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“England, a seafaring nation…”

The naval might of Switzerland has prevailed. A country with all the maritime traditions of Outer Mongolia, Iowa and Chad has prevailed where 152 years of British endeavour have failed. The America’s Cup, a trophy given by Queen Victoria to promote yachting in the English Channel, and which has never been won by a British team has now changed hands from the USA (1851-1983 [No, that isn't a typo!], and 1988-1995), Australia (1983-1988), and New Zealand (1995-2003). And now Switzerland.

The main priviledge for the winner, apart from collecting a silver trophy named after its first winner, the schooner America is to get the right to host the next challenge, which is now expected to be in 2007. As this has to be on seawater, there is a little problem. Switzerland is about 450 miles from the nearest coastline. So the defence will probably take place in the Mediterranean or on the Altantic coastline of France.

It’s all very jolly for Ernesto Bertarelli the Swiss owner of the Alinghi team, for Russell Coutts the New Zealander skipper hired to beat his former team mates. So why no British success. Until the 1970s, no one else but the British even challenged the New York Yacht Club. The explanation I offer explains why Italian and now Swiss challengers have emerged, despite no obvious historical tradition for this sort of contest. In the first place, British ship design has been poor since the day that King Henry VIII watched his newly launched flagship the Mary Rose, capsize in Solent. Admiral Nelson is well known to have preferred a captured French frigate to the Admiralty’s own designs. At the battle of Jutland in 1916, inferior ship design was responsible for the destruction from one hit each of two British battle cruisers and only the desperate (and dying) actions of a crew member saved the flagship from suffering the same fate moments later. At the same battle the only German loss was a cruiser which had taken over one hundred hits and was scuttled. During the pursuit of the Bismark in 1942, the largest British ship ever built (later overtaken by the Vanguard) HMS Hood took one hit from the German battleship. Three out of 1,300 crew survived as the Hood simply blew up. During the Falkands war (1982) it was discovered that the British frigate hulls were so thin that one Exocet missile would melt a whole section of it, and the anti-aircraft missiles didn’t work.

Whenever a foreign government (Japan, Tsarist Russia etc.) has decided to build a navy, it has nearly always considered buying British. Yet having taken a look at what British shipyards had to offer, they almost invariably bought German, French or (before steam) Dutch. If the State Department will let them, they’ll buy American.

Second, status. If one country could combine public money and individual talent to produce a succesful America’s Cup challenge, it is France. Many of the yachting and long-distance windsufing records are held by French, especially Breton sailors. This is nothing new. Jean Cabot who landed in Newfoundland to secure the first English presence in the New World was French. Many of the place names hundreds of miles upstream in the US have curious names: Pierre, Des Moines, Boise to name but state capitals. The supreme British yachtswoman Ellen Macarthur is far better known in France than in the UK, indeed she seems to sail in French ships most of the time. When Macarthur completed a solo round the world trip a couple of years ago, the French president travelled 500 miles to welcome her ashore. I think the local British consul might have been on duty.

Third, taxes. Yachting is a rich man’s toy. To compete in an America’s Cup challenge, you need a cool $50 million to even think about taking part. You need a crew that’s incredibly strong and intelligent, neither feature being the sort of thing a comprehensive education is designed to produce. You also need to be able to hire the best at top rates, again more money and dynamic management. The result is that only big corporations, very big family businesses and governments have the money for this sort of enterprise.

Britain has plenty of corporations and government, but not a lot of family businesses in the billionaire bracket. The main blame for this is taxation. ‘Inheritance Tax’ or ‘Death Tax’ as I prefer to call it, whacks 40 per cent of capital from one generation to the next. One of Britain’s cutest institutions the National Trust was actually created to manage the property confiscated through taxation from Britain’s wealthy families, hence all the stately homes one can visit. Luxembourg has no Death Tax, I imagine that Switzerland’s can’t be very high and the Italian situation can’t be too harsh (one way or another).

Taxation also forces savings into distorted investment patterns, what the Austrian economists call “malinvestment”. In Britain we have wonderful private and corporate pension funds able to provide a far higher proportion of our old age needs than any other European country. Of course this means that there are virtually no family businesses of large scale in the UK, unlike France, Italy, Germany, Switzerland. everything is owned by the funds and administered by fund managers.

It is obvious that board-room politics and being the skipper of a racing yacht don’t mix, the best model on a ship is top-down autocracy. Politicians acting via bureaucrats also don’t make very good skippers either, except perhaps in wartime. But a family business that can throw a hundred million away from time to time has exactly the right focus to make a success of a racing team. Witness the Grand Prix Formula One racing dominated by the late Gianni Agnelli‘s Ferrari team. Yachting is the same. So too was aeronautics before the 1950s.

So for land-lubbers like myself – and most Swiss people – the America’s Cup has a curious function. It is a barometer of enterprise around the world. One of these years I expect to see a private challenge from Russia or China, now what an indicator of social change that would be.

15 comments to “England, a seafaring nation…”

  • Byron

    Nice analysis. However, I’d lend more credit to the family money part of the theory than to the nautical engineering part. Ernesto simply hired the core of the previous winning Cup team. That not only got him six of the best AC sailors in the world, but a nice plus in that Russel Coutts is also an engineer and no doubt brought a ton of TNZ design info with him to Alinghi. Switzerland tried a challenge in 99/2000 – Be Happy – that was one of the less capable challengers then. I doubt even Ernesto could have faired much better this year by relying solely on homegrown Swiss technology and sailing skill.

  • Felonious Punk

    You should say the “Swiss” won the America’s Cup, not the Swiss won the America’s Cup, since the sailors were pretty much not Swiss. More properly, the New Zealanders won it again.

  • Dale Amon

    The family money route is one of the things which will open up the High Frontier as well… Bigelow Aerospace is wholly owned by Mr and Mrs Bigelow with no board, no shareholders, no hassles… as is the company from whence the money came, Budget Suites of America. Nothing like an individualist Billionaire when you really want to get something done.

  • Pete

    Hold it on Lake Constance. The winner gets the gold the Nazis dumped in it.

  • John

    Iowa, hehehehehe….

  • The Swiss World Cup team for some reason reminds me of the “Russian” figure skaters in the Olympics, half of whom seem to live in Southern California.

  • The Swiss America’s Cup team for some reason reminds me of the “Russian” figure skaters in the Olympics, half of whom seem to live in Southern California.

  • Have the New Zealanders been given Swiss citizenship? It’s normally fairly hard to get.

  • Kevin Connors

    Be advised that the Swiss do have a small Navy that petrol Lakes Konstanz and Geneva.

    As well, Southern California has been a hotbed of figure skating for years. We have no natural ice, but make up for it with many fine refrigerated rinks which are, of course, open year-round.

  • steevil (Dr Weevil's bro Steve)

    I don’t believe citizenship is required for participating on a particular country’s America’s Cup team. There is some sort of residency requirement. An example is American Paul Cayard (http://www.americaone.org/syndicate/cayard.html) who was part of the 1992 Italian effort, but who was on USA teams before and after that.

  • (1) There is, or rather was, a residency requirement for a certain % of the crew, the exact number not at my finger tips at this time. It’s (historically speaking) actually not very difficult to get residency for any country when bucket loads of cash and prestige are involved (as is with the AC)

    The residency rule is going to be dropped for the next America’s Cup. See 7(g):
    http://americascup.nzoom.com/americascup_detail/0,2523,172921-296-297,00.html

    (2) John Cabot — Giovanni Caboto — is believed to be Italian.
    http://www.heritage.nf.ca/exploration/cabot.html

    (3)
    The French have produced many outstanding _solo_ sailors, but very few great team sailors. This is widely believed to be a cultural thing — that the French don’t like taking orders from people they don’t consider as good as themselves, and this becomes a real problem at elite levels of sailing. As a nod to the Anglosphere countries, it is thought that english speaking sailors tend to be less bitter about their position in the power hierarchy of organizations.

  • Rich Rostrom

    You’re too negative about British ship design, and there are some factual errors. My personal fetish is the dreadnought era. Of the eleven “outside buys” of dreadnought battleships, eight went to Britain, including four of the six actual deliveries. Britain lost _three_ battlecruisers at Jutland, not two, but Germany lost a battlecruiser, not a cruiser, and a pre-dreadnought battleship. Britain also did respectably in export sales of destroyers, especially in the pre-WW II era. Whether this has any relevance to the America’s Cup I don’t know, but I like getting things right.

  • Antoine Clarke

    To Rich Rostrum,
    Jutland: two British battle cruisers destroyed, one saved in extremis. The design flaw was inadequate protection of the magazines from plunging fire.
    Your point about Dreadnoughts is well made.
    However, I could have compared gunnery aiming mechanisms (pre-radar) where Admiralty standards were low, plus the obstinate unwillingness to believe that the Germans had developed gunnery radar (in the 1930s).
    If I compared aircraft carriers (2nd world war) I wonder if the punishment endured by the USS Lexington and USS Yorktown compares with the HMS Ark Royal? It seems to me that the US carriers coped with torpedoes better than the British ones, but that’s just an impression.

    General comment:
    I stress that no single factor can be isolated, I would list in order of importance:
    1. Lack of billionaires and big family businesses (tax and financial regulations)
    2. Inferior designers (partly education)
    3. Status: sailing is bigger in other countries though there are exceptional British individual competitors.

  • Robert Davis

    America’s Cup has been organized around nationality, so much so that rules on the subject weren’t even needed until 1980.

    Up through 2003, there was a requirement for all sailing crew and designers, though it was only based on residency for a preceding period, not actual citizenship.

    Rather than fix an admittedly broken system by putting more effective rules in place, Alinghi had to relax them since they could not hope to maintain their team under real nationality rules.

    Whether the way to advance the profile of the Cup, as Alinghi has vowed to do, is best acheived by eliminating the single most powerful appeal of the competition is something that will have to be played out now as Alinghi has removed all requirements that a team reflect the country it challenges from.

    The first Australian challenge was in 1962, not 1970, though the Canadians had challenged nearly 100 years earlier.

    The French have never assembled a coherent crew for the America’s Cup, despite individual talent and sometimes large budgets.

    British sailing ships of the 19th century were generally slower than their American counterparts because commercial design at that time was distorted by the tarrif measurement rules. The most cost-effective British sailing ships maximized their capacity while minimizing their tariff rates, but unfortunaltely the most cost-effective hulls were not efficient sailing shapes.

    As yachting became a more popular activity, the US was a more fertile ground for devlopement, though several British yachts were significant advances, too, just not well sailed and facing better competition when they tried for the America’s Cup.

    Also, Queen Victoria did not award the Cup to the Schooner America, though she did watch the racing in 1851.

  • Robert Davis

    America’s Cup has been organized around nationality, so much so that rules on the subject weren’t even needed until 1980.

    Up through 2003, there was a requirement for all sailing crew and designers, though it was only based on residency for a preceding period, not actual citizenship.

    Rather than fix an admittedly broken system by putting more effective rules in place, Alinghi had to relax them since they could not hope to maintain their team under real nationality rules.

    Whether the way to advance the profile of the Cup, as Alinghi has vowed to do, is best acheived by eliminating the single most powerful appeal of the competition is something that will have to be played out now as Alinghi has removed all requirements that a team reflect the country it challenges from.

    The first Australian challenge was in 1962, not 1970, though the Canadians had challenged nearly 100 years earlier.

    The French have never assembled a coherent crew for the America’s Cup, despite individual talent and sometimes large budgets.

    British sailing ships of the 19th century were generally slower than their American counterparts because commercial design at that time was distorted by the tarrif measurement rules. The most cost-effective British sailing ships maximized their capacity while minimizing their tariff rates, but unfortunaltely the most cost-effective hulls were not efficient sailing shapes.

    As yachting became a more popular activity, the US was a more fertile ground for devlopement, though several British yachts were significant advances, too, just not well sailed and facing better competition when they tried for the America’s Cup.

    Also, Queen Victoria did not award the Cup to the Schooner America, though she did watch the racing in 1851.