Construction work costs beyond money

We often admire the great architecture, yet we often forget its costs and its benefits. Great leaders often invest in building elaborate infrastructures that serve generations.  Tyrants invest in personal glorification and strange dreams. Businessmen invest for more than just profit potential. And the actual investment is often much larger than the expected cost, not just in money but also in human lives.

Why does it matter?

This article addresses huge historical and geopolitical figures. They appear to be well beyond the range of our common interests. Well, they are. However, simple people also invest and overinvest.

Remember the subprime crisis, when people bought more real estate than they could afford? There is even a so-called skyscrapers index: the more skyscrapers are constructed the higher the risks of a financial crisis. This has to do with an unreasonably fast rise of land costs and high leveraging of construction companies. The skyscrapers of New York were followed by the great depression and the skyscrapers of Moscow with international embargos.

Big construction projects cost actual human lives. Our personal construction endeavors cost our time, energy, focus, and happiness over several years. A person building his private residence is unlikely to die from it but is likely to suffer several sleepless nights and legal troubles.

So what we can learn from big events, can apply to our small lives.

Versaille and dynasty

One of the biggest construction projects in baroque Europe was the construction of the Versaille palace in France. I will argue, that this was one of the most important events in human history. Why?

Before the construction project, France emerged from a very long and bloody period of civil wars as a glorious superpower. Cardinal Richelieu was a very complex figure, yet under his guidance, France constantly leveraged the power shifts of the thirty-year war to get stronger. The war was further transformed into the English civil war and the war of the Spanish superpower against its own richest provinces in the Nederlands.

King Louis XIV invested all of this huge leverage into building the most luxurious palace in Europe. After accounting for inflation, experts believe the Palace of Versailles cost between $200 and $300 billion to build in contemporary money – an almost unthinkable sum for the construction of a single (even palatial) residence. King Louis XIV spent about one-third of the entire building budget just on fountains for the garden.  There are 357 mirrors in the Hall of Mirrors. When it was built, Venice had a monopoly on making mirrors, but France was not deterred by this fact and enticed Venetian mirror makers to make some especially for the Palace. The craftsmen were later ordered to be assassinated by the Italians for giving away their secrets.

The construction project was expensive beyond any reason. It depleted the booming french financial resources, and as a result, France entered into a long financial crisis. The situation was very bad because the construction spree was shared by three generations of kings. Louis XVI invested in a model village for his beautiful wife in Versaille. And then the French economy collapsed.

So what were the results of this construction, besides a very beautiful palace?

  • The establishment of Nederlands, as France did not have enough resources to take the rebellious provinces from Spain.
  • Consolidation of English naval power, since France, lacked the resources for the navy.
  • The banking empire of Rotshields was established to finance further French endeavors.
  • American revolution supported by France, as a cheap way to harass the English superpower in the colonies.
  • French revolution with metric measurements followed by Napoleon’s tyranny as the people did not want to pay for the palaces.

I argue that these events shaped the world as we know it. Probably very differently from what Lois XIV would like to see…

Exodus

The largest construction projects in ancient history were probably in Egypt. There were at least two huge complexes of pyramids, followed by the temple complex and ‘golden city’ in Luxor. Each of the megastructures was a project for an entire generation, a sort of shuttle into eternity. The megastructures were built in areas with a relatively comfortable climate and readily accessible via the Nile.

In the 14th century BC, the ruling pharaoh Akhenaten saw a blazing vision of one true God, whom he called Aten. This first-ever monotheistic religion was in need of a new temple region and a new palace. These buildings were built in the middle of the desert, a place called Amarna. The name Amarna comes from the Beni Amran tribe that lived in the region.

Not much is known about the short rule of Amarna pharaohs, as subsequent pharaohs tried to erase that memory. I will continue from my understanding of available findings. To build the new city, the pharaoh issued conscription, possibly of the first-born son of every family. The children between 9 and 25 years old built the project, carrying huge stones. There are skeletons around the area with traumas caused by wrong technique and pressure of weights too large for the children’s bodies. Thousands died, but the new city rose in the desert like a dream.

Akhenaten reigned for 17 years, with help of his wife Nefertiti who was the living spirit behind the new religion. They were succeeded by their daughters and the husbands or brothers of those ladies (Smenkhkare?) as rulers. The royal line of the dynasty died out with Tutankhamun, Akhenaten’s nephew, a partially disabled child pharaoh manipulated by powerful viziers. Both the prince Ay and the scribe Horemheb were generals, then viziers, and later became pharaohs rather violently. A civil war followed. Amarna was abandoned and pharaohs returned to Luxor. The inhabitants of Amarna and believers in one great god fled from Egypt, some via the sea and others via the land.

Somehow the exodus from Amarna happens around the time of the Biblical exodus. A coincidence or continuity of the great monotheistic religion? We might never know for sure.

Gulag

A very troubling vision of forced progress in the 20th century was the Soviet industrialization experiment. Before WWI Russia was one of the world superpowers, with very advanced infrastructure. The entire infrastructure and accumulated knowledge were decimated by WWI, revolution, civil war, and political persecution. Yet the Soviet leadership had a great dream of unprecedented progress via massive mobilization of the people.

Between the years 1929 and 1953 around 25 million were involved in forced labor as prisoners of the Gulag or maybe exiled and deported, or labor colonies and settlements. Today we kind of feel that being exiled was a sort of death sentence, but deaths were uncommon. The horrific story for example of Cannibal Island was as shocking, as it was unique. Overall around 10% of the prisoners died, and the heaviest death toll was during WWII. For comparison,  it is estimated that at least 3.3 million Soviet POWs died in Nazi custody, out of 5.7 million.

Gulag was not used for imprisoning and slowly killing people. It was used for building a new industrial Soviet superpower, ruthlessly and not very effectively. Many mining and industrial towns and cities in northern and eastern Russia and in Kazakhstan such as Karaganda, Norilsk, Vorkuta and Magadan, were originally blocks of camps built by prisoners and subsequently run by ex-prisoners. The Soviet space program was executed by former Gulag prisoners.

A very large portion of the Soviet metal used for agricultural machines between the wars and tanks during the war was mined using forced labor. Initially, the results appeared to be astounding with an extremely high rate of progress. In fact, the results looked too good to be true.

Using skilled and rich farmers, administrators, engineers and military leaders for manual labor is not just inhumane, but also very counterproductive. All levels of leadership reported results very different from the results actually measured. Russia never fully recovered from this construction experiment.

 

The story of two canals

There is a huge human price tag on many construction projects, not just projects using forced labor. Two of the biggest canals were started by the same man. Lesseps was a Frech nobleman, diplomat, and entrepreneur.

After serving as a diplomat in Egypt, he understood the benefits of building the Suez canal and knew all the people required to execute the project. In 1856 Lesseps got engineers’ approval and started patriotic speeches. Lesseps succeeded in rousing the patriotism of the French and obtaining by their subscriptions more than half of the capital of two hundred million francs which he needed in order to form a company. The Egyptian government thus subscribed for eighty million francs worth of shares. After 10 years of works, on 17 November 1869, the canal was officially opened. It has been effective since.  Some sources estimate that over 30,000 people were working on the canal at any given period, that more than 1.5 million people from various countries were employed. The company’s chief medical officer reporting no higher than 2.49 deaths per thousand in 1866. So the death toll was not less than 3000 people.

In February 1880, Lesseps arrived in New York City to raise money for the  Panama Canal project. He estimated in 1880 that the project would take 658 million francs and eight years to complete. Eight years was the time it took for the company to declare bankruptcy and enter liquidation. Particularly disastrous were recurrent landslides into the excavations from the bordering water-saturated hills and the death toll from malaria and yellow fever. In the end, insufficient financial capital and financial corruption ended the project. According to a report by Dr. Gorgas (the man who minimized the effects of yellow fever and malaria during the American construction period), it is possible that some 22,000 workers died during the French construction period.

Several years later, with new technologies and medical equipment, Americans were able to build the canal. The canal was built in 1904–1914 after the territory was purchased by the USA.   5,609 died of diseases and accidents during the U.S. construction period. Of these, 4,500 were West Indian workers. The Panama Canal cost Americans around $375,000,000, including the $10,000,000 paid to Panama and the $40,000,000 paid to the French company. It was the single most expensive construction project in United States history to that time. That’s about 200 million franks in the year 1880. I used this historical currency converter. In today’s money that’s around 10 billion dollars, the cost of a single Nimitz class nuclear aircraft carrier.

The canals were not a religious fantasy or a political inspiration, but a very clear economic need. Despite the high costs of money and human lives, they are used to this day, boosting the global economy far more than any other construction projects I can think of. Except maybe…

Carnegie steel dream

Eads Bridge is a combined road and railway bridge over the Mississippi River connecting the cities of St. Louis, Missouri, and East St. Louis, Illinois. This is an arched bridge 2 km in length. In order to accommodate the massive size and strength of the Mississippi River, the Eads Bridge required a number of engineering feats. Perhaps most importantly, it was the first large-scale use of steel as a structural material. Fifteen workers died constructing the bridge.

Steel was expensive and not really tested. On June 14, 1874,  a “test elephant” strolled across the new Eads Bridge to prove that it was safe. A big crowd cheered as the elephant from a traveling circus lumbered toward Illinois. Popular belief held that elephants had instincts that would make them avoid setting foot on unsafe structures. Two weeks later, Eads sent 14 locomotives back and forth across the bridge at one time.

The bridge was a brainchild of Andrew Carnegie. Carnegie was basically a railroad clerk for several years until he was able to buy in 1964 Keystone Bridge Works company. At that time bridges were built of iron, and Carnegie constructed several such bridges. Iron is very heavy with respect to its strength, which limited the bridge capabilities. The entire industry was looking for a new solution. Steel was well-known at that time, used with cutlery and tools, but it was extremely expensive even for cannons.

A system akin to the Bessemer process has existed since the 11th century in China along the Henan–Hebei border. In 1856 Bessemer patented an improved process for cheap steel manufacturing for artillery steel. The original patent was ineffective due to impurities in steel. The problem was solved by English metallurgist Robert Forester Mushet, who could not pay for his patent.

In 1872 Carnegie was an investor in one of Bessemer’s businesses. He further licensed the patent and mass-produced steel. The price of steel at Eads Bridge construction was 100$ per ton, and 20 years later it was 18$ per ton. The price of steel did not change much since, and steel is one of the major construction materials of our time.

Bottom line

The best investment of your time and money in the infrastructure is probably not some glorious structure, but something very boring and serving an important practical role.

My father invested 20 years in building a library with more than 3000 books. Then one day he threw all of his books away, as he was reading electronic books and his library got infested with termites.

Probably the best home investments are a comfortable bed and an effective kitchen.

 

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