variety of ways. That had to do a lot with the fact that these forms of colonies were not just emanating from the center out, but were being constructed by these different institutional forms locally.
But anyway, hopefully that persuades you or persuades people that one needs the book. But I think it's really all on the theme of this question of exactly, how do we think about private, the blur lies between private and public power, private and public sovereignty.
PJ (08:51.261)
Ha ha!
PJ (09:05.231)
Well, and I so I had Dr. Meg Lea on to talk about Carolingian medicine and religion, which is pretty esoteric. Most people would think. But we one of the things we talked about is how in history, people want the big narrative because it's hard to you know, that that's just how most people think about history.
outside of the history department. It's like, well, there's like Waterloo, and then there's like, you know, even as you talk about that shift, that's how we first start understanding things, right? We don't think about all the fragmentation because it takes work to get into the details. But the value of the details that you're talking about is that that's where we start to break apart those assumptions. So for instance, one of the things that came up is she focused a lot on the transmission of medicine through Carolingian Europe.
And so one of the things that really struck me is, you talked about naturalizing assumptions. And what's interesting is the layers of assumptions. And so, you know, I remember a time before a personal computer, like I remember getting my first personal computer. I remember social media. And you know, that's something we talk about because it's within our memory. But the interesting thing about history, and even like her time period, is she was talking about a time.
before the printing press. And we don't even think about how much of our thoughts on information are based on, like, I was like, sitting there thinking about copying by hand, right? And like, even it's like, you know, you can get so caught up in like the recent developments, you can miss the power structures or the knowledge structures in like things that have been going on for centuries. And so anyways, I...
I really, and what that does is, if we don't break apart those naturalized assumptions, then we become subject to these power structures that we're not even aware are there, right? Like as you were talking about these institutions. That's a long-winded way to, but I, when we talk about big questions, I think sometimes I feel, maybe this isn't right, but I do feel this need to defend history. Why do I include history in this? And like, people are like,
PJ (11:23.727)
Well, who cares about corporations and British? And it's like, no, you don't understand. This is all our story, right? We're all weaving this together and these assumptions are built into it. One of the things that just immediately stuck out to me is you said transnational versus multinational because what I wanted to ask you about was multinational corporations. What's the difference and what is that transition from transnational to multinational?
Philip Stern (11:49.834)
Oh, yeah, that's a good question. I mean, you know, I think some people tend to use the word concept interchangeably. And sometimes we think about them kind of analytically differently. I mean, as far as I'm concerned, I'm not sure that there is actually a smooth transition from companies that, you know, exist in multiple places at once and ones that cross borders with great frequency. So I think, you know, many multinationals are in fact, transnational in that, in that respect, you know, and so I think, but I think that the bigger, that's a good question. I mean, I think I think the bigger point you're kind of driving at,
is, and I really appreciate you having me, but also historians in to talk because I really do think for a couple of reasons that's really important. I like to say, I mean, I wrote this book about the history of the British Empire, I really do hope people who could care less about the history of the British Empire will see something important to read and think about in this book. And for no other reason than many of the foundations that are laid in this book, or not laid in this book, but laid in the story the books tells.
still with us today, not just the kind of international order that's created by colonialism and decolonization, but even many of the companies in the book still exist in some form or another, either literally, you know, companies that still endure from that period, maybe some we don't even associate with that colonial past, and others that kind of exist buried in the DNA of modern companies and corporations in a variety.
a variety of ways. So that history, you know, what I say in the book is, you know, I think it's really important that we think about history as genealogy, not analogy, right? So we don't just dig into the past to look for comparisons, but we actually can see how things develop over time. And like genealogy is like a family tree, you might be genetically related to your ancestors, but you're also different and you've mixed in a variety of different ways with other influences, both, you know, nature and nurture. And so context matters. But
PJ (13:29.061)
Mmm.
Philip Stern (13:45.438)
you can see in that past the germs of the story we have in the present. Even more importantly though than that, I think, and I talk about this in the book as well, that looking into the past, it's like it's going to another country. It literally is a global story, so we are going to another country, but it's like looking in a different place and time, as you just sort of said, so that we get distant from ourselves so we can kind of maybe see more clearly the things that we take for granted and the assumptions.
that this book tries to say is, I think a lot of histories of the corporation try to definitively say, well, I'll look at the past or I'll look at the present. I'll tell you a corporation is X or a corporation is Y, this is what we should do with it. My kind of conclusion was that what the past tells us is that there is this deep, long history going back to the 12th and 13th centuries in some respect, back to your Carolingians in some sense, that almost bake the paradox and the dilemmas of the corporation into its DNA.
into what it actually is. So looking to the past can help us realize that these are not modern phenomena, but that going back to its medieval origins, the corporation is a kind of legal concept. I mean, the very fact that the corporation comes not from a commercial legal tradition, but really comes from the medieval church and medieval empires as a way of organizing political communities. When you think about like corporations as a way of organizing the Catholic.
structures in the Catholic church, as well as urban corporations, cities. Many, many people listening will be living in towns and cities that are corporations and not ever really have thought about it, right? Or have gone to universities that are corporations and not have to have thought about it, or go to churches that are corporations and not have to have really thought about it. So you think about the fact that this is a model that stretches well beyond that. We instinctively colloquially think that you hear corporation, you think, Oh, business.
But it's actually a much broader phenomenon that's about just kind of figuring out and ordering the kinds of communities and associations that we live in and interact in our lives. And that helps us to kind of understand it. But what that also does is it leads, it helps us to see how it's very hard to get your arms around what the business corporation is because it's got these different elements in it. Right?
Philip Stern (16:09.798)
Is it a person? We talk a lot about corporate personhood in this country. Or is it a society? Is it a private body? We think of it kind of as a private entity, but also is it a public body with public responsibilities? As you try to negotiate, what is its responsibility? Is it to profit or to social good? These are the kinds of questions you have to go back in the past to kind of see where did this thing come from. If you want to have any arguments or answers about what it should be in the future. I think just to answer, well, the law says it is X.
is a very limited way, I think, of grappling with the problems of the world. It might be a good way of sort of arguing a lawsuit, but it's not a great way of sort of thinking about what you want the world to look like in a certain respect. I will say to be very clear, I try to steer away in the book from telling you what it should be like. I mean, I like people to draw their own conclusions in some way, but part of the book is about exposing the questions. And you'll find many companies in the book that will trouble you.
by for you trying to get a bead on exactly what you think they are. You go to it with a certain set of assumptions. Well, they must be in it for profit. And then you find out that the corporation is there for, say, missionary activities, or that it's actually by a bunch of people who had some bizarre philosophical experiments and were, in a sense, exercising that on Indigenous peoples halfway around the world, or how people were sort of...
I was a philanthropic experiment, but it was a philanthropic experiment that somehow intersected with the dispossession of indigenous territories. It helps you to see the complexities that go into something as world historical and transformative as something like empire. That helps you, I think, to think about something as world historical and transformative as modern capitalism or something like that as well.
PJ (18:02.607)
Yeah, and I love that you talk about cutting off assumptions, or I'm sorry, assertions, right? That you want people to create their own. And what I have found that's really fascinating as I have thought more about this question of what is the point of history, is that it's more about creating fertile ground to find solutions now. It's actually more creative.
than people realize. It's about not necessarily about drawing like equation type answers out, but about allowing us to be creative about the present and hopefully our future. So well said, thank you. I do want to, I would love to just press you a little bit about that movement from ecclesiastical law to what we now know as corporations.
Part of the reason is I'm still a little bit annoyed that when I moved into my new house, that I did not realize that it was unincorporated my town. So I missed it by half a mile, and so I have to pay for a library card. And I'm not gonna lie, it still annoys me a little bit. So I would love to have this explained to me, like why I have to pay for a library card because I'm unincorporated rather incorporated.
Philip Stern (19:27.902)
If only I had known to be able to include that in the book, that would have been very helpful. I feel your pain. But I just, not to interrupt you, but I take the point. It affects us, these kinds of questions affect us in such local and global and substantive library. It digs deep into sort of very everyday.
PJ (19:31.975)
That's right.
Philip Stern (19:51.626)
Life, it's interesting when you say that, because I think about something else, which is when I talk to my students about these kinds of questions, and they say, well, what does it matter? Government is government, right? And I'm like, well, where do you find government? Where do you find power, right? You find it in all of the different ways in which it operates on your life, including in some sense, your library card, right? I mean, for many people actually, I mean, historians like to write, you talk about big narratives.
And we like to write about diplomacy. We like to write about war. We like to write about high level politics. But for most people, it actually operates at these very day-to-day levels about like, how do you get a library book? How do you send a letter through the mail? Like, how do you, things we do on a day-to-day basis. And that's where we look. And then you look at those and you say, in some places we see
that's done by something we might think of as a public entity like a government agency. In a lot of places, you see it being run by businesses, by private entities, and those have different representative politics. They have different structures and they have different implications about how much money they cost and where that money comes from. If you live in an unincorporated county or an incorporated town, how you're represented in politics makes a difference and how that operates. Anyway, I didn't mean to interrupt you.
But in many respects, it seems like a small thing. I don't minimize your anger and frustration. I totally get it. But, I'm joking, but it's amazing how these, and you see that, I mean, I've seen this in the book, this can, so when I talk about corporations, for example, I got a lot about the East India Company. I can't get away from the East India Company in some respects. It's so big and outsized, and not only for scholars,
PJ (21:24.623)
No, no!
Philip Stern (21:46.294)
But actually for the people in my book, the East India Company, even after it ceases to be a government of colonial, I mean, it's been fueled so much of my scholarly interest is this bizarre idea that a company essentially created such a massive and transformative violent empire for hundreds of years, right? But what's also interesting, and it's the other sense in my book that I use the term empire incorporated, in one sense it's about a bunch of corporations.
that sort of fuel empire in a way you hadn't thought about, but it's also about how the state over time incorporates and absorbs those companies into its empire. So in 1858, British India ceases to be a company empire and becomes the crown empire. And I talk a little about that in the book. But even after that happens and everybody's supposed to have said, well, that was a terrible idea. Why did we ever let a company be an empire? And that's an important point, by the way, as a parenthetical, a lot of the opposition to companies is not an opposition to colonialism. It's essentially...
an argument over how to do colonial, you know, what's the best effective way to do colonialism doesn't exactly exonerate the opponents of the companies from their, their complicity and culpability. But if you, but, but for the next 50 to 80 years, it was striking to me as I was writing this book, how many people came back, including famous philosophers like John Stuart Mill, who not surprisingly had in the sense because he had also been an East India Company administrator early in his career, wrote eloquently and forcefully about how
actually, we lost something. We had nothing to do with me, but how the empire had lost something by losing this kind of company form. So the model just keeps coming back and back again. But say sort of with that, back to your library card example, there's all these profound examples, and they're very important. The East India Company, which rules over the largest portion
Philip Stern (23:41.378)
The Royal African Company was responsible for transforming the British Empire into a slave trading operation. Companies that are deeply implicated and in fact drive the scramble for African colonization in the late 19th century. But there's also this other side to the story of the corporation and empire, which is about how important the corporation was to producing civil society.
and making colonialism and settlement endure in a day-to-day life kind of way. So I talk a lot, for example, about, or not a lot, but I talk at various points in the book about various universities, like Yale University, which happens to actually be named after a former East India Company administrator who gave them, who donated a whole bunch of books to the university, and they took his name, and then he, I don't think, ever really delivered his donation in full.
There's also a lot of stories about people who don't pay their bills in this book, which is what corporations also sort of allow, or about, as you said, you used to mention religious institutions, but also learned societies, and towns and cities that is through local government. These also need corporations to manage land, to manage governance.
In many respects, I make the argument this is the formative way in which, especially in New England, but in general in North America, the North American colonies expanded themselves was by reproducing joint stock towns as they moved westward and westward, including one very bizarre story which I'm quite obsessed with and I think will be developing into a much larger project about a company that out of Connecticut...
that attempts to settle in the Wyoming Valley in Pennsylvania near Coeur d'Escranton in Wiltz Bari, even though there was another English colony there, Pennsylvania, and especially knowing that there were, of course, overlapping Indigenous peoples and nations there, including the Iroquois.
Philip Stern (26:05.922)
The company form reproduces these various ways of organizing life, everything from library cards to war making. That's what's so fascinating about the whole enterprise, to me at least.
PJ (26:19.631)
Yeah, and I wanted to ask specifically, and maybe I misunderstood, you mentioned that the idea of the corporation comes out of the church. Is that because, was it something that came out of ecclesiastical law, that split in medieval? I understand this is a little bit before the book, but that, I'm sure that gets us into some of the questions of things like IPOs, municipal bonds, corporate finance, is buried in this structure. Did that come out of, I didn't realize that,
Did it come out of the ecclesiastical court? Or ecclesiastical laws?
Philip Stern (26:51.886)
So it's a premise of the book. I think I mentioned very briefly, I wish I had more space and honestly, more words allowed to me in the book to get into all these things more deeply. But yeah, so the legal idea of the corporation as a body of individuals or perhaps even one individual who can be made by law into a separate but related entity that can act in law, right?
sue and be sued or hold debts, hold property in the name of the corporation rather than the name of the individual or individuals that make up the corporation. That is a legal concept that's developed in the medieval period to grapple with two, it kind of simultaneously interrelated two places that were presenting legal governance quandaries.
Philip Stern (27:51.142)
abbots over local church governance and the nature of imperial authority in something like the Holy Roman Empire over local governance, particularly cities and urban spaces. Kind of quasi related to that is its development of concepts in say the Italian city states as well in the late medieval and early modern period. My point is that all of this stuff you're talking about kind of comes in when you start to start to fuse in. It's very much related to commercial life.
the urban corporations of medieval Europe were primarily organized in a way to self-govern, but what were the people there, but for like merchants, self-organized. So then corporate form then begins to inform things like guilds and guild structures and other, and then eventually by the time you get to the 16th and 17th centuries, it starts to be applied to mercantile companies.
variety of forms. And in my book, the one I'm looking at most particularly is the joint stock company, which is kind of a latecomer to using this corporate form. And that a joint stock company being of course, a kind of company that unlike a guild, where each individual or partnership of traders trades on their own accord, but under a set of common rules and regulations and privileges, a joint stock company is a single body that in which everybody through some form of shareholding
It was very varied at this point, right? It didn't look like it does today. Shares could come in various forms, but through some form of shareholding, essentially participated in a common entity and gave over the governance to a common government, which we now think of as a board of directors or a CEO or something like that. So I don't know if that makes sense or seems clear, but I guess from my perspective, by fusing the joint stock.
company model, with the corporation model, you're actually not just creating a commercial technology that can raise capital or raise great amounts of debt, be infinitely more liquid, be much more risk tolerant. All of these things we tend to talk about, we talk about the birth of modern capitalism, but it's also a form of governance. It's an argument for how you govern by giving over to a common government rather than a bunch of individual traders trading on their own accord.
Philip Stern (30:11.838)
if you'll sort of indulge me, the medieval genealogy, the medieval legacy there becomes fascinating. And this is kind of what I mean when I say in the book that the corporation is sort of from its origins a paradox, right? Because and I will admit to your listeners, you gave me permission to go geeky and deep. So I'm going to go with it. But the argument in the book
PJ (30:30.419)
Oh yeah, please, please.
Philip Stern (30:39.446)
is that the premise in the argument in the book is that out of this medieval tradition comes the philosophical tradition of corporations, a legal and philosophical principle, come two traditions that lead into modern political theory. One is the idea of pluralism, right? And it's the one that's most obviously associated with the corporation. For example, you associate this, most particularly with a
with a seventh century political theorist, Protestant political theorist Johannes Althussius, but it makes its way into the modern period into the early 20th century, into a group of English philosophers who tend to be known collectively as pluralists, the English pluralists. The idea here is that corporate theory allows us to understand society as made up of many different overlapping but independent.
political communities, right? So it's a kind of challenge to the idea of a singular state that we all belong to different communities at once and they all have different forms of authority, right? You might belong to, you might have, be a citizen of a nation, but you're also a member of a church, a member of a union, a member of a club or a variety of different ways in which these, and particularly also cities and other levels of government. So a kind of.
other version of our sort of offshoot, that kind of thing, an offshoot of this kind of pluralist theory is what we think of as federalism. The idea that there's government at every different level. And it's not, you know, we tend to, I think, casually, if you don't study this or you're not a lawyer, you don't think, well, cities are subordinate to states and states are subordinate to the federal government. But if you actually look at how this works, right, companies that can incorporate in one
so that they can evade or get different taxes than another jurisdiction. Sometimes it's international, sometimes it's even among states. Cities that insist on the autonomy of their laws to reject federal or state law. Conflicts of laws. You've seen this in a variety of different forms of law in federal law, like states and localities that in fact have laws that contradict.
Philip Stern (33:01.87)
federal law or that have laws that are different than other states. We have all of these questions and it's never always clear which one precedes the other. The corporation also gives you a completely different stream towards modernity. That is that it's corporate theory and the idea of the fictional person, a lot of people made into a singular entity that is abstract and eternal.
uh, is, um, you has succession. That is the major theory that allows for us to think about the modern state and modern state sovereignty, singular sovereignty. And the most iconic example of this, if anybody listening is familiar with the, the front page of the frontispiece to Thomas Hobbes' Leviathan, it is quite literally the sovereign made up of the bodies of all the people of the polity, literally the body politic, right? And so.
So corporate theory, and other scholars have looked at this and seen how corporate theory underlies someone like Thomas Hobbes' absolutist theory of governance. So you can see that if this makes sense, I don't know if it makes sense, corporate theory gives you both an idea of civil society is made up of lots of different centers, and civil society is made up of one hierarchical center where everything else is subordinate to it. And so it's, and then.
I think when you think about that, it helps you to see the paradox at the heart of the corporation, the business, the modern business corporation. Is it subject to national law? Is it a citizen of a national state? Or is it its own form of sovereignty or its own form of independent jurisdiction in relation to those states? You asked about transnational multinational corporates. What happens when they exceed the boundaries of those states? We colloquially will think of something as an American company or a British company, right?
But that may be where its articles of incorporation are, but is it that in fact where its offices are? Is that where it's paying taxes? And is that, and how do you hold it responsible when one of those entities deems it to have committed a crime or to have exceeded its mandate in some way, right? So you get these kind of almost paradox at the core of the theory. And it's not just that that's interesting in and of itself, but it really helps you to sort of, I think, see what I was going back to what I said earlier.
Philip Stern (35:27.126)
how they pass, can it help you to really take a step back and think, oh, I get it. That's why I felt this is why I don't quite understand what I'm supposed to think about the power of these corporations. Because on the one hand, I think of them as subordinate to, we think of nations as sort of having laws that govern over these things, but somehow they evade them all the time and push back. Or why is legislation in the EU affecting how Apple or...
Google does its business in the US, how are these things sort of interrelated and transformed over time? And so this helps you, I think, to understand why this is, you know, what the implications of that happening are, if that makes sense.
PJ (36:15.555)
Yeah, the average person I think everything works so smoothly that they don't really think about it But like they had to write out and figure out things like even within the states in the United States Licensing, you know, like marriage licenses passing back and forth drivers licenses passing back and forth and Every once in a while some kind of odd thing will pop up where it's like wait This marriage license works over here. This marriage license doesn't work over here or drivers license drivers license
And extradition of course across countries across states that had to be smoothed out or doesn't smooth out. I mean that's kind of You know what you mentioned there a strange example go ahead
Philip Stern (36:57.752)
Well, uh.
I was going to say it just parenthetically, and I think you can trace a lot of that back, and other people have done more work on this than I have in the United States history, trace that back to the fact that many of these states, especially the original ones, originated as colonies that identified themselves as corporations or corporate-like entities, right, in that sense.
PJ (37:17.807)
Yeah, yeah, yeah. Well, so, and here's one, and I don't know if this would be useful or not. To me, it immediately strikes me, when I first started podcasting, I tried to use a different camera, and they, independent filmmakers, use these Canon cameras. I don't know if you know where I'm going with this. They have a limit. They're great for shooting video. It's gorgeous. You can show it on a big screen, like a...
in the theater and it works fine. They have a limit of 29 minutes and 59 seconds and they will turn off. And the first time it happened, I couldn't figure out what was going on because why, I was like, that's very specific, it always turns off at that time. It has nothing to do with the capabilities of the camera. They have an automatic built-in switch because in the EU, it gets taxed as a different bracket for a video camera than as a.
still camera, even though it takes, I was like, why does that affect me? But it's because of this multinational transnational corporation operating in different, you know, and then there's all these weird workarounds that are legal or not legal. And so, you know, this is something that, these are the underlying assumptions that govern our lives. The one thing I did kind of wanted to ask
One thing that keeps popping up as you're talking is this idea of kind of responsibility and who's responsible for what and how are they responsible. And even as you talk about joint stock operations or joint stock corporations, there seems to be even this idea of diffusing responsibility, right? Like not any one person's responsible. You have like, it's like concentrating and diffusing. You know, there's that paradoxical nature. How did that affect the structure of colonialism?
throughout the British Empire.
Philip Stern (39:13.558)
Yeah, I mean, at least in the way that I tell the story in this book, from this perspective, it's fundamental, right? In a variety of ways. I'll just name a few, because I could talk about this for the whole hour, really. One is, you know, one is I call it in the book, the phrase I use in the book is what I call portfolio colonialism, right? The idea that you have
joint stock corporations that are fueling colonialism at any given point in time means that individuals can kind of partake, they can be partake of colonialism. They can be responsible for funding and on some very basic level governing colonialism in all these different parts of the world just simply by owning shares in all these different companies at once. We don't think about, you know, a lot of people, very passive shareholders these days and I didn't think there were a lot of passive shareholders at the time as well.
That's a really important point, which is also to realize that many people were complicit in this colonial enterprise because they bought stocks for many different reasons. I think one of the mistakes we make is to read back into the past the idea that people say they own shares primarily in a cost-benefit analysis for making profit. Shareholding was often in these companies, rather social enterprise. You did it because your friends were doing it, you did it for political capital, you did it because your allies were doing it.
It might have been a familial enterprise, you bought stocks because your family was involved in some way. It might have been an ideological thing, right? Or it may have been a religious motivation. You contributed because it was something you saw as a kind of religious mission because of what these colonial enterprises were doing. So people bought stocks for various reasons, but it created this much greater foundation, much more deeply implicated in society, both financially and politically for these colonial
enterprises, right? The second answer I give to that is that the legal consequences of diffusing, and I don't know, I wouldn't argue that it's a conscious plan, something that evolves and develops over time is a legal idea. The legal consequences of diffusing colonial sovereignty as a form of property of shareholding company participants, as well as companies themselves, is profound.
Philip Stern (41:38.422)
Because one of the mistakes, so many people sort of come into this and what was sort of one of the underlying, I wouldn't say even arguments in the book, but maybe just one of these things I, you know, one of these things I just kind of keep shouting in the book in some way, right, which is that, you know, we tend to think, you tend to, and you know, I can get this for students, you hear this for people all the time, you know, many of the companies until you get to the 19th century, the way you largely made a corporation was by getting a charter from the Crown or eventually from Parliament, right.
And there's this kind of assumption we make that those charters, that the crown kind of had absolute authority. It gave the charter and it could take the charter away. It made you and it could break you. But that's actually not how it worked legally. Often giving out a charter was much easier than taking it back. There were rather convoluted legal processes you had to go through, the crown had to go through to almost basically sue the corporation to get the charter back, to cancel the charter.
the Charter. Sometimes what the Crown did, actually more often than not, when government had a desire to dilute or undermine the power of corporation, it couldn't take the Charter away so much as it would just create new charters and just give them to other people that would overlap with those charters, even though those charters were by definition exclusive monopolies. Right? And remember those border disputes I mentioned before, that's how you get...
I mean, so just as an aside, I'll get back to your point about the shareholders in a second, but as an aside, that example I mentioned before of the Connecticut Company that tries to create a colony inside of Pennsylvania, the legal argument, a foundation for that, is that in the Connecticut Charter, the Western boundary of Connecticut was theoretically what they called the South Seas, the Pacific, which was a very vague geographical concept at the time. But the Northern boundary of Pennsylvania.
overlapped with the Western boundary in law, if you were to draw it out, and actually had some students want to do this on a digital, you know, through digital mapping. And there was basically this Venn diagram where there were these overlapping charters, even though both charters were supposed to be exclusive monopoly, right? So it creates this conflict that has no resolution, no obvious legal resolution. It's something you litigate, you argue, you say in the case of this Susquehanna company that I'm talking about in Pennsylvania,
Philip Stern (44:05.046)
They're actually armed conflicts between Pennsylvanians and these Connecticut settlers at several times so it's worked out in a variety of different ways, but the implications of this being both the property of a body like the corporation and the body of shareholders means that there are many times that when Crown or Parliament or some British court or British government agency was trying to rein in these charters or
or take them back where the companies would make the legal argument rather effectively actually at times that to do so was not only to violate the sovereignty of this kind of entity, this colony, but actually to violate the property rights of all of the individual shareholders that had this tiny little bit of slice of share in this sovereign entity as well as all of its actual material. There were literal, there were actually was what they called dead stock. There was actually things they owned, ships.
forts, infrastructure, right? In my book, one of the most fascinating things, I wish, I mean, to be honest, you know, you know, it's just, keep this between me and you, no one's listening, right? I would, yeah, no, I mean, I treat it in the book, but I really wish I had, you know, you finish a book and there's so many things you just wish you'd have more time to talk about, so you come on podcasts and you just make people listen to you talk about it, but at the,
PJ (45:29.427)
Great.
Philip Stern (45:32.134)
One of the things I traced in this book that was incredibly fascinating to me and actually something I didn't know as much about when I started the book is when I finished the book, which was a wonderful process, was how hard it was when even these companies wanted willingly to be taken over by the state. Because as these companies, the East India Company is taken over by the state or these late 19th century African companies are taken over by the state, they're not just taken over. They have to actually be bought out.
property rights in their investments. But what is, I mean, put it abstractly, and actually there were some theorists that put it almost literally this way, what is the price of sovereignty? So you can put a value on a ship, you can put a value even on a Ford, but how did you put a value on the right of governance? And so there was never any way to settle, like what was this company worth? And the debates were really telling. So we have this idea that
that, well, why can't government just go in and take over the company? Well, because there are these laws that the political culture and the law regard as inviolable and one of them is a sort of private property. So if you want to think of that, if you go back to our original, where we started, you want to ask, well, because companies doing this, why can't the government just go stop it?
Well, you think a little bit about exactly how those companies can use the law to protect themselves and the rights of their shareholders. Now think about that company is not just making a product or something like that, but that company is actually ruling over people's halfway around the world. You really start to see how profound using this structure to create a kind of colonial environment.
is how profoundly powerful it becomes. Now don't get me wrong, there were many times where the government and state were complicit in this, encouraging of it, or they wanted to take it over just so they could do it themselves. It wasn't simply that the state comes in as a kind of white hat regulator that's trying to prevent this kind of corruption. That's not the story I wanna tell, this is not the story that, it's not how it happens. This is a debate where
Philip Stern (47:54.338)
for many people. There are critics of empire through this period. We shouldn't mistake that. One thing, you'll go back to why do we look at history? One thing that makes me crazy about when people talk about history is when they talk about history is if everybody in the past all had the same opinion about stuff as if they don't live in the world today where you get three people in a room and you get four opinions about things. You can't look at modern politics and look in the past and assume, oh, well, the British thought that or this was the economic theory.
or it was an absolute estate, at no point in time was there not vicious debate over how the world should look, right? That's the beauty of being an intellectual historian was part of what I think of myself as, right? Anyway, so this is the, this is, so there are, but the majority of these conversations, the majority of these debates are about how to sustain empire, and it's a debate over the proper way to do it. So everybody's kind of implicated in that.
in some ways. But the fact that one version of this is saying it's shareholders who are doing it, it's boards of directors who are doing it. This is what John Stuart Mill essentially argues that these people who do this singularly are far more expert than legislators whose constituents are some small town in Northern England. What do they know about India? This company is the one that has the expertise.
You know, I mean, there's a lot of problems with that argument, but if you actually think about what the argument is like, and then you listen to say, testimony about, you know, from Silicon Valley companies in front of Congress, you hear very similar themes. I'm not comparing the two. I really want to be very careful. That's the analogy part that I think is problematic. This is not the same thing. But the questions are similar. About where the boundaries of
power, or the boundaries of autonomy and power are, if that makes sense. There's more I could say about the shareholding stuff, but it really goes very deep into the whole thing. It's the key, including also the other, the financial side. I talked just about the politics, but the financial side of there being a shareholder company, and I talk about this a lot in the book, is the capacity of these companies to go into massive amounts of debt. They essentially... The pledges of shares...
Philip Stern (50:17.618)
especially for companies that are territorial companies in a variety of ways, is the most bizarre structure. It's almost like a multi-level marketing scheme in some way, where you pledge money or your labor to a company for a piece of land halfway over in the world the company doesn't really own except on paper. The only way to actualize that colonial power is for you or people you pay for to go there.
fight off the indigenous peoples, claim the land, put down roots, and turn it into a productive territory and then sublease it or sell it to others and subdivide it and re-grant it and these sorts of things until eventually there's nothing there. I mean, kind of joking about it being kind of a pyramid scheme, but it does look a little like a pyramid. And so it really helps you to sort of understand.
the kind of feats of imagination and twists of law and finance that you needed to make something as really profound and transformative as empire happen, if that makes sense.
PJ (51:28.547)
Yeah, yeah, even as you're talking about this, you talk about the violence spilling over where you have indigenous peoples getting caught in border disputes between companies where it would be very different if you were just, I mean, as soon as you get more than two people negotiating, it's just gonna get crazier and crazier, right? I mean, and all I could think of the whole time is the way that this re, to me,
It changes the way I hear the common phrase, possession is nine-tenths of the law, where it's like you have people doing these protracted, long legal disputes, and meanwhile, the profit is given to the people who have boots on the ground, right, and the military power. And I'm really struck too by, you know, as you're talking about this, the difference between negotiation between one person and...
uh, the way that social inertia is created and the debate is widened by adding several hundred people to uh to a company and they all have a vested interest, right? All of a sudden we're not talking about like you can get two people in a room talking And if I can sit down with a mediator we can hash this out. It's like no you have to convince, you know You have to get the board convinced and you have to and what ends up happening is that stuff takes time which means there's just
and inertia to the sheer complexity of what's being created. Am I tracking with on that? Like, is that part of the story you're telling here?
Philip Stern (53:06.334)
Yeah, the only thing I'd add to that though is that inside a company as well as outside the company, there's not necessarily any guarantee people will agree on the best way to get to their interests. One of the big questions is always sort of like to talk about the company versus the state like we've been kind of talking here abstractly is to miss something that's true today as it was back then.
PJ (53:17.809)
Right?
Philip Stern (53:33.898)
Members of parliament are shareholders of companies. Members of companies are administrators in government. Right? I mean, it's not a one-to-one overlap. It is as untrue to suggest that the companies are in locked, pitched battle with the state at all times as it is to suggest. The other thing I'm pushing back on, which is that the companies are somehow some kind of outsourced or...
extension of the state, you know, kind of a plausible, only a plausible denibality. And that was actually an argument people made going back to the 16th century for these charters. All of these things are true at various times. Humphrey Gilbert is one of the early kind of colonial projectors of the 16th century, literally argues to Queen Elizabeth, you should give me a charter because if Spain comes to you and says, why are you encroaching on our territory, you can say, oh, it wasn't me, it was that guy. Right? And so, but.
But that's not the whole story. At various times, these entities overlap and these individuals overlap. And at various times, they absolutely detest one another. Now, there was one of the leading voices in the British Colonial Office in the early 19th century was very hostile to the idea of company colonialism and thought that one of the leading theorists of company colonialism.
who was a guy who was behind this enterprise of settling a colony in South Australia, was one of the odious individuals he had ever encountered his entire life. In many respects, actually was. It's not so simple. Another example is that if you look at the debates over the East India Company in the middle of the 18th century, after the East India Company acquires that sort of territorial power I mentioned at the beginning of this conversation,
in the 1750s and 1760s, there's massive debates in British Parliament and British public over what do you do about this? This seemed like a really transformative thing. Those debates were not like company people in Parliament versus non-company people in Parliament. There were actually lots of shareholders on both sides of the debate who were having the same debate in Parliament and in shareholder meetings. What we should we do, right? So it's not so easy as to identify what people's interests are.
Philip Stern (55:45.33)
in that respect. The other thing is someone who takes ideology, emotions, passions, irrational behavior really seriously in the past, if only because I am myself a very irrational person many, many times in my life. I like to be wary of trying to assume we can understand interest so clearly, because sometimes
Philip Stern (56:14.674)
are interests, but they're not necessarily always rational financial interests. You see this all the time. People vote based on things that have... Sometimes it has to do with their financial interests, sometimes it has to do with their religious commitments or philosophical commitments or political beliefs. You have to take all those motivations seriously to understand the full range of human experience that goes into these kinds of acts.
PJ (56:41.743)
Well, I want to be respectful of your time, but let me first off say what an enjoyable conversation it's been, and I just always really appreciate someone who is willing to complicate history in order to create more empathy and creativity for us today. So thank you, Dr. Stern. It's been awesome having you on today.
Philip Stern (57:00.982)
Thank you. That was the nicest thing anybody's ever said to me. I really appreciate it. Thank you. No, I'm serious. That is a great compliment to what you just described. I really hope I lived up to that description. But I really appreciate you having me. It was a really fun conversation as well for myself.