Jefferson "worried lest the bank in time become an institution that cut across all regional and political lines. Doing so, he reasoned, it would subvert the authority of the states and hence replace or override them as an institution in the political economy. It would do so moreover, outside the constitutional framework. This would not only recast the entire balance of power that the constitution established, but the bank would effect the change as an institution which was not in any way directly responsible to the people. He feared the end result would be a kind of 'vassalage' imposed on both the individual and the government.
"...It was an astute analysis of the relationship between economic power and its social and political consequences, and our modern industrial corporations, together with the Federal Reserve Board itself have verified it."
----William Appleman Williams, Contours of American History,Chicago: Quadrangle Paperbacks, 1961, 1966, p. 190.
Showing posts with label william appleman williams. Show all posts
Showing posts with label william appleman williams. Show all posts
Wednesday, August 27, 2008
Wednesday, August 13, 2008
William Appleman Williams's "Contours of American History" II
William Appleman Williams, The Contours of American History. Chicago: Quadrangle Paperbacks, 1961. 513 pages. Available new and used from Amazon.com starting at $2.16.
"While periodically overshadowed by more conservative groups, some combination of Progressives has guided American policy during most of the century irrespective of whether Republicans or Democrats have been in control of the national government."
---p. 390.
This is a great book. It reveals as much about the psychology of the left as it does about American history, and its narrative enlivens us to much about American history. The author is unabashedly ideological. He develops a brilliant argument using significant historical evidence. The book reminds me of something my philosophy professor, Elfie Stock Raymond, said when I was a senior at Sarah Lawrence College: Freud was like a bull in a china shop. He spoke the unspoken that everyone had known but had the good taste to avoid saying. Likewise, Williams makes explicit the elitist, mercantilist and ultimately authoritarian nature of the left's ideology. He does so by developing a history of the idea of mercantilism that begins with Shaftesbury and 17th century England and ends with what he calls the syndicalism of mid twentieth century political structure. The key theme of the book is that mercantilism is a preferable social arrangement to laissez-faire and that syndicalism is a sub-optimal manifestation of mercantilism that evolved from the reassertion of elitist corporate power at the end of the laissez-faire period in the 1890s. He writes about (p. 480)
"the functional and syndicalist fragmentation of American society (and hence its individual citizens) along technological and economic lines. The personal and public lives of Americans are defined by, and generally limited to, their specific functional role. To an amazing extent, they share very little on a daily basis beyond a common duty as consumers and a commitment to anti-communism. The persistent cliche of being 'caught in the rat race' dramatizes that alienation, as does the attempt to 'play it cool' in order to maintain some semblance of identity and integration."
He also argues (p. 480) that the "persistence of a frontier-expansionist outlook--a conception of the world and past American history--which holds that expansion or ('growth' as Walter Lippmann put it in 1960) offers the best way to resolve problems and to create or take advantage of opportunities as well as 'private property' and 'humanity'" have been consistent American themes.
Williams believes that America faces a problem because of fragmentation,factions or special interest groups, which has been discussed going back to Shaftesbury through Madison, Lincoln, the early twentieth century's National Civic Foundation and Bernard Baruch and on into late twentieth century economists like Mancur Olson.
Americans attempted to solve the problem of fragmentation in two conflicting ways. First, (p. 481) through de-emphasizing private property in favor of social property (i.e. mercantilism) and through the co-operative building of a community; second, through accepting private property and conceptualizing the idea of a commonwealth based, for example on Calvin's conception of "a corporate Christian commonwealth", "the practice of feudal noblesse oblige" and expansion.
He then states of Shaftesbury's mercantilist outlook (p. 482):
"That outlook on the world was and remained the essence of all class consciousness among upper-class groups in England and the United States from the age of Elizabeth I...Shaftesbury...tried to organize political affairs on the basis of parties which included men of all functional interests (or factions) who accepted a broad conception of the general welfare and the means to achieve it. By thus coming together as men who shared an ideal of community--a Utopia--they would be able to override the tendency of functional activity to fragment and divide them...Jonathan Edwards integrated its various themes perhaps more successfully and infused them with a more noble vision of Christian community than any English or American philosopher either before or after his time..."
Williams views the frontier or expansionist impulse as leading to irresponsibility (p. 483) : "the urge to escape the responsibility of that ideal of a corporate Christian commonwealth was powerful, persistent, and without regard for the direct and indirect costs of such flight...Americans proceeded in the space of two generations to substitute the Manifest Destiny of empire for the Christian Commonwealth of Jonathan Edwards."
But I would argue that, rather than individualism reflecting a flight from responsibility, it is mercantilism and collectivism that is a reaction to the anxiety and insecurity that self-reliance creates in the weak of heart. Jefferson made this point in one his letters, when he argued that in every generation there are the weak and timid or conservatives (i.e., those who follow Williams's corporatist view) and those who are robust or liberal, i.e., individualists. Those who are meek and fearful of challenge resort to the conservative-socialist-mercantilist view. Those who value humanity and respect the human spirit are individualists.
James Madison, argues Williams, offered expansion as the antidote for faction. "By making escape so easy (the continent) produced an unrestrained and anti-intellectual individualist democracy that almost destroyed any semblance of community and commonwealth" (p. 483).
But alas, it was in the laissez-faire period of the late nineteenth century that millions fled here from the corporatist butchers of Europe, and their descendants, advocates of European community like Adolf Hitler and Josef Stalin. God bless the individualism of America, and God save us from the academic cranks who cry for community while the blood of their murdered millions spews from their collectivist throats like vomit.
Williams starts by arguing that neither Martin Luther nor Calvin held that economic success reflected godliness (p. 37). This contradicts the sociological arguments of Weber and Reinhard Bendix that claim that American capitalism issued from Protestantism. There was a debate within Cromwell's army. Some argued that property rights should be limited by political and social welfare rights while others emphasized property rights to a greater degree. "The liberal tradition stems from the triumph of laissez-faire individualism over corporate Christianity. Marx and other socialists reasserted the validity of the original idea in response to the liberal heresy. That is indeed one of the basic explanations of socialism's persistent relevance and appeal in the 20th century." Economic uncertainty in the early 1500s led England's leaders to adopt a centrally planned, mercantilist approach. "Englishmen were henceforward to argue about who should control the central government but not to dispute the validity of the national state or its active role in society.
According to Williams, the four chief mercantilist ideas were (pp. 40-1):
1. The state was the institution for achieving wealth and welfare
2. Good planning and policies led to economic success
3. The state had an obligation to serve society by accepting and discharging the responsibility for the general welfare (by delegating economic responsibility to private concerns, much as Republicans frequently advocate privatization)
4. A win/lose psychology: the chief way to become wealthy was to take wealth from someone else, or to quote Marcus P. Cato "it behooves the husbandman to be a seller and not a buyer".
Thus, (p. 41) "beginning with Elizabeth and continuing for a century and a half, the mercantilists sought to accomplish five tasks: erect the framework of a political and economic system; modify, centralize and consolidate the older but still useful units of society; encourage and direct the development of a new political economy; balance that evolution; and expand the resulting system abroad...Thus, the Parliament of 1563 passed legislation encouraging food production, a relief measure for the poor, an act designed to improve the navy as a means of securing more wealth, tariff regulation, and an elaborate Statute of Artificers calculated to put the nation to work in a rational and balanced manner, and called for a concerted effort to diversify and expand overseas trade..."
and (p. 41) "Mercantilism's emphasis on corporate responsibility is dramatized by the Statute of Artificers (1563) and various Poor Laws enacted throughout the age. The legislation concerning artificers was an effort to create and sustain some balance...Wage rates (and their relationship to prices), migration within the country, terms and conditions of employment and the principle of a seven-year apprenticeship were all written into an integrated system enforced by the strengthened national government. Poor laws complemented this involved legislation by prohibiting begging, placing pauper children in apprenticeship, establishing a system of collecting and distributing alms among the aged and infirm, and putting the poor to work in special enterprises...these laws were predicated upon the idea that poverty, instead of being a personal sin, was a function of the economic system, and that the general welfare was the responsibility of government."
Pre-Revolutionary War Puritan religious leaders emphasized social responsibility. "All agreed that a specific calling was subordinate to the general welfare; even men who had several callings were to choose among them 'not for it selfe, but for the good of whole bodie.'"
Central to mercanitilism was colonization (p. 46). "Colonization was a fundamental part of the view that wealth had to be taken away from others and integrated into a self-sufficient empire....Thomas Mun...worked out a magnificent synthesis of the mercantilist Weltanschauung. 'The main thing...is to possess goods; if you have them you will get money. He that hath ware hat money by the year....the ordinary means therfore to increase our wealth and treasure is by foreign trade, wherein we must ever observe the rule to sell more to strangers yearly than we consume of their value...Behold then, the true form and worth of foreign trade, which is the great revenue of the King...the school of our arts, the supply of our wants, the employment of our poor, the improvement of our lands...the terror of our enemies.'"
Williams argues that secularization led to the replacement of the "Christian Commonwealth" aspect of mercantilism by individualism and emphasis on property rights.
Anthony Ashley Cooper, the first Earl of Shaftesbury led a fight against individualism and in favor of mercantilism. Samuel Fortrey warned "'Private advantages are often impediments of public profit'" (p. 53) and Shaftesbury added, "Where the merchant trades for a great deal of Profit, the nation loses.' Openly attacked in 1662 by a group of London merchants who complained that the new navigation system was destructive of his Majesty's trading subjects...He and other mercantilists saw the challenge to their program inherent in the power of the largest joint stock companies and trading corporations."
Williams notes that republicanism was grounded in feudalism (Williams is favorable to the reciprocal rights and responsibilities as part of feudalism; he ignores the routine abuses of power, Crusades, murder, etc. that characterized feudalism): "American leaders were not only conscious of this heritage of their own constitution but they understood that the theory that small states were both necessary and more desirable conflicted with the explicit emphasis on expansion in mercantilism."
Mercantilism, though, did not work (p. 69): "This decay of the standards and performance of mercantilism served to strengthen and invigorate the continuing battle for laissez-faire." But Williams argues that domestic laissez-faire in England was accompanied by intensification of imperialism with respect to the colonies (p. 69): "This shift from the mercantilist conception of empire toward an imperialistic outlook became increasingly apparent after 1715. English investments were protected by strict controls over colonial currency established in 1751 and through a law of 1731 which made colonial property legally forfeit for debts. Articles such as copper, furs and special forest products were added to the list of goods reserved for England..."
The debate between laissez-faire and mercantilism came to a head in two books: Adam Smith's Wealth of Nations (1776) for laissez-faire and Sir John Steuart's Principles of Political Oeconomy for mercantilism (1767). "The books were the final statements in an argument that lasted nearly twenty years."
(p. 70) "At the crucial juncture of the Restoration, Shaftesbury realized that mercantilism could develop in one of two ways. It could sustain the image and the ideal of society and the general welfare, or it could slide back into a narrower and ultimately extreme emphasis on group and personal interest. Shaftesbury held fast to the broader ideal. His protege, Locke, turned toward a hedonistic individualism."
(p. 71) "As with Shaftesbury and Locke, Steuart and Smith shared one crucial assumption: whatever the local or domestic means of achieving welfare, it could not be accomplished without an empire. The key difference lay in the view shared by Shaftesbury and Steuart that conscious, positive policies were necessary to sustain the reality of corporate mutual responsibility within society and to improve the general welfare. The four protagonists also agreed, however, that self-interest was the main engine of human action" but Steuart "was convinced...that the exchange economy of the capitalist system suffered from an inherent tendency to get out of balance. As it did so, it produced unemployment, political unrest and the probability of social revolution...Steuart's acceptance of the responsibility to provide food, other necessities and employment, not only for those who actually exist, but also for those who are to be brought into existence" dramatized his reassertion--contrary to Locke and Smith--of the moral imperative that had been so strong in early mercantilism and that Shaftesbury had labored so hard to reinvigorate and sustain...Entertaining no thought of total regulation and quite willing to give individuals a broad area for independent action, Steuart nevertheless insisted that welfare was the product of policy, not of Providence nor of the automatic workings of Newton's Great Clock..."
p. 73 "James Madison, the commanding mind of the American gentry and the sage of the Founding Fathers, ultimately adopted and then adapted the mercantilism of Steuart as the morality and the policy by which to transform the feeble colonial confederation into a mighty republican empire."
Williams does a good job of describing the authoritarianism inherent in mercantilism and the corporatist society (pp. 95-6):
"Devoted to the ideal of a corporate community guided by a strong moral sense (the Puritans) developed a great talent for misinterpreting any opposition. From the outset, for example, they were prone to view the Indians as agents of the Devil waiting to test their convictions...This propensity to place Evil outside their system not only distorted the Puritans' own doctrine, it inclined them toward a solution which involved the extension of their system over others. Here was a subtle convergence of religious and secular ideas, for mercantilism also emphasized the necessity as well as the desirability of expansion in economic and political affairs. It externalized secular evil by arguing that domestic poverty could in the last analysis be overcome only by taking wealth away from others...Embarking upon a campaign of righteous persuasion which often became outright intimidation, and upon a bloody trail of persecution, the church fathers punished the courageous, exiled the bold and terrified the timid...this horrible travesty on the ideal of a corporate community culminated some 20 years later in the witchcraft trials".
Nevertheless (p. 98) both Massachusetts and Virginia "each had an outlook rooted in a religious conception of the good society as a balanced corporate system originally shared by their Puritan and Anglican ancestors in England."
(p. 99) "But this early devotion to the corporate ideal was weakened as Massachusetts and the other colonies in New England extended their boundaries and their prosperity. Religion was not abandoned but the wealthy 'river gods' of the Connecticut Valley and the merchants of Salem, Boston and Providence gradually redefined the meaning of the crucial term, the elect. From signifying membership in Calvin's corporate religious community it came to mean the upper class of that society...Jonathan Edwards assaulted their outlook." Williams describes the Great Awakening: "In defining religious commitment as an affair of the heart, in considering that only God is worthy of worship, in placing high value on the intellect and on education, in valuing and respecting self-government, and in asserting that there were positive, pragmatic consequences of being sober, honest, responsible and willing to work--in all these respects Edwards was a man who left his life as a monument to the positive side of Puritanism."
The American revolutionaries were mostly mercantilists, not advocates of Adam Smith and laissez-faire. Samuel Adams (p. 111-12): "launched a determined campaign to establish a corporate Christian and mercantilist American empire. Like his allies in Virginia, Adams was thus a revolutionary without being radical. Some of Adams's counterparts in other colonies stressed an extension of popular government more heavily than he did, for example, but none challenged the assumptions of the existing order....The Boston Society for Encouraging Industry and Employing the Poor (a mercantilist title if ever there was one) established a spinning school in 1769. The New York Society for the promotion of the Arts, Agriculture and Oeconomy began to grant premiums for domestic production and apprenticeship schools in 1765...." The first Continental Congress set up price regulations and the Massachusetts legislature called for American manufactures (p. 115).
Williams argues that Americans picked up mercantilism just as the British were shifting to laissez-faire. "American leaders were very conscious of the crucial role played by imperial expansion in the mercantilist conception of the state". Thus, American expansion and emphasis on the American frontier is an offshoot of mercantilism."
p. 124 " And paper-money inflation, which won the support of some groups, had been the avowed program of one group of English mercantilists since at least the 1690s. By the end of the war, the states were passing navigation acts and protective tariffs and granting bounties and subsidies to special sectors of the economy."
p. 124 "(Robert) Morris rather than Alexander Hamilton was the central figure in the creation of this first quasi-public bank. Morris wanted the bank to 'exist for ages' since in his view the 'salvation of our country' in attaching many powerful individuals to the cause of our country by the strong principle of self-love and the immediate sense of private interest."
p. 126 John Jay was " an American mercantilist deeply concerned to remove the difficulties in the way of the nation's development."
In 1783 Virginia ceded its western frontier. p. 128 "The cession by Virginia of its lands was in many respects the apex of the small-state theory of republicanism in America. The finest practical statements of that political and economic outlook were the related 1783-84 proposals by Jefferson...As finally passed, the Ordinance of 1784 divided teh trans-Appalachian west into ten relatively large states...But while his market and social interests as a planter and his education as a physiocrat strongly inclined Jefferson toward small states and local self government dominated by a benevolent aristocracy, he either sensed or rapidly became aware of the dilemmas...Territorial expansion was one way to resolve such difficulties...he rapidly modified his practice along mercantilist lines..."
p. 131 "From the beginning, Jay and many other early American leaders saw the law and some supreme judicial institution as the secular cement that would replace a state religion in such a corporate society. On the other hand, Jay's deep Anglicanism undoubtedly lay behind that general view..."
p. 133 "The militancy and throughness of Monroe's mercantilism is difficult to exaggerate." Monroe saw "...the double dilemma of American mercantilism: how to reconcile the political commtiment to republicanism and representative government with the necessity of expansion and at the same time effect a compromise between the landed and commercial interests."
p. 138 "This recognition of the need to control the existing west whyile the east gained strength and cohesion--a combination tht would tehn generate further expansion--played an important role in the rapid growth of the movement for a more powerful central government.
p. 139 "John Adams also explained similar truths to Jeferson and, along with Madison, seems clearly to have given the future sage of Monticello an intensive course in mercantilism. For that matter, Adams was a vigorous instructor to the entire American seaboard"
p. 142 "Several other developments strengthened and accelerated this mercantilist drive toward a powerful central government empowered to co-ordinate the landed and commercial manufacturing interests in one system and at the same time expand it in all directions. One of these was the increasing activity in manufacturing and an associated agitation for government aid. John Adams had reported in 1780 that Europe was worried lest American 'become the greatest manufacturing country and thus ruin Europe. Though America had not even approached that strength by 1786, there was a great deal of interest and activity. And the corporation, as a modification of the old joint-stock company, had already appeared as a means of solving the problems of capital accumulation and organization."
p. 144 "As had been the case with Shaftesbury at the time of the Restoration in England, many American mercantilists in the circumstances of 1786 began to be seriously worried that the strife between factions would combine with the particularism of the states to destroy the government and lead to a voluntary or forced return to some kind of colonial status."
p. 145 "As he awaited the meeting which had finally been arranged for at Annapolis, Madison began to grapple with the central dilemma posed by the contradiction between the expansionism of mercantilism and (of economic interest) and the political theory which asserted that republicanism could work only in a small state. He concluded that the existing low ratio between population and land would prevent lower-class rebellion or aristocratic tyranny for some years."
p. 160 "Madison ultimately realized that a crisis would occur when and if the citizen ceased to have significant leverage on the political economy. This happened in fact as the corporation replaced the individual in the narrow economic sense and subsumed the state as the elemnt of social decision-making in the broader sense. While he did not foresee that particular form which the crisis was to take, Madison did recognize two other dangers. Conflict was inherent in a feudal system of organization. 'And what,' he asked rehtorically, 'has been the progress and event of the feudal Constitution? In all of them a continual struggle between the head and hte inferior members, until a final victory has been gained in some instances by one, in others, by the other of them.'...Madison resolved both difficulties by standing feudal theory on its head. He simply asserted that a large state would weaken the influence of faction..."
p. 164 "(Madison) called on April 8, 1789 for the construction of an independent, balanced political economy...He recommended a mercantilist system to protect commerce, to sustain and extend the 'rapid advances in manufacturing' through duties running p to 50 per cent to rpvoide a revenue for the government, and to secure the fisheries, because they were 'perhaps the best nurseries for seamen of any employment...He even wanted a duty on beer that 'would be such encouragement as to induce the manufacture to take deep root in every state in the Union."
p. 164 "Tench Coxe, a leading political economist of his day, was agitating for a program to foster and encourage but not to force manufactures as a way of binding the north and south together and guaranteeing a prosperous influence."
Williams makes the interesting argument that Hamilton opposed the development of manufacturing in favor of banking and developing a trade relationship with Great Britain. (p. 164-5): "Despite their awareness that Hamilton's methods of centralizing the debts immediately favored the mercantile and banking factions, Madison and other mercantilists, and even some of the narrow agrarians, were willing to contribute this extra subsidy to the north because they realized teh necessity and the broader benefits of the actions...Madison also opposed Hamilton's Bank of the United States because he was not convinced that it was necessary...But both men feared that such a bank, managed as it would be by private entrepreneurs, would exert a preponderant influence on the economy and thereby usurp part of the effective power of the people and the government...In the matter of manufactures, however, Hamilton has received far more repute than he deserves. He never revealed, either in the famous report on the subject or in his other actions, the kind of support for American manufacturing with which he is credited or which might be expected of an American mercantilist."
p. 168 Jefferson's "Report on Commercial Privileges and Restrictions" of December 16, 1793 reflected Jefferson's move toward mercantilism.
p. 187 In the early 19th century , government assistance to business had become widely accepted. "South Carolina, for example, passed a typical law in 1808 for 'the establishment and encouragement' of manufactures. Pennsylvania helped finance various enterprises, granted cash subsidies to others, and proclaimed 'the duty and interest of all governments to prevent fraud, and promote the interests of just and useful commerce.' A typical writer in Massachusetts thought it 'manifestly erroneous' that people 'are the judges of their interests, and consequently should be allowed to regulate them unobstructed.' Such laissez faire was 'subsersive to the end and aim of all governments.' As the governor pointed out in 1809, the state had accepted the responsibility of 'making and executing just and practicable laws of inspection on manufactured articles.' John Adams summarzied the situation accurately in his comment that democrats and aritocrats all unite on the basic axioms of mercantilism. National debate centered on four issues: internal improvements, banking and monetary policy, commercial discrimination and aid to manufactures...Both of these, internal improvements and national finance, became the principal concern of Albert Gallatin. A vigorous defender of civil and religious liberties and a strong advocate of an educational system, since his service in the Pennsylvania legislature during the 1790s...His plan was simple: use the receipts from land sales to promote economic development, and then sustain, control and balance it through assistance to manufactures and by a national finance system. Gallatin's masterpiece was his majestic report of April 8, 1808 on a national transportation and communications network designed to strengthen the sense and reality of community...He proposed four main avenues: coastwise from Maine to Georgia, across the mountains through New York, Pennsylvania and Virginia into Kentucky and Tennessee; across the four mathor isthmian blocks; and into the Great Lakes region. Two years later, in 1810, he reported on manufactures. Stressing their vital importance to balanced growth and independence, he recommended a program of cash subsidies and other government aid to accelerate their development. But, as he realized, the long range solution would be provided by an expanding home market stable enough to encourage large investment, and by the establishment of economic independence vis-a-vis England's superior industrial system"
p. 189 "Jefferson accepted teh principle of such internal improvements, emphasizing education as well as canals, but he raised the issue of constitutionality. So did Madison, who feared that such a plan would unbalance his feudal system of republics. Both men put their case directly: if the Congress undertook a ten-year plan of the magnitude and with the consequences inherent in Galltain's program...then a process of interpreting the constitution would have started that could end only in monarchy or some other form of tyranny."
p. 190 Jefferson "worried lest the bank in time become an institution that cut across all regional and political lines. Doing so, he reasoned, it would subvert the authority of the states and hence replace or override them as an institution in the political economy. It would do so moreover, outside the constitutional framework. This would not only recast the entire balance of power that the constitution established, but the bank would effect the change as an institution which was not in any way directly responsible to the people. He feared the end result would be a kind of 'vassalage' imposed on both the individual and the government.
"...It was an astute analysis of the relationship between economic power and its social and political consequences, and our modern industrial corporations, together with the Federal Reserve Board itself have verified it."
p. 196. By 1816 Jefferson essentially gave up his "physiocratic dream": We must now place the manufacturer by the side of the agriculturalist"
p. 197 "Monroe concurred, stating flatly that since manufactures required the systematic and fostering care of the government, it was 'of great importance' to offer such assistance."
"Calhoun understood and admitted that ' what is necessary for the common good may apparently be opposed to the interest of particular sections.' But he insisted on the equity and the necessity of compromise...Probably no other American leader except John Quincy Adams looked so squarely into the central dilemma of mercantilism. And like Adams, Calhoun realized that the common good would give way to private interests and ambitions were the tension not controlled by everyman's commitment to the larger goal."
(p. 200) The second central bank was passed into law under President James Madison in 1816 and "their policy of loose credit helped bring on the panic and depression of 1819...Land speculation was literally fantastic." During the panic of 1819 "cotton prices were almost halved. People either left for the frontier or demanded help. Relief laws were passed throughout the west, and the entire country turned on the new bank as it tightened its credit...The bank became THE MONSTER..."
The panic of 1819 led to adoption of laissez-faire
Many, such as Monroe and Henry Clay continued to favor mercantilism.
"In four years the Adams administration spent almost as umuch on internal ipmrovements as had been allocated in the previous twenty-four. By 1826 the government was the largest single economic entrepreneur in the country" (P. 211)
Advocates of laissez faire included John Taylor of Caroline, President Martin van Buren, Senator Thomas Hart Benton and President Andrew Jackson.
p. 235 "Van Buren's operations in New York and Washington reveal and clarify the regional and national coalition between rising businessmen, yeoman farmers, southern planters and northern mechanics that is generally labeled 'Jacksonian Democracy'. It was an unstable alliance between a rising boureoisie on the make and a quasi-feudal landed aristocracy directed against the esbslished harbiners of an industrial order...Van Buren integrated teh mechanics and the aristocrats in a political machine (The Albany Regency) that was as autocratic and entralized as any the mercantilists ever organized...Van Buren's tie with eastern mechanics became even more important as manufacturing and commerce continued to institutionalize themselves in the factory and wholesaling systems centered in urban society
p. 305. Some examples of Whig/Republican government intervention during the Civil War period: "Having passed the tariff of 1864, given the farmer the Homestead Act of 1862 (along with formal representation in the government and educational aid) and subsidized the railroads, the radicals occupied the south and jammed through the 13th, 14th and 15th Amendments...Financial leaders, on the other hand, were less enthusiastic about the radical policy of soft oney. Bankers did not like having the government in the money business, and had opposed the National Banking Act of 1862. Their gains from inflation were small. Along with a good many of the rising corporation industrialists, such financial spokesmen were likewise cool to any wholesale equality for the Nego; the other side of that attitude was a desire, particularly strong among New York merchants, to restore their prewar economic connections to the south...."
p. 307 "As should be apparent, the merchant-planter-store system involved the railraods and the monetary system in every transaction. Consequently one group of businessmen and farmers joined the financial interests in favoring a deflationary monetary policy: they concluded that inflation hurt them more than it helped. A similar coalition, led by radicals like Stevens and generally based on the expanding iron and steel industry, preferred to keep the wartime greenback paper money system and even to expand it. They argued vigorously that contraction would retard economic development ('Businessmen are hungry for money,') operate unfairly against everyone except bondholders, adn hurt domestic manufacturers by undercutting the tariff. Since the per-capita money supply had declined from $30.35 in 1865 to $17.51 in 1876, the argument had considerable relevance. But the vote in the Congress on contraction revealed that the west was almost evenly divided (36 yes to 35 no) and the combination of a good harvest and foreign-crop failures temporarily damped the farmer's insurgency."
Large scale railroads led to demands for regulation..."Georgia and California reacted to this serious problem in 1879 by establishing permanent commissions staffed by experts to keep a running check on the lines...By way of avlidating an Illinois regulatory law in the cqase of Munn v. Illinois (1877) Chief Justice Morrison R. Waite explicitly invoked mercantilist precedents. citing the English common law as enunciated by Lord Chief Justice Hale during the period of Shaftesbury' influence in the 1670s, and examples taken from the era of Madison and Monroe, Waite reassertedthe principle tht 'property does become clothed with a public interest when used in a manner to make of it public consequence, and affect the community at large.' He also reiterated a cardinal principle that had been vigorously defended by Madison and Marshall. 'For protection against abuses by legislatures, the people must resort to the polls, not to the courts.'"
p. 325 In the late 19th century "the bulk of economic activity was carried on by small-to-medium-sized apitalists whose businesses were undramatic and even unimportant when considered individually. But they were often the first to introduce and perfect key innovations (as the refinement of iron into steel) which were then taken over by the big operators who proceeded to put many of the real innovators out of business. Most of them died unknown and have remained so, yet they carried the burden of industrialization and commercial development. hey also applied the principles of the laissez-faire market place to sports, as with baseball and prizefighting. This processing of games into enterprises was in some respects the classic proof of the triumph of business in America...The undeniable achievement of the laissez-faire entrepreneur, from Carnegie to the Wyoming dry goods merchant, is that he sustained the momentum of economic development through a long-wave depression (and an era of steadily falling prices) that lasted from 1873 to 1898. Up to 1893 at any rate, per capita income, real wages and gross national product all continued to increase. That tremendou surge of industrial strength changed the face, the food and the ideas of America and provoked serious re-evaluations of diplomacy in European and Asian capitals. It also extracted a terri ble cost in death and physical injury in psychic and emotional wounds, and a process of moral leaching that carried away a great amount of American idealism..."
p. 328 "Justice Stephen Johnson Field's strategy was to define the market place as a national rather than a state problem and then insist that the due process clause of the 14th amendment gave the Supreme Court the power and the duty to review all restrictions on private property. That meant that the market place of the system would remain one unit instead of becoming a wild and uneconomic conglomeration of many different (state) market places. It also meant that regulation would be milder because of the weaker position of the reformers in Congress. His first victory came when the New York high court accepted his dissenting argument against Jutice Waite in the Munn case as its majority view. In a test (In re Jacobs, 1885) of the state's right to regulate the atrocious conditions of cigar manufacturing, New York judges explicitly raised the specterof a return to mercantilist doctrine on social property. Such ideas--'from those ages when governmentl prefects supervised the rate of wages, the price of food, and a large range of other affairs'--were declared archaic. WThey disturbed the 'normal adjustments' of the market place, and also violated the due process clause which protected 'personal liberty' and private property...During the next two years, moreover, even Waite agreed that the 'right of continuous transportation from one end of the country to the other is essential' and admitted that the corporaton was entitled to 'equal protection' as an individual under the due process clause. Field's triumph was announced by his ideological colleague, Justice Rufus W. Peckham, in 1889, with a direct reference to Waite's earlier citation of Eglish mercantilist law: 'no reason exists for...[going] back to the seventeenth or eighteenth century ideas of paternal government.' It was further consolidated in 1897 in the Allgeyer v. Louisiana case, when the court stressed the right of the citizen to be free in the enjoyment of all his faculties' and tied the principle to the 'pursuit of happiness' clause in the Declaration of Independence.'"
The fallacy of confusing expansion with economic advance was characteristic of the 19th century, and we carry that error forward today. The repeated complaints about depression in the late nineteenth century despite massive immigration, increasing real wages and mild unemployment suggest a deeper psychological problem. "President Rutherford Hayes expalined in 1877 the long commercial depression...directed attention to the subject in a concerted manner. For that matter, some entreprenuers had already been talking to Grant's Secreaty of State Hamilton Fish about foreign policy as a way to 'relieve business distress'...Persistently reminded of the importance of expansion and the necessity of government assistance by such men as Charles Dalton of the textile industry and HK Slayton, a dry goods merchant, Senator John T. Morgan spoke for a growing consensus of congressmen as early as 1882. 'Our home market is not equal to the demands of our producing and manufacturing clases and to the capital which is seeking employment...we must enlarge the field of our traffic..." (p. 338)
Countries like India were viewed as targets. "Viewing the Navy as the key to such expansion, Congress began to debate a large construction program and in 1884 established the Naval War College. Senator John F. Miller of California, Chairman of the Senate Foreign Relatins Committee, provided a neat summary of the outlook. 'The time has come when...new markets are necessary to be found in order to keep our factories running. Here lies to the sout of us our India...If we reach out and attempt to secure this great prize of commerce we shall excite the jealousy of other peoples..."
Williams' treatment of the gilded age transformation of individual entrepreneurship and small business to corporate enterprise and big business is characteristic of the naive assumptions of traditional, left-wing historians. He emphasizes the importance of the emphasis on planning. He writes (p. 356):
"It is almost impossible to overemphasize the importance of the very general yet dynamic and powerful--concept that the country faced a fateful choice between order and chaos. Not only did it guide men in the 1890s; it persisted through World War I, the Great Depression, World War II and emerged more persuasive than ever in 1943-44 to guide the entire approach to postwar opportunities and problmes. Only the anarchists and a few doctrinaire laissez-faire spokesmen seemed willing to accept the possibility of chaos. Arguing that it was both necessary and possible, most americans reformulated and reasserted their traditional confidence in their ability to choose and control their fate...But given a consensus on the sanctity of private property and confronted by the increasingly obvious failure of laissez faire, this faith could be verified only by controlling the market place..."
The problem for Williams is that he never produces evidence that laissez faire had failed.
McKinley and Roosevelt both made steps to accomodate the new corporatist orientation.
"Granting the assumptions of the system, Roosevelt most certainlyh dealt with these difficulties from the most relevant and potentially most successful point of view. His conception of leadership derived from the agrarian gentry, a group that had wielded power in an earlier society also characterized by consolidated economic power (in land) and by a similar vast and interrelated network of authority, influence and responsibility. Hanna understood the modern industrial system based on centralized power in the corporation, but lacked the tradition of class-conscious leadership...Roosevelt did not fully comprehend the industrial system, but he did have the image and ideal of class-conscious leadership."
In other words, in response to complaints by subsidized big businesses that their profits were too low, Williams argues for the reinstitution of feudealism headed by Lord Roosevelt and his inept entourage of corporate planners headed by Lieutenant Hanna.
p. 382. "Bankers and their lawyer spokesmen revealed a strikingly firm conception of a benevolent feudal approach to the firm and its workers. Both were to be dominated and co-ordinated from the central office. In that vein, they were willing to extend--to provide in the manner of traditional beneficence--such things as new housing, old age pensions, death payments, wage and job scheduules and bureaus charged with responsibility for welfare, safety and sanitation. Though he was not the most sophisticated of the industrialists, Charles M. Schwab of Bethlehem Steel revealed the essentials of a different outlook at an early date. Concluding from the Homestead Strike that labor "had som erights, whether others were willing to recognize it or not," Schwab also understood the necessity of making periodic, on-the-spot accomodations wtih labor in order to maintain steady production. Financiers, he complained, were always ready to treat thre men fairly as individuals and give them good liberal wages, but they did not grasp the value of unions either to the laborer or to the corporation itself."
pp. 384-6 Williams argues that syndicalism is how the American system developed. Under syndicalism, functions determine representation. "Political representation should arise within each segment and be coordinated at the top in the national governmetn. Individuals would thus participate in the relevant decisions and at the same time enjoy a sense of community and purpose within their particular group that would replace the alienation of an individual lost in a highly organized society...Herbert Hoover was the crucialfigure in the evolution of the approach. Describing society as composed of three major groups--labor, capital and the government--he struggled to balance and control the units so that they would not drive the system toward fascism (business control), socialism (labor dominance) or the tyranny of bureaucratic government. All such men, from Theodore Roosevelt through Hoover and later theorists, recognized that the central problem was to find som eideal that would generate the self-discipline an dpublic spirit essential to maintaining equity...As a basic component of both the fascist movement in Italy and the hard core of National Socialism in Germany, syndicalism provided the leaders of both parties and coutnries with many of their central ideas and programs. Since they rsorted to terror in establishing and maintaining th eapproach, and distorted it in other ways, the essentiqal characteristics common to American and European syndicalism are generally missed or discounted."
p. 391 In the twentieth century "the functional-syndicalist organization of the economy led most political groups to play both sides of the street. Corporations, fo example contributed money and leaders to both parties.
p. 439 In discussing the New Deal Williams writes:
"Though its own leaders admitted that it lasted barely five years (1933-37) and though it ended with candid admissions of failure from its major protagonists, the New Deal is often viewed as a major turning point in American history. A bit more perspective suggeests that it represented a reaction to a severe crisis in which most of the elements, attitudes and policies of the Progressive movmeent were finally consolidated in one short period under the leadership of a particularly dramatic politician. The New Deal saved the system. It did not change it."
I question the claim that the new deal saved the system. Prove it. If it didn't work, then how did it save the system? Progressivism caused the depression, Progressive ideas did nothing to improve the situation.
p. 446-7 "In April 1937, in the case of the National Labor Relations Board v. the Jones and Laughlin Steel Corporation, the Court upheld the Wagner Labor Act. By explicitly sanctioning unions because they were essential to give laborers opportunity to deal on an equality with the meployer, " chief Justice Hughes implicitly authorized the governmetn to intervene in the political economy to establish, maintain and institutionalize a rough kind of parity between the various functions...The Court's decisions upholding the Social Security Act and the State of Alabama's Unemployment Compensation Act were perhaps even more necessary to the functioning of that system. Holding that social security deductions were justified as an excise tax, and further in being used fo rthe general welfare, the judges underwrote that approach to old age and retirement benefits. The court went even further in the Alabama case. For in that instance the plaintiff charged that the taxes returned no benefit to those who paid them, thereby raising the question posed by the role of the government in accumulating capital from the taxpayer and allocating or investing it without his direct participation in the decisions...In a syndicalist sytem composed of interest-conscious functional groups which exert extremely poerful and effective pressure on political leaders, how does the citizen taxpayer either participate to any signficant extent in the formulation of proposals or protect himself against decisions taken in his name which subject him to double jeopardy in matters of economics or civil rights. The meaing of the decision in the Alabama case was very simple and very blunt: he does not. 'The only bneefit to which the taxpayer is contitutionally entitled, the Court pronounced in the words of Justice Harlan F. Stone's opinion, ' is that derived from his enjoyment of the privilege of living in a civilized soicety, established and safeguarded by the devoltion of taxes to a public purpose.' That meant that the citizen elected a representative who was his agent, but over whose action he had no substantial control. For electing a different man did not even modify the basic features of system, let alone change them. Thus the Alabama case sanctified a system and procedure of defining 'the public purpose' which not only left the citizen far removed from final decisions, but denied him any grounds for appeal through the courts. An ad hoc syndicalist system was thus formally held to be democratic in domestic affairs. In later years, during and after World War II, such vast powers of the government were further extended...It is of course essential to evaluate the combined significance of these decisions within the framework of the syndicalist approach that had been present in the Progressive Movement from the very beginning of the twentieth century, adn which the New Deal consolidated. Granted those assumptions, what the Court had done was to legalize a system ctreated by the large corporation adn the Progressive movement. In that system, the citizen was almost wholly dependent upon the definition of public welfare that emerged inside the national governmetn as a consensus among the leaders of the various functional-syndicalist elements of the political economy. The possibility that Hoover had projected in 1921-1922 had emerged as a reality: The United States was a syndicalist nationon a gigantic scale. Yet the citizen's political activity was carried on within a framework that was organized on an entirely differrent basis: i.e., geographic boundaries which had only the most casual and accidnetal relationship to the syndicalist structure of the political economy. That discrepancy left the citizen without any effective, institutionalized leverage on the crucial and centralized decisions affecting every phase of his life."
Williams's hope for a "truly class-conscious industrial gentry" (p. 449) is a ridiculous conlusion to an utterly brilliant analysis. Williams is trapped by his left wing ideology. His perceptive brilliance in analyzing the contours of American history is marred by his dependence on mercantilist and feudalist assumptions that are, as he so aptly points out, the essence of socialism.
"While periodically overshadowed by more conservative groups, some combination of Progressives has guided American policy during most of the century irrespective of whether Republicans or Democrats have been in control of the national government."
---p. 390.
This is a great book. It reveals as much about the psychology of the left as it does about American history, and its narrative enlivens us to much about American history. The author is unabashedly ideological. He develops a brilliant argument using significant historical evidence. The book reminds me of something my philosophy professor, Elfie Stock Raymond, said when I was a senior at Sarah Lawrence College: Freud was like a bull in a china shop. He spoke the unspoken that everyone had known but had the good taste to avoid saying. Likewise, Williams makes explicit the elitist, mercantilist and ultimately authoritarian nature of the left's ideology. He does so by developing a history of the idea of mercantilism that begins with Shaftesbury and 17th century England and ends with what he calls the syndicalism of mid twentieth century political structure. The key theme of the book is that mercantilism is a preferable social arrangement to laissez-faire and that syndicalism is a sub-optimal manifestation of mercantilism that evolved from the reassertion of elitist corporate power at the end of the laissez-faire period in the 1890s. He writes about (p. 480)
"the functional and syndicalist fragmentation of American society (and hence its individual citizens) along technological and economic lines. The personal and public lives of Americans are defined by, and generally limited to, their specific functional role. To an amazing extent, they share very little on a daily basis beyond a common duty as consumers and a commitment to anti-communism. The persistent cliche of being 'caught in the rat race' dramatizes that alienation, as does the attempt to 'play it cool' in order to maintain some semblance of identity and integration."
He also argues (p. 480) that the "persistence of a frontier-expansionist outlook--a conception of the world and past American history--which holds that expansion or ('growth' as Walter Lippmann put it in 1960) offers the best way to resolve problems and to create or take advantage of opportunities as well as 'private property' and 'humanity'" have been consistent American themes.
Williams believes that America faces a problem because of fragmentation,factions or special interest groups, which has been discussed going back to Shaftesbury through Madison, Lincoln, the early twentieth century's National Civic Foundation and Bernard Baruch and on into late twentieth century economists like Mancur Olson.
Americans attempted to solve the problem of fragmentation in two conflicting ways. First, (p. 481) through de-emphasizing private property in favor of social property (i.e. mercantilism) and through the co-operative building of a community; second, through accepting private property and conceptualizing the idea of a commonwealth based, for example on Calvin's conception of "a corporate Christian commonwealth", "the practice of feudal noblesse oblige" and expansion.
He then states of Shaftesbury's mercantilist outlook (p. 482):
"That outlook on the world was and remained the essence of all class consciousness among upper-class groups in England and the United States from the age of Elizabeth I...Shaftesbury...tried to organize political affairs on the basis of parties which included men of all functional interests (or factions) who accepted a broad conception of the general welfare and the means to achieve it. By thus coming together as men who shared an ideal of community--a Utopia--they would be able to override the tendency of functional activity to fragment and divide them...Jonathan Edwards integrated its various themes perhaps more successfully and infused them with a more noble vision of Christian community than any English or American philosopher either before or after his time..."
Williams views the frontier or expansionist impulse as leading to irresponsibility (p. 483) : "the urge to escape the responsibility of that ideal of a corporate Christian commonwealth was powerful, persistent, and without regard for the direct and indirect costs of such flight...Americans proceeded in the space of two generations to substitute the Manifest Destiny of empire for the Christian Commonwealth of Jonathan Edwards."
But I would argue that, rather than individualism reflecting a flight from responsibility, it is mercantilism and collectivism that is a reaction to the anxiety and insecurity that self-reliance creates in the weak of heart. Jefferson made this point in one his letters, when he argued that in every generation there are the weak and timid or conservatives (i.e., those who follow Williams's corporatist view) and those who are robust or liberal, i.e., individualists. Those who are meek and fearful of challenge resort to the conservative-socialist-mercantilist view. Those who value humanity and respect the human spirit are individualists.
James Madison, argues Williams, offered expansion as the antidote for faction. "By making escape so easy (the continent) produced an unrestrained and anti-intellectual individualist democracy that almost destroyed any semblance of community and commonwealth" (p. 483).
But alas, it was in the laissez-faire period of the late nineteenth century that millions fled here from the corporatist butchers of Europe, and their descendants, advocates of European community like Adolf Hitler and Josef Stalin. God bless the individualism of America, and God save us from the academic cranks who cry for community while the blood of their murdered millions spews from their collectivist throats like vomit.
Williams starts by arguing that neither Martin Luther nor Calvin held that economic success reflected godliness (p. 37). This contradicts the sociological arguments of Weber and Reinhard Bendix that claim that American capitalism issued from Protestantism. There was a debate within Cromwell's army. Some argued that property rights should be limited by political and social welfare rights while others emphasized property rights to a greater degree. "The liberal tradition stems from the triumph of laissez-faire individualism over corporate Christianity. Marx and other socialists reasserted the validity of the original idea in response to the liberal heresy. That is indeed one of the basic explanations of socialism's persistent relevance and appeal in the 20th century." Economic uncertainty in the early 1500s led England's leaders to adopt a centrally planned, mercantilist approach. "Englishmen were henceforward to argue about who should control the central government but not to dispute the validity of the national state or its active role in society.
According to Williams, the four chief mercantilist ideas were (pp. 40-1):
1. The state was the institution for achieving wealth and welfare
2. Good planning and policies led to economic success
3. The state had an obligation to serve society by accepting and discharging the responsibility for the general welfare (by delegating economic responsibility to private concerns, much as Republicans frequently advocate privatization)
4. A win/lose psychology: the chief way to become wealthy was to take wealth from someone else, or to quote Marcus P. Cato "it behooves the husbandman to be a seller and not a buyer".
Thus, (p. 41) "beginning with Elizabeth and continuing for a century and a half, the mercantilists sought to accomplish five tasks: erect the framework of a political and economic system; modify, centralize and consolidate the older but still useful units of society; encourage and direct the development of a new political economy; balance that evolution; and expand the resulting system abroad...Thus, the Parliament of 1563 passed legislation encouraging food production, a relief measure for the poor, an act designed to improve the navy as a means of securing more wealth, tariff regulation, and an elaborate Statute of Artificers calculated to put the nation to work in a rational and balanced manner, and called for a concerted effort to diversify and expand overseas trade..."
and (p. 41) "Mercantilism's emphasis on corporate responsibility is dramatized by the Statute of Artificers (1563) and various Poor Laws enacted throughout the age. The legislation concerning artificers was an effort to create and sustain some balance...Wage rates (and their relationship to prices), migration within the country, terms and conditions of employment and the principle of a seven-year apprenticeship were all written into an integrated system enforced by the strengthened national government. Poor laws complemented this involved legislation by prohibiting begging, placing pauper children in apprenticeship, establishing a system of collecting and distributing alms among the aged and infirm, and putting the poor to work in special enterprises...these laws were predicated upon the idea that poverty, instead of being a personal sin, was a function of the economic system, and that the general welfare was the responsibility of government."
Pre-Revolutionary War Puritan religious leaders emphasized social responsibility. "All agreed that a specific calling was subordinate to the general welfare; even men who had several callings were to choose among them 'not for it selfe, but for the good of whole bodie.'"
Central to mercanitilism was colonization (p. 46). "Colonization was a fundamental part of the view that wealth had to be taken away from others and integrated into a self-sufficient empire....Thomas Mun...worked out a magnificent synthesis of the mercantilist Weltanschauung. 'The main thing...is to possess goods; if you have them you will get money. He that hath ware hat money by the year....the ordinary means therfore to increase our wealth and treasure is by foreign trade, wherein we must ever observe the rule to sell more to strangers yearly than we consume of their value...Behold then, the true form and worth of foreign trade, which is the great revenue of the King...the school of our arts, the supply of our wants, the employment of our poor, the improvement of our lands...the terror of our enemies.'"
Williams argues that secularization led to the replacement of the "Christian Commonwealth" aspect of mercantilism by individualism and emphasis on property rights.
Anthony Ashley Cooper, the first Earl of Shaftesbury led a fight against individualism and in favor of mercantilism. Samuel Fortrey warned "'Private advantages are often impediments of public profit'" (p. 53) and Shaftesbury added, "Where the merchant trades for a great deal of Profit, the nation loses.' Openly attacked in 1662 by a group of London merchants who complained that the new navigation system was destructive of his Majesty's trading subjects...He and other mercantilists saw the challenge to their program inherent in the power of the largest joint stock companies and trading corporations."
Williams notes that republicanism was grounded in feudalism (Williams is favorable to the reciprocal rights and responsibilities as part of feudalism; he ignores the routine abuses of power, Crusades, murder, etc. that characterized feudalism): "American leaders were not only conscious of this heritage of their own constitution but they understood that the theory that small states were both necessary and more desirable conflicted with the explicit emphasis on expansion in mercantilism."
Mercantilism, though, did not work (p. 69): "This decay of the standards and performance of mercantilism served to strengthen and invigorate the continuing battle for laissez-faire." But Williams argues that domestic laissez-faire in England was accompanied by intensification of imperialism with respect to the colonies (p. 69): "This shift from the mercantilist conception of empire toward an imperialistic outlook became increasingly apparent after 1715. English investments were protected by strict controls over colonial currency established in 1751 and through a law of 1731 which made colonial property legally forfeit for debts. Articles such as copper, furs and special forest products were added to the list of goods reserved for England..."
The debate between laissez-faire and mercantilism came to a head in two books: Adam Smith's Wealth of Nations (1776) for laissez-faire and Sir John Steuart's Principles of Political Oeconomy for mercantilism (1767). "The books were the final statements in an argument that lasted nearly twenty years."
(p. 70) "At the crucial juncture of the Restoration, Shaftesbury realized that mercantilism could develop in one of two ways. It could sustain the image and the ideal of society and the general welfare, or it could slide back into a narrower and ultimately extreme emphasis on group and personal interest. Shaftesbury held fast to the broader ideal. His protege, Locke, turned toward a hedonistic individualism."
(p. 71) "As with Shaftesbury and Locke, Steuart and Smith shared one crucial assumption: whatever the local or domestic means of achieving welfare, it could not be accomplished without an empire. The key difference lay in the view shared by Shaftesbury and Steuart that conscious, positive policies were necessary to sustain the reality of corporate mutual responsibility within society and to improve the general welfare. The four protagonists also agreed, however, that self-interest was the main engine of human action" but Steuart "was convinced...that the exchange economy of the capitalist system suffered from an inherent tendency to get out of balance. As it did so, it produced unemployment, political unrest and the probability of social revolution...Steuart's acceptance of the responsibility to provide food, other necessities and employment, not only for those who actually exist, but also for those who are to be brought into existence" dramatized his reassertion--contrary to Locke and Smith--of the moral imperative that had been so strong in early mercantilism and that Shaftesbury had labored so hard to reinvigorate and sustain...Entertaining no thought of total regulation and quite willing to give individuals a broad area for independent action, Steuart nevertheless insisted that welfare was the product of policy, not of Providence nor of the automatic workings of Newton's Great Clock..."
p. 73 "James Madison, the commanding mind of the American gentry and the sage of the Founding Fathers, ultimately adopted and then adapted the mercantilism of Steuart as the morality and the policy by which to transform the feeble colonial confederation into a mighty republican empire."
Williams does a good job of describing the authoritarianism inherent in mercantilism and the corporatist society (pp. 95-6):
"Devoted to the ideal of a corporate community guided by a strong moral sense (the Puritans) developed a great talent for misinterpreting any opposition. From the outset, for example, they were prone to view the Indians as agents of the Devil waiting to test their convictions...This propensity to place Evil outside their system not only distorted the Puritans' own doctrine, it inclined them toward a solution which involved the extension of their system over others. Here was a subtle convergence of religious and secular ideas, for mercantilism also emphasized the necessity as well as the desirability of expansion in economic and political affairs. It externalized secular evil by arguing that domestic poverty could in the last analysis be overcome only by taking wealth away from others...Embarking upon a campaign of righteous persuasion which often became outright intimidation, and upon a bloody trail of persecution, the church fathers punished the courageous, exiled the bold and terrified the timid...this horrible travesty on the ideal of a corporate community culminated some 20 years later in the witchcraft trials".
Nevertheless (p. 98) both Massachusetts and Virginia "each had an outlook rooted in a religious conception of the good society as a balanced corporate system originally shared by their Puritan and Anglican ancestors in England."
(p. 99) "But this early devotion to the corporate ideal was weakened as Massachusetts and the other colonies in New England extended their boundaries and their prosperity. Religion was not abandoned but the wealthy 'river gods' of the Connecticut Valley and the merchants of Salem, Boston and Providence gradually redefined the meaning of the crucial term, the elect. From signifying membership in Calvin's corporate religious community it came to mean the upper class of that society...Jonathan Edwards assaulted their outlook." Williams describes the Great Awakening: "In defining religious commitment as an affair of the heart, in considering that only God is worthy of worship, in placing high value on the intellect and on education, in valuing and respecting self-government, and in asserting that there were positive, pragmatic consequences of being sober, honest, responsible and willing to work--in all these respects Edwards was a man who left his life as a monument to the positive side of Puritanism."
The American revolutionaries were mostly mercantilists, not advocates of Adam Smith and laissez-faire. Samuel Adams (p. 111-12): "launched a determined campaign to establish a corporate Christian and mercantilist American empire. Like his allies in Virginia, Adams was thus a revolutionary without being radical. Some of Adams's counterparts in other colonies stressed an extension of popular government more heavily than he did, for example, but none challenged the assumptions of the existing order....The Boston Society for Encouraging Industry and Employing the Poor (a mercantilist title if ever there was one) established a spinning school in 1769. The New York Society for the promotion of the Arts, Agriculture and Oeconomy began to grant premiums for domestic production and apprenticeship schools in 1765...." The first Continental Congress set up price regulations and the Massachusetts legislature called for American manufactures (p. 115).
Williams argues that Americans picked up mercantilism just as the British were shifting to laissez-faire. "American leaders were very conscious of the crucial role played by imperial expansion in the mercantilist conception of the state". Thus, American expansion and emphasis on the American frontier is an offshoot of mercantilism."
p. 124 " And paper-money inflation, which won the support of some groups, had been the avowed program of one group of English mercantilists since at least the 1690s. By the end of the war, the states were passing navigation acts and protective tariffs and granting bounties and subsidies to special sectors of the economy."
p. 124 "(Robert) Morris rather than Alexander Hamilton was the central figure in the creation of this first quasi-public bank. Morris wanted the bank to 'exist for ages' since in his view the 'salvation of our country' in attaching many powerful individuals to the cause of our country by the strong principle of self-love and the immediate sense of private interest."
p. 126 John Jay was " an American mercantilist deeply concerned to remove the difficulties in the way of the nation's development."
In 1783 Virginia ceded its western frontier. p. 128 "The cession by Virginia of its lands was in many respects the apex of the small-state theory of republicanism in America. The finest practical statements of that political and economic outlook were the related 1783-84 proposals by Jefferson...As finally passed, the Ordinance of 1784 divided teh trans-Appalachian west into ten relatively large states...But while his market and social interests as a planter and his education as a physiocrat strongly inclined Jefferson toward small states and local self government dominated by a benevolent aristocracy, he either sensed or rapidly became aware of the dilemmas...Territorial expansion was one way to resolve such difficulties...he rapidly modified his practice along mercantilist lines..."
p. 131 "From the beginning, Jay and many other early American leaders saw the law and some supreme judicial institution as the secular cement that would replace a state religion in such a corporate society. On the other hand, Jay's deep Anglicanism undoubtedly lay behind that general view..."
p. 133 "The militancy and throughness of Monroe's mercantilism is difficult to exaggerate." Monroe saw "...the double dilemma of American mercantilism: how to reconcile the political commtiment to republicanism and representative government with the necessity of expansion and at the same time effect a compromise between the landed and commercial interests."
p. 138 "This recognition of the need to control the existing west whyile the east gained strength and cohesion--a combination tht would tehn generate further expansion--played an important role in the rapid growth of the movement for a more powerful central government.
p. 139 "John Adams also explained similar truths to Jeferson and, along with Madison, seems clearly to have given the future sage of Monticello an intensive course in mercantilism. For that matter, Adams was a vigorous instructor to the entire American seaboard"
p. 142 "Several other developments strengthened and accelerated this mercantilist drive toward a powerful central government empowered to co-ordinate the landed and commercial manufacturing interests in one system and at the same time expand it in all directions. One of these was the increasing activity in manufacturing and an associated agitation for government aid. John Adams had reported in 1780 that Europe was worried lest American 'become the greatest manufacturing country and thus ruin Europe. Though America had not even approached that strength by 1786, there was a great deal of interest and activity. And the corporation, as a modification of the old joint-stock company, had already appeared as a means of solving the problems of capital accumulation and organization."
p. 144 "As had been the case with Shaftesbury at the time of the Restoration in England, many American mercantilists in the circumstances of 1786 began to be seriously worried that the strife between factions would combine with the particularism of the states to destroy the government and lead to a voluntary or forced return to some kind of colonial status."
p. 145 "As he awaited the meeting which had finally been arranged for at Annapolis, Madison began to grapple with the central dilemma posed by the contradiction between the expansionism of mercantilism and (of economic interest) and the political theory which asserted that republicanism could work only in a small state. He concluded that the existing low ratio between population and land would prevent lower-class rebellion or aristocratic tyranny for some years."
p. 160 "Madison ultimately realized that a crisis would occur when and if the citizen ceased to have significant leverage on the political economy. This happened in fact as the corporation replaced the individual in the narrow economic sense and subsumed the state as the elemnt of social decision-making in the broader sense. While he did not foresee that particular form which the crisis was to take, Madison did recognize two other dangers. Conflict was inherent in a feudal system of organization. 'And what,' he asked rehtorically, 'has been the progress and event of the feudal Constitution? In all of them a continual struggle between the head and hte inferior members, until a final victory has been gained in some instances by one, in others, by the other of them.'...Madison resolved both difficulties by standing feudal theory on its head. He simply asserted that a large state would weaken the influence of faction..."
p. 164 "(Madison) called on April 8, 1789 for the construction of an independent, balanced political economy...He recommended a mercantilist system to protect commerce, to sustain and extend the 'rapid advances in manufacturing' through duties running p to 50 per cent to rpvoide a revenue for the government, and to secure the fisheries, because they were 'perhaps the best nurseries for seamen of any employment...He even wanted a duty on beer that 'would be such encouragement as to induce the manufacture to take deep root in every state in the Union."
p. 164 "Tench Coxe, a leading political economist of his day, was agitating for a program to foster and encourage but not to force manufactures as a way of binding the north and south together and guaranteeing a prosperous influence."
Williams makes the interesting argument that Hamilton opposed the development of manufacturing in favor of banking and developing a trade relationship with Great Britain. (p. 164-5): "Despite their awareness that Hamilton's methods of centralizing the debts immediately favored the mercantile and banking factions, Madison and other mercantilists, and even some of the narrow agrarians, were willing to contribute this extra subsidy to the north because they realized teh necessity and the broader benefits of the actions...Madison also opposed Hamilton's Bank of the United States because he was not convinced that it was necessary...But both men feared that such a bank, managed as it would be by private entrepreneurs, would exert a preponderant influence on the economy and thereby usurp part of the effective power of the people and the government...In the matter of manufactures, however, Hamilton has received far more repute than he deserves. He never revealed, either in the famous report on the subject or in his other actions, the kind of support for American manufacturing with which he is credited or which might be expected of an American mercantilist."
p. 168 Jefferson's "Report on Commercial Privileges and Restrictions" of December 16, 1793 reflected Jefferson's move toward mercantilism.
p. 187 In the early 19th century , government assistance to business had become widely accepted. "South Carolina, for example, passed a typical law in 1808 for 'the establishment and encouragement' of manufactures. Pennsylvania helped finance various enterprises, granted cash subsidies to others, and proclaimed 'the duty and interest of all governments to prevent fraud, and promote the interests of just and useful commerce.' A typical writer in Massachusetts thought it 'manifestly erroneous' that people 'are the judges of their interests, and consequently should be allowed to regulate them unobstructed.' Such laissez faire was 'subsersive to the end and aim of all governments.' As the governor pointed out in 1809, the state had accepted the responsibility of 'making and executing just and practicable laws of inspection on manufactured articles.' John Adams summarzied the situation accurately in his comment that democrats and aritocrats all unite on the basic axioms of mercantilism. National debate centered on four issues: internal improvements, banking and monetary policy, commercial discrimination and aid to manufactures...Both of these, internal improvements and national finance, became the principal concern of Albert Gallatin. A vigorous defender of civil and religious liberties and a strong advocate of an educational system, since his service in the Pennsylvania legislature during the 1790s...His plan was simple: use the receipts from land sales to promote economic development, and then sustain, control and balance it through assistance to manufactures and by a national finance system. Gallatin's masterpiece was his majestic report of April 8, 1808 on a national transportation and communications network designed to strengthen the sense and reality of community...He proposed four main avenues: coastwise from Maine to Georgia, across the mountains through New York, Pennsylvania and Virginia into Kentucky and Tennessee; across the four mathor isthmian blocks; and into the Great Lakes region. Two years later, in 1810, he reported on manufactures. Stressing their vital importance to balanced growth and independence, he recommended a program of cash subsidies and other government aid to accelerate their development. But, as he realized, the long range solution would be provided by an expanding home market stable enough to encourage large investment, and by the establishment of economic independence vis-a-vis England's superior industrial system"
p. 189 "Jefferson accepted teh principle of such internal improvements, emphasizing education as well as canals, but he raised the issue of constitutionality. So did Madison, who feared that such a plan would unbalance his feudal system of republics. Both men put their case directly: if the Congress undertook a ten-year plan of the magnitude and with the consequences inherent in Galltain's program...then a process of interpreting the constitution would have started that could end only in monarchy or some other form of tyranny."
p. 190 Jefferson "worried lest the bank in time become an institution that cut across all regional and political lines. Doing so, he reasoned, it would subvert the authority of the states and hence replace or override them as an institution in the political economy. It would do so moreover, outside the constitutional framework. This would not only recast the entire balance of power that the constitution established, but the bank would effect the change as an institution which was not in any way directly responsible to the people. He feared the end result would be a kind of 'vassalage' imposed on both the individual and the government.
"...It was an astute analysis of the relationship between economic power and its social and political consequences, and our modern industrial corporations, together with the Federal Reserve Board itself have verified it."
p. 196. By 1816 Jefferson essentially gave up his "physiocratic dream": We must now place the manufacturer by the side of the agriculturalist"
p. 197 "Monroe concurred, stating flatly that since manufactures required the systematic and fostering care of the government, it was 'of great importance' to offer such assistance."
"Calhoun understood and admitted that ' what is necessary for the common good may apparently be opposed to the interest of particular sections.' But he insisted on the equity and the necessity of compromise...Probably no other American leader except John Quincy Adams looked so squarely into the central dilemma of mercantilism. And like Adams, Calhoun realized that the common good would give way to private interests and ambitions were the tension not controlled by everyman's commitment to the larger goal."
(p. 200) The second central bank was passed into law under President James Madison in 1816 and "their policy of loose credit helped bring on the panic and depression of 1819...Land speculation was literally fantastic." During the panic of 1819 "cotton prices were almost halved. People either left for the frontier or demanded help. Relief laws were passed throughout the west, and the entire country turned on the new bank as it tightened its credit...The bank became THE MONSTER..."
The panic of 1819 led to adoption of laissez-faire
Many, such as Monroe and Henry Clay continued to favor mercantilism.
"In four years the Adams administration spent almost as umuch on internal ipmrovements as had been allocated in the previous twenty-four. By 1826 the government was the largest single economic entrepreneur in the country" (P. 211)
Advocates of laissez faire included John Taylor of Caroline, President Martin van Buren, Senator Thomas Hart Benton and President Andrew Jackson.
p. 235 "Van Buren's operations in New York and Washington reveal and clarify the regional and national coalition between rising businessmen, yeoman farmers, southern planters and northern mechanics that is generally labeled 'Jacksonian Democracy'. It was an unstable alliance between a rising boureoisie on the make and a quasi-feudal landed aristocracy directed against the esbslished harbiners of an industrial order...Van Buren integrated teh mechanics and the aristocrats in a political machine (The Albany Regency) that was as autocratic and entralized as any the mercantilists ever organized...Van Buren's tie with eastern mechanics became even more important as manufacturing and commerce continued to institutionalize themselves in the factory and wholesaling systems centered in urban society
p. 305. Some examples of Whig/Republican government intervention during the Civil War period: "Having passed the tariff of 1864, given the farmer the Homestead Act of 1862 (along with formal representation in the government and educational aid) and subsidized the railroads, the radicals occupied the south and jammed through the 13th, 14th and 15th Amendments...Financial leaders, on the other hand, were less enthusiastic about the radical policy of soft oney. Bankers did not like having the government in the money business, and had opposed the National Banking Act of 1862. Their gains from inflation were small. Along with a good many of the rising corporation industrialists, such financial spokesmen were likewise cool to any wholesale equality for the Nego; the other side of that attitude was a desire, particularly strong among New York merchants, to restore their prewar economic connections to the south...."
p. 307 "As should be apparent, the merchant-planter-store system involved the railraods and the monetary system in every transaction. Consequently one group of businessmen and farmers joined the financial interests in favoring a deflationary monetary policy: they concluded that inflation hurt them more than it helped. A similar coalition, led by radicals like Stevens and generally based on the expanding iron and steel industry, preferred to keep the wartime greenback paper money system and even to expand it. They argued vigorously that contraction would retard economic development ('Businessmen are hungry for money,') operate unfairly against everyone except bondholders, adn hurt domestic manufacturers by undercutting the tariff. Since the per-capita money supply had declined from $30.35 in 1865 to $17.51 in 1876, the argument had considerable relevance. But the vote in the Congress on contraction revealed that the west was almost evenly divided (36 yes to 35 no) and the combination of a good harvest and foreign-crop failures temporarily damped the farmer's insurgency."
Large scale railroads led to demands for regulation..."Georgia and California reacted to this serious problem in 1879 by establishing permanent commissions staffed by experts to keep a running check on the lines...By way of avlidating an Illinois regulatory law in the cqase of Munn v. Illinois (1877) Chief Justice Morrison R. Waite explicitly invoked mercantilist precedents. citing the English common law as enunciated by Lord Chief Justice Hale during the period of Shaftesbury' influence in the 1670s, and examples taken from the era of Madison and Monroe, Waite reassertedthe principle tht 'property does become clothed with a public interest when used in a manner to make of it public consequence, and affect the community at large.' He also reiterated a cardinal principle that had been vigorously defended by Madison and Marshall. 'For protection against abuses by legislatures, the people must resort to the polls, not to the courts.'"
p. 325 In the late 19th century "the bulk of economic activity was carried on by small-to-medium-sized apitalists whose businesses were undramatic and even unimportant when considered individually. But they were often the first to introduce and perfect key innovations (as the refinement of iron into steel) which were then taken over by the big operators who proceeded to put many of the real innovators out of business. Most of them died unknown and have remained so, yet they carried the burden of industrialization and commercial development. hey also applied the principles of the laissez-faire market place to sports, as with baseball and prizefighting. This processing of games into enterprises was in some respects the classic proof of the triumph of business in America...The undeniable achievement of the laissez-faire entrepreneur, from Carnegie to the Wyoming dry goods merchant, is that he sustained the momentum of economic development through a long-wave depression (and an era of steadily falling prices) that lasted from 1873 to 1898. Up to 1893 at any rate, per capita income, real wages and gross national product all continued to increase. That tremendou surge of industrial strength changed the face, the food and the ideas of America and provoked serious re-evaluations of diplomacy in European and Asian capitals. It also extracted a terri ble cost in death and physical injury in psychic and emotional wounds, and a process of moral leaching that carried away a great amount of American idealism..."
p. 328 "Justice Stephen Johnson Field's strategy was to define the market place as a national rather than a state problem and then insist that the due process clause of the 14th amendment gave the Supreme Court the power and the duty to review all restrictions on private property. That meant that the market place of the system would remain one unit instead of becoming a wild and uneconomic conglomeration of many different (state) market places. It also meant that regulation would be milder because of the weaker position of the reformers in Congress. His first victory came when the New York high court accepted his dissenting argument against Jutice Waite in the Munn case as its majority view. In a test (In re Jacobs, 1885) of the state's right to regulate the atrocious conditions of cigar manufacturing, New York judges explicitly raised the specterof a return to mercantilist doctrine on social property. Such ideas--'from those ages when governmentl prefects supervised the rate of wages, the price of food, and a large range of other affairs'--were declared archaic. WThey disturbed the 'normal adjustments' of the market place, and also violated the due process clause which protected 'personal liberty' and private property...During the next two years, moreover, even Waite agreed that the 'right of continuous transportation from one end of the country to the other is essential' and admitted that the corporaton was entitled to 'equal protection' as an individual under the due process clause. Field's triumph was announced by his ideological colleague, Justice Rufus W. Peckham, in 1889, with a direct reference to Waite's earlier citation of Eglish mercantilist law: 'no reason exists for...[going] back to the seventeenth or eighteenth century ideas of paternal government.' It was further consolidated in 1897 in the Allgeyer v. Louisiana case, when the court stressed the right of the citizen to be free in the enjoyment of all his faculties' and tied the principle to the 'pursuit of happiness' clause in the Declaration of Independence.'"
The fallacy of confusing expansion with economic advance was characteristic of the 19th century, and we carry that error forward today. The repeated complaints about depression in the late nineteenth century despite massive immigration, increasing real wages and mild unemployment suggest a deeper psychological problem. "President Rutherford Hayes expalined in 1877 the long commercial depression...directed attention to the subject in a concerted manner. For that matter, some entreprenuers had already been talking to Grant's Secreaty of State Hamilton Fish about foreign policy as a way to 'relieve business distress'...Persistently reminded of the importance of expansion and the necessity of government assistance by such men as Charles Dalton of the textile industry and HK Slayton, a dry goods merchant, Senator John T. Morgan spoke for a growing consensus of congressmen as early as 1882. 'Our home market is not equal to the demands of our producing and manufacturing clases and to the capital which is seeking employment...we must enlarge the field of our traffic..." (p. 338)
Countries like India were viewed as targets. "Viewing the Navy as the key to such expansion, Congress began to debate a large construction program and in 1884 established the Naval War College. Senator John F. Miller of California, Chairman of the Senate Foreign Relatins Committee, provided a neat summary of the outlook. 'The time has come when...new markets are necessary to be found in order to keep our factories running. Here lies to the sout of us our India...If we reach out and attempt to secure this great prize of commerce we shall excite the jealousy of other peoples..."
Williams' treatment of the gilded age transformation of individual entrepreneurship and small business to corporate enterprise and big business is characteristic of the naive assumptions of traditional, left-wing historians. He emphasizes the importance of the emphasis on planning. He writes (p. 356):
"It is almost impossible to overemphasize the importance of the very general yet dynamic and powerful--concept that the country faced a fateful choice between order and chaos. Not only did it guide men in the 1890s; it persisted through World War I, the Great Depression, World War II and emerged more persuasive than ever in 1943-44 to guide the entire approach to postwar opportunities and problmes. Only the anarchists and a few doctrinaire laissez-faire spokesmen seemed willing to accept the possibility of chaos. Arguing that it was both necessary and possible, most americans reformulated and reasserted their traditional confidence in their ability to choose and control their fate...But given a consensus on the sanctity of private property and confronted by the increasingly obvious failure of laissez faire, this faith could be verified only by controlling the market place..."
The problem for Williams is that he never produces evidence that laissez faire had failed.
McKinley and Roosevelt both made steps to accomodate the new corporatist orientation.
"Granting the assumptions of the system, Roosevelt most certainlyh dealt with these difficulties from the most relevant and potentially most successful point of view. His conception of leadership derived from the agrarian gentry, a group that had wielded power in an earlier society also characterized by consolidated economic power (in land) and by a similar vast and interrelated network of authority, influence and responsibility. Hanna understood the modern industrial system based on centralized power in the corporation, but lacked the tradition of class-conscious leadership...Roosevelt did not fully comprehend the industrial system, but he did have the image and ideal of class-conscious leadership."
In other words, in response to complaints by subsidized big businesses that their profits were too low, Williams argues for the reinstitution of feudealism headed by Lord Roosevelt and his inept entourage of corporate planners headed by Lieutenant Hanna.
p. 382. "Bankers and their lawyer spokesmen revealed a strikingly firm conception of a benevolent feudal approach to the firm and its workers. Both were to be dominated and co-ordinated from the central office. In that vein, they were willing to extend--to provide in the manner of traditional beneficence--such things as new housing, old age pensions, death payments, wage and job scheduules and bureaus charged with responsibility for welfare, safety and sanitation. Though he was not the most sophisticated of the industrialists, Charles M. Schwab of Bethlehem Steel revealed the essentials of a different outlook at an early date. Concluding from the Homestead Strike that labor "had som erights, whether others were willing to recognize it or not," Schwab also understood the necessity of making periodic, on-the-spot accomodations wtih labor in order to maintain steady production. Financiers, he complained, were always ready to treat thre men fairly as individuals and give them good liberal wages, but they did not grasp the value of unions either to the laborer or to the corporation itself."
pp. 384-6 Williams argues that syndicalism is how the American system developed. Under syndicalism, functions determine representation. "Political representation should arise within each segment and be coordinated at the top in the national governmetn. Individuals would thus participate in the relevant decisions and at the same time enjoy a sense of community and purpose within their particular group that would replace the alienation of an individual lost in a highly organized society...Herbert Hoover was the crucialfigure in the evolution of the approach. Describing society as composed of three major groups--labor, capital and the government--he struggled to balance and control the units so that they would not drive the system toward fascism (business control), socialism (labor dominance) or the tyranny of bureaucratic government. All such men, from Theodore Roosevelt through Hoover and later theorists, recognized that the central problem was to find som eideal that would generate the self-discipline an dpublic spirit essential to maintaining equity...As a basic component of both the fascist movement in Italy and the hard core of National Socialism in Germany, syndicalism provided the leaders of both parties and coutnries with many of their central ideas and programs. Since they rsorted to terror in establishing and maintaining th eapproach, and distorted it in other ways, the essentiqal characteristics common to American and European syndicalism are generally missed or discounted."
p. 391 In the twentieth century "the functional-syndicalist organization of the economy led most political groups to play both sides of the street. Corporations, fo example contributed money and leaders to both parties.
p. 439 In discussing the New Deal Williams writes:
"Though its own leaders admitted that it lasted barely five years (1933-37) and though it ended with candid admissions of failure from its major protagonists, the New Deal is often viewed as a major turning point in American history. A bit more perspective suggeests that it represented a reaction to a severe crisis in which most of the elements, attitudes and policies of the Progressive movmeent were finally consolidated in one short period under the leadership of a particularly dramatic politician. The New Deal saved the system. It did not change it."
I question the claim that the new deal saved the system. Prove it. If it didn't work, then how did it save the system? Progressivism caused the depression, Progressive ideas did nothing to improve the situation.
p. 446-7 "In April 1937, in the case of the National Labor Relations Board v. the Jones and Laughlin Steel Corporation, the Court upheld the Wagner Labor Act. By explicitly sanctioning unions because they were essential to give laborers opportunity to deal on an equality with the meployer, " chief Justice Hughes implicitly authorized the governmetn to intervene in the political economy to establish, maintain and institutionalize a rough kind of parity between the various functions...The Court's decisions upholding the Social Security Act and the State of Alabama's Unemployment Compensation Act were perhaps even more necessary to the functioning of that system. Holding that social security deductions were justified as an excise tax, and further in being used fo rthe general welfare, the judges underwrote that approach to old age and retirement benefits. The court went even further in the Alabama case. For in that instance the plaintiff charged that the taxes returned no benefit to those who paid them, thereby raising the question posed by the role of the government in accumulating capital from the taxpayer and allocating or investing it without his direct participation in the decisions...In a syndicalist sytem composed of interest-conscious functional groups which exert extremely poerful and effective pressure on political leaders, how does the citizen taxpayer either participate to any signficant extent in the formulation of proposals or protect himself against decisions taken in his name which subject him to double jeopardy in matters of economics or civil rights. The meaing of the decision in the Alabama case was very simple and very blunt: he does not. 'The only bneefit to which the taxpayer is contitutionally entitled, the Court pronounced in the words of Justice Harlan F. Stone's opinion, ' is that derived from his enjoyment of the privilege of living in a civilized soicety, established and safeguarded by the devoltion of taxes to a public purpose.' That meant that the citizen elected a representative who was his agent, but over whose action he had no substantial control. For electing a different man did not even modify the basic features of system, let alone change them. Thus the Alabama case sanctified a system and procedure of defining 'the public purpose' which not only left the citizen far removed from final decisions, but denied him any grounds for appeal through the courts. An ad hoc syndicalist system was thus formally held to be democratic in domestic affairs. In later years, during and after World War II, such vast powers of the government were further extended...It is of course essential to evaluate the combined significance of these decisions within the framework of the syndicalist approach that had been present in the Progressive Movement from the very beginning of the twentieth century, adn which the New Deal consolidated. Granted those assumptions, what the Court had done was to legalize a system ctreated by the large corporation adn the Progressive movement. In that system, the citizen was almost wholly dependent upon the definition of public welfare that emerged inside the national governmetn as a consensus among the leaders of the various functional-syndicalist elements of the political economy. The possibility that Hoover had projected in 1921-1922 had emerged as a reality: The United States was a syndicalist nationon a gigantic scale. Yet the citizen's political activity was carried on within a framework that was organized on an entirely differrent basis: i.e., geographic boundaries which had only the most casual and accidnetal relationship to the syndicalist structure of the political economy. That discrepancy left the citizen without any effective, institutionalized leverage on the crucial and centralized decisions affecting every phase of his life."
Williams's hope for a "truly class-conscious industrial gentry" (p. 449) is a ridiculous conlusion to an utterly brilliant analysis. Williams is trapped by his left wing ideology. His perceptive brilliance in analyzing the contours of American history is marred by his dependence on mercantilist and feudalist assumptions that are, as he so aptly points out, the essence of socialism.
Thursday, August 7, 2008
George Washington on the Future of US Foreign Policy
"If we remain one people, under an efficient government, the period is not far off when we may defy material injury from external annoyance; when we may take such an attitude as will cause the neutrality we may at any time resolve upon to be scrupulously respected; when belligerent nations, under the impossibility of making acquisitions upon us, will not lightly hazard the giving us provocation; when we may choose peace or war, as our interest, guided by justice, shall counsel."
---From Washington's Farewell Address, quoted in William Appleman Williams, Contours of American History, Chicago: Quadrangle Paperbacks, 1966, p. 173.
Williams adds:
"Far from being a call for isolation, what Washington issued was a mercantilist manifesto for an unchallengable empire. Whatever one thinks of the logic or of the goal itself, Washington's Farewell Address remains one of the great documents of America's Age of Mercantilism."
---From Washington's Farewell Address, quoted in William Appleman Williams, Contours of American History, Chicago: Quadrangle Paperbacks, 1966, p. 173.
Williams adds:
"Far from being a call for isolation, what Washington issued was a mercantilist manifesto for an unchallengable empire. Whatever one thinks of the logic or of the goal itself, Washington's Farewell Address remains one of the great documents of America's Age of Mercantilism."
Sunday, August 3, 2008
Daniel Walker Howe's Political Culture of the American Whigs
Daniel Walker Howe. The Political Culture of the American Whigs. Chicago: University of Chicago Press. 1979. 404 pages. Available from Amazon.com for $26.60. Available used and new from $14.00.
This is a fine book. Interesting, highly informative, fun to read. Howe's writing is lucid. Books like this inspire us to learn. Howe's insights about the American Whig Party, their ideas, religion and culture are wonderful, and he covers a lot of ground. He uses a biographical approach that covers a wide range of Whig Party politicians beginning with John Quincy Adams (who became a Whig after his presidency and during his post-presidency Congressional tenure) and ending with Abraham Lincoln, not only the best-remembered Whig but also the best-remembered 19th Century politician, except perhaps for Jefferson. Of course, the Whig Party expired in 1856 and Lincoln gained the presidency as the first Republican, but his allegiance to Henry Clay never diminished.
I read the book because I became curious about the continuity of American elitist and pro-Central Bank ideology between the 18th and twentieth centuries. This book makes clear that there are many linkages between the Whigs and the Progressives, hence the New Deal (which is my own conclusion, not Professor Howe's). Nancy Cohen makes clear the link between the Mugwumps and the Progressives, and in his concluding pages Howe mentions that the Whigs mildly reasserted themselves via the Liberal Republican Party in the 1872 election, which is often referred to as an early phase of the Mugwumps' activism. Although Howe characterizes the Whigs as the "country" party, it is clear that many former Federalists became Whigs in the 1830s. It also is clear that the economic elite was associated with the Whigs just as they had been with the Federalists, niceties about political ideology aside. Thus, there is a clear line from the Federalists to the Whigs, then to the Mugwumps and then to the Progressives. The speeches of Theodore Roosevelt, himself a one-time Mugwump, make clear the connection between his own ideas and those of Franklin Roosevelt's.
One of the nice things about this book is that Howe covers the religious and evangelical elements in the Whig philosophy along with the economic and political. It is fairly clear that the evangelical social concerns, linked of course to abolitionism, form the basis of today's social democrats' concerns. The evangelical religious impulse developed in several ways, one of which was through Social Gospel Christianity, through to Progressivism and then the social welfare elements of the New Deal. The emotional commitment of social democrats to their programs can be explained in this evolution of religious feeling that has been displaced into social democracy.
This book, written as a solid piece of history, does not suggest that there is a continuous party that has favored economic centralization from the Federalists to the New Deal Democrats. But it seems clear from the evidence. For most of its history, with the exception of the Mugwump period, the centralization party has favored a central bank, public works (which were characteristic of not only of Hamilton's Federalist program but also of Henry Clay's American system, of Theodore Roosevelt's ideas and of the New Deal) and business. The Whigs, the Mugwumps and the Progessives were ambivalent about big business, although their moral concerns seem to have been easily displaced. There is little doubt that the tariffs that the Whigs implemented were in large part responsible for big business in America. The Mugwumps, at least in some instances, were willing to repeal the tariffs but the Progressives amounted to a reassertion of more aggressive Whiggery than had existed since the end of the Civil War. In the Mugwump period the urban elite became hostile to corruption of some big business. In turn, the Progressives and New Dealers in increasing progression used anti-business rhetoric to cloak their centralist orientation. The centralizing party favored tariffs in the Hamiltonian and Clay periods, then divided over tariffs during the Mugwump period. The anti-tariff position won thereafter to the extent that reductions in tariffs did not hurt American business interests.
American history occurs in cycles, with each cycle involving various combinations and variations on the issues of economic centralization, central banking, protectionism, and support for industry. Progressivism aggressively asserted the centralizing position against the late nineteenth century elitists' deviant laissez-faire philosophy. I call it deviant because in all other periods other than the late nineteenth century American elites have opposed laissez-faire in favor of corporatist, centralizing mercantilism, Progressivism and finally so-called "liberalism". It is a tribute to the power of laissez-faire that a movement that was backed primarily by working-class and small farmer Jacksonians from say 1825to today really, and had the backing of economic elites only during the post-bellum period that ended in the late 1890s, continued to provoke so much distress from university-trained economic elites, business and banking interests, organized labor and other proponents of elitist centralization through to the present.
Like the Whigs, the Progressives were advocates of a return to the corporatist mercantilism of the 17th and 18th centuries represented by Anthony Ashley Cooper, the Earl of Shaftesbury in the 17th century and Sir James Steuart in his "Inquiry into the Principles of Political Oeconomy", published in 1767. As William Appleman Williams aptly points out in his classic Contours of American History :
"...it is possible to gain a vital insight into that contemporary liberalism which defends the right of private property and asserts the supremacy of individual liberty while at the same time advocating the general welfare. For although such liberals show superficial similarities to the mercantilists, they are considerably removed from that conservative tradition of the common good. Such liberals usually label Karl Marx a heretic and consider socialism a heresy, but the reverse is much closer to the truth. The liberal tradition stems from the triumph of laissez-faire individualism over corporate Christianity. Marx and other socialists reasserted the validity of the original idea in response to the liberal heresy. That is indeed one of the basic explanations of socialism's persistent relevance and appeal in the 20th century."*
Williams's point can be expanded a bit, because not only socialists but also Whigs and Progressives rejected the laissez-faire heresy.
As opposed to laissez-faire, the Whig Party (p. 16) "advanced a particular program of national development. The Whig economic platform called for purposeful intervention by the federal government in the form of tariffs to protect domestic industry, subsidies for internal improvements, and a national bank to regulate the currency and make tax revenues available for private investment...The Democrats inclined toward free trade and laissez-faire; when government action was required, they preferred to leave it to the states and local communities. The Whigs were more concerned with providing centralized direction to social policy...The most important single issue dividing the parties, and the source of the most acute disappointment to the Whigs after President Harrison had been succeeded by Tyler, concerned the banking systemm. Jackson's veto of the recharter of the Second Bank of the United States in 1832 became the point of departure for a generation of political partisanship". By 1860 Abraham Lincoln favored reinstitution of a central bank but was unable to effect it, and a central bank was not reinstituted until 1913, under Woodrow Wilson, who was the first of several Democratic Party Whigs.
Howe goes on to point out (p. 17):
"The banking-currency issue (that is, the right of banks to issue their own paper money) mattered at the state as well as the federal level. Many states redrafted their constitutions during the Jacksonian period and had to decide whether they would authorize state banking monopolies (usually mixed public-private corporations), specially chartered banks, free banking, or no banks of issue at all. As time went by, the parties tended to polarize with respect not only to rechartering a national bank but to the function of banking in general. The Democrats generally became more committed to hard money (specie or government-issued currency), while the Whigs became defenders of the credit system (in which banks were the issuers of currency)."
"When Democratic "Martin van Buren complained during the Panic of 1837 that people looked to the government for too much," (Whig) Henry Clay retorted that the people were "entitled to the protecting care of a paternal government." This is very much in the tradition of mercantilism.
But while on economic issues the Democrats were anti-inflation and pro-democracy, on the race issue the Democrats were pro-slavery and racism while the Whigs were less racist and more anti-slavery.
Howe argues that (p. 20):
"there is danger in calling the Whigs champions of the positive liberal state. It makes them sound too much like twentieth-century liberals. Actually, the differences between the Whigs and twentieth century liberals are more important than the similarities. Whig policies did not have the object of redistributing wealth or diminishing the influence of the privileged. Furthermore, the Whigs distrusted executives in both state and federal government (they had been traumatized by the conduct of Jackson), whereas twentieth century liberals have endorsed strong executives more often than not. For all their innovations in economic policy, the Whigs usually thought of themselves as conservatives, as custodians of an identifiable political and cultural heritage. Most deeply separating the Whigs from twentieth century liberals were their moral absolutism, their paternalism and their concern with imposing discipline...the Whigs proposed a society that would be economically diverse but culturally uniform; the Democrats preferred the economic uniformity of a society of small farmers and artisans but were more tolerant of cultural and moral diversity."
Taking the last point first, economic diversity is not an issue of importance today, but cultural uniformity is. Perhaps invisibly to Howe, twentieth century social democrats have aimed to foist a cultural uniformity on America. In the mid twentieth century they claimed that liberalism reflected the national consensus. By the 1980s they advocated political correctness. Political correctness is a moralistic impulse with Whiggish religious roots. Moreover, although the twentieth and 21st centuries have rejected the sexual morality and Aristotelian virtues characteristic of the Whigs and earlier, they have replaced these with a host of politically correct moralities with which they replace faith and tradition, to include animal rights, global warming and similar causes.
It fascinates me that Howe's argument begs the argument of Murray Rothbard, Ronald Radosh and Martin J. Sklar in New History of Leviathan that twentieth century liberalism did not aim to redistribute wealth but only used social democratic rhetoric to re enforce elitist goals. In terms of culture, there is no doubt that 20th and 21st century liberalism repudiates 19th century Whiggish elitism as well as 19th century Democratic Party racism in favor of a revised elitist philosophy based in part on similar impulses, such as claiming special status for the educated, especially the professions. Changing technology and extensions of knowledge created new economic interests in the late nineteenth century that changed the emphasis of the Whigs' descendants, the Mugwumps, into emphasizing the role of the professions, Whiggish forms of government intervention in support of the professions and rationalization of industry and government (which the Whigs would have supported). Naturally, economic conditions altered the form elitist centralization took just as religious and moral emphasis and alliances shifted.
But on the following page Howe puts the statist essence of the Whigs into focus (p. 21):
"Because of their commitment to 'improvement', Whigs were much more concerned than Democrats with providing conscious direction to the forces of change. For them, real progress was not likely to occur automatically; it required careful, purposeful planning...Whig morality was corporate as well as individual; the community, like its members, was expected to set an example of virtue and to enforce it when possible. A third recurring theme in Whig rhetoric was the organic unity of society...the Whigs were usually concerned with muting social conflict."
Seventy years later, when Frederick Winslow Taylor advocated a "mental revolution" between labor and management as part of his system of scientific management that aimied to rationalized industry, like a good Whig Progressive (and Herbert Croly specifically endorsed Taylorism) he was arguing for the organic unity of society.
The Whigs liked to draw an analogy between the human body and the political system (p. 29): "An essential feature of the analogy for the Whigs was the parallel between regulating the faculties within an individual and regulating the individuals within society. Faculty psychology tgaught an ideal of harmony within diversity...The model ruled out laissez-faire as a social philosophy, emphasizing instead the mutual responsibility of individuals and classes. The ideal society, like the ideal personality, improved its potential in many directions. Economic development promoted a healthy diversity, which 'furnishes employment for every variety of human faculty.' The conception implied an active, purposeful central government, administering the affairs of the nation according to its best judgment for the good of the whole and all parts of the whole."
This explains the difference between the Whigs and their later descendants, the Progressives and the New Dealers, as to the importance of the chief executive. By 1900 the federal government was becoming too complex to permit a legislature to make managerial decisions. Hence, advocates of centralization had to choose between no centralization and a strong legislature or centralization and and a strong executive. Obviously, centralization was more important to the centralizing party than was a weak executive. As a practical matter, centralization is impossible without a strong executive once government reaches a certain level of size and complexity. Since the Whig/Progressive/New Deal Party has been focused on expanding government to satisfy the economic interests of the professional and managerial classes, the issue of a powerful executive is a trivial one compared to the issue of increasing size and complexity of government. You can't have both.
Moreover, the Whigs anticipated today's liberal New Deal Democrats in their claim that the educated had the right to special privileges and that the educated ought to rule over the uneducated (p. 30):
"John Locke had written that people who lacked the opportunity to cultivate their higher faculties (such as women and the poor) could not become fully rational and therefore justly held subordinate positions within society...The American Whigs were less explicit than Locke, but they shared his general view that those who had not had the opportunity of education should defer to the leadership of those who had received it..."
Today, the claim of elite privilege by the educated has reached a fever pitch. I doubt that a single Congressman or member of the President's cabinet lacks a college degree. This is so even as the intellectual demands of a college education have dwindled to next to nothing and college graduates today know less than high school graduates of 100 years ago. Compare this with an observation by Herbert Hoover in 1922**:
"That our system has avoided the establishment and domination of class has a significant proof in the present administration in Washington. Of the twelve men comprising the President, Vice-President, and Cabinet, nine have earned their own way in life without economic inheritance, and eight of them started with manual labor."
Andrew Jackson and the Democratic Party violated the "politics of deference" characteristic of early American society through extending the spoils system to all classes (p. 31). This tradition continued through Hoover's time, but the Progressives and their New Deal descendants put in place policies that were less democratic. This repositioning of elitism to focus on education rather than on the traditional land and wealth criteria occurred during and before the Mugwump period. The Mugwumps emphasized the rationalization of civil service, a concept which the Progressives developed into scientific management.
To support business, Whigs supported tariffs and the central bank (p. 32). These stands appealed to wealthy business interests but not to the poor. In order to appeal to the poor, the Whigs emphasized ethnic (specifically, WASP) identity politics, and moral issues that cut across social classes. Part of this involved the evangelical Second Great Awakening as well as appeals to basic morals (p.33):
"The Whig party's electoral campaigns formed part of a cultural struggle to impose on the United States the standards of morality we usually term Victorian. They were standards of self-control and restraint, which dovetailed well with the economic program of the party, for they emphasized thrift, sobriety and public responsibility...They looked upon the Democratic voters as undisciplined."
The Whigs extended this moralism to a belief in central planning and opposition to free markets (p. 34):
"Running through Whig political appeals was the concept of consciously arranged order. This was characteristic of their reliance on government planning rather than the invisible forces of the marketplace. It was characteristic of their reliance on government planning..."
The Whigs emphasized public education, in part through the activities of Horace Mann, a Whig (p. 36): "A believer in uniformity and conscious planning, Mann wanted more centralization in school systems. Democrats, resenting higher taxes and loss of control, frequently opposed Mann and other Whig educational reformers."
In contrast to Democrats, who aimed to end economic privilege through systemic reform such as the abolition of the central bank (p. 37):
"Whig reforms were frequently altruistic efforts to redeem others rather than examples of self-help. Whigs supported Dorothea Dix's campaign for federal aid to mental hospitals; Democrats opposed. Whig prison reformers sought to make prison a place of redemption as well as retribution...Democratic prision reformers, on the other hand, were usually concerned with economy, efficiency and deterrence."
The parallels to Progressivism and the New Deal seem clear.
The Jacksonian Democrats were the ones who oppressed the Indians. For instance the Cherokee case, where the rich lands of the Five Tribes in Georgia led to their expulsion via the famously tragic "trail of tears" was a partisan Democratic policy. "Chief Justice John Marshall delivered the judgment of the United States Supreme Court in Worcester et al. v. Georgia on March 3, 1832. He found Georgia's action unconstitutional: the state had no right to legislate for the Cherokee Nation...But Georgia defied the Court's decision...and went ahead with the expulsion of the Indians. Jackson made it clear that he would never enforce the Court's mandate, and loopholes in federal appellate procedure enabled him to avoid doing so. Meanwhile, he used the Army to facilitate the dispossession of the Indians, not to protect them." Chief Justice Marshall was, of course, a Whig.
In part because of their emphasis on moral development that coincided with their belief in economic development, Whigs emphasized history to a greater extent than Democrats (p. 72). Whigs believed that a generation could bind a later generation, lending acceptability to long term mortgages. Again, we seen a hint of future big government social democracy. For instance (p. 72) the Whig William Henry Seward recommended a series of internal improvements in New York.
Thomas J. DiLorenzo of the Ludwig Von Mises Institute quotes a Edgar Lee Masters's biography of Lincoln that states that the internal improvements of the Whigs involved a considerable degree of corruption:
"Henry Clay was their champion, and he represented 'that political system which doles favors to the strong in order to win and to keep their adherence to the government. His system offered shelter to devious schemes and corrupt enterprises.' They advocated 'a people taxed to make profits for enterprises that cannot stand alone.' The Whig party had 'no platform to announce, because its principles were plunder and nothing else.' These men 'adopted the tricks of the pickpocket who dresses himself like a farmer in order to move through a rural crowd unidentified while he gathers purses and watches.'...Lincoln in the 1830s succeeded in having the legislature allocate $12 million in an absurd make-work scheme to turn Illinois into one vast system of government-subsidized canals and railroad lines...The scheme was a colossal failure as virtually all of the money was stolen or squandered. Lincoln's law partner, William Herndon, called the scheme 'reckless and unwise' and a disaster that 'rolled up a debt so enormous' that it impeded Illinois' economic growth for many years. 'The internal improvement system, the adoption of which Lincoln had played such a prominent part, had collapsed,' Herndon wrote in his biography of Lincoln."
These points contradict some in Howe's book, but Howe does not address the issue of corruption in the actual implementation of the public works projects that Whigs like Lincoln did implement. It is not surprising that corruption was involved, nor is it surprising that ideologically the Whigs might not have addressed this issue despite or rather because of the moralism in their belief system. On the other hand, Howe's evidence does not support DiLorenzo's claim that the Whigs did not have a platform. On some issues, such as treatment of the Indians, Whig opposition to the Mexican War (which was a Jacksonian plicy) and abolition, there was considerably more overlap between the Whigs' position and the libertarian one that DiLorenzo advocates. Nor is it fair to dismiss the mercantilist view as one that intentionally encouraged corruption. The economic development of Britain between 1600 and 1840 was one of the dramatic feats of economic development in the history of the world, and it occurred under a primarily mercantilist ideology. It might have been better to have adopted the ideas of Murray Rothbard in 1600, but it also might have been better if jets and cellular phones had been available to Clay, Biddle and Lincoln.
Like Libertarians, Jacksonian Democrats feared the emergence of a plutocratic elite. However, the Whigs saw a threat "in the perversion of the political process by demagogoues taking advantage of the loss of an independent spirit among the people" (p. 76) and they saw Jackson himself as a demagogue. Like the Federalists, the Whigs emphasized not democracy but balance. In their view (p. 77) "the purpose of government is not to implement popular will but to balance and harmonize interests." Balanced government, of course, is the theme of the Federalist Papers. The Whigs emphasized the national origin of the Constitution. They did not believe that the Constitution originated with the states. The federal government is mixed, neither wholly federal nor wholly consolidated.
(p. 77) "The most salient characteristic of American Whig political thought was that it remained within the tradition of the "commonwealthmen," that remarkable group of English and Scottish writers...Two favorite writers in the tradition were James Harrington and Viscount Bolingbroke."
(p. 78) "That the Whigs who advocated industrialization and economic development should have identified with a political heritage called 'country' may seem at first anomalous. Actually, however, the word 'country' was understood more in opposition to 'court' than in opposition to 'city'. Within the English 'country party' not only landed gentlemen but also bourgeois Protestant Dissenters were prominent...As a group that included both townsmen and commercial farmers, and as inheritors of the religious tradition of English Dissent, the Whigs found the country-party tradition congenial."
p. 90 "Both Whigs and Democrats claimed to be heirs of the Republican Party of Jefferson though both in fact contained some some former Federalists. Ex-Federalists like Daniel Webster became willing to cite Jefferson as an opponent of executive power once they had become Whigs. The closest ideological predecessors of the Whigs seem to have been not the Federalists but the 'moderate' or 'nationalistic' wing of the Republicans. This group combined, as the Whigs did later, a country-party respect for consitutional balance, legal tradition and executive restraint with belief in federally sponsored economic development and government 'for' rather than 'by' the people. The archetypal representative of this brand of Republicanism, and the patron of Whiggery, was James Madison. It is well known (or it should be) that Jefferson disapproved of Jackson's candidacy in 1824; it is even more significant that Madison and Gallatin, who were still alive in 1832, when the issues of the Jacksonian era had been clearly drawn, supported Clay for president that year."
"The Whig defeat in 1844 entailed consequences of imponderable magnitude, leading as it did to war with Mexico and exacerbated sectional antagonism. War was traditionally an evil in country-party ideology, dreaded not only for its cost in blood and money but because it provided an occasion for executive aggrandizement. President Polk's devious and provocative conduct, both before and afterthe beginning of hostilities, provided plenty of confirmation for such fears" (p. 92)
Howe provides fascinating biographies of two Whig entrepreneurs: Nathan Appleton and Henry Carey. Appleton founded various textile mills, including most famously an early joint stock company called the Merrimack Manufacturing Company. Appleton named the company town "Lowell" after a deceased partner. The firm made early forays into human resource management on a dramatic scale:
"The company built homes for the households of its male supervisory employees and boardinghouses for its unamrried female operatives; it supplied the town with a school, a hospital and a library, whose resources made possible the magazine the employees put out, the famous Lowell Offering. It was by no means sufficient for the proprietors to provide what they thought were wholesome working and living conditions at Lowell. They desired to preserve the morals of the people there to be gathered. With this in mind, they built or subsidized eight churces, exercised strict supervision over the workers' private lives and founded a savings bank...Lowell Massachusetts represented social innovation as much as technological innovation. In its original conception, it was to be not only a company town but also an experimental utopia...Lowell illustrates the Whig desire to remake the world...most of the workers were isolated from their families and lived regimented lives of hard work, chastity and diligent uplift...the workers would be women...By hiring women the Merrimack Manufacutring Company could pay lower wages than British industry was paying men..."
(p. 104) "In reply to Democratic charges that corporations were conspiratorial and elitist, Whig defenders of corporations (mixed or private) insisted that they conferred great benefit on savers of modest means by allowing them to participate with the rich in the profits of incorporated business. This was why John Quincy Adams could speak of the 'truly republican institution of joint stock companies.'"
Appleton and his associates founded a private banking system based in Boston. As a result, New England was not dependent on the bank of the United States for a uniform circulating medium. "Member banks in many New England towns would desposit sufficient funds to guarantee their notes at the Suffolk Bank in Boston. In consideration for the use of their money, the Suffolk Bank would redeem the notes of the out-of-town banks at par instead of discounting them. Thus a uniform circulating medium and banking reserve requirements were maintained within the region..." (p. 106).
Henry Carey (p. 109) "identified himself with what might be called the commercial wing of Jeffersonian Republicanism, advocating internal improvements, a protective tariff, a national bank, and reconciliation with the Federalists--in short, the Madisonian Platform." Carey was a moral philosopher and economist (p. 111) "who believed America would be a better place to live if it could industrialize." He believed that "genuine full employment was both the means to economic progress and, for Carey, the end of economic progress. Carey was a feminist and argued that economic development held out considerable promise to women (p. 112). He believed in a mixed economy, capitalism combined with government intervention (remember, this was the 1830s--the idea that a mixed economy was "progressive" was a claim of the 1900's-1930s, 70-100 years after Carey). "Government policy should add...what is today called social overhead--a transportation network and an educational system. To keep the economy expanding, the burden of taxation should not be oppressive, but in the United States in Carey's time there was little danger of this. Carey laid the most stress on a plentiful money supply and a protective tariff to prevent this money from being drained off...Taken together, trhese policies would secure investment capital, increase productivity and raise wages..."
"Carey looked to technology to solve the differences between capital and labor" (P. 113). Carey's philosophy had Christian and moral overtones (p. 114). He believed in progress and opposed Malthus and the Manchester school. He advocated a culture of progress (by which he meant economic as opposed to political progress).
Whigs may have been the first advocates of suburbanization. "Whiggery was an outlook more appropriate to villagers or townsmen than to either frontiersmen or city dwellers....in many parts of the country where the Whig party was strongest it was asociated with a longing to recreate the early New England town settlement." (p. 116). Whig candidates generally outpolled Democrats in the cities (p. 117). "The Whig desire to preserve rural values within an urban context eventually led to important developments in urban park and cemetary landscape architecture, culminating after the Civil War in the genius of Frederick Law Olmstead". Olmstead was a Mugwump associate of EL Godkin.
Le Corbusier is generally recognized as the ideological forerunner of Robert Moses, but Moses seems to bear some things in common with the Whigs, specifically, the notion of the need to introduce country-like super-blocks would seem to echo Olmstead's concept of a park within a city (although when Olmstead designed Central Park it was on the northern end of the city). Moses would seem to have fulfilled the Whiggish tradition, both in terms of being a master public works builder and one who introduced urban America to the suburbs through highway building and superblocks.
Carey opposed trade, viewing it as parasitic and exploitative. He viewed the Irish potato famine as indicative of the problems that trade can cause (p. 118) "The same Carey who praised the small-to-medium-scale capitalism of the town deplored the large-scale capitalism of the metropolis. A trading economy corrupted its own society...Within cities a submerged 'proletariat' appeared...The trading classes lived by appropriation of wealth created by others." The Whig ideology had an anti-capitalist flavor at times, which parallels Progressivism seven decades later. Carey believed that the evils of trade could be overcome with a protective tariff. Protectionism led to "a diversified economy" which would "provide a healthy human environemnt for varied talents." A diversified economy secured people's independence against intimidation. (p. 122) "The great triumph of Carey's life came with the passage of the Morrill Tariff of 1862, commencing a century of American protectionism that would last until the Kennedy round of economic conferences. Yet instead of a decentralized 'middle zone' of opportunity and morality, economic consolidation and further urbanization characterized the high tariff era. The idea that protection was only a transitional phase for infant industries was ignored." This brings us back to the Rothbard/Radosh thesis. Were the Whigs merely fools to advocate tariffs to encourage "a diversified economy" instead of big business, or were they merely front men for big business interests?
Henry Clay
"Henry Clay believed in stability and order" (p. 123). (p. 139) "The Bank issue brought into sharp focus the conflict between the two views of the nation's destiny: Clay's vision of economic development planned centrally by a capitalist elite and the Democratic vision of a land of equal opportunity. Even after the Bank's charter finally expired in 1836, banking and currency remained the subject of bitterest partisan debate." (p. 146) "The conjunction of commerce with Christianity was typical of the Whig version of imperialism". Clay adopted the ideas of Henry Carey. He (p. 137) advocated revenue sharing or distribution of federal money to the states. His American System "was predicated on the basis of a harmony of interests" 9P. 138). The Whigs argued for class harmony and mutuality of interests.
Lyman Beecher
Lyman Beecher represented the evangelical dimension of the Whigs. "The tradition of Edwardsean eschatology had been transmitted to Beecher via Timothy Dwight, Edwards's grandson, who became president of Yale during Beecher's undergraduate years. The continuity of evangelical thought remained unbroken during the time of the Whig party; the providential interpretation of history that one finds in Edwards' accounts of the Reformation or the Glorious Revolution appears in the writings of Whigs as late as the 1840s...Like Edwards--and John Quincy Adams--Beecher believed in postmillennialism, the doctrine that the Second Coming will occur at the end of the thousand years of peace...The Second Coming was not far off...One last big effort would do it--or rather two: the establishment of foreign missions to complete the conversion of the world and the moral renovation of American society to give Christ a beachhead for His return." (p. 152)
p. 152-3: the one hopeful source that the Whigs had was postmillenial theology. Their other sources were the classical writers and some economists who were pessimistic. The secular authors the Whigs read "espoused a limited view of the possibilities for human achievement...The evangelical movement supplied Whiggery with a conception of progress that was the collective form of redemption: like the individual, society as a whole was capable of improvement through conscious effort. Nineteenth century evangelicism, even more than eighteenth century evangelicism, demanded the moral regeneration of society, not simply of the individuals within it. Again, there are hints of Progressivism.
p. 154 "When Lyman Beecher declared that 'the stated policy of heaven is to raise the world from its degraded condition' he had in mind not only its spiritual but also its intellectual and material condition..."
p. 156 "In his 'Lectures on Political Atheism'...Beecher begins by arguing that Christianity is the ally of social progress and liberty...Biblical Christianity, that is Protestantism, promotes schools, morality, economic enterprise and relative social equality..."
The Whigs' ideology was institutionalist and evolutionary, as was that of Progressives like John R. Commons and John Dewey. The Democrats saw institutions as threatening liberty. (p. 182) "Whigs, however felt that institutions provided the structures that made freedom meaningful. Institutions could evolve to cope with changing circumstances; they could serve as intermediaries for redemption, as the benevolent societies did. Whig institutionalism was by no means incompatible with antislavery...European conservatives in the nineteenth century sometimes found that progressive legislation suited their purposes, as Bismarck and Disraeli well illustrate. Lord John Russell put their policy nicely: 'There is nothing so conservative as progress.' This attitude--that a measure of progress is desirable to forestall more drastic upheavals--was certainly not unknown among the American Whigs...'True conservatism,' a party spokesman affirmed, operates not by indiscriminate resistance to change, but the intelligent and seasonable combination of Order and Improvement."
(p. 182) "The economic, social, cultural and moral proram of the Whigs can be characterized in a broad sense as that of a modernizing elite, a bourgeois elite that was open to the talents of an upwardly mobile Lincoln or Greeeley...the modernizing of social organization during this time was pioneered to a great extent by paternalists...(Jackson) and his Democratic Party were primarily defending a society of independent yeoman and artisans, who were threatened by the kind of modernization the Whigs envisaged...As exemplars of Whigs who were deliberate modernizers, Horace Greeley and William Henry Seward serve well."
I disagree with Howe there. Although the Whigs claimed to advocate modernization, the most important modernizing steps occurred outside of the "American System" of Clay and Lincoln. These included the inventions of the late nineteenth century which occurred despite government not because of it. Because historians tend to emphasize institutions, philosophers, ideologues and political structures they fail to see the spontaneous change that occurs because of the Jacksonian impulse. This institutionalist bias in history results in mistaken and destructive policy conclusions that are drawn from failure to grasp the role of markets. Getting back to Howe:
(p. 187) "Greeley favored workers' cooperatives, supported the ten-hour day, and joined the printers' union; yet anything that smacked of class conflict was abhorrent to him. He advocated collective bargaining but felt that it should lead to binding arbitration rather than strikes. Since capital and labor did not seem to Greeley to have opposing interests, arbitration commended itself to him as peaceful, rational and just.
"Social reform did not, for Greeley, necessarily mean opposition to the interests or wishes of capitalists. He supported limited liability and the Whig Bankruptcy Act of 1841, admired the Lowell textile mills, and endorsed industrialization in general...Greeley belonged to a generation that could think of business itself as a moral cause." (p. 188)
"It makes it easier to understand Greeley if we note his remarkable similarity to the 'progressives' of the early twentieth century. Like them, he wanted to rationalize the existing social order and make it more humane. Through the Tribune he advocated such protprogressive casues as a national presidential primary, an income tax, the abolition of capital punishment, and the direct election of United States Senators...Almost alone among American newspapers, the Tribune gave thorough coverage and serious attention to the women's rights movement...Like most Whigs, Greeley retained a strong sense of the moral qualities of rural and small town life, even while favoring industrialization" (p. 195).
William H. Seward was a Whig who supported subsidies to business. Like Warren G. Harding, who supported subsidies to the merchant marine 80 years later, "He endorsed subsidies for the Collins Steamship Company to help it compete against the British Cunard Line...Seward's interest in American commercial activity in the Pacific was not without prcedent among the Whigs. Daniel Webster, when he was secretary of state, extended the scope of the Monroe Doctrine to include the Hawaiian Islands.
The Whigs combined an interest in "improvements" with a fundamental conservatism, and they emphasized "protecting property, maintaining social order, and preserving a distinct cultural heritage." Whigs and pro-bank Democrats were called "conservatives" in the 1830s, a usage that does not seem altogether different from the way the term is used today. "As a party, the Whigs wanted conservatism and progress to blend their harmonious action" (p. 210). Daniel Webster, one of the best-remembered Whigs, "has aptly been called a broker-state politician who thought of government policy in terms of adjusting the claims of propertied interests to government favors...In his mind, social organization legitimated encouraging economic modernization through special favors to property."
Again it is a serious mistake to confuse policies that encourage modernization with modernization itself. The abolition of the central bank may have caused more modernsization than the conscious policies of the Whigs. Conscious policies may be destructive if our minds are not capable of grasping the complexities of market phenomena, a contribution of Friedrich A. Hayek and Ludwig von Mises in the 1920s and 1930s.
Abraham Lincoln was especially attracted to internal improvements. "Of all items in the Whig program, internal improvements held the greatest appeal for the young Lincoln.He shared the typical Whig aspiration for humanity to triumph over its physical environment. His first political platform, announcing his unsuccessful candidacy for the legislature in 1832, stressed the need for internal improvements, adi to education, and easy credit in promoting the development of the West...Lincoln was also an orthodox Whig on the crucial tariff and banking issues...In the 1830s and 1840s Lincoln consistently defended both state and national banking. To him, the assault on the Bank of the United States was part of a general breakdown of respect for property and morality that was also manifesting itself in lynch law...Lincoln was still arguing for the constitutionality of a national bank as a congressman in 1848 and even raised the issue several times in his great debates with Douglas a decade later."
"Believing that only those who paid taxes should vote, he opposed universal manhood suffrage. In an aggressively male society, he advocated votes for women."
Quoted, p. 266, from Robert Kelley "Ideology and Political Culture from Jefferson to Nixon", American Historical Review, 82, June 1977, 545.
Lincoln was a big supporter of Henry Clay. When the Republicans replaced the Whigs, the new party system "revealed a recombination of the cultural elements that had made up the old one. Douglas Democrats had come to endorse economic development, while Republicans now endorsed the westward movement. On strictly economic issues, there was little difference between them save for the tariff." (p. 289)
Lincoln synthesized elements of Jacksonian political thought with Whiggery. "Lincoln took over what was best in Jacksonian Democracy, the commitment to the rights of the common man." Lincoln reasserted the importance of the Declaration of Independence and "the proposition that all men are created equal" became a positive goal for political action" (p. 291).
*William Appleman William, The Contours of American History. Chicago: Quadrangle Paperbacks, 1966, p. 38.
**Herbert Hoover, American Individualism. New York: Doubleday, Page and Co., 1922, p. 21.
This is a fine book. Interesting, highly informative, fun to read. Howe's writing is lucid. Books like this inspire us to learn. Howe's insights about the American Whig Party, their ideas, religion and culture are wonderful, and he covers a lot of ground. He uses a biographical approach that covers a wide range of Whig Party politicians beginning with John Quincy Adams (who became a Whig after his presidency and during his post-presidency Congressional tenure) and ending with Abraham Lincoln, not only the best-remembered Whig but also the best-remembered 19th Century politician, except perhaps for Jefferson. Of course, the Whig Party expired in 1856 and Lincoln gained the presidency as the first Republican, but his allegiance to Henry Clay never diminished.
I read the book because I became curious about the continuity of American elitist and pro-Central Bank ideology between the 18th and twentieth centuries. This book makes clear that there are many linkages between the Whigs and the Progressives, hence the New Deal (which is my own conclusion, not Professor Howe's). Nancy Cohen makes clear the link between the Mugwumps and the Progressives, and in his concluding pages Howe mentions that the Whigs mildly reasserted themselves via the Liberal Republican Party in the 1872 election, which is often referred to as an early phase of the Mugwumps' activism. Although Howe characterizes the Whigs as the "country" party, it is clear that many former Federalists became Whigs in the 1830s. It also is clear that the economic elite was associated with the Whigs just as they had been with the Federalists, niceties about political ideology aside. Thus, there is a clear line from the Federalists to the Whigs, then to the Mugwumps and then to the Progressives. The speeches of Theodore Roosevelt, himself a one-time Mugwump, make clear the connection between his own ideas and those of Franklin Roosevelt's.
One of the nice things about this book is that Howe covers the religious and evangelical elements in the Whig philosophy along with the economic and political. It is fairly clear that the evangelical social concerns, linked of course to abolitionism, form the basis of today's social democrats' concerns. The evangelical religious impulse developed in several ways, one of which was through Social Gospel Christianity, through to Progressivism and then the social welfare elements of the New Deal. The emotional commitment of social democrats to their programs can be explained in this evolution of religious feeling that has been displaced into social democracy.
This book, written as a solid piece of history, does not suggest that there is a continuous party that has favored economic centralization from the Federalists to the New Deal Democrats. But it seems clear from the evidence. For most of its history, with the exception of the Mugwump period, the centralization party has favored a central bank, public works (which were characteristic of not only of Hamilton's Federalist program but also of Henry Clay's American system, of Theodore Roosevelt's ideas and of the New Deal) and business. The Whigs, the Mugwumps and the Progessives were ambivalent about big business, although their moral concerns seem to have been easily displaced. There is little doubt that the tariffs that the Whigs implemented were in large part responsible for big business in America. The Mugwumps, at least in some instances, were willing to repeal the tariffs but the Progressives amounted to a reassertion of more aggressive Whiggery than had existed since the end of the Civil War. In the Mugwump period the urban elite became hostile to corruption of some big business. In turn, the Progressives and New Dealers in increasing progression used anti-business rhetoric to cloak their centralist orientation. The centralizing party favored tariffs in the Hamiltonian and Clay periods, then divided over tariffs during the Mugwump period. The anti-tariff position won thereafter to the extent that reductions in tariffs did not hurt American business interests.
American history occurs in cycles, with each cycle involving various combinations and variations on the issues of economic centralization, central banking, protectionism, and support for industry. Progressivism aggressively asserted the centralizing position against the late nineteenth century elitists' deviant laissez-faire philosophy. I call it deviant because in all other periods other than the late nineteenth century American elites have opposed laissez-faire in favor of corporatist, centralizing mercantilism, Progressivism and finally so-called "liberalism". It is a tribute to the power of laissez-faire that a movement that was backed primarily by working-class and small farmer Jacksonians from say 1825to today really, and had the backing of economic elites only during the post-bellum period that ended in the late 1890s, continued to provoke so much distress from university-trained economic elites, business and banking interests, organized labor and other proponents of elitist centralization through to the present.
Like the Whigs, the Progressives were advocates of a return to the corporatist mercantilism of the 17th and 18th centuries represented by Anthony Ashley Cooper, the Earl of Shaftesbury in the 17th century and Sir James Steuart in his "Inquiry into the Principles of Political Oeconomy", published in 1767. As William Appleman Williams aptly points out in his classic Contours of American History :
"...it is possible to gain a vital insight into that contemporary liberalism which defends the right of private property and asserts the supremacy of individual liberty while at the same time advocating the general welfare. For although such liberals show superficial similarities to the mercantilists, they are considerably removed from that conservative tradition of the common good. Such liberals usually label Karl Marx a heretic and consider socialism a heresy, but the reverse is much closer to the truth. The liberal tradition stems from the triumph of laissez-faire individualism over corporate Christianity. Marx and other socialists reasserted the validity of the original idea in response to the liberal heresy. That is indeed one of the basic explanations of socialism's persistent relevance and appeal in the 20th century."*
Williams's point can be expanded a bit, because not only socialists but also Whigs and Progressives rejected the laissez-faire heresy.
As opposed to laissez-faire, the Whig Party (p. 16) "advanced a particular program of national development. The Whig economic platform called for purposeful intervention by the federal government in the form of tariffs to protect domestic industry, subsidies for internal improvements, and a national bank to regulate the currency and make tax revenues available for private investment...The Democrats inclined toward free trade and laissez-faire; when government action was required, they preferred to leave it to the states and local communities. The Whigs were more concerned with providing centralized direction to social policy...The most important single issue dividing the parties, and the source of the most acute disappointment to the Whigs after President Harrison had been succeeded by Tyler, concerned the banking systemm. Jackson's veto of the recharter of the Second Bank of the United States in 1832 became the point of departure for a generation of political partisanship". By 1860 Abraham Lincoln favored reinstitution of a central bank but was unable to effect it, and a central bank was not reinstituted until 1913, under Woodrow Wilson, who was the first of several Democratic Party Whigs.
Howe goes on to point out (p. 17):
"The banking-currency issue (that is, the right of banks to issue their own paper money) mattered at the state as well as the federal level. Many states redrafted their constitutions during the Jacksonian period and had to decide whether they would authorize state banking monopolies (usually mixed public-private corporations), specially chartered banks, free banking, or no banks of issue at all. As time went by, the parties tended to polarize with respect not only to rechartering a national bank but to the function of banking in general. The Democrats generally became more committed to hard money (specie or government-issued currency), while the Whigs became defenders of the credit system (in which banks were the issuers of currency)."
"When Democratic "Martin van Buren complained during the Panic of 1837 that people looked to the government for too much," (Whig) Henry Clay retorted that the people were "entitled to the protecting care of a paternal government." This is very much in the tradition of mercantilism.
But while on economic issues the Democrats were anti-inflation and pro-democracy, on the race issue the Democrats were pro-slavery and racism while the Whigs were less racist and more anti-slavery.
Howe argues that (p. 20):
"there is danger in calling the Whigs champions of the positive liberal state. It makes them sound too much like twentieth-century liberals. Actually, the differences between the Whigs and twentieth century liberals are more important than the similarities. Whig policies did not have the object of redistributing wealth or diminishing the influence of the privileged. Furthermore, the Whigs distrusted executives in both state and federal government (they had been traumatized by the conduct of Jackson), whereas twentieth century liberals have endorsed strong executives more often than not. For all their innovations in economic policy, the Whigs usually thought of themselves as conservatives, as custodians of an identifiable political and cultural heritage. Most deeply separating the Whigs from twentieth century liberals were their moral absolutism, their paternalism and their concern with imposing discipline...the Whigs proposed a society that would be economically diverse but culturally uniform; the Democrats preferred the economic uniformity of a society of small farmers and artisans but were more tolerant of cultural and moral diversity."
Taking the last point first, economic diversity is not an issue of importance today, but cultural uniformity is. Perhaps invisibly to Howe, twentieth century social democrats have aimed to foist a cultural uniformity on America. In the mid twentieth century they claimed that liberalism reflected the national consensus. By the 1980s they advocated political correctness. Political correctness is a moralistic impulse with Whiggish religious roots. Moreover, although the twentieth and 21st centuries have rejected the sexual morality and Aristotelian virtues characteristic of the Whigs and earlier, they have replaced these with a host of politically correct moralities with which they replace faith and tradition, to include animal rights, global warming and similar causes.
It fascinates me that Howe's argument begs the argument of Murray Rothbard, Ronald Radosh and Martin J. Sklar in New History of Leviathan that twentieth century liberalism did not aim to redistribute wealth but only used social democratic rhetoric to re enforce elitist goals. In terms of culture, there is no doubt that 20th and 21st century liberalism repudiates 19th century Whiggish elitism as well as 19th century Democratic Party racism in favor of a revised elitist philosophy based in part on similar impulses, such as claiming special status for the educated, especially the professions. Changing technology and extensions of knowledge created new economic interests in the late nineteenth century that changed the emphasis of the Whigs' descendants, the Mugwumps, into emphasizing the role of the professions, Whiggish forms of government intervention in support of the professions and rationalization of industry and government (which the Whigs would have supported). Naturally, economic conditions altered the form elitist centralization took just as religious and moral emphasis and alliances shifted.
But on the following page Howe puts the statist essence of the Whigs into focus (p. 21):
"Because of their commitment to 'improvement', Whigs were much more concerned than Democrats with providing conscious direction to the forces of change. For them, real progress was not likely to occur automatically; it required careful, purposeful planning...Whig morality was corporate as well as individual; the community, like its members, was expected to set an example of virtue and to enforce it when possible. A third recurring theme in Whig rhetoric was the organic unity of society...the Whigs were usually concerned with muting social conflict."
Seventy years later, when Frederick Winslow Taylor advocated a "mental revolution" between labor and management as part of his system of scientific management that aimied to rationalized industry, like a good Whig Progressive (and Herbert Croly specifically endorsed Taylorism) he was arguing for the organic unity of society.
The Whigs liked to draw an analogy between the human body and the political system (p. 29): "An essential feature of the analogy for the Whigs was the parallel between regulating the faculties within an individual and regulating the individuals within society. Faculty psychology tgaught an ideal of harmony within diversity...The model ruled out laissez-faire as a social philosophy, emphasizing instead the mutual responsibility of individuals and classes. The ideal society, like the ideal personality, improved its potential in many directions. Economic development promoted a healthy diversity, which 'furnishes employment for every variety of human faculty.' The conception implied an active, purposeful central government, administering the affairs of the nation according to its best judgment for the good of the whole and all parts of the whole."
This explains the difference between the Whigs and their later descendants, the Progressives and the New Dealers, as to the importance of the chief executive. By 1900 the federal government was becoming too complex to permit a legislature to make managerial decisions. Hence, advocates of centralization had to choose between no centralization and a strong legislature or centralization and and a strong executive. Obviously, centralization was more important to the centralizing party than was a weak executive. As a practical matter, centralization is impossible without a strong executive once government reaches a certain level of size and complexity. Since the Whig/Progressive/New Deal Party has been focused on expanding government to satisfy the economic interests of the professional and managerial classes, the issue of a powerful executive is a trivial one compared to the issue of increasing size and complexity of government. You can't have both.
Moreover, the Whigs anticipated today's liberal New Deal Democrats in their claim that the educated had the right to special privileges and that the educated ought to rule over the uneducated (p. 30):
"John Locke had written that people who lacked the opportunity to cultivate their higher faculties (such as women and the poor) could not become fully rational and therefore justly held subordinate positions within society...The American Whigs were less explicit than Locke, but they shared his general view that those who had not had the opportunity of education should defer to the leadership of those who had received it..."
Today, the claim of elite privilege by the educated has reached a fever pitch. I doubt that a single Congressman or member of the President's cabinet lacks a college degree. This is so even as the intellectual demands of a college education have dwindled to next to nothing and college graduates today know less than high school graduates of 100 years ago. Compare this with an observation by Herbert Hoover in 1922**:
"That our system has avoided the establishment and domination of class has a significant proof in the present administration in Washington. Of the twelve men comprising the President, Vice-President, and Cabinet, nine have earned their own way in life without economic inheritance, and eight of them started with manual labor."
Andrew Jackson and the Democratic Party violated the "politics of deference" characteristic of early American society through extending the spoils system to all classes (p. 31). This tradition continued through Hoover's time, but the Progressives and their New Deal descendants put in place policies that were less democratic. This repositioning of elitism to focus on education rather than on the traditional land and wealth criteria occurred during and before the Mugwump period. The Mugwumps emphasized the rationalization of civil service, a concept which the Progressives developed into scientific management.
To support business, Whigs supported tariffs and the central bank (p. 32). These stands appealed to wealthy business interests but not to the poor. In order to appeal to the poor, the Whigs emphasized ethnic (specifically, WASP) identity politics, and moral issues that cut across social classes. Part of this involved the evangelical Second Great Awakening as well as appeals to basic morals (p.33):
"The Whig party's electoral campaigns formed part of a cultural struggle to impose on the United States the standards of morality we usually term Victorian. They were standards of self-control and restraint, which dovetailed well with the economic program of the party, for they emphasized thrift, sobriety and public responsibility...They looked upon the Democratic voters as undisciplined."
The Whigs extended this moralism to a belief in central planning and opposition to free markets (p. 34):
"Running through Whig political appeals was the concept of consciously arranged order. This was characteristic of their reliance on government planning rather than the invisible forces of the marketplace. It was characteristic of their reliance on government planning..."
The Whigs emphasized public education, in part through the activities of Horace Mann, a Whig (p. 36): "A believer in uniformity and conscious planning, Mann wanted more centralization in school systems. Democrats, resenting higher taxes and loss of control, frequently opposed Mann and other Whig educational reformers."
In contrast to Democrats, who aimed to end economic privilege through systemic reform such as the abolition of the central bank (p. 37):
"Whig reforms were frequently altruistic efforts to redeem others rather than examples of self-help. Whigs supported Dorothea Dix's campaign for federal aid to mental hospitals; Democrats opposed. Whig prison reformers sought to make prison a place of redemption as well as retribution...Democratic prision reformers, on the other hand, were usually concerned with economy, efficiency and deterrence."
The parallels to Progressivism and the New Deal seem clear.
The Jacksonian Democrats were the ones who oppressed the Indians. For instance the Cherokee case, where the rich lands of the Five Tribes in Georgia led to their expulsion via the famously tragic "trail of tears" was a partisan Democratic policy. "Chief Justice John Marshall delivered the judgment of the United States Supreme Court in Worcester et al. v. Georgia on March 3, 1832. He found Georgia's action unconstitutional: the state had no right to legislate for the Cherokee Nation...But Georgia defied the Court's decision...and went ahead with the expulsion of the Indians. Jackson made it clear that he would never enforce the Court's mandate, and loopholes in federal appellate procedure enabled him to avoid doing so. Meanwhile, he used the Army to facilitate the dispossession of the Indians, not to protect them." Chief Justice Marshall was, of course, a Whig.
In part because of their emphasis on moral development that coincided with their belief in economic development, Whigs emphasized history to a greater extent than Democrats (p. 72). Whigs believed that a generation could bind a later generation, lending acceptability to long term mortgages. Again, we seen a hint of future big government social democracy. For instance (p. 72) the Whig William Henry Seward recommended a series of internal improvements in New York.
Thomas J. DiLorenzo of the Ludwig Von Mises Institute quotes a Edgar Lee Masters's biography of Lincoln that states that the internal improvements of the Whigs involved a considerable degree of corruption:
"Henry Clay was their champion, and he represented 'that political system which doles favors to the strong in order to win and to keep their adherence to the government. His system offered shelter to devious schemes and corrupt enterprises.' They advocated 'a people taxed to make profits for enterprises that cannot stand alone.' The Whig party had 'no platform to announce, because its principles were plunder and nothing else.' These men 'adopted the tricks of the pickpocket who dresses himself like a farmer in order to move through a rural crowd unidentified while he gathers purses and watches.'...Lincoln in the 1830s succeeded in having the legislature allocate $12 million in an absurd make-work scheme to turn Illinois into one vast system of government-subsidized canals and railroad lines...The scheme was a colossal failure as virtually all of the money was stolen or squandered. Lincoln's law partner, William Herndon, called the scheme 'reckless and unwise' and a disaster that 'rolled up a debt so enormous' that it impeded Illinois' economic growth for many years. 'The internal improvement system, the adoption of which Lincoln had played such a prominent part, had collapsed,' Herndon wrote in his biography of Lincoln."
These points contradict some in Howe's book, but Howe does not address the issue of corruption in the actual implementation of the public works projects that Whigs like Lincoln did implement. It is not surprising that corruption was involved, nor is it surprising that ideologically the Whigs might not have addressed this issue despite or rather because of the moralism in their belief system. On the other hand, Howe's evidence does not support DiLorenzo's claim that the Whigs did not have a platform. On some issues, such as treatment of the Indians, Whig opposition to the Mexican War (which was a Jacksonian plicy) and abolition, there was considerably more overlap between the Whigs' position and the libertarian one that DiLorenzo advocates. Nor is it fair to dismiss the mercantilist view as one that intentionally encouraged corruption. The economic development of Britain between 1600 and 1840 was one of the dramatic feats of economic development in the history of the world, and it occurred under a primarily mercantilist ideology. It might have been better to have adopted the ideas of Murray Rothbard in 1600, but it also might have been better if jets and cellular phones had been available to Clay, Biddle and Lincoln.
Like Libertarians, Jacksonian Democrats feared the emergence of a plutocratic elite. However, the Whigs saw a threat "in the perversion of the political process by demagogoues taking advantage of the loss of an independent spirit among the people" (p. 76) and they saw Jackson himself as a demagogue. Like the Federalists, the Whigs emphasized not democracy but balance. In their view (p. 77) "the purpose of government is not to implement popular will but to balance and harmonize interests." Balanced government, of course, is the theme of the Federalist Papers. The Whigs emphasized the national origin of the Constitution. They did not believe that the Constitution originated with the states. The federal government is mixed, neither wholly federal nor wholly consolidated.
(p. 77) "The most salient characteristic of American Whig political thought was that it remained within the tradition of the "commonwealthmen," that remarkable group of English and Scottish writers...Two favorite writers in the tradition were James Harrington and Viscount Bolingbroke."
(p. 78) "That the Whigs who advocated industrialization and economic development should have identified with a political heritage called 'country' may seem at first anomalous. Actually, however, the word 'country' was understood more in opposition to 'court' than in opposition to 'city'. Within the English 'country party' not only landed gentlemen but also bourgeois Protestant Dissenters were prominent...As a group that included both townsmen and commercial farmers, and as inheritors of the religious tradition of English Dissent, the Whigs found the country-party tradition congenial."
p. 90 "Both Whigs and Democrats claimed to be heirs of the Republican Party of Jefferson though both in fact contained some some former Federalists. Ex-Federalists like Daniel Webster became willing to cite Jefferson as an opponent of executive power once they had become Whigs. The closest ideological predecessors of the Whigs seem to have been not the Federalists but the 'moderate' or 'nationalistic' wing of the Republicans. This group combined, as the Whigs did later, a country-party respect for consitutional balance, legal tradition and executive restraint with belief in federally sponsored economic development and government 'for' rather than 'by' the people. The archetypal representative of this brand of Republicanism, and the patron of Whiggery, was James Madison. It is well known (or it should be) that Jefferson disapproved of Jackson's candidacy in 1824; it is even more significant that Madison and Gallatin, who were still alive in 1832, when the issues of the Jacksonian era had been clearly drawn, supported Clay for president that year."
"The Whig defeat in 1844 entailed consequences of imponderable magnitude, leading as it did to war with Mexico and exacerbated sectional antagonism. War was traditionally an evil in country-party ideology, dreaded not only for its cost in blood and money but because it provided an occasion for executive aggrandizement. President Polk's devious and provocative conduct, both before and afterthe beginning of hostilities, provided plenty of confirmation for such fears" (p. 92)
Howe provides fascinating biographies of two Whig entrepreneurs: Nathan Appleton and Henry Carey. Appleton founded various textile mills, including most famously an early joint stock company called the Merrimack Manufacturing Company. Appleton named the company town "Lowell" after a deceased partner. The firm made early forays into human resource management on a dramatic scale:
"The company built homes for the households of its male supervisory employees and boardinghouses for its unamrried female operatives; it supplied the town with a school, a hospital and a library, whose resources made possible the magazine the employees put out, the famous Lowell Offering. It was by no means sufficient for the proprietors to provide what they thought were wholesome working and living conditions at Lowell. They desired to preserve the morals of the people there to be gathered. With this in mind, they built or subsidized eight churces, exercised strict supervision over the workers' private lives and founded a savings bank...Lowell Massachusetts represented social innovation as much as technological innovation. In its original conception, it was to be not only a company town but also an experimental utopia...Lowell illustrates the Whig desire to remake the world...most of the workers were isolated from their families and lived regimented lives of hard work, chastity and diligent uplift...the workers would be women...By hiring women the Merrimack Manufacutring Company could pay lower wages than British industry was paying men..."
(p. 104) "In reply to Democratic charges that corporations were conspiratorial and elitist, Whig defenders of corporations (mixed or private) insisted that they conferred great benefit on savers of modest means by allowing them to participate with the rich in the profits of incorporated business. This was why John Quincy Adams could speak of the 'truly republican institution of joint stock companies.'"
Appleton and his associates founded a private banking system based in Boston. As a result, New England was not dependent on the bank of the United States for a uniform circulating medium. "Member banks in many New England towns would desposit sufficient funds to guarantee their notes at the Suffolk Bank in Boston. In consideration for the use of their money, the Suffolk Bank would redeem the notes of the out-of-town banks at par instead of discounting them. Thus a uniform circulating medium and banking reserve requirements were maintained within the region..." (p. 106).
Henry Carey (p. 109) "identified himself with what might be called the commercial wing of Jeffersonian Republicanism, advocating internal improvements, a protective tariff, a national bank, and reconciliation with the Federalists--in short, the Madisonian Platform." Carey was a moral philosopher and economist (p. 111) "who believed America would be a better place to live if it could industrialize." He believed that "genuine full employment was both the means to economic progress and, for Carey, the end of economic progress. Carey was a feminist and argued that economic development held out considerable promise to women (p. 112). He believed in a mixed economy, capitalism combined with government intervention (remember, this was the 1830s--the idea that a mixed economy was "progressive" was a claim of the 1900's-1930s, 70-100 years after Carey). "Government policy should add...what is today called social overhead--a transportation network and an educational system. To keep the economy expanding, the burden of taxation should not be oppressive, but in the United States in Carey's time there was little danger of this. Carey laid the most stress on a plentiful money supply and a protective tariff to prevent this money from being drained off...Taken together, trhese policies would secure investment capital, increase productivity and raise wages..."
"Carey looked to technology to solve the differences between capital and labor" (P. 113). Carey's philosophy had Christian and moral overtones (p. 114). He believed in progress and opposed Malthus and the Manchester school. He advocated a culture of progress (by which he meant economic as opposed to political progress).
Whigs may have been the first advocates of suburbanization. "Whiggery was an outlook more appropriate to villagers or townsmen than to either frontiersmen or city dwellers....in many parts of the country where the Whig party was strongest it was asociated with a longing to recreate the early New England town settlement." (p. 116). Whig candidates generally outpolled Democrats in the cities (p. 117). "The Whig desire to preserve rural values within an urban context eventually led to important developments in urban park and cemetary landscape architecture, culminating after the Civil War in the genius of Frederick Law Olmstead". Olmstead was a Mugwump associate of EL Godkin.
Le Corbusier is generally recognized as the ideological forerunner of Robert Moses, but Moses seems to bear some things in common with the Whigs, specifically, the notion of the need to introduce country-like super-blocks would seem to echo Olmstead's concept of a park within a city (although when Olmstead designed Central Park it was on the northern end of the city). Moses would seem to have fulfilled the Whiggish tradition, both in terms of being a master public works builder and one who introduced urban America to the suburbs through highway building and superblocks.
Carey opposed trade, viewing it as parasitic and exploitative. He viewed the Irish potato famine as indicative of the problems that trade can cause (p. 118) "The same Carey who praised the small-to-medium-scale capitalism of the town deplored the large-scale capitalism of the metropolis. A trading economy corrupted its own society...Within cities a submerged 'proletariat' appeared...The trading classes lived by appropriation of wealth created by others." The Whig ideology had an anti-capitalist flavor at times, which parallels Progressivism seven decades later. Carey believed that the evils of trade could be overcome with a protective tariff. Protectionism led to "a diversified economy" which would "provide a healthy human environemnt for varied talents." A diversified economy secured people's independence against intimidation. (p. 122) "The great triumph of Carey's life came with the passage of the Morrill Tariff of 1862, commencing a century of American protectionism that would last until the Kennedy round of economic conferences. Yet instead of a decentralized 'middle zone' of opportunity and morality, economic consolidation and further urbanization characterized the high tariff era. The idea that protection was only a transitional phase for infant industries was ignored." This brings us back to the Rothbard/Radosh thesis. Were the Whigs merely fools to advocate tariffs to encourage "a diversified economy" instead of big business, or were they merely front men for big business interests?
Henry Clay
"Henry Clay believed in stability and order" (p. 123). (p. 139) "The Bank issue brought into sharp focus the conflict between the two views of the nation's destiny: Clay's vision of economic development planned centrally by a capitalist elite and the Democratic vision of a land of equal opportunity. Even after the Bank's charter finally expired in 1836, banking and currency remained the subject of bitterest partisan debate." (p. 146) "The conjunction of commerce with Christianity was typical of the Whig version of imperialism". Clay adopted the ideas of Henry Carey. He (p. 137) advocated revenue sharing or distribution of federal money to the states. His American System "was predicated on the basis of a harmony of interests" 9P. 138). The Whigs argued for class harmony and mutuality of interests.
Lyman Beecher
Lyman Beecher represented the evangelical dimension of the Whigs. "The tradition of Edwardsean eschatology had been transmitted to Beecher via Timothy Dwight, Edwards's grandson, who became president of Yale during Beecher's undergraduate years. The continuity of evangelical thought remained unbroken during the time of the Whig party; the providential interpretation of history that one finds in Edwards' accounts of the Reformation or the Glorious Revolution appears in the writings of Whigs as late as the 1840s...Like Edwards--and John Quincy Adams--Beecher believed in postmillennialism, the doctrine that the Second Coming will occur at the end of the thousand years of peace...The Second Coming was not far off...One last big effort would do it--or rather two: the establishment of foreign missions to complete the conversion of the world and the moral renovation of American society to give Christ a beachhead for His return." (p. 152)
p. 152-3: the one hopeful source that the Whigs had was postmillenial theology. Their other sources were the classical writers and some economists who were pessimistic. The secular authors the Whigs read "espoused a limited view of the possibilities for human achievement...The evangelical movement supplied Whiggery with a conception of progress that was the collective form of redemption: like the individual, society as a whole was capable of improvement through conscious effort. Nineteenth century evangelicism, even more than eighteenth century evangelicism, demanded the moral regeneration of society, not simply of the individuals within it. Again, there are hints of Progressivism.
p. 154 "When Lyman Beecher declared that 'the stated policy of heaven is to raise the world from its degraded condition' he had in mind not only its spiritual but also its intellectual and material condition..."
p. 156 "In his 'Lectures on Political Atheism'...Beecher begins by arguing that Christianity is the ally of social progress and liberty...Biblical Christianity, that is Protestantism, promotes schools, morality, economic enterprise and relative social equality..."
The Whigs' ideology was institutionalist and evolutionary, as was that of Progressives like John R. Commons and John Dewey. The Democrats saw institutions as threatening liberty. (p. 182) "Whigs, however felt that institutions provided the structures that made freedom meaningful. Institutions could evolve to cope with changing circumstances; they could serve as intermediaries for redemption, as the benevolent societies did. Whig institutionalism was by no means incompatible with antislavery...European conservatives in the nineteenth century sometimes found that progressive legislation suited their purposes, as Bismarck and Disraeli well illustrate. Lord John Russell put their policy nicely: 'There is nothing so conservative as progress.' This attitude--that a measure of progress is desirable to forestall more drastic upheavals--was certainly not unknown among the American Whigs...'True conservatism,' a party spokesman affirmed, operates not by indiscriminate resistance to change, but the intelligent and seasonable combination of Order and Improvement."
(p. 182) "The economic, social, cultural and moral proram of the Whigs can be characterized in a broad sense as that of a modernizing elite, a bourgeois elite that was open to the talents of an upwardly mobile Lincoln or Greeeley...the modernizing of social organization during this time was pioneered to a great extent by paternalists...(Jackson) and his Democratic Party were primarily defending a society of independent yeoman and artisans, who were threatened by the kind of modernization the Whigs envisaged...As exemplars of Whigs who were deliberate modernizers, Horace Greeley and William Henry Seward serve well."
I disagree with Howe there. Although the Whigs claimed to advocate modernization, the most important modernizing steps occurred outside of the "American System" of Clay and Lincoln. These included the inventions of the late nineteenth century which occurred despite government not because of it. Because historians tend to emphasize institutions, philosophers, ideologues and political structures they fail to see the spontaneous change that occurs because of the Jacksonian impulse. This institutionalist bias in history results in mistaken and destructive policy conclusions that are drawn from failure to grasp the role of markets. Getting back to Howe:
(p. 187) "Greeley favored workers' cooperatives, supported the ten-hour day, and joined the printers' union; yet anything that smacked of class conflict was abhorrent to him. He advocated collective bargaining but felt that it should lead to binding arbitration rather than strikes. Since capital and labor did not seem to Greeley to have opposing interests, arbitration commended itself to him as peaceful, rational and just.
"Social reform did not, for Greeley, necessarily mean opposition to the interests or wishes of capitalists. He supported limited liability and the Whig Bankruptcy Act of 1841, admired the Lowell textile mills, and endorsed industrialization in general...Greeley belonged to a generation that could think of business itself as a moral cause." (p. 188)
"It makes it easier to understand Greeley if we note his remarkable similarity to the 'progressives' of the early twentieth century. Like them, he wanted to rationalize the existing social order and make it more humane. Through the Tribune he advocated such protprogressive casues as a national presidential primary, an income tax, the abolition of capital punishment, and the direct election of United States Senators...Almost alone among American newspapers, the Tribune gave thorough coverage and serious attention to the women's rights movement...Like most Whigs, Greeley retained a strong sense of the moral qualities of rural and small town life, even while favoring industrialization" (p. 195).
William H. Seward was a Whig who supported subsidies to business. Like Warren G. Harding, who supported subsidies to the merchant marine 80 years later, "He endorsed subsidies for the Collins Steamship Company to help it compete against the British Cunard Line...Seward's interest in American commercial activity in the Pacific was not without prcedent among the Whigs. Daniel Webster, when he was secretary of state, extended the scope of the Monroe Doctrine to include the Hawaiian Islands.
The Whigs combined an interest in "improvements" with a fundamental conservatism, and they emphasized "protecting property, maintaining social order, and preserving a distinct cultural heritage." Whigs and pro-bank Democrats were called "conservatives" in the 1830s, a usage that does not seem altogether different from the way the term is used today. "As a party, the Whigs wanted conservatism and progress to blend their harmonious action" (p. 210). Daniel Webster, one of the best-remembered Whigs, "has aptly been called a broker-state politician who thought of government policy in terms of adjusting the claims of propertied interests to government favors...In his mind, social organization legitimated encouraging economic modernization through special favors to property."
Again it is a serious mistake to confuse policies that encourage modernization with modernization itself. The abolition of the central bank may have caused more modernsization than the conscious policies of the Whigs. Conscious policies may be destructive if our minds are not capable of grasping the complexities of market phenomena, a contribution of Friedrich A. Hayek and Ludwig von Mises in the 1920s and 1930s.
Abraham Lincoln was especially attracted to internal improvements. "Of all items in the Whig program, internal improvements held the greatest appeal for the young Lincoln.He shared the typical Whig aspiration for humanity to triumph over its physical environment. His first political platform, announcing his unsuccessful candidacy for the legislature in 1832, stressed the need for internal improvements, adi to education, and easy credit in promoting the development of the West...Lincoln was also an orthodox Whig on the crucial tariff and banking issues...In the 1830s and 1840s Lincoln consistently defended both state and national banking. To him, the assault on the Bank of the United States was part of a general breakdown of respect for property and morality that was also manifesting itself in lynch law...Lincoln was still arguing for the constitutionality of a national bank as a congressman in 1848 and even raised the issue several times in his great debates with Douglas a decade later."
"Believing that only those who paid taxes should vote, he opposed universal manhood suffrage. In an aggressively male society, he advocated votes for women."
Quoted, p. 266, from Robert Kelley "Ideology and Political Culture from Jefferson to Nixon", American Historical Review, 82, June 1977, 545.
Lincoln was a big supporter of Henry Clay. When the Republicans replaced the Whigs, the new party system "revealed a recombination of the cultural elements that had made up the old one. Douglas Democrats had come to endorse economic development, while Republicans now endorsed the westward movement. On strictly economic issues, there was little difference between them save for the tariff." (p. 289)
Lincoln synthesized elements of Jacksonian political thought with Whiggery. "Lincoln took over what was best in Jacksonian Democracy, the commitment to the rights of the common man." Lincoln reasserted the importance of the Declaration of Independence and "the proposition that all men are created equal" became a positive goal for political action" (p. 291).
*William Appleman William, The Contours of American History. Chicago: Quadrangle Paperbacks, 1966, p. 38.
**Herbert Hoover, American Individualism. New York: Doubleday, Page and Co., 1922, p. 21.
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