September 9, 2019 • 47 mins
After World War II, General Electric would grow rapidly to the point of bloat. Then a man named Jack Welch took over as CEO and made some big changes. What was Welch's legacy?
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Episode Transcript
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Speaker 1 (00:04):
Welcome to tech Stuff, a production of I Heart Radios
How Stuff Works. Hey there, and welcome to tech Stuff.
I'm your host, Jonathan Strickland. I'm an executive producer with
How Stuff Works in iHeart Radio and I Love all
things tech. And we are continuing our journey through the
history of General Electric or GE, a company that has
(00:27):
encountered some pretty significant challenges over the last decade or so. Now.
In our first two episodes, I went through the founding
of GE and then made my way all the way
up through World War Two, and I talked about how
some of the top level executives of the company were
called upon by the US government to serve in wartime
government positions to help the US meet the needs of
(00:48):
supplying the military with the equipment necessary to fight the war.
I also talked about how g E continued to grow
as a company, building on new departments and divisions and
diversifying the company's businesses. And I ended the last episode
by talking about a court case that determined g E
was being anti competitive by leveraging patents in order to
act as an effective monopoly when it came to manufacturing
(01:10):
light bulbs. Now we're almost up to nineteen fifty and
it's time to get out of this world. The one
thing I want to mention before we get into the
nineteen fifties is that in nineteen forty six a scientist
at GE named Vincent Schaefer developed the process of cloud seating.
And the idea is pretty elegant but has long been
(01:31):
a subject of scientific dispute. So here's the process. It
involves distributing tiny particles into clouds in an effort to
make it rain. And the thought is that these particles
will act as nucleic sites for rain drops to form.
When the raindrops get large enough, they have enough weight
to fall to Earth. And so that is the general
(01:54):
thought behind cloud seating. It's been practiced ever since, but
there have been many questions over whether or not cloud
seating actually works. Sometimes it would rain, sometimes it wouldn't,
And if it did rain, is there any way to
be sure that it was the cloud seeding that actually
made the difference. I mean, you had to have a
cloud there in the first place. You couldn't just manufacture
(02:14):
a cloud. Experiments and labs suggested that it should work,
but the natural world is very different from the controlled
conditions of a lab environment. It didn't help that many
of our measuring instruments lacked the precision to detect very
small raindrops, so you couldn't really monitor to see if
it was actually doing what it was supposed to do.
(02:34):
An experiment in two thousand eighteen suggests that cloud seating
does in fact work, at least to some extent. But
there's another question that's still open, which is does cloud
seeding make economic sense? Does the amount of water produced
by rainfall justify the cost of flying aircraft up and
distributing the particles in the first place, Because it may
(02:56):
very well work, but it might not work well enough
to make sense from a financial perspective. I just find
it fascinating that we've essentially been doing this for seventy
years and we still don't know if we should be
doing it now. I can certainly see why cloud seating
companies feel we should be doing it. I mean, that's
their business. But the jury is still technically out over
(03:18):
whether or not it makes sense, and there's still a
little bit debate on whether or not it really truly works,
or if it works in enough conditions for it to
be reasonable. Now in Ge made the first two door
refrigerator freezer combo. And I only mentioned it here because
I think it's cool. That's a pun. Now we're up
(03:43):
to the nineteen fifties. So in nineteen fifty one g
E built a new jet engine called the J seven nine.
And here's an interesting historical note. When engineers tested the
J seven nine, which had variable statures, the efficiency ratings
were so high that the engineers thought their instruments were malfunctioning.
(04:04):
There's no way we're getting this level of energy efficiency
out of this thing. But then that raises a question
for a lot of people, what is a statter? What
does that actually mean? Well, the name gives you a hint. Statter, stationary,
that kind of thing. So in jet engines, you have
fan blades that rotate. Those are rotors, and you had
fan blades that hold in place. Those are called statters.
(04:27):
And the purpose of this combination is to both draw
air into the engine and to compress that air before
it enters into the combustion chamber. The adjustable status meant
that the engine could be finely tuned to produce higher
compressor pressures and to produce more usable energy as opposed
to waste heat. When you're actually burning fuel. In n
(04:52):
GE Research Laboratory, scientists named Tracy Hall announced that his
team had discovered a way to create synthetic diamond in
the lab. Halls team used a process involving high pressure
high temperature or hp HT. They were successful in producing
synthetic diamonds on December sixteenth, nineteen fifty four. Now, other
(05:14):
teams were using different methods to create diamonds of in
other companies as well, but it was Hall's efforts that
would receive the credit for designing the first reliable, reproducible
methodology to create commercially viable synthetic diamonds. So there are
a lot of qualifiers there because there were people who
were working on different methodologies and they were also producing diamonds,
(05:37):
but it wasn't considered to be as reliable nor as
viable for a commercial use. And these were not diamonds
meant to adorn engagement rings or other jewelry. For one,
they were brownish in color, so they weren't terribly attractive.
They also were very very tiny. The largest diamond they
produced in that early batch measured point one five millimeters across,
(06:01):
so these were not large stones. More importantly, this purpose
would be put to commercial uses. In fact, it wouldn't
be until the nineteen seventies that scientists would actually be
able to create diamonds of sufficient quality and clarity that
they could be used in the gem industry. And even
then the process was so labor intensive and so expensive
(06:22):
it was not economically feasible to create synthetic diamonds for
decorative purposes. The cost of the synthetic diamond would be
so high that would actually be cheaper for you to
go out and buy a ring with a natural diamond
on it. Also, the whole topic of diamonds is one
that I find particularly upsetting, But that's a that's a
(06:47):
topic for a totally different podcast. So how did they
make synthetic diamonds? Well, I'm sure most of you know,
diamonds are a form of carbon. It's a it's a
crystalline form of carbon. You've gotta crystalline structure where you
have a carbon atom that's surrounded by four other carbon
atoms and they're all connected to each other through strong
(07:07):
covalent bonds. And diamonds are incredibly hard. They are the
hardest natural substance we found so far. They also have
a lot of different industrial uses. They can operate at
high temperatures where they can hold stiff firm. At high temperatures,
they don't really operate at all. They're just minerals, but
they hold together well at high temperatures. So you put
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it on something like a high speed cutting tool, and
the hardness combined with the fact that it's not going
to break down at high temperatures, means you can run
that very high RPMs and start cutting through stuff pretty well.
In nature, diamonds form as carbon is compressed at very
high temperatures over a very long time, and if it
weren't for stuff like volcanoes, we probably never would have
(07:52):
found the things because they tend to form in the
Earth's mantle, which is not easy to get to. They
they these zone where they form is about a hundred
miles beneath the surface of the Earth. That's far deeper
than we've ever drilled. Hall's lab used a belt press,
and this press could exert more than ten giga pascals
(08:14):
of pressure. A pascal is a unit of measurement for pressure,
and it equates to a Newton per square meter. Standard
atmospheric pressure is about one d one point three to
five kilo pascals, So a giga pascal is one billion pascals.
Ten giga pascals would be ten billion pascals, so that's
(08:36):
a lot of pressure. G would actually put it in
another way for those of us who don't use you know,
scientific notation for everything. They said, the press could exert
one point five million pounds per square inch of pressure,
So in other words, it's just a whole lot of pressure.
And plus it would operate at a very high temperature.
It would be heated to a temperature of more than
(08:58):
three thousand six d fifty degrees fahrenheit or two thousand
ten degrees celsius. This press pushed against a mixture of graphite,
which is another form of carbon, and the graphite would
be dissolved in a catalyst metal and catalyst metals could
include stuff like nickel or iron. A catalyst in a
chemical reaction is something that facilitates and speeds up the
(09:20):
chemical reaction. So in this case, and meant that we
didn't have to wait millions of years for synthetic diamonds
to form, instead talk about twenty minutes. The largest of
those diamonds, like I said, was point one five millimeters across,
so pretty darn tiny. The following year, g E introduced
hermetically sealed relays. These are electronic components that could be
(09:42):
used in lots of different applications that otherwise might be
sensitive to their environments, particularly in stuff like high altitude
airplanes and aerospace applications, and variations of these components would
be used throughout the next few decades in those particular applications.
It's just one early example of how GE would become
(10:02):
an important part of the space race, which was just
heating up in the nineteen fifties between the United States
and the then Soviet Union. Meanwhile, the company continued to
expand its consumer product line. It had introduced a toaster
decades earlier, but in nineteen fifty six it introduced the
toaster oven. Specifically, it was one called the tree toast
(10:27):
our oven, and it's adorable. You should look up a
picture of it. That same year, GE built a commercial
jet engine based off the J seventy nine design, which
was intended for military aircraft that wasn't meant to be
for commercial aircraft. So this new engine, which had the
designation c J eight oh five, would mark General Electrics
(10:49):
entry into the commercial jet engine business. So now they
were building jet engines not just for the U. S. Military,
but also for companies like Boeing and other companies were
creating aircraft. Seven would be a really big year for GE.
The company secured a contract with the United States Air
Force to provide the engine for an experimental supersonic aircraft,
(11:10):
the x B seventy Valkyrie. Now the X in aircraft
names is a big tip off that that's an experimental prototype.
You'll often see X as part of the designation at
the beginning of various aircraft that usually means experimental. The engine,
called d J ninety three, was capable of producing enough
thrust to propel the experimental aircraft to three times the
(11:33):
speed of sound, and it would travel an altitude of
seventy thousand feet or about twenty one meters. Not the time,
the thinking was that the greatest threat to bombers were
intercept aircraft. So if you could fly high enough and
fast enough, you wouldn't have to worry about that. No
one would ever be able to get a bead on you.
They wouldn't be able to to track you and fire
(11:55):
on you at that speed and at that altitude. So
the Valkyrie would be safe against tip called defenses. However,
the Soviet Union was developing service to air missile technology
and that started to bring into question whether or not
the Valkyrie would be equally as effective against that sort
of defense system. And one of the ways to get
(12:16):
around that would be to fly the Valkyrie at lower altitudes,
where it could fly beneath radar. But if you did that,
you also had to fly slower. You couldn't fly at
the same mock three speed at lower altitudes. That meant
that the bomber would be flying lower and slower than
it was designed to do, and it would be no
more effective than other bombers that were already in use
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at that time, and it was more expensive. So with
all of those considerations stacked against the Valkyrie, the ultimate
decision was not to go into production and build those
out as a production model, so it just remained an
experimental prototype. But it is super cool to look at.
If you ever want to look at a picture of
a x B said in the Valcrie, they're pretty neat looking.
(13:02):
Something else that happened in nineteen seven was that General
Electric constructed a nuclear power plant in Alameda County California,
and it was the first nuclear reactor to be connected
to a commercial electricity grid. In other words, General Electric
was able to produce electricity that would go to average
citizens over an Alameda County. And I've talked a little
(13:24):
bit about how nuclear power plants work, I'll just give
a very very high level rundown. So you have a
nuclear material that undergoes nuclear decay, and as part of
that process, it releases subatomic particles, typically neutrons, and those
neutrons collide with other atoms of that same nuclear material.
This is your fuel, and when they collide with those
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other atoms, it initiates a chain reaction. Those atoms then
go undergo radioactive decay and they release neutrons and so
on and so forth. So if there's enough thistle material,
that is material that can split apart in the few will,
this reaction can be sustained until the amount of fuel
dips below critical levels, in which case you start to
have fewer and fewer reactions and you've spent the nuclear fuel.
(14:10):
Doesn't mean that all the nuclear radiation stuff is gone,
far from it, but it's no longer producing the reactions
at the level you need to sustain that reaction indefinitely.
This is a nuclear power plant. Now, the concentration of
nuclear material is really high where that reaction starts to
pick up speed over and over and over again, and
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this happens in the blink of an eye. Then you
can set off a much more explosive chain reaction. In
that case you have a nuclear bomb rather than a
power plant, and that that concentration is key there. That's
why you'll hear stories about how how much UH uranium
you would need for a nuclear power plant versus one
(14:53):
for you know, refined uranium for a nuclear bomb. Now,
this reaction produces a lot of heat, and it's the
heat that's the key for these nuclear power plants. That heat,
usually through a paired system of pipes, transfers to a boiler,
and the water in the boiler boils into steam, and
that steam then turns turbines which generate electricity. So a
(15:16):
nuclear power plant is, if you think about it, really
just a way to boil water, really fast and really efficiently.
Cold power plants also boil water, but obviously they do
it through combustion rather than through a nuclear reaction. So
the interesting thing to me is that the the part
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that generates the heat is different, but the end result
is very much the same in the sense that you're
boiling water to create steam to turn turbines to generate electricity. Now,
I'll not go down the nuclear power rabbit hole because
there's much more to talk about just with general electric
But if you want to learn more about nuclear power plants,
(15:58):
do a quick search over at text of podcast dot com.
That's where we have an archive of all of our
past episodes. You can also learn the difference between fission
nuclear reactors, which are what we use today, and fusion
nuclear reactors, which we hope we can make feasible in
the near future. We have done fusion reactions already, but
the question is can you make that sustainable? Can you
(16:21):
make it economically feasible. That's a question that we have
not yet answered, but if we are able to do it,
it could transform the world anyway. The ge facility, which
was called the Valacitos Nuclear Center, it still exists, uh.
It was only an active power plant until nineteen sixty three.
At that point, the federal government told g E to
(16:42):
shut it down, So the boiler reactor was shut down
in nineteen sixty three, but GE maintains the facility mainly
for the purposes of testing an analysis, particularly testing radiated
materials to see how long they remain at dangerous levels
of radiation. For example, So if you have instruments or suits,
(17:04):
things like that that would exist in a radiation radiation
UH filled area, you want to know how long is
that stuff going to be dangerous UM. That's just part
of what they do now. A major part of that facility.
UH One of the largest of the reactors on that
site got shut down in ninety seven. It was still
being used for research purposes, but not to generate electricity.
(17:26):
Why was it shut down, Well, it was discovered that
it had the unfortunate distinction of sitting nearly directly on
top of a fault line. There was a legitimate concern
over what might happen should an earthquake hit while the
reactor was an operation. There is still a smaller reactor
on the site that operates in the one kilowatt range,
(17:46):
but that's the only one as far as I can tell. Otherwise,
all the other reactors have been completely decommissioned to shut down.
We've got a lot more to say about general electric
but before I get into that. Let's take a quick break.
(18:07):
The work out of GEES research Lab was pretty incredible.
In the nineteen fifties. You had the nuclear scientists building
that first licensed power plant to provide electricity to a grid.
You had synthetic diamonds, and you had Robert H. Windorf
who created a substance called borazon in the lab. Borizon
is is a man made substance. You don't find it
(18:27):
in nature, but it's almost as hard as diamond and
it can be used in temperatures much higher than even
diamonds can be used in. Like diamonds will break down
once you get over a certain temperature, but borazon can
hold together longer. So it would also become a very
useful component in industrial cutting tools for example. Now around
the same time, a different group of engineers were building
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something perhaps a bit less lofty in the grand scheme
of things, but that would be the humble electric can opener.
G introduce is the first consumer electric can opener in
nineteen fifty eight, and pet ownership has never been the
same since. In nineteen fifty nine, g E introduced the
(19:10):
halogen lamp. These work in a way very similar to
incandescent lamps. There's a tungsten filament inside a very small bulb,
and encasing the filament is a quartz envelope. Inside the
envelope is a gas from the halogen group of gases.
So this is different from what the kind of gas
you would find in your typical incandescent bulb. The benefit
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of halogen gas is that it can combine with tungsten vapor.
So when the tungsten filament heats up and it starts
to give off light, it's also giving off tungsten vapor.
You know, tungsten is essentially burning off of the filament.
That vapor combines with the halogen gas and then it
gets deposited back onto the tungsten filament, at least some
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of it does, so some of that vaporized tungsten gets returned.
That actually helps ex in the useful life of the
halogen lamp. Halogen lamps can produce a lot more light
per unit of energy compared to an incandescent bulb. They
also produce a lot more heat, and as someone who
has sadly a few halogen lamp fixtures in his house,
(20:16):
I can speak from experiences. Those things get real hot.
Guys like you will burn your fingers. I know I
have anyway. In nineteen sixty a device built by g
E became the first man made object to be recovered
after going into orbit around the Earth. It was code
named by g E the r v X to a
(20:37):
re entry vehicle that was part of the Discoverer thirteen satellite.
The discovered thirteen satellite kind of set the stage for
space based reconnaissance and spy missions. Now, granted, that was
not the public facing part of the mission. Obviously, letting
everyone know, hey, this is a spy satellite is not
the best plan if you want to use it for
(21:00):
you know, spy stuff. So there was a cover story,
and the cover story was essentially that it was a
science experiment, but in reality it was a classified mission
that was overseen by both the Air Force and the
c I A. G would go on to open up
a space center in Valley Forge, Pennsylvania in nineteen sixty
one because they were getting more and more involved in
(21:22):
building components for the space race. Also in nineteen sixty
there was a guy named Jack Welch who joined g
E as a chemical engineer. He'll be really important later,
So remember that name, Jack Welch. We'll get back to it.
Nineteen sixty two, scientists from GE would develop one of
the first solid state lasers using semiconductors. Interestingly, scientists at
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IBM and over at M I T were independently doing
the exact same thing, and all the parties pretty much
cracked the problem right around the same time. This set
off a bit of a patent rush, with GE beating
IBM to the punch by a little more than a week.
I just find it fascinating that the solid state laser
was one of those things that multiple parties invented at
(22:09):
around the same time, independently of each other. But to
be fair, the stage had already been set with early
work in masers and lasers, so these were not the
first lasers. They were the first solid state ones. Solid
state lasers would then find their way into numerous technologies
and applications. Early on, scientists theorized that they could be
(22:29):
incredibly useful in communications, but they would become so commonplace
that we'd rely on them to play our tunes for us.
Because the laser and stuff like CD players, DVD players,
Blu ray players, those are all solid state lasers. So
what was truly cutting edge technology in nineteen sixty two.
Is now so commonplace that you can go out and
buy one and use it to frustrate your pets. You know,
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you can just go get a little key chain with
a solid state laser on it. Um. But I'm pretty
sure back in nineteen sixty two, no one thought that
that was going to be a few future possibility. D
E scientists were also working with superconductors and magnetism. Now,
a conductor is a material that allows electrons to pass
through it. You know, it conducts electricity. A superconductor is
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a material that does this with no resistance to the
flow of electricity. So, under normal conditions, conductors have a
bit of resistance to electricity, and the amount of resistance
is dependent upon several factors, like how what what the
actual material is, You know, what is the conductive material. Also,
it's thickness or gauge. So a thin copper wire, for example,
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has higher resistance than a thick copper cable. They're both
made of the same thing, but the physical structure is
different and that changes the resistance of the material. G
S super conducting magnet was the first to break through
the one hundred thousand gass limit. The gass is a
unit of measurement for magnetic flux density. I'll give you
(23:57):
the technical definition of a gass as laid out by
the Encyclopedia Britannica. So here we go. One goss quote
corresponds to the magnetic flux density that will induce an
electromotive force of one ab volt in each linear centimeter
of a wire moving laterally at one cimeter per second
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at right angles to a magnetic flux end quote. Okay,
so that's a bit of a mouthful. Anyway, we rate
magnets in goss. That's how we measure their strength. So
g S super conducting magnet was incredibly powerful. It would
also lay the foundation for practical applications of that type
of a magnet, particularly in the creation of magnetic resonance
(24:40):
imaging technologies, and GE would play a very important role
in developing that technology, or the m r I as
we would say, um very important part of g S business.
One of the fun facts I discovered while researching these
episodes is that the footprints that the Apollo eleven astronauts
left on the Moon are there in thanks to GE. Specifically,
(25:02):
the boots worn by the astronauts had silicone rubber in
them that had been manufactured by g E. So that's
a g E footprint up there in a way. But
that was just one of the contributions g E made
to the Apollo program. I don't want to discount or
dismiss any of the other ones that the company made.
They actually provided a lot of technology to the space program.
(25:23):
General Electric was involved in designing or manufacturing several systems
related to the space race, including the ship to satellite
communication system that allowed the Apollo crew to send TV
images from the capsule to satellites orbiting the Earth, which
in turn beamed those images down to terrestrial stations. In
nineteen seventy three, another ge researcher, dr Ivar Giev, would
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get a Nobel prize. He had back in nineteen sixty
discovered the truly odd behavior of super conductive tunneling. So
what the heck is tunneling? What it all has to
do with the weird weird world of quantum mechanics and
quantum physics. So when I was in school, we learned
that electrons orbit the nucleus of atoms in a certain
(26:08):
energy state, and electrons would quote unquote want to occupy
the lowest energy state available. Once that energy state was
full of electrons, then the next electrons would fill up
the next available state further out from the nucleus, and
so on and so on, until you had all the
electrons that that particular atom would have, whether it was
(26:28):
a base version of the atom or an eon or whatever.
This was a pretty big simplification of what is actually
going on, and in my books, I remember seeing the
old illustrations. We had newer ones too, but I remember
those old illustrations made it look like an electron was
sort of like a planet orbiting around a sun like nucleus. So,
in other words, according to those illustrations, it would appear
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that an electron has a specific position around the nucleus
that you could measure and detect and predict. But as
scientists would later learn, we could really only determined partial
information about a sub atomic particles velocity and location. The
more we knew about one of those two things, the
less we would know about the other. So the more
you know about a particle's velocity, the less you know
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about its position. The more you know about its position,
the less you know about velocity. So really we don't
know whether an electron quote unquote is in a specific place,
but we we know where it can be, the various
positions where the electron could possibly be found, so you
can think of it as kind of a zone of
probability or a field of probability. There's a chance the
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electron will be at any of those points within that field.
It has to be within that field unless you've poured
more energy into the atom and thus pushed the electron out.
But it has to be somewhere in that field. You
just don't know where it is. So it's kind of
this amorphous fog that the electron could inhabit. Now, if
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you have a situation in which this field, this imaginary field,
because we don't actually have a fog here, but if
this field spans a barrier that normally you would have
to use energy to get across, it means that the
there's actually a possibility that the electron could appear on
the other side of that barrier. So imagine you have
(28:19):
a hallway and there's a door closed at the end
of the hallway, and you have this electron field, and
the electron field actually overlaps the door to the point
where part of the field extends to the other side
of the closed door. Now, you would expect the electron
to be in the hallway. You didn't open the door.
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You saw the electron go into the hallway. You figure
that's where it's got to be. But because that field
overlaps the door, there is the possibility that the electron
could be on the other side. And because there's a possibility,
it means that sometimes there will be an electron on
the other side of that door, and it's as if
the electron has tunneled through or climbed over the door.
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But at no time did it ever have to expend
energy to do that. It just appeared on the other side.
This is tunneling, and it doesn't make a whole lot
of sense to us because that's not how we observe
things in our normal world. You don't go down the
hallway and suddenly little Jimmy is just on the other
side of the door because there was a chance little
Jimmy was gonna be there. That doesn't happen in our
(29:22):
real world, but in quantum physics it's tots a thing.
It's also one of the reasons why developing microchips with
smaller and smaller components becomes a really huge challenge because
electron tunneling is a problem. If you're determined to channel
electrons down specific pathways, as is the case with a circuit,
then you run into an issue. If an electron can
(29:45):
encounter a gate, the gate is closed, but because of
electron tunneling, there's the possibility of the electron appearing on
the other side of the gate. It means that you
can create errors this way. Anyway, let's get back to
g E S timeline. In ninet g ES Medical Systems
Division developed an improved method for taking X ray cross
(30:06):
section pictures which reduced the scanning time down to less
than five seconds, which was an enormous improvement, a huge
leap forward. Ad meant that patients wouldn't have to sit
still for as long to get a cross section X
ray done. Now, I'm reminded of a time when I
had to get an X ray done and I was
having a kidney stone and that was painful. It was
(30:28):
so painful that just trying to stay still was a
huge challenge for me. And it was technology like this,
this breakthrough I was just talking about that made those
sort of X ray scans much faster, much more efficient
and reduced blurring, so that if the patient were moving
because the scanning took so so little time, there was
a better chance that you're going to get a nice
(30:49):
clear picture. Otherwise, obviously, if the patient moves while the
picture is being taken, you're gonna get blur. So I'm
very thankful that GE was able to make X rays
much more efficient and take less time. GE celebrated one
years of innovation in nineteen seventy eight, which might be
a little confusing at first because General Electric as a
(31:09):
company was founded in eighteen nine two, not eighteen seventy eight. However,
g also traces its historical roots back to an earlier company.
If you listen to the first episode, you know about
that Edison Electric Light company, that one began in eighteen
seventy eight. According to a timeline on the GE website,
specifically a timeline that's on gees website in India, the
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company states that nineteen became the first company to have
received fifty thousand patents. Wow. While the company continued to
diversify and work in various industries, a big change was
around the corner, and that change happened in nineteen eighty one,
when Jack Welch, that chemical engineer I mentioned earlier, would
become the company's youngest chairman and CEO. He replaced the
(31:55):
outgoing CEO, which was a guy named Reginald H. Jones.
Welch's ten year is an incredibly important one in the
history of GE, so I figured it'd be good to
get a little background on the man first. He was
born in Peabody, Massachusetts, in nineteen thirty five. His father
was a railroad conductor. Jack Welch would grow up in Salem, Massachusetts,
(32:15):
and as a kid he loved playing sports. He really
loved winning, and he despised losing. That would be a
fundamental part of his character that would carry over to
his work at GE. He received a bachelor's degree in
chemistry from the University of Massachusetts at Amherst, and he
received his masters and his pH d at the University
of Illinois Champagne. Upon graduating and got a job at
(32:38):
GE and he worked in their plastics division, and he
had nearly quit his job after just a short while.
He felt that gees organization was too cumbersome that was
filled with middle management positions, it was bloated, and he
felt his own work wasn't being valued properly, but an
executive named Ruben Gutoff convinced Welch to stay with the company.
So he did, and he would end up lee eating
(33:00):
the plastic division after working there for a while, then
he moved on to other executive roles. He oversaw the
Chemical and Metallurgical division, then he headed up GE strategic planning.
Then he became a sector executive for the consumer products division.
And despite all of that, he wasn't first and foremost
in the minds of the board of directors who are
(33:20):
looking to fill that position of CEO. When we come back,
I'll talk a little bit more about how he got
his position and what he did with it, but first
let's take another quick break. Welch was just one of
seven people under consideration for the role of g E
(33:43):
CEO in nine He didn't even have a formalized plan
for where he wanted the company to go, but he
did have the determination to lead GE to being the
number one company in every industry in which g E
had a presence. This was enough to commence the board
to name him CEO, and his first moves were really
to streamline g E. While he had risen through the
(34:06):
ranks in his decades at General Electric, he still felt
that the company was bloated. That opinion had not changed,
even though he had gone from being an engineer to
an executive. At the time he assumed the position of CEO,
g E was a mega giant, consisting of three hundred
different businesses, and Welch saw that as a problem, because
(34:28):
how could you focus and be the absolute best when
your presence is spread so thin across so many businesses.
And so Welch began to consolidate departments. He began to
sell off divisions. He was trimming the fat. Part of
that meant laying off employees, and Welch did that too.
He did that a lot. By the mid nineteen eighties,
(34:49):
just a few years after he had become CEO, GE
had laid off around one hundred twenty thousand employees. This
is hard for me to even imagine. The town I
grew up in has a population of around forty thousand
people today. G E laid off three times as many
people as were in my hometown. That's tough for me
(35:12):
to even imagine. The layoffs earned Welch a nickname neutron
Jack because he was like a neutron bomb going off
in the company, he would eliminate employees while leaving the
corporate assets intact. A neutron bomb is thought of as
the same thing. It's a sort of bomb that can
kill living stuff and leave physical infrastructure untouched. Welch hated
(35:35):
this nickname. It was a pretty cutthroat and brutal strategy,
but Welch was pretty much demanding that approach. He wanted
to get out of any business where GE did not
occupy the number one or number two spot in the industry.
If G were further behind them that he would rather
ditch that part of the business than to continue to
(35:57):
just sort of muddle along. It made little sense, he said,
to be in businesses where other companies could go to
market selling stuff cheaper than what it cost GE to
manufacture those same things in the first place. So he
gave an example of this. He's talked about television sets
and Schenecta in New York. They were still making television
sets when Jack Welch took over GE, but Welch said
(36:19):
that Japanese companies were selling TV sets for less money
to the final customer than it would cost GE to
manufacture a set. So Japanese television set might sell for
a hundred dollars and it might cost a hundred ten
dollars for g E to even make a TV set.
There was no way to compete in that space and
(36:40):
at all make a profit, so it made no sense
to keep the business. He preferred focusing the company's efforts
on industries where they could outperform their competitors, rather than
remain in a business just to have a foot in
the door. Through a limiting divisions, selling off businesses, and
through laying off thousands of employees, the company ended up
saving a lot of money, to the tune of billions
(37:02):
of dollars, and Welch wasn't just going to sit on
those savings. He looked to reinvest in the company, and
as part of that, he was looking for a possible acquisition,
and he decided upon an old, familiar name. That name
was r c A. Now, if you listen to the
earlier GE episodes, or if you listen to my r
c A episodes, you'll remember that General Electric was one
(37:25):
of the founding companies that created our CIA in the
first place. GE was also the majority shareholder until it
was compelled to sell off those shares of our CIA,
along with the other founders. This was because the United
States government at the time had antitrust concerns about the
radio industry. Well. The merger of g E and r
c A was a six point three billion dollar deal,
(37:48):
which was the largest in history at that point, and
Welch took the same approach to our c A as
he had to GE. Namely, he began hacking away at
businesses he viewed as being distractions. So within three years
of this deal, Welch had reduced the number of our
CIA employees to half of what they once were. He
oversaw r c A selling off almost all of its businesses.
(38:11):
Really only two remained. One was the defense business that
our ci A would do for the U. S Military
and also for NASA. The other was the NBC television network,
So this was the time when GE would own NBC.
This was a subject that become a frequent plot point
on the TV series thirty Rock. It's also when our
(38:32):
c A effectively just became a name. It was no
longer the company at once was, so if you listen
to the r c A episodes, this is pretty much
at the point where the r c A story ended
working for Welch was really tough. If you were really
good at your job and your job was in a
division that Welch viewed as being central to GS mission,
(38:53):
you had decent job security. Welch had employees go through
regular performance reviews, and the emloyees who were in the
top twenty would get bonuses. Those who were in the
bottom ten percent were likely to get fired, and holy
cats did. His strategy pushed GE to new heights. The
company became known as the House that Jack built. The
(39:16):
stock price for g E rose four thousand per cent. Meanwhile,
the company was still churning out innovations such as groundbreaking
work and fiber optics and magnetic residance imaging systems. The
company also launched the Consumer News and Business Channel or
c NBC in nine so it wasn't just a powerful
(39:37):
company in industry, it was now also becoming a powerful
media company. One other area Welch pushed g E into
was financial services. With GE Capital, Welch led acquisition efforts
to buy foreign banks, and GE also would become a
major insurance provider. These services were at the time remarkably profitable.
(39:59):
In fact, that an understatement when Welch took over GE,
the company's value was fourteen billion dollars. By the time
Welch would retire in two thousand one, the company's value
was an excess of four hundred ten billion dollars, and
a large part of that was due to the profitability
of the financial services during that time. Also, we have
(40:21):
to say that when this happened, it was a brilliant
move from a business perspective. It pushed GE to new heights,
and it made Welch a very wealthy man. It would
also end up being the major pain point for GE
several years later that I'm going to get to that
in our next episode as it begins to play into
the more recent allegations about g E and its accounting practices.
(40:43):
But before we get to those dark tidings, let's finish
up with some of the techie things that the company
was doing under Welch's command. In GE, through its r
c A Space division, delivered the Mars Observer to NASA.
It had been seventeen years since NASA had sent a
space craft to study Mars, so the intent was to
launch the Mars Observer and insert it into an orbit
(41:06):
around the Red planet. The Mars Observer had instruments meant
to study the climate, geophysics, and the geology of Mars.
The launch went off beautifully. On September n the orbiter
began its long journey to Mars that would take nearly
a full year, and on August twenty one nine, just
(41:26):
a couple of days before the orbiter was meant to
officially enter Mars's orbit, all communication was lost between the
spacecraft and Earth. NASA was unable to re establish contact,
so the mission was ultimately a failure, though NASA was
at least able to learn some things through the process
of sending the orbiter to Mars in the first place,
but none of the primary mission objectives were achieved. In nineteen,
(41:51):
in another move to dominate media, NBC and Microsoft partner
together to launch the twenty four hour news channel ms NBC.
In g E began to adhere to a quality control
strategy called six Sigma, which calls for fewer than three
defects per million opportunities now. To achieve that goal, g
(42:12):
E would spend millions of dollars on training and new
production processes, so it was a very expensive and time
consuming effort, but Welch's view was that it would ultimately
benefit the company and result in massive savings. Fewer defects
would mean less waste. The first product from GE to
go through this process was a medical scanner called the
(42:34):
light Speed q X slash i CT system. In GE
secured a contract with Boeing to build massive, powerful jet
engines for Boeing seven seventy seven line of jets. The
company produced the g E nine D family. Now this
is not the only type of engine used on a
seven seventy seven. There's a whole bunch of different variations
(42:55):
of the seven seventy seven, and some of them use
engines from other companies, So it all depends upon the
version of the seven seventy seven you're looking at, but
it is the largest and most powerful jet engine produced
to date. In g E opened a new research lab.
This one is called GE Global Research. It's located in Bangalore, India,
(43:16):
and this marked an effort for g E to not
just expand its overseas markets, which it ha been doing
for the previous decades, but also to attract new talent
in the field of technology, talent that wasn't just located
in Europe or the United States. In two thousand, the
company unveiled the tm DRED, which is a power plant
on wheels. It's a gas turbine generator that can supply
(43:38):
twenty two point eight megawatts of electricity. Takes a couple
of days to set up once it's on location, and
it's used for lots of different purposes, including as a
way to supply electricity to areas that have been affected
by natural disasters. Gas turbines, by the way, work in
a very similar way to jet engines. You've got a
compressor that draws air into the engine. The air gets compressed,
(44:00):
and that's what a compressor does, and then it enters
into the combustion chamber where it combines with fuel from
fuel injectors. This mixture gets ignited and then it burns
at a very high temperature. It generates high temperature, high
pressure gas. The gas moves out of the combustion chamber
into a turbine section. That's where the gas can expand
and escape, and as it does so, the force of
(44:21):
that escaping expanding gas turns a turbine. The turbine does
two things. One, it drives the compressor, so it pulls
in more air and thus keeps the process going as
long as you have fuel to burn, and it also
spends a generator to create electricity. Jack Welch planned to
retire from GE and two thousand but one thing kept
him around a little bit longer. That thing was a
(44:43):
prize Welch really wanted for GE. There's a company called
Honeywell International. Now. Honeywell makes advanced electronics for the aviation industry,
among other things, and Welch led a forty billion dollar
plus acquisition effort to get this company. He that Honeywell
had another suitor, that of United Technologies Corporation, and he
(45:05):
added a promise to Honeywell that he would stay on
with GE until this acquisition was complete. He would delay
his retirement until two thousand one. So they decided they
would pursue this acquisition deal and things were going pretty well.
The United States seemed fully on board, but then you
get to the summer of two thousand one, and that's
when European regulators expressed concern that this merger would stifle
(45:28):
competition in the industry. Welch reportedly reached out to US
government officials to see if anything could be done to
smooth things out and get the deal approved. This had
the effect of royally taking off those regulators, and ultimately
the European Union denied authorization for this merger and the
deal fell apart. Welch, who hated losing, lost this one.
(45:51):
The CEO of Honeywell, Michael Bunt Sire, was shown the
door not long after the deal was scrapped, and Welch
would continue on towards his retire Ermont Jack Welch stepped
down as CEO of g E on September seven, two
thousand one. His replacement would be Jeffrey R. Emilt, and
just four days after Emilt would take the helm of
(46:13):
ge the terrorist attacks on the United States on September
eleven would change the company's course. We'll talk about how
that happened in our next episode. In the meantime, if
you have a suggestion for a future episode of tech Stuff,
whether it's a company, a technology, just a concept in tech,
anything like that, let me know. You can send me
(46:34):
an email the addresses tech Stuff at how stuff works
dot com or pop on over to tech Stuff podcast
dot com. That's where're gonna find the archive of all
of our past episodes, all one thousand, one sixty plus
of them, and you'll also find links to where we
are on social media, as well as a link to
our online store, where every purchase you make goes to
(46:56):
help the show. We greatly appreciate it, and I'll talk
to you again really soon. Y Text Stuff is a
production of I heart Radio's How Stuff Works. For more
podcasts from I heart Radio, visit the I heart Radio app,
Apple Podcasts, or wherever you listen to your favorite shows.
Welcome to tech Stuff, a production of I Heart Radios
How Stuff Works. Hey there, and welcome to tech Stuff.
I'm your host, Jonathan Strickland. I'm an executive producer with
How Stuff Works in iHeart Radio and I Love all
things tech. And we are continuing our journey through the
history of General Electric or GE, a company that has
(00:27):
encountered some pretty significant challenges over the last decade or so. Now.
In our first two episodes, I went through the founding
of GE and then made my way all the way
up through World War Two, and I talked about how
some of the top level executives of the company were
called upon by the US government to serve in wartime
government positions to help the US meet the needs of
(00:48):
supplying the military with the equipment necessary to fight the war.
I also talked about how g E continued to grow
as a company, building on new departments and divisions and
diversifying the company's businesses. And I ended the last episode
by talking about a court case that determined g E
was being anti competitive by leveraging patents in order to
act as an effective monopoly when it came to manufacturing
(01:10):
light bulbs. Now we're almost up to nineteen fifty and
it's time to get out of this world. The one
thing I want to mention before we get into the
nineteen fifties is that in nineteen forty six a scientist
at GE named Vincent Schaefer developed the process of cloud seating.
And the idea is pretty elegant but has long been
(01:31):
a subject of scientific dispute. So here's the process. It
involves distributing tiny particles into clouds in an effort to
make it rain. And the thought is that these particles
will act as nucleic sites for rain drops to form.
When the raindrops get large enough, they have enough weight
to fall to Earth. And so that is the general
(01:54):
thought behind cloud seating. It's been practiced ever since, but
there have been many questions over whether or not cloud
seating actually works. Sometimes it would rain, sometimes it wouldn't,
And if it did rain, is there any way to
be sure that it was the cloud seeding that actually
made the difference. I mean, you had to have a
cloud there in the first place. You couldn't just manufacture
(02:14):
a cloud. Experiments and labs suggested that it should work,
but the natural world is very different from the controlled
conditions of a lab environment. It didn't help that many
of our measuring instruments lacked the precision to detect very
small raindrops, so you couldn't really monitor to see if
it was actually doing what it was supposed to do.
(02:34):
An experiment in two thousand eighteen suggests that cloud seating
does in fact work, at least to some extent. But
there's another question that's still open, which is does cloud
seeding make economic sense? Does the amount of water produced
by rainfall justify the cost of flying aircraft up and
distributing the particles in the first place, Because it may
(02:56):
very well work, but it might not work well enough
to make sense from a financial perspective. I just find
it fascinating that we've essentially been doing this for seventy
years and we still don't know if we should be
doing it now. I can certainly see why cloud seating
companies feel we should be doing it. I mean, that's
their business. But the jury is still technically out over
(03:18):
whether or not it makes sense, and there's still a
little bit debate on whether or not it really truly works,
or if it works in enough conditions for it to
be reasonable. Now in Ge made the first two door
refrigerator freezer combo. And I only mentioned it here because
I think it's cool. That's a pun. Now we're up
(03:43):
to the nineteen fifties. So in nineteen fifty one g
E built a new jet engine called the J seven nine.
And here's an interesting historical note. When engineers tested the
J seven nine, which had variable statures, the efficiency ratings
were so high that the engineers thought their instruments were malfunctioning.
(04:04):
There's no way we're getting this level of energy efficiency
out of this thing. But then that raises a question
for a lot of people, what is a statter? What
does that actually mean? Well, the name gives you a hint. Statter, stationary,
that kind of thing. So in jet engines, you have
fan blades that rotate. Those are rotors, and you had
fan blades that hold in place. Those are called statters.
(04:27):
And the purpose of this combination is to both draw
air into the engine and to compress that air before
it enters into the combustion chamber. The adjustable status meant
that the engine could be finely tuned to produce higher
compressor pressures and to produce more usable energy as opposed
to waste heat. When you're actually burning fuel. In n
(04:52):
GE Research Laboratory, scientists named Tracy Hall announced that his
team had discovered a way to create synthetic diamond in
the lab. Halls team used a process involving high pressure
high temperature or hp HT. They were successful in producing
synthetic diamonds on December sixteenth, nineteen fifty four. Now, other
(05:14):
teams were using different methods to create diamonds of in
other companies as well, but it was Hall's efforts that
would receive the credit for designing the first reliable, reproducible
methodology to create commercially viable synthetic diamonds. So there are
a lot of qualifiers there because there were people who
were working on different methodologies and they were also producing diamonds,
(05:37):
but it wasn't considered to be as reliable nor as
viable for a commercial use. And these were not diamonds
meant to adorn engagement rings or other jewelry. For one,
they were brownish in color, so they weren't terribly attractive.
They also were very very tiny. The largest diamond they
produced in that early batch measured point one five millimeters across,
(06:01):
so these were not large stones. More importantly, this purpose
would be put to commercial uses. In fact, it wouldn't
be until the nineteen seventies that scientists would actually be
able to create diamonds of sufficient quality and clarity that
they could be used in the gem industry. And even
then the process was so labor intensive and so expensive
(06:22):
it was not economically feasible to create synthetic diamonds for
decorative purposes. The cost of the synthetic diamond would be
so high that would actually be cheaper for you to
go out and buy a ring with a natural diamond
on it. Also, the whole topic of diamonds is one
that I find particularly upsetting, But that's a that's a
(06:47):
topic for a totally different podcast. So how did they
make synthetic diamonds? Well, I'm sure most of you know,
diamonds are a form of carbon. It's a it's a
crystalline form of carbon. You've gotta crystalline structure where you
have a carbon atom that's surrounded by four other carbon
atoms and they're all connected to each other through strong
(07:07):
covalent bonds. And diamonds are incredibly hard. They are the
hardest natural substance we found so far. They also have
a lot of different industrial uses. They can operate at
high temperatures where they can hold stiff firm. At high temperatures,
they don't really operate at all. They're just minerals, but
they hold together well at high temperatures. So you put
(07:29):
it on something like a high speed cutting tool, and
the hardness combined with the fact that it's not going
to break down at high temperatures, means you can run
that very high RPMs and start cutting through stuff pretty well.
In nature, diamonds form as carbon is compressed at very
high temperatures over a very long time, and if it
weren't for stuff like volcanoes, we probably never would have
(07:52):
found the things because they tend to form in the
Earth's mantle, which is not easy to get to. They
they these zone where they form is about a hundred
miles beneath the surface of the Earth. That's far deeper
than we've ever drilled. Hall's lab used a belt press,
and this press could exert more than ten giga pascals
(08:14):
of pressure. A pascal is a unit of measurement for pressure,
and it equates to a Newton per square meter. Standard
atmospheric pressure is about one d one point three to
five kilo pascals, So a giga pascal is one billion pascals.
Ten giga pascals would be ten billion pascals, so that's
(08:36):
a lot of pressure. G would actually put it in
another way for those of us who don't use you know,
scientific notation for everything. They said, the press could exert
one point five million pounds per square inch of pressure,
So in other words, it's just a whole lot of pressure.
And plus it would operate at a very high temperature.
It would be heated to a temperature of more than
(08:58):
three thousand six d fifty degrees fahrenheit or two thousand
ten degrees celsius. This press pushed against a mixture of graphite,
which is another form of carbon, and the graphite would
be dissolved in a catalyst metal and catalyst metals could
include stuff like nickel or iron. A catalyst in a
chemical reaction is something that facilitates and speeds up the
(09:20):
chemical reaction. So in this case, and meant that we
didn't have to wait millions of years for synthetic diamonds
to form, instead talk about twenty minutes. The largest of
those diamonds, like I said, was point one five millimeters across,
so pretty darn tiny. The following year, g E introduced
hermetically sealed relays. These are electronic components that could be
(09:42):
used in lots of different applications that otherwise might be
sensitive to their environments, particularly in stuff like high altitude
airplanes and aerospace applications, and variations of these components would
be used throughout the next few decades in those particular applications.
It's just one early example of how GE would become
(10:02):
an important part of the space race, which was just
heating up in the nineteen fifties between the United States
and the then Soviet Union. Meanwhile, the company continued to
expand its consumer product line. It had introduced a toaster
decades earlier, but in nineteen fifty six it introduced the
toaster oven. Specifically, it was one called the tree toast
(10:27):
our oven, and it's adorable. You should look up a
picture of it. That same year, GE built a commercial
jet engine based off the J seventy nine design, which
was intended for military aircraft that wasn't meant to be
for commercial aircraft. So this new engine, which had the
designation c J eight oh five, would mark General Electrics
(10:49):
entry into the commercial jet engine business. So now they
were building jet engines not just for the U. S. Military,
but also for companies like Boeing and other companies were
creating aircraft. Seven would be a really big year for GE.
The company secured a contract with the United States Air
Force to provide the engine for an experimental supersonic aircraft,
(11:10):
the x B seventy Valkyrie. Now the X in aircraft
names is a big tip off that that's an experimental prototype.
You'll often see X as part of the designation at
the beginning of various aircraft that usually means experimental. The engine,
called d J ninety three, was capable of producing enough
thrust to propel the experimental aircraft to three times the
(11:33):
speed of sound, and it would travel an altitude of
seventy thousand feet or about twenty one meters. Not the time,
the thinking was that the greatest threat to bombers were
intercept aircraft. So if you could fly high enough and
fast enough, you wouldn't have to worry about that. No
one would ever be able to get a bead on you.
They wouldn't be able to to track you and fire
(11:55):
on you at that speed and at that altitude. So
the Valkyrie would be safe against tip called defenses. However,
the Soviet Union was developing service to air missile technology
and that started to bring into question whether or not
the Valkyrie would be equally as effective against that sort
of defense system. And one of the ways to get
(12:16):
around that would be to fly the Valkyrie at lower altitudes,
where it could fly beneath radar. But if you did that,
you also had to fly slower. You couldn't fly at
the same mock three speed at lower altitudes. That meant
that the bomber would be flying lower and slower than
it was designed to do, and it would be no
more effective than other bombers that were already in use
(12:39):
at that time, and it was more expensive. So with
all of those considerations stacked against the Valkyrie, the ultimate
decision was not to go into production and build those
out as a production model, so it just remained an
experimental prototype. But it is super cool to look at.
If you ever want to look at a picture of
a x B said in the Valcrie, they're pretty neat looking.
(13:02):
Something else that happened in nineteen seven was that General
Electric constructed a nuclear power plant in Alameda County California,
and it was the first nuclear reactor to be connected
to a commercial electricity grid. In other words, General Electric
was able to produce electricity that would go to average
citizens over an Alameda County. And I've talked a little
(13:24):
bit about how nuclear power plants work, I'll just give
a very very high level rundown. So you have a
nuclear material that undergoes nuclear decay, and as part of
that process, it releases subatomic particles, typically neutrons, and those
neutrons collide with other atoms of that same nuclear material.
This is your fuel, and when they collide with those
(13:47):
other atoms, it initiates a chain reaction. Those atoms then
go undergo radioactive decay and they release neutrons and so
on and so forth. So if there's enough thistle material,
that is material that can split apart in the few will,
this reaction can be sustained until the amount of fuel
dips below critical levels, in which case you start to
have fewer and fewer reactions and you've spent the nuclear fuel.
(14:10):
Doesn't mean that all the nuclear radiation stuff is gone,
far from it, but it's no longer producing the reactions
at the level you need to sustain that reaction indefinitely.
This is a nuclear power plant. Now, the concentration of
nuclear material is really high where that reaction starts to
pick up speed over and over and over again, and
(14:31):
this happens in the blink of an eye. Then you
can set off a much more explosive chain reaction. In
that case you have a nuclear bomb rather than a
power plant, and that that concentration is key there. That's
why you'll hear stories about how how much UH uranium
you would need for a nuclear power plant versus one
(14:53):
for you know, refined uranium for a nuclear bomb. Now,
this reaction produces a lot of heat, and it's the
heat that's the key for these nuclear power plants. That heat,
usually through a paired system of pipes, transfers to a boiler,
and the water in the boiler boils into steam, and
that steam then turns turbines which generate electricity. So a
(15:16):
nuclear power plant is, if you think about it, really
just a way to boil water, really fast and really efficiently.
Cold power plants also boil water, but obviously they do
it through combustion rather than through a nuclear reaction. So
the interesting thing to me is that the the part
(15:37):
that generates the heat is different, but the end result
is very much the same in the sense that you're
boiling water to create steam to turn turbines to generate electricity. Now,
I'll not go down the nuclear power rabbit hole because
there's much more to talk about just with general electric
But if you want to learn more about nuclear power plants,
(15:58):
do a quick search over at text of podcast dot com.
That's where we have an archive of all of our
past episodes. You can also learn the difference between fission
nuclear reactors, which are what we use today, and fusion
nuclear reactors, which we hope we can make feasible in
the near future. We have done fusion reactions already, but
the question is can you make that sustainable? Can you
(16:21):
make it economically feasible. That's a question that we have
not yet answered, but if we are able to do it,
it could transform the world anyway. The ge facility, which
was called the Valacitos Nuclear Center, it still exists, uh.
It was only an active power plant until nineteen sixty three.
At that point, the federal government told g E to
(16:42):
shut it down, So the boiler reactor was shut down
in nineteen sixty three, but GE maintains the facility mainly
for the purposes of testing an analysis, particularly testing radiated
materials to see how long they remain at dangerous levels
of radiation. For example, So if you have instruments or suits,
(17:04):
things like that that would exist in a radiation radiation
UH filled area, you want to know how long is
that stuff going to be dangerous UM. That's just part
of what they do now. A major part of that facility.
UH One of the largest of the reactors on that
site got shut down in ninety seven. It was still
being used for research purposes, but not to generate electricity.
(17:26):
Why was it shut down, Well, it was discovered that
it had the unfortunate distinction of sitting nearly directly on
top of a fault line. There was a legitimate concern
over what might happen should an earthquake hit while the
reactor was an operation. There is still a smaller reactor
on the site that operates in the one kilowatt range,
(17:46):
but that's the only one as far as I can tell. Otherwise,
all the other reactors have been completely decommissioned to shut down.
We've got a lot more to say about general electric
but before I get into that. Let's take a quick break.
(18:07):
The work out of GEES research Lab was pretty incredible.
In the nineteen fifties. You had the nuclear scientists building
that first licensed power plant to provide electricity to a grid.
You had synthetic diamonds, and you had Robert H. Windorf
who created a substance called borazon in the lab. Borizon
is is a man made substance. You don't find it
(18:27):
in nature, but it's almost as hard as diamond and
it can be used in temperatures much higher than even
diamonds can be used in. Like diamonds will break down
once you get over a certain temperature, but borazon can
hold together longer. So it would also become a very
useful component in industrial cutting tools for example. Now around
the same time, a different group of engineers were building
(18:49):
something perhaps a bit less lofty in the grand scheme
of things, but that would be the humble electric can opener.
G introduce is the first consumer electric can opener in
nineteen fifty eight, and pet ownership has never been the
same since. In nineteen fifty nine, g E introduced the
(19:10):
halogen lamp. These work in a way very similar to
incandescent lamps. There's a tungsten filament inside a very small bulb,
and encasing the filament is a quartz envelope. Inside the
envelope is a gas from the halogen group of gases.
So this is different from what the kind of gas
you would find in your typical incandescent bulb. The benefit
(19:33):
of halogen gas is that it can combine with tungsten vapor.
So when the tungsten filament heats up and it starts
to give off light, it's also giving off tungsten vapor.
You know, tungsten is essentially burning off of the filament.
That vapor combines with the halogen gas and then it
gets deposited back onto the tungsten filament, at least some
(19:54):
of it does, so some of that vaporized tungsten gets returned.
That actually helps ex in the useful life of the
halogen lamp. Halogen lamps can produce a lot more light
per unit of energy compared to an incandescent bulb. They
also produce a lot more heat, and as someone who
has sadly a few halogen lamp fixtures in his house,
(20:16):
I can speak from experiences. Those things get real hot.
Guys like you will burn your fingers. I know I
have anyway. In nineteen sixty a device built by g
E became the first man made object to be recovered
after going into orbit around the Earth. It was code
named by g E the r v X to a
(20:37):
re entry vehicle that was part of the Discoverer thirteen satellite.
The discovered thirteen satellite kind of set the stage for
space based reconnaissance and spy missions. Now, granted, that was
not the public facing part of the mission. Obviously, letting
everyone know, hey, this is a spy satellite is not
the best plan if you want to use it for
(21:00):
you know, spy stuff. So there was a cover story,
and the cover story was essentially that it was a
science experiment, but in reality it was a classified mission
that was overseen by both the Air Force and the
c I A. G would go on to open up
a space center in Valley Forge, Pennsylvania in nineteen sixty
one because they were getting more and more involved in
(21:22):
building components for the space race. Also in nineteen sixty
there was a guy named Jack Welch who joined g
E as a chemical engineer. He'll be really important later,
So remember that name, Jack Welch. We'll get back to it.
Nineteen sixty two, scientists from GE would develop one of
the first solid state lasers using semiconductors. Interestingly, scientists at
(21:47):
IBM and over at M I T were independently doing
the exact same thing, and all the parties pretty much
cracked the problem right around the same time. This set
off a bit of a patent rush, with GE beating
IBM to the punch by a little more than a week.
I just find it fascinating that the solid state laser
was one of those things that multiple parties invented at
(22:09):
around the same time, independently of each other. But to
be fair, the stage had already been set with early
work in masers and lasers, so these were not the
first lasers. They were the first solid state ones. Solid
state lasers would then find their way into numerous technologies
and applications. Early on, scientists theorized that they could be
(22:29):
incredibly useful in communications, but they would become so commonplace
that we'd rely on them to play our tunes for us.
Because the laser and stuff like CD players, DVD players,
Blu ray players, those are all solid state lasers. So
what was truly cutting edge technology in nineteen sixty two.
Is now so commonplace that you can go out and
buy one and use it to frustrate your pets. You know,
(22:51):
you can just go get a little key chain with
a solid state laser on it. Um. But I'm pretty
sure back in nineteen sixty two, no one thought that
that was going to be a few future possibility. D
E scientists were also working with superconductors and magnetism. Now,
a conductor is a material that allows electrons to pass
through it. You know, it conducts electricity. A superconductor is
(23:13):
a material that does this with no resistance to the
flow of electricity. So, under normal conditions, conductors have a
bit of resistance to electricity, and the amount of resistance
is dependent upon several factors, like how what what the
actual material is, You know, what is the conductive material. Also,
it's thickness or gauge. So a thin copper wire, for example,
(23:35):
has higher resistance than a thick copper cable. They're both
made of the same thing, but the physical structure is
different and that changes the resistance of the material. G
S super conducting magnet was the first to break through
the one hundred thousand gass limit. The gass is a
unit of measurement for magnetic flux density. I'll give you
(23:57):
the technical definition of a gass as laid out by
the Encyclopedia Britannica. So here we go. One goss quote
corresponds to the magnetic flux density that will induce an
electromotive force of one ab volt in each linear centimeter
of a wire moving laterally at one cimeter per second
(24:18):
at right angles to a magnetic flux end quote. Okay,
so that's a bit of a mouthful. Anyway, we rate
magnets in goss. That's how we measure their strength. So
g S super conducting magnet was incredibly powerful. It would
also lay the foundation for practical applications of that type
of a magnet, particularly in the creation of magnetic resonance
(24:40):
imaging technologies, and GE would play a very important role
in developing that technology, or the m r I as
we would say, um very important part of g S business.
One of the fun facts I discovered while researching these
episodes is that the footprints that the Apollo eleven astronauts
left on the Moon are there in thanks to GE. Specifically,
(25:02):
the boots worn by the astronauts had silicone rubber in
them that had been manufactured by g E. So that's
a g E footprint up there in a way. But
that was just one of the contributions g E made
to the Apollo program. I don't want to discount or
dismiss any of the other ones that the company made.
They actually provided a lot of technology to the space program.
(25:23):
General Electric was involved in designing or manufacturing several systems
related to the space race, including the ship to satellite
communication system that allowed the Apollo crew to send TV
images from the capsule to satellites orbiting the Earth, which
in turn beamed those images down to terrestrial stations. In
nineteen seventy three, another ge researcher, dr Ivar Giev, would
(25:46):
get a Nobel prize. He had back in nineteen sixty
discovered the truly odd behavior of super conductive tunneling. So
what the heck is tunneling? What it all has to
do with the weird weird world of quantum mechanics and
quantum physics. So when I was in school, we learned
that electrons orbit the nucleus of atoms in a certain
(26:08):
energy state, and electrons would quote unquote want to occupy
the lowest energy state available. Once that energy state was
full of electrons, then the next electrons would fill up
the next available state further out from the nucleus, and
so on and so on, until you had all the
electrons that that particular atom would have, whether it was
(26:28):
a base version of the atom or an eon or whatever.
This was a pretty big simplification of what is actually
going on, and in my books, I remember seeing the
old illustrations. We had newer ones too, but I remember
those old illustrations made it look like an electron was
sort of like a planet orbiting around a sun like nucleus. So,
in other words, according to those illustrations, it would appear
(26:51):
that an electron has a specific position around the nucleus
that you could measure and detect and predict. But as
scientists would later learn, we could really only determined partial
information about a sub atomic particles velocity and location. The
more we knew about one of those two things, the
less we would know about the other. So the more
you know about a particle's velocity, the less you know
(27:13):
about its position. The more you know about its position,
the less you know about velocity. So really we don't
know whether an electron quote unquote is in a specific place,
but we we know where it can be, the various
positions where the electron could possibly be found, so you
can think of it as kind of a zone of
probability or a field of probability. There's a chance the
(27:37):
electron will be at any of those points within that field.
It has to be within that field unless you've poured
more energy into the atom and thus pushed the electron out.
But it has to be somewhere in that field. You
just don't know where it is. So it's kind of
this amorphous fog that the electron could inhabit. Now, if
(27:58):
you have a situation in which this field, this imaginary field,
because we don't actually have a fog here, but if
this field spans a barrier that normally you would have
to use energy to get across, it means that the
there's actually a possibility that the electron could appear on
the other side of that barrier. So imagine you have
(28:19):
a hallway and there's a door closed at the end
of the hallway, and you have this electron field, and
the electron field actually overlaps the door to the point
where part of the field extends to the other side
of the closed door. Now, you would expect the electron
to be in the hallway. You didn't open the door.
(28:40):
You saw the electron go into the hallway. You figure
that's where it's got to be. But because that field
overlaps the door, there is the possibility that the electron
could be on the other side. And because there's a possibility,
it means that sometimes there will be an electron on
the other side of that door, and it's as if
the electron has tunneled through or climbed over the door.
(29:01):
But at no time did it ever have to expend
energy to do that. It just appeared on the other side.
This is tunneling, and it doesn't make a whole lot
of sense to us because that's not how we observe
things in our normal world. You don't go down the
hallway and suddenly little Jimmy is just on the other
side of the door because there was a chance little
Jimmy was gonna be there. That doesn't happen in our
(29:22):
real world, but in quantum physics it's tots a thing.
It's also one of the reasons why developing microchips with
smaller and smaller components becomes a really huge challenge because
electron tunneling is a problem. If you're determined to channel
electrons down specific pathways, as is the case with a circuit,
then you run into an issue. If an electron can
(29:45):
encounter a gate, the gate is closed, but because of
electron tunneling, there's the possibility of the electron appearing on
the other side of the gate. It means that you
can create errors this way. Anyway, let's get back to
g E S timeline. In ninet g ES Medical Systems
Division developed an improved method for taking X ray cross
(30:06):
section pictures which reduced the scanning time down to less
than five seconds, which was an enormous improvement, a huge
leap forward. Ad meant that patients wouldn't have to sit
still for as long to get a cross section X
ray done. Now, I'm reminded of a time when I
had to get an X ray done and I was
having a kidney stone and that was painful. It was
(30:28):
so painful that just trying to stay still was a
huge challenge for me. And it was technology like this,
this breakthrough I was just talking about that made those
sort of X ray scans much faster, much more efficient
and reduced blurring, so that if the patient were moving
because the scanning took so so little time, there was
a better chance that you're going to get a nice
(30:49):
clear picture. Otherwise, obviously, if the patient moves while the
picture is being taken, you're gonna get blur. So I'm
very thankful that GE was able to make X rays
much more efficient and take less time. GE celebrated one
years of innovation in nineteen seventy eight, which might be
a little confusing at first because General Electric as a
(31:09):
company was founded in eighteen nine two, not eighteen seventy eight. However,
g also traces its historical roots back to an earlier company.
If you listen to the first episode, you know about
that Edison Electric Light company, that one began in eighteen
seventy eight. According to a timeline on the GE website,
specifically a timeline that's on gees website in India, the
(31:32):
company states that nineteen became the first company to have
received fifty thousand patents. Wow. While the company continued to
diversify and work in various industries, a big change was
around the corner, and that change happened in nineteen eighty one,
when Jack Welch, that chemical engineer I mentioned earlier, would
become the company's youngest chairman and CEO. He replaced the
(31:55):
outgoing CEO, which was a guy named Reginald H. Jones.
Welch's ten year is an incredibly important one in the
history of GE, so I figured it'd be good to
get a little background on the man first. He was
born in Peabody, Massachusetts, in nineteen thirty five. His father
was a railroad conductor. Jack Welch would grow up in Salem, Massachusetts,
(32:15):
and as a kid he loved playing sports. He really
loved winning, and he despised losing. That would be a
fundamental part of his character that would carry over to
his work at GE. He received a bachelor's degree in
chemistry from the University of Massachusetts at Amherst, and he
received his masters and his pH d at the University
of Illinois Champagne. Upon graduating and got a job at
(32:38):
GE and he worked in their plastics division, and he
had nearly quit his job after just a short while.
He felt that gees organization was too cumbersome that was
filled with middle management positions, it was bloated, and he
felt his own work wasn't being valued properly, but an
executive named Ruben Gutoff convinced Welch to stay with the company.
So he did, and he would end up lee eating
(33:00):
the plastic division after working there for a while, then
he moved on to other executive roles. He oversaw the
Chemical and Metallurgical division, then he headed up GE strategic planning.
Then he became a sector executive for the consumer products division.
And despite all of that, he wasn't first and foremost
in the minds of the board of directors who are
(33:20):
looking to fill that position of CEO. When we come back,
I'll talk a little bit more about how he got
his position and what he did with it, but first
let's take another quick break. Welch was just one of
seven people under consideration for the role of g E
(33:43):
CEO in nine He didn't even have a formalized plan
for where he wanted the company to go, but he
did have the determination to lead GE to being the
number one company in every industry in which g E
had a presence. This was enough to commence the board
to name him CEO, and his first moves were really
to streamline g E. While he had risen through the
(34:06):
ranks in his decades at General Electric, he still felt
that the company was bloated. That opinion had not changed,
even though he had gone from being an engineer to
an executive. At the time he assumed the position of CEO,
g E was a mega giant, consisting of three hundred
different businesses, and Welch saw that as a problem, because
(34:28):
how could you focus and be the absolute best when
your presence is spread so thin across so many businesses.
And so Welch began to consolidate departments. He began to
sell off divisions. He was trimming the fat. Part of
that meant laying off employees, and Welch did that too.
He did that a lot. By the mid nineteen eighties,
(34:49):
just a few years after he had become CEO, GE
had laid off around one hundred twenty thousand employees. This
is hard for me to even imagine. The town I
grew up in has a population of around forty thousand
people today. G E laid off three times as many
people as were in my hometown. That's tough for me
(35:12):
to even imagine. The layoffs earned Welch a nickname neutron
Jack because he was like a neutron bomb going off
in the company, he would eliminate employees while leaving the
corporate assets intact. A neutron bomb is thought of as
the same thing. It's a sort of bomb that can
kill living stuff and leave physical infrastructure untouched. Welch hated
(35:35):
this nickname. It was a pretty cutthroat and brutal strategy,
but Welch was pretty much demanding that approach. He wanted
to get out of any business where GE did not
occupy the number one or number two spot in the industry.
If G were further behind them that he would rather
ditch that part of the business than to continue to
(35:57):
just sort of muddle along. It made little sense, he said,
to be in businesses where other companies could go to
market selling stuff cheaper than what it cost GE to
manufacture those same things in the first place. So he
gave an example of this. He's talked about television sets
and Schenecta in New York. They were still making television
sets when Jack Welch took over GE, but Welch said
(36:19):
that Japanese companies were selling TV sets for less money
to the final customer than it would cost GE to
manufacture a set. So Japanese television set might sell for
a hundred dollars and it might cost a hundred ten
dollars for g E to even make a TV set.
There was no way to compete in that space and
(36:40):
at all make a profit, so it made no sense
to keep the business. He preferred focusing the company's efforts
on industries where they could outperform their competitors, rather than
remain in a business just to have a foot in
the door. Through a limiting divisions, selling off businesses, and
through laying off thousands of employees, the company ended up
saving a lot of money, to the tune of billions
(37:02):
of dollars, and Welch wasn't just going to sit on
those savings. He looked to reinvest in the company, and
as part of that, he was looking for a possible acquisition,
and he decided upon an old, familiar name. That name
was r c A. Now, if you listen to the
earlier GE episodes, or if you listen to my r
c A episodes, you'll remember that General Electric was one
(37:25):
of the founding companies that created our CIA in the
first place. GE was also the majority shareholder until it
was compelled to sell off those shares of our CIA,
along with the other founders. This was because the United
States government at the time had antitrust concerns about the
radio industry. Well. The merger of g E and r
c A was a six point three billion dollar deal,
(37:48):
which was the largest in history at that point, and
Welch took the same approach to our c A as
he had to GE. Namely, he began hacking away at
businesses he viewed as being distractions. So within three years
of this deal, Welch had reduced the number of our
CIA employees to half of what they once were. He
oversaw r c A selling off almost all of its businesses.
(38:11):
Really only two remained. One was the defense business that
our ci A would do for the U. S Military
and also for NASA. The other was the NBC television network,
So this was the time when GE would own NBC.
This was a subject that become a frequent plot point
on the TV series thirty Rock. It's also when our
(38:32):
c A effectively just became a name. It was no
longer the company at once was, so if you listen
to the r c A episodes, this is pretty much
at the point where the r c A story ended
working for Welch was really tough. If you were really
good at your job and your job was in a
division that Welch viewed as being central to GS mission,
(38:53):
you had decent job security. Welch had employees go through
regular performance reviews, and the emloyees who were in the
top twenty would get bonuses. Those who were in the
bottom ten percent were likely to get fired, and holy
cats did. His strategy pushed GE to new heights. The
company became known as the House that Jack built. The
(39:16):
stock price for g E rose four thousand per cent. Meanwhile,
the company was still churning out innovations such as groundbreaking
work and fiber optics and magnetic residance imaging systems. The
company also launched the Consumer News and Business Channel or
c NBC in nine so it wasn't just a powerful
(39:37):
company in industry, it was now also becoming a powerful
media company. One other area Welch pushed g E into
was financial services. With GE Capital, Welch led acquisition efforts
to buy foreign banks, and GE also would become a
major insurance provider. These services were at the time remarkably profitable.
(39:59):
In fact, that an understatement when Welch took over GE,
the company's value was fourteen billion dollars. By the time
Welch would retire in two thousand one, the company's value
was an excess of four hundred ten billion dollars, and
a large part of that was due to the profitability
of the financial services during that time. Also, we have
(40:21):
to say that when this happened, it was a brilliant
move from a business perspective. It pushed GE to new heights,
and it made Welch a very wealthy man. It would
also end up being the major pain point for GE
several years later that I'm going to get to that
in our next episode as it begins to play into
the more recent allegations about g E and its accounting practices.
(40:43):
But before we get to those dark tidings, let's finish
up with some of the techie things that the company
was doing under Welch's command. In GE, through its r
c A Space division, delivered the Mars Observer to NASA.
It had been seventeen years since NASA had sent a
space craft to study Mars, so the intent was to
launch the Mars Observer and insert it into an orbit
(41:06):
around the Red planet. The Mars Observer had instruments meant
to study the climate, geophysics, and the geology of Mars.
The launch went off beautifully. On September n the orbiter
began its long journey to Mars that would take nearly
a full year, and on August twenty one nine, just
(41:26):
a couple of days before the orbiter was meant to
officially enter Mars's orbit, all communication was lost between the
spacecraft and Earth. NASA was unable to re establish contact,
so the mission was ultimately a failure, though NASA was
at least able to learn some things through the process
of sending the orbiter to Mars in the first place,
but none of the primary mission objectives were achieved. In nineteen,
(41:51):
in another move to dominate media, NBC and Microsoft partner
together to launch the twenty four hour news channel ms NBC.
In g E began to adhere to a quality control
strategy called six Sigma, which calls for fewer than three
defects per million opportunities now. To achieve that goal, g
(42:12):
E would spend millions of dollars on training and new
production processes, so it was a very expensive and time
consuming effort, but Welch's view was that it would ultimately
benefit the company and result in massive savings. Fewer defects
would mean less waste. The first product from GE to
go through this process was a medical scanner called the
(42:34):
light Speed q X slash i CT system. In GE
secured a contract with Boeing to build massive, powerful jet
engines for Boeing seven seventy seven line of jets. The
company produced the g E nine D family. Now this
is not the only type of engine used on a
seven seventy seven. There's a whole bunch of different variations
(42:55):
of the seven seventy seven, and some of them use
engines from other companies, So it all depends upon the
version of the seven seventy seven you're looking at, but
it is the largest and most powerful jet engine produced
to date. In g E opened a new research lab.
This one is called GE Global Research. It's located in Bangalore, India,
(43:16):
and this marked an effort for g E to not
just expand its overseas markets, which it ha been doing
for the previous decades, but also to attract new talent
in the field of technology, talent that wasn't just located
in Europe or the United States. In two thousand, the
company unveiled the tm DRED, which is a power plant
on wheels. It's a gas turbine generator that can supply
(43:38):
twenty two point eight megawatts of electricity. Takes a couple
of days to set up once it's on location, and
it's used for lots of different purposes, including as a
way to supply electricity to areas that have been affected
by natural disasters. Gas turbines, by the way, work in
a very similar way to jet engines. You've got a
compressor that draws air into the engine. The air gets compressed,
(44:00):
and that's what a compressor does, and then it enters
into the combustion chamber where it combines with fuel from
fuel injectors. This mixture gets ignited and then it burns
at a very high temperature. It generates high temperature, high
pressure gas. The gas moves out of the combustion chamber
into a turbine section. That's where the gas can expand
and escape, and as it does so, the force of
(44:21):
that escaping expanding gas turns a turbine. The turbine does
two things. One, it drives the compressor, so it pulls
in more air and thus keeps the process going as
long as you have fuel to burn, and it also
spends a generator to create electricity. Jack Welch planned to
retire from GE and two thousand but one thing kept
him around a little bit longer. That thing was a
(44:43):
prize Welch really wanted for GE. There's a company called
Honeywell International. Now. Honeywell makes advanced electronics for the aviation industry,
among other things, and Welch led a forty billion dollar
plus acquisition effort to get this company. He that Honeywell
had another suitor, that of United Technologies Corporation, and he
(45:05):
added a promise to Honeywell that he would stay on
with GE until this acquisition was complete. He would delay
his retirement until two thousand one. So they decided they
would pursue this acquisition deal and things were going pretty well.
The United States seemed fully on board, but then you
get to the summer of two thousand one, and that's
when European regulators expressed concern that this merger would stifle
(45:28):
competition in the industry. Welch reportedly reached out to US
government officials to see if anything could be done to
smooth things out and get the deal approved. This had
the effect of royally taking off those regulators, and ultimately
the European Union denied authorization for this merger and the
deal fell apart. Welch, who hated losing, lost this one.
(45:51):
The CEO of Honeywell, Michael Bunt Sire, was shown the
door not long after the deal was scrapped, and Welch
would continue on towards his retire Ermont Jack Welch stepped
down as CEO of g E on September seven, two
thousand one. His replacement would be Jeffrey R. Emilt, and
just four days after Emilt would take the helm of
(46:13):
ge the terrorist attacks on the United States on September
eleven would change the company's course. We'll talk about how
that happened in our next episode. In the meantime, if
you have a suggestion for a future episode of tech Stuff,
whether it's a company, a technology, just a concept in tech,
anything like that, let me know. You can send me
(46:34):
an email the addresses tech Stuff at how stuff works
dot com or pop on over to tech Stuff podcast
dot com. That's where're gonna find the archive of all
of our past episodes, all one thousand, one sixty plus
of them, and you'll also find links to where we
are on social media, as well as a link to
our online store, where every purchase you make goes to
(46:56):
help the show. We greatly appreciate it, and I'll talk
to you again really soon. Y Text Stuff is a
production of I heart Radio's How Stuff Works. For more
podcasts from I heart Radio, visit the I heart Radio app,
Apple Podcasts, or wherever you listen to your favorite shows.
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