Thursday, July 24, 2008

The Social Democratic Fetishization of the State and In Praise of Reaction

Louis Hartz argues that the New Deal was pragmatic. The claim that the state solves problems is one that reverberates throughout the twentieth century and into the 21st. But is that so? Whiggery has often been a reaction to government initiatives. In the 18th century the Whigs were a reaction to the establishment of the Bank of England and what they saw as the corruption of the English court and Parliament by Sir Robert Walpole. In the Federalist era in America, the Jeffersonian Republicans were a reaction to the Federalism of Alexander Hamilton. The Jacksonian Democracy, which was more Whiggish than Jackson's opponents, who changed their name from the National Republican to the Whig Party, was similarly a reaction to the Bank of the United States. In general, freedom is not a cause that rallies support until it is violated. Hence, Whiggish or libertarian movements always have the quality of reaction.

The Progressives confounded reaction to their policies with opposition to progress. Reaction to change can can be progressive if an initiative does harm. Progress means improvement toward a goal, so if change impedes improvement, reaction and removal of the change is progressive. There is no necessary conflict between reactionary and progressive ideas. American politics became overly rigid because of the equation of change and progress. Change is progressive if it improves human beings, if it does not cause harm and if society is better off because of it. Most change is complex and has unforeseen effects. The minimum wage, for instance, may cause unemployment and it may forestall the poorest segment of society from gaining work experience that in turn prevents the development of work habits and so leads to dependency and a welfare culture. This may be true even if the unemployment rate is not visibly raised following an increase in the minimum wage because employers may reduce training and other fringe benefits that are difficult to discern. On the other hand, a low minimum wage may not have these effects. If demand for labor is wage inelastic, then a small increase in the minimum wage may have little effect on employment or working conditions and cause a significant improvement in the welfare of low-wage workers. This is a question that is fairly simple to conceptualize, but there is no way to resolve it scientifically because the effects of the real wage on employment decisions are not completely measurable. There is no debate that a large increase in the minimum wage will reduce employment. In nations with high minimum wages and work standards unemployment is consistently higher than in more competitive nations. Similarly, union contracts may improve the wage level and introduce greater job security and employee "say" into the workplace, but it may also cause spillover effects under which lower employment levels in unionized plants cause higher unemployment and lower wages in non-union plants. The reverse may also be true, that the high wages that unions cause may threaten non-union employers to offer higher wages so that their employees will not unionize.

The effects of state intervention are difficult if not impossible to predict. The assessment of such effects takes many years, perhaps five decades. One would expect a pragmatic advocacy of New Deal policies to be open to such assessment.

In general, most ideas fail. Inventors find that they must fail many times before coming up with a single success. Four fifths of new product innovations in large firms fail, and the same percentage of business start ups fail. Yet, social democrats seem to feel that the programs that they advocate never fail. There was some welfare reform under the Democratic Clinton administration, but the left opposed this reform and continues to do so despite empirical evidence that it has worked. Welfare was certainly a hot button issue until Clinton initiated the reform, and it is something of an exception. Few other government programs have been revised, adjusted for quality reasons or terminated outright.

If government managers and politicians are no smarter than entrepreneurs, then we would expect four fifths of government programs to be terminated. Yet, few government programs die once initiated. Rather, they create a vested interest group that economically depends on the program (teachers, professors, government employees, health workers, police officers and the like) and the reactionary interest group radically opposes the program.

This may be viewed as a kind of fetishization. New Deal social democrats fetishize government policies and view them as sacred, much as a tribal culture views a totem as sacred. This religious fixation on government programs likely has religious roots in early America. The Whig Party, for instance, believed that social concerns commingled with economic concerns. Protestantism saw a link between social morality and economic success. Later in the nineteenth century, the Social Gospel held that there was a religious motivation for socialistic reform. The laissez-faire conservatism of late nineteenth century Republicanism that led to today's Republicans being associated with free market and conservative ideas was a deviation from the earlier association. The Federalists and the Whigs, the first two conservative parties that represented wealthy interests, were big government parties. They were also the more religious parties in comparison with the Jeffersonian Democratic Republicans and the Jacksonian Democrats. Thus, until the Civil War, big government and imposition of social morality was associated with the economic elite. It was not until American business began to mature in the late nineteenth century that the Whigs' descendants, the Republicans, began to adopt laissez-faire positions. But even these laissez-faire positions were heavily qualified. In particular, as the late nineteenth century Republicans had begun to adopt professions, they began to advocate government intervention on behalf of the professions. Thus, a new constellation of professional interests began to evolve. By education, these professionals advocated laissez-faire, and it was not for two generations that the advocates of the professions were to dispense with laissez-faire in the interest of Progressivism and then the New Deal. Of course, Progressivism and the New Deal had the incidental effect of stimulating demand for the professions and enforcing professional standards.

The social democratic fetishization of the state, then, has its roots in elitism and in a communitarian interpretation of religion associated with the early evangelicals. There is therefore considerable tension within the Republican Party. There is no necessary connection between laissez-faire economics and religion. In fact, for much of American history the evangelical Protestants believed in big government. The Democratic Party has always been the more diverse of the parties, but it has only since 1932 been the more social democratic of the parties. Thus, the Democratic Party has increasingly become the party of the professions, of academics, lawyers and physicians. The Republicans have retained the support of the evangelical Protestants, but have done so through an uneasy alliance of the remnant of the individualist liberals and with big business Progressives, i.e., Rockefeller Republicans, who in many ways have more in common with the Democratic professional interests than with the evangelicals or the individualist liberals.

How do these views correspond with those of Americans? It would seem that they capture some of the viewpoints of most Americans. However, given the range of cultural orientations, it would be difficult for the Republicans to consistently capture the portion of the country that is primarily individualist-oriented in its voting, since big business and individualist interests are in conflict. At best, only some of the time can the Republicans represent each of the three orientations in its fold, the individualist, the Progressive and the religious. It is true that religious orientation can be combined with the others, as it has, but the individualist and big business interests are almost necessarily in conflict.

Similarly, there are likely a significant percentage of Democrats who differ from the left wing perspective and who are not supportive of the economic interests of medicine, law and academia. Thus, the Democratic Party has been fairly "conservative" under the Clinton administration but more governmentally expansive under earlier administrations. Due to simple arithmetic, at the national level the two party system cannot capture the ideological diversity of the American public.

Wednesday, July 23, 2008

Louis Hartz's Liberal Tradition in America and the Locke-Step Theory of American Liberalism

Louis Hartz. The Liberal Tradition in America: A new concept of liberal community that relates American politics and political thought to the mainstream of Western history. Winner of the Woodrow Wilson Foundation Award. New York: Harcourt, Brace and World, Inc. 1955. Available from Amazon.com for $10.20, used and new $0.42.

Louis Hartz's Liberal Tradition in America is a brilliant, riveting and erudite study of the history of Lockean liberal ideology in America. Hartz argues that all of American history to his writing in the early 1950s was characterized by a commitment to Lockean liberalism. There are paradoxes to this argument, though, because in order to make this claim Hartz has to explain away elements of the New Deal that were not Lockean in nature and overlook elements of the Progressive era that were also illiberal. Hartz's argument is almost Freudian. Much as Freud claimed that frustrated sexual impulse is behind myriad behaviors, Hartz claims that frustrated liberal impulses are behind myriad behaviors. This single-factor theory fails to work for Freud, but it becomes silly despite the brilliance of Hartz's exegesis. Moreover, Hartz himself is contemptuous of what he several times calls Americans' "irrational liberalism", which in his view is psychologically sublimated whenever a non-Lockean policy is devised.

Hartz's writing is unusually facile and abstract and so susceptible to over-generalization. Moreover, he focuses on ideology as opposed to economic fact. This problem becomes acute in his discussion of the twentieth century. The chapters in the book that discuss the Federalist and Whig periods are the most interesting. He fails to anticipate the possibility that Progressivism was as much a Whiggish doctrine as was late 19th century Republicanism. Somehow, he sees the Republicans as having made a transition from the Whiggery of McKinley to the Progressivism of Theodore Roosevelt and then back to the Whiggery of Harding, Coolidge and Hoover (p. 261). He misconstrues Hoover, failing to grasp that Hoover was as much an advocate of New Deal-style solutions as Franklin D. Roosevelt was, an insight that Murray N. Rothbard develops in his and Ronald Radosh's New History of Leviathon.

Perhaps I am committing a present-orientation fallacy since the benefit of Rothbard's, Martin J. Sklar's, Ronald Radosh's and Gabriel Kolko's libertarian and New Left reinterpretation of Progressivism had yet to be written at the time that Hartz wrote. But there is little in the record to enable him to argue, as he does, that Hoover and Harding were "Whigs" as opposed to Wilson. But he repeatedly calls Hoover a Whig, contrasting him with FDR, yet Hoover was a more left-wing Progressive than was Wilson. Moreover, Wilson was not the most characteristic Progressive, and Theodore Roosevelt was to Wilson's left, which is why Roosevelt ran against Taft, facilitating Wilson's victory. Teddy Roosevelt's Progressivism was not as Lockean and individualist as Hartz argues that Wilson's was. Moreover, the practical economic effects of the four Progressive administrations, Roosevelt, Taft, Wilson and Hoover were different from the democratic effects that Hartz assumes. Nor need we interpret FDR's New Deal in anything other than Whiggish terms. Nor is there any real reason to claim, as Hartz does, that a secret Lockean impulse was beyond FDR's statist policies. Roosevelt abolished restrictions on the central bank, a policy very much in the Whiggish and Federalist tradition, and this was the most far-reaching policy of the New Deal.

As with his discussion of the Progressives, Hartz takes the assertions of Harding at face value. He claims that Progressive legislation was repealed, but this is hardly so. Workers' compensation laws exist today in all of the states, and most or all of them were established in the Progressive era. Harding made no effort to repeal the Progressive laws concerning the Federal Trade Commission and the railroad regulation, and he added a few boondoggles of his own, despite the conservative rhetoric that Hartz takes at face value. Likewise, the gulf between FDR's practical influence in abolishing the gold standard and reinforcing the privileges of Wall Street and his democratic rhetoric are not sufficiently recognized.

The book's weakness with respect to Progressivism and the New Deal is that Hartz fails to disentangle the ideological rhetoric of the Progressives and FDR from the practical economic realities underlying their reforms. Although Hartz makes the point several times that much of the Progressive and New Deal reform had the effect of shoring up business, he overlooks the Whiggish long term effects of both movements.

Today's political milieu is dominated by a separation of rhetoric from effect, and so Hartz's argument concerning the nineteenth century has important implications. He is willing to view the Whigs and their Republican descendants as manipulative and opportunistic in the nineteenth century, but somehow in the twentieth he takes the claims of the Progressives and the New Dealers at face value, adding a naive belief in central planning and government to the mix and the cliched claim that the New Deal was pragmatic.

Hartz claims that liberalism characterizes all of American ideological history, and then argues that FDR's New Deal proves this because even though its policies were pragmatic and not Lockean, it retained an underlying belief in Lockean liberalism that was "sublimated" (pp. 270-1):

"For when the moral cosmology of New Dealism sank beneath the surface, what appeared, of course, was that happy pragmatism which usually refused to concern itself with moral issues at all. And this, in turn, permitted the American democrat to go about solving his problems without the serious twinges of conscience which would surely have appeared had he felt that his Lockian Americanism was at stake...the New Dealers were themselves taken in by the process involved, being proud of their pragmatism and seeing no more clearly than the great Dewey himself the absolute moral base on which it rested."

The trouble is, there is a reality against which ideas need to be tested. Ideas result in policies. If the policies are not Lockean, the ideas cannot be said to be so. The claim that there is an underlying Lockean morality is not a falsifiable one.

For all his literary and philosophical brilliance, Hartz fails to define liberalism coherently. Thus, he contradicts himself on various occasions. Liberalism is first and foremost a philosophy involving freedom. The Latin liberalis means "of freedom". Freedom means that an individual is free from coercion. To the extent that any doctrine involves coercion, it is no longer liberal. Progressive policies like the income tax, the Federal Reserve Bank and railroad rate setting are not liberal and are not motivated by liberalism. Nor is the Red Scare, the Palmer raids or McCarthyism. They are reflections of special interest manipulation of the state on the one hand, and emotional, democratic impulse on the other, not liberalism.

Hartz's ideas make an interesting contrast to those of Reinhard Bendix in his Work and Authority in Industry. Bendix argued that the Protestant idea of a pre-ordained elect that is chosen for salvation carries forward to business, as Max von Weber argued in his Protestantism and the Spirit of Capitalism. In Hartz's scheme, the idea of an elite carries forward to Hamilton but not to Jefferson. Hamiltonian Federalism fails because it rejects democracy in favor of the elitist Federalist doctrine. The Whigs recreate the elitist Federalist doctrine, but fail to elect candidates until William Henry Harrison took a different tack in 1840, claiming a common upbringing. Lincoln too, really the fifth Whig (and of course first Republican) president after Harrison, Tyler, Taylor and Fillmore emphasized his log cabin upbringing. Thus the Whigs created a "Horatio Alger" ideology. All Americans can be capitalists and all can be landowners. This capitalist vision enabled the Whigs and their Republican descendants to win two ante-bellum elections and to dominate national politics after the Civil War. In contrast, Bendix emphasizes the transformation of managerial justification of power from the religious to the moral justification associated with the common sense philosophers of the early nineteenth century to the social Darwinism of the late nineteenth century.

Where Bendix (who wrote his book a few years after Hartz) and Hartz diverge is with respect to the scientific management and human relations school eras. Scientific management was very much an ideology of the Progressives, while the Human Relations School was dominant in management theory from the 1930s through the 1950s, what might be called the New Deal period. In contrast to Hartz, who accepts the New Deal at face value, Bendix argues that scientific management and the human relations schools were but continuations of the elitist ideologies of the late eighteenth and nineteenth centuries. While sociologists and historians criticize Progressive and New Deal managerial theories as elitist, they reserve such judgments from the political power holders such as TR, Wilson, Hoover and FDR.

Hartz argues that to understand American political ideology it is crucial to emphasize the lack of a feudal history in the United States. Without feudalism, there is no socialism, for the power of conservative feudal aristocrats forces their opponents to think in centralizing terms. (p. 5; 43) "One of the central characteristics of a non feudal society is that it lacks a genuine revolutionary tradition..." He adds (pp. 9-10):

"...it is a remarkable force: this fixed, dogmatic liberalism of a liberal way of life. It is the secret root from which have sprung may of the most puzzling of American phenomena...At bottom it is riddled with paradox. Here is a Lockian doctrine which in the West as a whole is a symbol of rationalism, yet in America the devotion to it has been so irrational that it has not even been recognized for what it is: liberalism....I believe that this is the basic ethical problem of a liberal society: not the danger of the majority which has been its conscious fear, but the danger of unanimity, which has slumbered unconsciously behind it..."

He adds (p. 12): "Do we not find here, hidden away at the base of the American mind, one of the reasons why its legalism has been so imperfect a barrier against the violent moods of its mass Lockianism?"

This question illustrates the basis for my criticisms. Locke emphasizes natural rights and liberal limitation on the state. The Palmer raids, McCarthyism and similar examples of democratic hysteria are the antithesis of Locke. Any logician worth is salt will tell you that if you say that what is not Locke is Locke, then any conclusion can be drawn. Hartz over-strains his insight. America is primarily Lockean, but it falls prey to anti-liberal, democratic patterns at times. The anti-liberal patterns such as McCarthyism are democratic, not Lockean. There is no need to claim that the Tennessee Valley Authority is liberal because of unconscious libido-like liberal impulses.

The best part of this book, and it is truly breathtaking, is in the second section on the development of the liberal idea in combination with elitism. America was the freest country in the world, much freer than it is now, before the Revolutionary War. Hence, there was no need to overturn an aristocracy (p. 39-55):

"When men have already inherited the freest society in the world, and are grateful for it, their thinking is bound to be of the soldier type. America has been a sober nation, but it has also been a comfortable one, and the two points are by no means unrelated...the revolutionaries of 1776 had inherited the freest society in the world...It gave them, in the first place, an appearance of outright conservatism. We know, of course, that most liberals of the eighteenth century, from Bentham to Quesnay, were bitter opponents of history, posing a sharp antithesis between nature and tradition. And it is an equally familiar fact that their adversaries, including Burke and Balckstone, sought to break down this antithesis by identifying natural law with the slow evolution of the past...The past had been good to the Americans, and they knew it. Instead of inspiring them to the fury of Bentham and Voltaire, it often produced a mystical sense of Providential guidance...The trouble they had with England did not alter this outlook...The result was that the traditionalism of the Americans, like a pure freak of logic, often bore amazing marks of anti historical rationalism...one of the secrets of the American character: a capacity to combine rock-ribbed traditionalism with high inventiveness, ancestor worship with ardent optimism....men began to be held together, not by the knowledge that they were different parts of a corporate whole, but by the knowledge that they were similar participants in a uniform way of life--by that pleasing uniformity of decent competence."

Thus, the liberal norm penetrates us all (p. 56). Moreover, and this is part of the excessively Freudian part of Hartz's thinking (p. 59), "American pragmatism has always been deceptive because glacierlike, it has rested on miles of submerged conviction and the conformitarian ethos which that conviction generates has always been infuriating because it has refused to pay its critics the compliment of an argument." While I think he's right and that America is conformist and there is a Lockean impulse, it is wrong to conclude that imposition of securities regulation or internment of the Japanese during the Second World War reflect liberalism. A is not not A.

Hartz's comparative methodology (he uses France, England and Germany as comparison points) is off-the-charts brilliant. Hartz's familiarity with European and American history is impressive. He compares American and European liberalism and concludes that part of the reason socialism never appealed to Americans was that there was never any feudalism here (p.78). In America, the two basic impulses are toward democracy and toward capitalism (p. 89). In early American history, the Federalists saw the needs of the capitalist in opposition to the democracy. The democratic tradition of Jackson, which was therefore able to destroy it, formulated a philosophy which seemed to deny its faith in capitalism. But rather than allow the petit-bourgeoisie, the peasant and the worker to oppose capitalism, American Whiggery transformed the peasant into the "capitalist farmer", the worker and petit bourgeoisie into the "incipient entrepreneur" (p. 92). "For" (p. 94) "if the American democrat was unconquerable, he was so only because he shared the liberal norm. Thus what (pre-1840) Whiggery should have done, instead of opposing the American democrat was to ally itself with him..." (p. 95) "In America there was no mob: the American democrat was as liberal as the Whigs who denounced him...the quick emergence of democracy was inherent in the American liberal community."

But the American democrat was liberal and the Whigs' fear of him "coincided with the American democrats' fear of himself, for he no more than they, understood the liberal world that brought him to power and hence could not see any better than they could that in such a world the majority would not want to annihilate the individualist way of life." Thus, Jacksonian democracy did not resist the establishment of the Supreme Court, the Constitution and the law as a limit on democratic power. But while the Federalists and Whigs denounced the American democrat, the people were as liberal as they were (p. 106). Whiggery could only control the democratic American "by uniting with him in a capitalist movement" (p. 108). In the "age of Harrison" the Whigs "transformed" "the egalitarian thunder of the Democrats" (p. 111) by combining Hamiltonian capitalism with Jeffersonian equality. "The result was to electrify the democratic individual with a passion for great achievement and to produce a personality type that was neither Hamiltonian nor Jeffersonian but a strange mixture of them both: the hero of Horatio Alger...A new social outlook took shape, dynamic, restless, competitive, and because it united the two great traditions of the American liberal community, its impact ultimately became enormous" (p. 112). Hartz quotes Tocqueville: "what astonishes me in the United states is not so much the marvelous grandeur of some undertakings as the innumerable multitude of small ones" (p. 115). Farmer and factory worker were absorbed into the capitalist ethos (p. 119). Thus, the American character is rooted in small entrepreneurship. Americans have "a certain smallness of entrepreneurial preoccupation which has never been glamorous in Western thought." (p. 116).

However, there is tension between the democrats' attribution of the growth of big business on the state (pp. 137-8):

"The clash between capitalist hunger and anti capitalist principle reached its climax, of course, on the banking question. Charles A. Dana, a disciple of the easy credit schemes of Proudhon, lamented that American democracy wages a 'relentless war' on the banks of discount and circulation'...But the war was more relentless in theory than in practice...The hard money dreams of Taylor and Jackson were shattered by rising entrepreneurs, Western farmers and private bankers who favored the assault on Biddle not in order to limit credit but rather to expand it at the hands of local banks. This type of pressure had been exerted even against the First Bank of the United States under Jefferson. By the time of Jackson, America's acquisitive democracy,--its millions of go getting Americans as Hammond puts it--overwhelmed the concept of credit control. The speculative boom of the thirties is an excellent commentary on the get-rich-quick compulsion of the American democrat."

The outcome is that Whigs become like Democrats and Democrats like Whigs. "Locke dominates American political thought as no thinker anywhere dominates the political thought of a nation" (p.140).

In chapters six and seven Hartz discusses how the southern slave interests such as Calhoun and Fitzhugh attempted to subvert Locke and assert feudalist, conservative or even socialistic theories in defense of slavery. The key point in this interesting discussion is that Lockean liberalism destroyed their ideologies (p. 199):

"Here surely is the final irony in the fate of the South's feudal Enlightenment. It was not even buried by an elitist liberalism; it was buried by a democratic liberalism. It was not even put to rest by a man as sympathetic as Hamilton; it was put to rest by Andrew Carnegie and Horatio Alger, the children of Lincoln's achievement. If political theorists turn in their graves, Fitzhugh has turned many times, but could anything have bothered him so much as the sight of Jed the Newsboy walking unconsciously over his corpse?"

He begins chapter eight (entitled "The New Whiggery: Democratic Capitalism", p. 203):

"Unfurling the golden banner of Horatio Alger, American Whiggery marched into the Promised Land after the Civil War and did not really leave it until the crash of 1929."

"Two moods then run through the new Whig doctrine: one rational, the other irrational; one liberal, the other Americanistic. The difference bewtween them is the difference between William Graham Sumner and the American Legion." American
"Whigs" responded to the threats of Progressive and socialism. American Whiggery (p. 215):

"had itself been largely resopnsible for the tradition of economic policy it now proceeded to bury and destroy. It had been the American democrat, with Jefferson, who in theory at least had opposed it and had developed the closest thing to a laissez faire dogma that the country had produced. The principle at work here was obvious enough: big captalism was able now, with the major exception of the tariff, to dispense with the Hamiltonian promotionalism on which it had relied in the days of its weakness, especially since the corporate technique had become established and important. And so, if in the age of Jackson the American Whigs looked like the Corn Law monopolists of England, in the age of Carnegie they were prepared to look like the John Brights who had assailed those monopolists. One can trace this process of spiritual conversion and dramatic flip-flop with a brilliant clarity within the American states where on the eve of the Civil War the Hamiltonian interests who had originally demanded many public inestments, especially in banking and transportation, proceeded to deride them, producing precedent after precedent for the laissez-faire constitutional law so famous in the later time.

"What made the matter even more complicated, however, was that when Whiggery shifed from Carey to Carnegie it proceeded to use the ancient arguments of the American democrat himself, thus gravely confounding this figure. He, of course, in assailing state action, had opposed monopoly, which meant particularly the corporate charter. Indeed, lacking any real understanding of social oppression, he had defined all nonpolitical tyranny in terms of inequitable political decisions. Now, with the corporate charter universally accepted, due in part to his own ultimate drive for general incorporation, and with a huge trust growth being built upon it, he found himself confronted in his effort to solve a real social problem with the very symbols he had used...Who was the real disciple of Jefferson, the man who wanted the Anti-Trust Act or the man who opposed it?"

Hartz goes on to argue that the Progressives (p. 229):

"advanced a version of the national Alger theme itself, based on trust busting and boss busting, which sounded as if he were smashing the national idols, but which actually meant that he was bowing before them on a different plane. Wilson, crusading Wilson, reveals even more vividly than Al Smith the pathetic enslavement of the Progressive tradition to the Americanism that Whiggery had uncovered...the Algerism of the Progressives was no more due in the last analysis to the boom of the time than was the Algerism of Whiggery...but after the crash of 1929 it would not disappear but would go underground to serve as the secret moral cosmos on the basis of which New Deal pragmatism moved."

Hartz is irritated that the Progressives were not more socialistic. They emphasized trusts because (p. 232) "If the trust were at the heart of all evil, then Locke could be kept intact simply by smashing it..." and (p.236) "The Progressives failed because, being children of the American absolutism, they could not get outside of it and so without fully seeing that Locke was involved everywhere, they built their analysis around a titanic struggle between "conservative" and "radical" which had little relevance to Western politics as a whole."

The Progressive movement's democratic impulse was, in Hartz's view, Lockean. I do not see the connection because Locke argues for natural rights and against unlimited democracy, and Herbert Croly and the Progressives argued against natural rights and for unlimited democracy. The Progressives were the democrats whom Hamilton feared, but they used the argument of democracy on behalf of underlying Hamiltonian ends: the furtherance of big business interests. Rothbard, Sklar and Radosh discuss this and I will review their book in my next blog. I don't think that Hartz is right in his claim (p. 241, bottom) that "wealth was inexorably being concentrated".

Chapter Ten concerns "The New Deal". Hartz labors under the erroneous belief of the pre-Friedman and Rothbard era that the Depression was an outcome of capitalism rather than of government and/or Federal Reserve Bank intervention. He begins by claimng that "If the Great Depression of the 'thirties suggested anything, it was that the failure of socialism in America stemmed from the ideologic power of the national irrational liberalism rather than from economic circumstance." Actually, the reverse is true. The irrational, socialistic response of the New Deal to failure of the Fed and President Herbert Hoover's interventionist, New Deal style policy program caused the Depression, and the irrational policies of the Roosevelt administration intensified it in a kind of hyper-irrational, anti-pragmatism. The divergence of narratives here suggests that American history has not been so Locke-step as Hartz claims. Moreover, Hartz's argument of the consistency of liberalism falls apart. He writes (p. 260):

"The experimental mood of Roosevelt, in which Locke goes underground while problems are solved often in a non-Lockean way, wins out persistently. And who will deny that this, even more than the isolation of socialism, is a tribute to the irrational liberal faith of America? Eaating your cake and having it too is very rare in politics."

The problem is that America did not eat its cake. The New Deal started an illiberal pattern which has not been reversed and has spawned an increasingly intensifying government by special interest group brokerage and wealth transfers. The premise of the New Deal involved several layers of deception, not the least of which was the claim that Roosevelt's experimentation was helpful to the petit bourgeoisie and the poor, which it hardly was. There was a period of about 40 years during which wages increased somewhat more quickly on average than they did prior to 1932. But since 1971 the cumulative effect of the abolition of the gold standard and the New Deal policies have resulted in declining real wages and a dissolution of the American community into two warring camps, the advocates of intensification of the New Deal pattern in a socialistic direction, and those who continue to believe in the Lockean consensus. American elites have in large part dispensed with democratic liberalism. Whiggery has become dominant, but it is Whiggery cloaked in Progressive (Republican) rhetoric concerning efficiency and in New Deal or socialistic rhetoric concerning equity, income inequality and redistribution. Neither party has any interest in democracy, in Locke or in liberalism. Republican elites advocate perpetuation of the easy credit scheme in order to further wealth redistribution to Wall Street clientele, while Democratic elites, who are also in favor of loose monetary policy for the same reason, carry forward the monetary regime in social democratic robes.

Tuesday, July 22, 2008

The Media's Obamanable Performance and a Business Plan

While exercising in the health club today someone had turned on CNN (when the person left the gym I changed the station to Fox ASAP). Since I avoid the media in general and when I do I mostly watch Fox, I was surprised at CNN's overt bias in Mr. Obama's favor. Jack Cafferty made a two minute speech alleging that Mr. McCain is too old and senile. Perhaps it is Mr. Cafferty who is too old and senile. Worse, there was no counter argument or balancing view to Cafferty's hyperbole. At the same time, the coverage of Obama omitted criticism and was monotonously flattering. When I turned to Fox, I heard a discussion of media bias but the accusations in McCain's favor were balanced by a Democrat who blamed McCain for the media's lack of interest in him. Thus, Fox is somewhat balanced but the other stations are for Obama.

This election may stack up to be a referendum on the mass media. The McCain campaign has produced two ads, and it is asking Web viewers to vote on which one it should air. You can see them here. The first video shows parrot-brained,Polly-Want-An-Obama broadcasters such as Chris Matthews repeating how great Obama is to the tune of "It's Just Too Good to Be True, I Can't Take My Eyes Off of You". The second one repeats the parroting with less music. The majority of viewers think that the first video is better.

This election may be a referendum on the mainstream media. That is a good reason alone to back McCain even though you may be frustrated with the Republicans. A McCain victory will be a blow to the M-S-M, which has been suffering from declining readership and ratings. In turn, a McCain victory would cause the market value of the media outlets to decline. This will make a stock market takeover bid of one of the second tier cable stations easier.

I wonder if it might be possible for a libertarian or conservative to buy out CNBC or MSNBC. These stations contribute little to the national policy debate and have dismal ratings. Fox offers an alternative to the hackneyed, social democratic bias of the M-S-M stations, but it is in some ways a limited alternative. A libertarian-conservative news network might turn out to be profitable. A bit of sex appeal thrown in with conservative views would enable such a station to overtake CNN, crippling the left's cultural hegemony in the media area.

Here is a business plan: a proposal to take over CNBC and turn it into a libertarian conservative news station. Perhaps Rupert Murdoch, one of the Koch brothers or someone else with the resources might be interested in doing this.

Monday, July 21, 2008

The Professional Staff Congress and Revolutionary Unionism

The temperate, prudent, courageous, just and of course virtuous Sharad Karkhanis has written an excellent issue of Patriot Returns. Karkhanis named his newsletter after our Patriot missles, which shot down Iraqi Scuds in 1991. With a circulation of 13,000, Karkhanis's newsletter aims to shoot down the Scuds of the perverse CUNY faculty union, the Professional Staff Congress (PSC) and hopefully blow the PSC leadership back to Cuba, although I doubt that even Castro or his brother would want them. Maybe North Korea's Kim Jong-il would welcome them since they seem to aim to give the CUNY faculty a North Korean-style wage-and-benefit package, but even he might find them tiresome.

In the early twentieth century there were alternative models of unionism being proposed. The mainstream AF of L, created by Samuel Gompers and Adolph Strasser, advocated a form of unionism that labor scholar Robert F. Hoxie called business unionism. Business unionism does not question the underlying assumptions of the capitalist economy and resorts to political gamesmanship only in order to "reward friends and punish enemies". Its emphasis is improving wages, benefits and working conditions, not changing the world. Gompers expressed the pro-capitalist essence of business unionism when someone asked him: "What does labor want?" Gompers responded: "More". Like any profit-maximizing capitalist, and any red-blooded American, business unionists aim to advance themselves economically. In contrast, models of unionism that were prevalent during the early twentieth century included the Industrial Workers of the World (the Wobblies) and the communist unionism of the Socialist Labor Party's Daniel de Leon's Socialist Trade and Labor Alliance and others. American workers rejected what labor scholar Hoxie called revolutionary unionism in favor of business unionism. The gulf between the "New" Left and the business unionists reached a crescendo during the Vietnam War in 1965 when AFL-CIO president George Meany announced his support for the Vietnam War.

Inverting the historical pattern, the PSC leadership has rejected business unionism in favor of revolutionary unionism. Its repeated calls for demonstrations; the anti-Iraqi War protests several years ago; the endless radical rhetoric that has alienated New York's political establishment (social democratic thought it be); and the utter contempt with which the PSC's leadership treats economic and workplace issues all suggest that the PSC does not operate as a mainstream union. The low contract numbers that Karkhanis decries result from the PSC's leadership's strategic choice to favor revolution over selfish gain, or even selfish keeping your head above water and avoiding the bankruptcy judge.

Perhaps the the PSC leadership does not need to worry about electric, heating, gasoline and food bills. Perhaps like Professor Ros, they live in high rent apartments on six figure incomes. Perhaps they can afford to contribute $5,000 to the Obama campaign.

If so, isn't it time to get back to reality and rocket this crew back to Cuba via one of Karkhanis's Patriots?