"Sooner or later the Internet will become profitable. It's an old story played before by canals, railroads and automobiles"
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Samuelson’s line has the cool, slightly bored confidence of someone who’s watched America build the future by first lighting money on fire. The point isn’t that the internet is destined to make cash; it’s that speculative excess is a feature of infrastructure revolutions, not a bug. By placing the internet in the same sentence as canals, railroads, and automobiles, he yanks it out of the late-1990s techno-mysticism and drops it into a familiar economic genre: the general-purpose technology that arrives with hype, overbuilding, bankruptcies, consolidation, and only then stable profits.
The subtext is a rebuke to two camps at once. To the dot-com evangelists, it’s a reminder that “new economy” rhetoric doesn’t repeal the math of capital costs and competition. To the skeptics, it’s a warning against mistaking early chaos for permanent uselessness. Canals and railroads famously spawned bubbles and wreckage; they also permanently reorganized commerce. Samuelson is betting the internet will follow the same arc: initial returns diluted by too many entrants and too much optimistic investment, followed by the slow emergence of moats, pricing power, and dependable cash flow.
Context matters. Coming from a Nobel-winning economist associated with rigorous, sometimes austere thinking, the analogy is doing rhetorical work: it translates an unruly cultural phenomenon into an old ledger of boom-and-bust cycles. The “sooner or later” also reads as a quiet jab at impatience. Markets can be wrong on timing even when they’re right on direction, and infrastructure takes time to learn how to charge.
The subtext is a rebuke to two camps at once. To the dot-com evangelists, it’s a reminder that “new economy” rhetoric doesn’t repeal the math of capital costs and competition. To the skeptics, it’s a warning against mistaking early chaos for permanent uselessness. Canals and railroads famously spawned bubbles and wreckage; they also permanently reorganized commerce. Samuelson is betting the internet will follow the same arc: initial returns diluted by too many entrants and too much optimistic investment, followed by the slow emergence of moats, pricing power, and dependable cash flow.
Context matters. Coming from a Nobel-winning economist associated with rigorous, sometimes austere thinking, the analogy is doing rhetorical work: it translates an unruly cultural phenomenon into an old ledger of boom-and-bust cycles. The “sooner or later” also reads as a quiet jab at impatience. Markets can be wrong on timing even when they’re right on direction, and infrastructure takes time to learn how to charge.
Quote Details
| Topic | Internet |
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