Abstract

"The Struggle to Bring a Global Assembly Model to Computer Services: Control Data Corporation and Reagan’s Caribbean Basin Initiative "

Ella Coon, Columbia University (emc2199@columbia.edu)

This paper looks at Control Data Corporation’s attempt to export a global assembly business model to the budding computer services industry in Jamaica during the early 1980s. This investment occurred in conjunction with Reagan’s Caribbean Basin Initiative—a kind of post-NIEO, proto-NAFTA developmental program for Caribbean centered on regional preferential trade privileges. The paper explores how Control Data’s investment in Jamaica was pulled by conflicting objectives: currying favor with Reagan administration in light of an increase in Defense allocations; the geopolitical goals of Reagan’s “Second” Cold War; Prime Minister Edward Seaga’s own political-economic program for Jamaica in the wake of Structural Adjustment; and, finally, the economics of computer services, in particular data entry. Unlike subassembly and assembly work in computer hardware, the labor requirements in computers services were (and are) such that revenue couldn’t (and can’t) increase faster than costs. This economic challenge stood in contrast to the company’s assembly line in computer hardware, which facilitated economies of scale and low-wages. To counterbalance these limitations, Control Data management pursued a dual-objective to computerize Jamaica’s financial services industry.

For context, Control Data—the smaller Midwestern rival of IBM—produced some of the fastest and most powerful mainframes in the twentieth century, was a major player in computer services, and became the world’s foremost producer of computer peripherals—disk packs, card readers, terminals, and printers—in the mid-1970s and early 1980s. The firm’s multi-billion-dollar business in computer hardware—a global assembly line—reached across research facilities in the Minneapolis suburbs to manufacturing operations in urban neighborhoods of the Midwest and Rust Belt,
eastern Kentucky, Mexico, Portugal, South Korea, the Eastern Bloc, among others.