The double helix of prosperity
What Javier Milei can learn from the Cape Colony
In a recent essay in the Financial Times, the president of Argentina set out to justify a new law by way of economic history. Javier Milei – an economist before he was a politician – traced the modern economy to a single document: the charter of the Dutch East India Company, signed on 20 March 1602. Machines made the Industrial Revolution possible, he argued, but Dutch corporate law made it happen, because only when the law placed a ceiling on risk did capital deploy with genuine force. The machine and the legal entity were, in his phrase, ‘the double helix of modern prosperity’.
And because artificial intelligence will do for the human brain what the steam engine did for human muscle, his government has now submitted legislation to give AI the same legal architecture: a new corporate category, the ‘non-human corporation’, operated by AI agents, protected by limited liability, taxed lightly and free to choose its own governance law. Human shareholders ‘may participate, but are not required’.
It is easy to list what could go wrong. Nobody knows how companies operated by autonomous AI agents will behave – not Milei, not the engineers building the agents, and certainly not the courts that will have to untangle the first disasters. But that is precisely what makes the experiment brave. Argentina is positioning itself as the place where the fruits of this new technology, and its dangers, will materialise first. Whatever AI-run companies turn out to be, the world will find out in Buenos Aires.
From the southern tip of Africa, the contrast stings. In April, the South African government had to withdraw its draft national AI policy after journalists discovered that several of its academic references did not exist – invented by the very technology the policy was meant to govern. One government is using economic history to design its future. The other could not check its own footnotes.
But is Milei’s history right? On the main point, yes. But the fullest record I know of what limited liability actually does to an economy sits not in Amsterdam but in Cape Town: fifteen volumes of company registrations in the Cape Joint Stock Archive, recording, name by name and street address by street address, who owned the companies of the late nineteenth-century Cape Colony. That archive shows what Milei gets right. It also shows what his essay leaves out…
