Money and Power Part 6

The Dematerialized Future.

*OR CENTURIES, THE CENTER OF GLOBAL ECONOMIC power has moved steadily westward from the citystates of Renaissance Italy through Spain and the J Netherlands the one grown rich on gold and silver, the other through trading in spices and stocks to the inventors and capitalists who fueled the Industrial Revolution in England. By the mid-1800s, the locus of wealth had begun to leap the ocean to the United States, where railroads waited to be built and vast natural resources turned into individual fortunes such as the world had never known. As the American market burgeoned, so did the American demand for durable goods, and no durable good was more fitted to the American ethic than the private automobile. Advertising exploited the multiplicity of choice and helped create brands such as CocaCola that ruled their market, and as the world shrunk, the world became the market. The intersection of ma.s.s communication with the rise of leisure time and a leisure cla.s.s turned the movie screen and the television into pots of gold for those who controlled the studios and the means of transmission. And then along came the computer and the Internet, and everything exploded yet again.

With the computer and an Internet navigation system, every home could be not just an entertainment center but a learning center, a trading center, and a communication hub, to boot. While profitable brick-and-mortar companies shrank in market value, often profitless dot.com companies soared to price/earnings ratios that could make the Dutch tulipmania of the seventeenth century seem almost sane, and yet the market roared on and on, a bull on a record run. The old rules seemed to have been broken. Wealth had dematerialized. Physical content meant almost nothing. Intellectual content meant almost everything. Information, it seemed, was everywhere. And the great trailing fortune that embodied the Information Age belonged to an $80-billion Seattle nerd named William Henry Gates III.

Like Henry Ford with his Model T, Bill Gates envisioned the ma.s.s appeal of the personal computer, but unlike Ford, he didn't want to build it. Gates's genius was never in hardware; instead, he provided the brains the software and operating systems that made the hardware hum. Like J.P. Morgan, Gates also saw himself as creating order out of disarray. MS-DOS and Windows weren't just operating systems and software products; they were meant to be industry standards because a standardized industry would benefit everyone-Bill Gates most particularly. Gates understood brand, too: The various iterations of his Windows software, all named by year, were introduced at press conferences that wrapped high-tech in the glitz of a Miss Universe pageant. Be there or be square, the press conferences seemed to be saying, but there was a subliminal message as well: Don't get in my way. Gates, in fact, had the ruthlessness of a John D. Rockefeller when it came to cutting down and co-opting his compet.i.tion, and just as the government had broken up Rockefeller's Standard Oil, so it sought to dismantle Gates's Microsoft Corporation.

One more way that Gates resembles so many of the moguls who came before him: He began the business that was to make him the world's richest man out of nothing more than a dominating idea borne on an iron will. Henry Ford empowered his workers and kept the unions at bay by creating the $5 a day wage. Bill Gates empowered his workers and kept them from fleeing to other software companies by sharing the wealth through stock options. He wasn't the first to try the strategy, but no one had ever shared the wealth quite like this. Before the century was out, Microsoft would create more than twenty thousand in-house millionaires, from code writers to secretaries. Gates and all the others who helped launch the Information Age also shared the wealth in one more critical way that would remake the world as surely as the Industrial Revolution had done: They provided the infrastructure that anyone, anywhere on earth could use. Nearly a thousand years earlier, G.o.dric had had to battle improbable odds simply to win the chance to raise himself out of abject poverty. Now, for the first time in human history, opportunity was universal.

Moguls, magnates, the people who create and master industries, the ones who integrate them and bring them to their fullest fruition such business meta-successes are always many different things to many different people. To some they are saints, promises that democratic capitalism nurtures a meritocracy of the naturally talented. Others laud the John D. Rockefellers for their generosity, even as they decry the ruthlessness that propels them to the top. To still others, moguls are evil incarnate, representatives of all that's wrong in a system that not only allows but sometimes seem to thrive on the economic disparity between top and bottom. Some of the biggest of the moguls have been all things at once: Henry Ford the first billionaire, Henry Ford the social innovator, Henry Ford the almost-president, Henry Ford the creator of the modern industrial order, Henry Ford the Fascist sympathizer and rabid antiunionist. The list of contradictions goes on and on. And so it is with Bill Gates.

No human has ever been so rich. Because Bill Gates is so heavily invested in his own company, his wealth at any given moment is tied intimately to the share price of Microsoft stock. That meant that in 1996, when the company's stock soared by 88 percent, Gates made nearly $11 billion on paper, or about $30 million a day. John D. Rockefeller was said to have earned roughly $2 a second at his prime: At his company's prime, Gates was earning at a pace nearly 175 times that roughly $347 a second, or enough every minute to buy a new Honda Accord. True to Gates's decree that Microsoft should always have enough cash in the bank to operate for a year without any revenues, his company at the time was carrying a balance of $8 billion. With his own money, Gates built a 40,000 square foot home sunk into a bluff overlooking Lake Was.h.i.+ngton, outside Seattle. The vaulted garage alone can hold 30 cars. Modern in the extreme, this house is also palatial in the extreme an El Escorial for the Information Age.

Rarely, too, has one human been quite so many conflicting things to quite so many people. Friends and colleagues like to talk in the language of the digerati about Gates's ability to "parallel process," his "unlimited bandwidth" and facility at "mult.i.tasking." They note that he works on two computers at once in his office at the sprawling Microsoft campus in Redmond, Was.h.i.+ngton: One computer sequences data coming in from the Internet, while the other handles the hundreds of daily e-mail messages through which Gates keeps in touch with his own employees and the larger world. His mind, they say, has many of the problem-solving capacities of the best computers: a knack for turning enormous input into finely crafted answers. At least in part, Gates goes along with the idea.

Gates told Walter Isaacson of Time magazine: I don't think there's anything unique about human intelligence. All the neurons in the brain that make up perceptions and emotions operate in a binary fas.h.i.+on. We can someday replicate that on a machine. Eventually we'll be able to sequence the human genome and replicate how nature did intelligence in a carbonbased system.... It's like reverse-engineering someone else's product in order to solve a challenge.

Even Gates's famously contentious style is a positive, according to Microsoft executive Steve Ballmer, a former Harvard cla.s.smate (he graduated, Gates didn't) whom Gates lured to the company in 1980 from Procter & Gamble: Conflict can be a good thing. The difference from P & G is striking. Politeness was at a premium there. Bill knows it's important to avoid that gentle civility that keeps you from getting to the heart of an issue quickly. He likes it when anyone, even a junior employee, challenges him, and you know he respects you when he starts shouting back.

As for Gates's softer, less binary side, supporters point to his philanthropy and to his friends.h.i.+p with the very low-tech billionaire, Warren Buffett, whom Gates superseded as America's richest citizen. Like Andrew Carnegie, Gates has expressed a desire to spend much of the second half of his life giving away his money, a process already underway. Through a foundation run by Gates's father, Gates and his wife, Melinda, have donated billions of dollars, mostly for education, libraries, and public health. For the year 1999, grants from the Bill & Melinda Gates Foundation included nearly $950 million for vaccines against preventable diseases and an even $1 billion to fund the Gates Millennium Scholars program, to enhance minority access to higher education. Among the points of attraction between Gates and Buffett, who is 25 years his senior, is a fascination with games of all sorts, and a marathon-like capacity to pursue them. The first time America's two richest men got together with their wives at Buffett's San Francisco home, they ended up playing nine straight hours of bridge.

Where Bill Gates is concerned, though, such benign a.s.sessments never want for counterbalance. Gates and Microsoft spent most of the 1990s under almost constant legal a.s.sault: The ant.i.trust suit filed by the justice Department that led to Judge Thomas Penfield Jackson's order to break up the company was an outgrowth of a lengthy and inclusive investigation by the Federal Trade Commission. Next to the verbal and written a.s.saults on Gates, though, the legal one seems almost tepid.

Rob Glaser, a former Microsoft executive who left to run an Internet sound system company, RealAudio, has called his former boss "Darwinian. He doesn't look for win-win situations with others, but for ways to make others lose. Success is defined as flattening the compet.i.tion, not creating excellence." Thanks to Gates's contentious style, Glaser went on, the Microsoft "atmosphere was like a Machiavellian poker game where you'd hide things even if it would blindside people you were supposed to be working with."

Others like Silicon Valley lawyer Gary Reback maintain that Microsoft uses "its existing monopoly to r.e.t.a.r.d introduction of new technology." The charge is a corollary of another longtime beef especially common among the most cuttingedge high-tech companies and their proponents: that both Gates and his company are evolutionary, not revolutionary. The same complaint could be made about moguls generally, from Cosimo de' Medici to Henry Ford. Just as Cosimo didn't invent banking, so Ford didn't invent the gasoline-powered automobiles; rather, their fortunes came from doing the job better. But in the digital, everything-must-be-new era the charge has gathered resonance.

Gates's immediate rivals seem to take almost demonic glee in attacking the man, his products, and his company. Borland CEO Philippe Kahn once compared Microsoft to Germany under Adolph Hitler; another time, he likened Microsoft's Windows system to AIDS. Lotus founder Mitch Kapor looked around the landscape of the software industry and declared that Microsoft's dominance had left it "the kingdom of the dead." Oracle CEO Larry Ellison is probably the most antagonistic of Gates's many industry compet.i.tors. As the Justice Department was moving against Microsoft, Ellison told a May 1998 Harvard computer conference that the company's business practices were "patently illegal ... more blatant than anything [John D.] Rockefeller ever did" and he accused Gates of "lying" about Microsoft's record of innovation. For good measure, Oracle also hired a Was.h.i.+ngton detective agency, Investigative Group International, to dig up dirt on its rival, literally going through Microsoft's trash.

In cybers.p.a.ce, things only get worse. Half a year into the new millennium, you could use a Microsoft operating system and Microsoft Internet Navigator to find Web sites with names like Boycott Microsoft, Punch Bill Gates, the Microsoft Hate Page, Microsoft Boycott Campaign, IHateBillGates.com, and the Bill Gates Personal Wealth Clock, which tracks Gates's gross worth by the fractional second, based on the 141,159,990 million shares of Microsoft he owned as of 1995, adjusted for splits in 1996, 1998, and 1999. As of Friday, December 15, 2000, at 13:45:47 P.M. Eastern Standard Time, with the Microsoft share price sitting at $48.875, Bill Gates was worth $55.1936 billion, the clock noted, or $199,738 for every living American. In case anyone missed the larger point, the clock also included an old Irish saying directly beneath its calcula tions: "If you want to know what G.o.d thinks about money, just look at the people He gives it to."

The real Bill Gates is probably best described by a quote attributed to a compet.i.tor in the software business who also described himself as a friend of the Microsoft cofounder. Gates, this person said, is "one part Albert Einstein, one part John McEnroe, and one part General Patton" one part, that is, scientific genius, one part the temperamental genius c.u.m bad boy, and one part tactical genius. For good measure, this person might also have thrown in Thomas Edison, another genius but also an ultra-successful entrepreneur who knew how to turn technological innovation into sales.

Born to wealthy parents in Seattle where his father was a prominent attorney and his mother a childhood friend of Meg Greenfield, the longtime editorial-page editor of the Was.h.i.+ngton Post Gates attended the fas.h.i.+onable and academically rigorous Lakeside School. It was there that he and his friend Paul Allen first discovered computing, on a fossilized school terminal bought with the proceeds from a Mothers' Club cookie sale. By 1968, the two eighth graders had learned the BASIC computer language and produced their first programs. Soon, they were spending evenings debugging a computer for a Seattle company. By tenth grade, Gates was writing a program that handled cla.s.s scheduling for Lakeside. About the same time, he, Paul Allen, and a third friend, Kent Evans, secured jobs writing a payroll system for a local firm and a.n.a.lyzing and graphing traffic data for the City of Seattle. (Evans, probably Gates's best friend from those days, was killed in a mountain climbing accident before the three of them had left high school.) After graduating from Lakeside in 1973, Gates moved on to Harvard, while Allen went to work for Honeywell. Two years later, in January 1975, came the event enshrined in Microsoft mythology as the moment of conception. As the story goes, Allen, who had driven East to be near his computer pal, held up a copy of the new issue of Popular Electronics magazine and shouted at Gates, "It's about to begin!" What inspired Allen was a cover mockup of the MITS (for Micro Instrumentation and Telemetry Systems) Altair 8800, a kit computer that despite its primitive and often unworkable nature was to be the first personal computer. Gates and Allen immediately set out to write a BASIC language for the Altair, and on February 1 of that year, they sold it to MITS, their first customer. Thus it was that Bill Gates became Harvard's most famous dropout he and Allen set up shop in Albuquerque, New Mexico, where MITS was headquartered and Microsoft was launched. The conception turned into a very quick birth.

Micro-soft, as it was first spelled, ended 1975 with three employees and $16,005 in revenues, but Gates and Allen were well on their way to settling a fundamental question that was to make all the difference in the company's success: what part of the computing business were they going to be in. Allen, who would leave the company in the early 1980s after a bout with Hodgkin's disease and go on to become a major venture capitalist as well as a sports team owner and the founder of a rockand-roll museum, had favored a combination of software and hardware. Hardware, after all, was the business that nearly all the computing giants of the time were pursuing. Gates wanted to do software only, and luckily for Microsoft's eventual shareholders, he prevailed.

"When you have the microprocessor doubling in power every two years, in a sense you can think of computer power as almost free," Gates told a Playboy interviewer who asked about the rift. "So you ask, Why be in the business of making something that's almost free? What is the scarce resource? What is it that limits being able to get value out of that infinite computing power? Software. Another way to look at it is that I just understood a lot more about software than I did about hardware, so I was sticking to what I knew well and that turned out to be something important."

By 1980, Microsoft had shed the hyphen, moved to Was.h.i.+ngton state, and was a 40-person company earning about $7.5 million in revenues. The company would end 1981 with three times as many employees and more than double the revenue. What happened in between was IBM. The computer giant had come calling with a request: Would Microsoft be willing to develop languages and an operating system for IBM's first personal computer? On August 12, 1981, IBM introduced with great fanfare its Personal Computer. Far less noticed at the time was the 16-bit brain inside the PC Microsoft's Disk Operating System, or MS-DOS, for short or the fact that Gates had pressured the industry behemoth into giving Microsoft sole rights to license MS-DOS. For Bill Gates and Microsoft, the train had left the station.

"We wanted to make sure only we could license it," Gates has said. "We did the deal with them at a fairly low price, hoping that would help popularize it.... We knew that good IBM products are usually cloned, so it didn't take a rocket scientist to figure out that eventually we could license DOS to others. We knew that if we were ever going to make a lot of money on DOS, it was going to come from the compatible guys, not from IBM."

And make a lot of money, Microsoft certainly would. Given an enormous leg up by IBM's failure to take control of its own operating system, Gates and company by the mid-1980s had won the personal-computer operating systems war and were turning their attention toward domination of what's known as the "office suite": the combination of word processing, spreadsheet, and presentation. Each new conquest further engrained MS-DOS and, later, its Windows successors as the industry standard. Happily for Microsoft, too, the company made money even when its operating system wasn't sold. Under an agreement that Gates' critics would come to deride as the "computer tax," all manufacturers of IBM personal computer clones had to pay Microsoft a royalty on every computer s.h.i.+pped, whether or not the machine was equipped with MS-DOS.

By the mid-1980s, Microsoft's market dominance was beginning to pay off in a serious fas.h.i.+on. Revenues for 1985 stood at over $140 million, more than nine times what they had been when the company's operating system was first introduced. The next year, on March 13, 1986, the company went public, at $21 a share with the price rising to $28 by the end of the trading day. (Fourteen years later, one of those original shares was worth about $10,000, adjusting for stock splits.) It was, of course, only the beginning.

A second revolution in computing this one led by Bob Kahn, Vint Cerf, and others had been underway ever since the 1960s when the Defense Department's Advanced Research Projects Agency had authorized an experiment in networking known as the Arpanet. As the Arpanet evolved into the Internet, the digital interconnection of the world was launched, with all the new economic opportunities that entailed. To make certain that computer users would head into cybers.p.a.ce using Microsoft products, the company gave away its Internet navigation software, called the MS Internet Explorer. It had the cash reserves to afford the luxury, and the killer compet.i.tive instincts to dry up its compet.i.tors' bottom lines. To make certain that its navigator would never fly far from its basic operating system and its users would never fly far from home, Microsoft bundled the Internet Explorer with Windows and created, in mid-1995, MSN the Microsoft Network as a full-service Internet portal. Within its first three months, MSN had enrolled more than half a million members. Thus what was by far the most popular personal computer operating software became by far the most popular Web exploration software. In time, Microsoft would spread itself all over the Internet and intranets, and into multimedia, on-line magazine publis.h.i.+ng, Web TV, and just about anywhere else that a company with a limitless appet.i.te and some $15 billion in annual revenues could take it.

Just as had been the case with Standard Oil almost nine decades earlier, the justice Department and courts seemed unable to slow Gates's company down, even when the government appeared to have won. In February 1999, StatMarket, an Internet fact gatherer, reported that the Microsoft Internet Explorer was being used by nearly 65 percent of all Net surfers worldwide. ByJune 2000, afterJudgeJackson had ruled against Microsoft in the ant.i.trust case, more than 86 percent of global surfers were using the Internet Explorer an increase of 32 percent in a scant 16 months that had been highlighted by a nonstop legal a.s.sault against the company. What's more, 93 percent of global Net surfers were also using a Microsoft licensed Windows operating system product, StatMarket found.

Bill Gates, who prefers to think of himself as a technologist, not a businessman, had become both one of the world's most admired men and one of its most despised men, as well as its richest citizen.

John D. Rockefeller was in his early 70s when the breakup of Standard Oil ordered by the Supreme Court helped to triple his fortune in two short years to just under $1 billion. Henry Ford was 45 before he sold his first Model T and in his 60s before he became the world's first billionaire. By age 43, Bill Gates, was a billionaire nearly 80 times over.

In the digital era, the speed at which information travels wasn't the only thing accelerating. So was the speed at which wealth acc.u.mulates, products seize their markets, and new ideas turn into the geese that lay golden eggs. Radio needed 20 years to garner 10 million listeners. Television halved that to 10 years. Netscape got to 10 million users in only 28 months, and Hotmail made it in a quarter of the time -a mere 7 months.

One year into the new millennium, 350 million people globally were expected to be using the Internet, according to Computer Industry Almanac. By the end of 2005, the wired worldwide population is predicted to hit 765 million people, and as the numbers grow, the digital wealth will spread. At the outset of the twenty-first century, about 43 percent of all Internet users were Americans; by 2005, that figure should drop to 28 percent. Almost overnight, Australia and Finland, the 11 time zones of the former Soviet Union, New Delhi, Madagascar, Rome, and New York City had all become just a log-on away. A web had been created a literal web: Touch it anywhere and you are in touch with its whole being. And as the Web was spreading exponentially, opportunity was spreading with it. Microsoft, AOL, Macintosh, Lotus, Netscape, Bill Gates, Steve Case, Steve jobs, Vint Cerf, Bob Kahn, and tens of thousands of others had all played a role in launching an opportunity machine such as the world had never known one that spread the chance for a better economic life to places that can seem almost unimaginable.

For hundreds of years, the women of the tiny village of Tan Mixay (p.r.o.nounced taan meesay) have lived simply, nearly untouched by the outside world. They spin silk and weave it into intricate designs pa.s.sed down through generations. Their country, Laos, is one of the least developed nations on the planet --a victim of decades of war and revolution. For most people who live there, "the market" means what it meant to their parents and grandparents and ancestors going back centuries: the town square where local produce is bought and sold. Just as they have been for generations, fis.h.i.+ng and farming are the main means for eking a living out of the nation's meager resources. To see how the new interconnected world creates opportunity, though, it's useful to look at three women who have made their global interconnection in this once unlikely place: Me Tha, Vivian Wee, and Nikone Nanong. The odds are against any of them ever becoming a Bill Gates, but the changes they are involved in may be even more profound.

Since she was a child, Me Tha has woven silk just as her mother and grandmother did before her, selling and trading among her neighbors in Tan Mixay, but soon her silks will be available on the Internet. No stay-at-home, Vivian Wee travels the world, helping businesses in remote countries like Laos learn how to use e-commerce and the World Wide Web so they can compete globally and take advantage of the global appet.i.te for goods. Between the two, half as broker, half as facilitator, stands Nikone Nanong. Born into a typical Lao family where girls are expected to learn weaving as part of their marriage skills, Nikone like G.o.dric and legions of entrepreneurs before her aspired to more. In 1992, with $1,000 in start-up capital and six looms, she launched Nikone's Handcraft Center in Laos' capital, Vientiane. By the start of the new century, those six looms had grown into a business that employs 150 women from all over Laos. Some of them work in the handcraft center; others like Me Tha remain in their own village, where they can care for their children. Where they do the weaving is immaterial because all the women are linked to the same global marketplace through Nikone's website, where she sells all her silks. That marketplace expands constantly as each new link to the Internet is made, and as the marketplace expands, the potential for profit expands exponentially with it. ("The value of a network goes up as the square of the users," as Bob Metcalf, founder of the Ethernet, has put it.) Nikone's Internet site (www.aworldforall.com) is operated by A World for All, a nonprofit foundation dedicated to improving community life in impoverished areas. The site includes artisans from Cambodia, Thailand, and Vietnam, as well as Nikone's Lao weavers. The goods for sale mostly textiles range from simple pillowcases to more ornate throws. Most items sell for about $50; just a few climb to over $200. The site itself is absent the bells and whistles common to so many cyber-trading posts. In a global Internet economy measurable in the trillions of dollars, the trade generated at aworldforall.com is not even a drop in the bucket, but it's a vital drop all the same. Through the site, craftspeople working in some of the world's most forlorn economies can compete with other weavers and textile entrepreneurs in every corner of the planet. And in a nation like Laos where yearly income in 1999 averaged less than $1,300 a person, it takes only a relatively few e-business sales to make an enormous difference in the standard of living for the craftspeople and the families and communities they help support.

"How many people in the world are going to Laos?" Vivian Wee asks. "How many people are going to be sitting next to a village weaver to see how she weaves? The number who do that is so small compared to the number who can click on her website and visit Nikone."

"We are so far away," Nikone adds. "I had never dreamed to be on the Internet." Now that she is, though, global exposure gives her one more advantage, she says: "I can convince my staff, 'You must work hard and you must be more responsible for your thing, because now it's on the Web."'

The Netherlands grew rich in the sixteenth and seventeenth centuries as a trading center where rare goods brought out of North Africa, the Levant, and further East at great cost could begin to make their way to the marketplaces of Europe. G.o.dric grew rich a half a millennium earlier by doing much the same at far greater risk. Faith in the power of business is inextinguishable. But today, the Internet accomplishes all that G.o.dric and the Dutch East India traders did in the blink of an eye. Goods from all over the globe are available to shoppers all over the globe, twenty-four hours a day and via every sort of barter exchange: meet a price, name a price, bid a price, bid a swap.

The Medicis grew rich through financial exchange. If you wanted a substantial loan in fifteenth century Europe one to raise an army or support a pope you were wise to get yourself to Florence or to one of Medicis' partner banks elsewhere on the continent. For smaller concerns or more immediate needs, there were the banchi di pegni the p.a.w.nbrokers and the banchi in mercado, the forerunners of today's neighborhood banks. Whichever one you dealt with and wherever, the exchange was sure to be in currency backed by precious metals: A Florentine florin consisted of 3.52 grams of 24-karat gold, exactly and always.

Today, through the Internet, stocks, bonds, mortgages, and mutual funds are all bought and sold on line, and currency trade has become the largest market in the world. Money crisscrosses the globe at the click of a mouse, and nothing real underlies it. Only a hundred years ago, a dollar bill still had to be backed up with a dollar's worth of gold or silver. Today, money is essentially electronic blips racing through electric wires, bouncing off satellites: No currency anywhere in the world is backed by anything more than sheer faith.

Matthew Boulton and James Watt dramatically reduced the size of the steam engine and gave it greatly increased utility, but they didn't dematerialize it. To get the advantage of a Boulton and Watt engine, you still had to have one installed and on location. Henry Ford and John D. Rockefeller both needed vast physical infrastructures to support their fortune making. Now the Internet provides both the power source and the bulk of the infrastructure for many businesses like Nikone's Handcraft Center at a fraction of the cost. The Net is not only an information highway; it's also what the influential CEO of EDventure Holdings Inc., Esther Dyson, has called "an information bicycle" an infrastructure built for personal freedom, one that allows entrepreneurs to do what they want to do, in whatever fas.h.i.+on makes sense, whether it's e-trading Hummel figurines or selling silk like your parents and parents' parents have always made but to infinitely bigger and better markets.

Throughout the last millennium, it was control that created fortunes: control over the oceans or the railroads, the highways or the airwaves. At the start of the new millennium, it's still control this time over cybers.p.a.ce, the new wealth machine. Some things never change, but here's the great difference: This road to riches is open to everyone.

Acknowledgments.

HANKING EVERYONE RESPONSIBLE FOR A DOc.u.mENtary or a book alone can run to many pages. Thanking everyone who has helped with a book born from a doc.u.mentary entails a double debt that will be inadequately paid in this brief s.p.a.ce.

First, profound thanks to David Grubin Productions, which created the magnificent doc.u.mentary that is the basis of this book along with producers Ed Gray and Nick Davis, a.s.sisted by Amanda Pollak, Annie Wong, and Alex Dionne. I'm especially grateful to David Grubin, who not only created the idea but furnished me with a terrific script from which to work, and to Lesley Norman for all her help.

Special grat.i.tude is owed to CNBC, which not only aired "Money and Power" but helped in ways big and small to shape my thinking and words, especially Bill Bolster and Bruno Cohen, who helped create the concept and make it happen; Charles MacLachlan and Andrew Darrow for all their support for the doc.u.mentary and involvement in all aspects of the creation of this book; and Karin Annus for her comments on the ma.n.u.script.

Credit goes also to all those who took time from busy schedules to impart their knowledge, wisdom, and insight in front of the cameras and subsequently to these pages: Frederick Allen, Stephen Ambrose, Jim Andrews, David Bain, Alan Brinkley, Edward Chancellor, Ron Chernow, Esther Dyson, Neal Gabler, John Steele Gordon, Henry Grunwald, Joel Kaye, Dale Kent, Maury Klein, David Landes, Joe Lennox, David Lewis, Nikone Nanong, Jean Strouse, Jennifer Tann, Steven Watts, Jack Weatherford, and Vivian Wee.

Thanks as well to those who helped in more anonymous ways to broaden my vision, sharpen my understanding, and resolve the often microscopic points that can be the biggest stumbling blocks in a project of this scope. Among the many: Paul Chernoff, Greg DeVito, Benjamin Lamberton, my nephew Tom Means, and my wife Candy, always the most reliable source. I'm grateful to Was.h.i.+ngtonian magazine for the use of its research facilities.

Last, but certainly not least, thanks to my dedicated and pa.s.sionate editor, Airie Dekidjiev, and her a.s.sistant, Jessica Noyes, at John Wiley & Sons; my agent, Raphael Sagalyn, of the Sagalyn Literary Agency; and Claire Huismann at Impressions Book and Journal Services.

Howard Means.

Bethesda, Maryland.

Source Notes.

Major sources for Money and Power include the following: 1. ST. G.o.dRIC: G.o.d AND PROFIT.

On-air interviews: Joe Lennox, Jack Weatherford Buechner, Frederick. G.o.dric. New York: HarperCollins, 1980.

Coulton, G.G., ed. Social Life in Britain from the Conquest to the Reformation. Cambridge: Cambridge University Press, 1918.

Elson, John. "The Millennium of Discovery." Time (October 15, 1992): 16 ff.

Kaye, Joel. Economy and Nature in the Fourteenth Century. Cambridge: Cambridge University Press, 1998.

McDonald, John. "Domesday Economy." National Inst.i.tute Economic Review (April 1, 2000): 105 if.

Pirenne, Henri. Medieval Cities: The Origins and the Revival of Trade. Princeton University Press, 1925.

2. COSIMO DE' MEDICI: PUTTING MONEY TO WORK.

On-air interviews: John Steele Gordon, Joel Kaye, Dale Kent, Jack Weatherford Brucker, Gene. Renaissance Florence. Berkeley and Los Angeles: University of California Press, 1969.

Calkins, Hugh. "Can Florence in the Quatrocentro Help Shape Tax Policy Today?" The Tax Lawyer (Spring 1991): 685 ff.

de Roover, Raymond. The Rise and Decline of the Medici Bank. 1999.

Green, Timothy. "From a p.a.w.nshop to Patron of the Arts in Five Centuries." Smithsonian (July 1991): 58 if.

Hale, J.R. Florence and the Medici. Thames and Hudson, 1977.

Hibbert, Christopher. The House of Medici: Its Rise and Fall. Morrow, Quill, 1974.

Jardine, Lisa. Worldly Goods. Bantam Doubleday Dell, 1996.

Kent, Dale. The Rise of the Medici. Oxford: Oxford University Press, 1978.

Le Goff, Jacques. Tour Money or Your Life: Economy and Religion in the Middle Ages. Cambridge: MIT Press, 1990.

Weatherford, J. McIver. The History of Money. New York: Crown, 1997.

3. PHILIP II: WEALTH WITHOUT WISDOM.

On-air interviews: John Steele Gordon, David Landes Dash, Mike. Tulipmania. Crown Publishers, 1999.

Kamen, Henry. Philip of Spain. New Haven, CT: Yale University Press, 1997.

Landes, David S. The Wealth and Poverty of Nations. New York: W.W. Norton, 1998.

Martin, Colin, and Geoffrey Parker. The Spanish Armada. New York: W.W. Norton, 1992.

Perez-Diaz, Victor. "State and Public Sphere in Spain During the Ancient Regime." Daedalus (June 22, 1998): 251 if.

Rocca, Francis X. "Philip of Spain." Atlantic Monthly (August 1997): 85 if.

4. TULIPMANIA: SHARING THE GREED.

On-air interviews: Edward Chancellor, John Steele Gordon, David Landes Chancellor, Edward. Devil Take the Hindmost. New York: Farrar, Straus and Giroux, 1999.

Dash, Mike. Tulipmania, Crown Publishers, 1999.

Garber, Peter. "Who Put the Mania in Tulipmania?" The journal of Portfolio Management (Fall 1989): 53 if Gordon, John Steele. The Great Game. New York: Simon & Schuster, 1999.

Landes, David S. The Wealth and Porerty of Nations. New York: W.W. Norton, 1998.

Rigby, Rhymer. "The True Story of Flower Power." Management Today (June 1997): 94 if Schama, Simon. The Embarra.s.sment of Riches. Zane, 1987.

5. JAMES WATT AND MATTHEW BOULTON: TURNING EVOLUTION INTO REVOLUTION.

On-air interviews: Jim Andrews, John Steele Gordon, David Landes, Jennifer Tann Arnot, Chris. "The Master Bauble-Maker." The Guardian (October 14, 1995): T66.

Crowther, J.G. Scientists of the Industrial Revolution.

d.i.c.kinson, H.W. Matthew Boulton. Cambridge: Cambridge University Press, 1936.

Landes, David S. The Wealth and Poverty of Nations. New York: W.W. Norton, 1998.

Lord, John. Capital and Steam Power: 1923.

Powell, John. "The Birmingham Coiners, 1770-1816." History Today (July 1993): 49 ff.

Rocco, Fiametta. "Keeping the Flame." Inst.i.tutional Investor (December 1988): 31 if.

Tann, Jennifer. The Selected Papers of Boulton and Watt (Vol. 1). Cambridge: MIT Press, 1981.

Webb, Robert N. James Watt: Inventor of a Steam Engine. Franklin Watts, 1970.

6. THE TRANSCONTINENTAL RAILROAD: ROGUES AND VISIONARIES.

On-air interviews: Stephen Ambrose, David Bain, Maury Klein Ambrose, Stephen. Nothing Like It in the World. New York: Simon & Schuster, 2000.

Bain, David. Empire Express. New York: Viking Penguin, 1999.

Interview "Booknotes." C-Span by Brian Lamb, March 5, 2000.

Klein, Maury. Union Pacific. New York: Doubleday, 1987.

Lewis, Oscar. The Big Four. New York: Alfred A. Knopf, 1959.

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