Browsing "Aftermath: The Gilded Age"

Monuments to Timeless Virtue and Infamy

The Grand Army of the Republic (GAR) formed after the war and quickly became a powerful organization whose political might led historians to see it as a pension lobby or “bloody-shirt” Republican club. The membership sustained the postwar Republican Party and Glided Age political corruption that followed the war, and no Northern politician’s campaign was complete unless he received the blessing of the GAR. The organization maintained the view that they saved the Union and that the South was guilty of treason, though the Constitution clearly states in Article III, Section 1: “Treason against the United States, shall consist only of levying War against them, or in adhering to their Enemies, giving them Aid and Comfort.” “Them” means the States comprising the United States.

Bernhard Thuersam, www.Circa1865.com

 

Monuments to Timeless Virtue and Infamy

“A . . . theme that emerged from GAR memorializations of the 1880s was that the war had broad meaning, not to say a moral, that transcended individual combat experiences. With occasional exceptions . . . the authors of the personal war experiences left the moral unstated. But in campfire speeches and war lectures, the repeated lesson was one of national salvation: the war had maintained the Union.

Prewar social and economic differences between the sections, issues of free labor and political power in the West, and especially the questions of blacks and slavery received scant mention in celebrations of the war’s outcome. Instead, the grand achievement of the Northern armies had been to rescue the indivisible nation as it had existed before . . . The war was a mission accomplished; the nation, something maintained intact rather than something greatly changed. It was a rhetoric pf preservation.

Both Civil War armies invoked republican traditions; both pointed to the same Revolutionary symbols. The other great influence on popular historical thinking during the antebellum years was evangelicalism . . . in the North, evangelical crusades against sin, culminating in the antislavery movement, drew on images of battles and the Apocalypse.

Yankee reformers pictured it as the crossroads of history. Armageddon, a climatic struggle from which the nation would emerge redeemed. Hymns urged patriots to march; ministers spoke of millennial change. No longer was the Republic seen as an entity formed at the beginning; it needed to be actively saved, not passively preserved. History was to be shaped, not studied, for examples of virtue.

At the same time, the overwhelming importance of the Republic’s preservation required permanent and public commemoration. Veterans proclaimed the message of national preservation in Congress, where on pension questions they drew pointed inferences regarding the duty of the nation to its saviors. And in city after city, new monuments refuted in stone any notion of the Civil War’s “pastness.”

As long as ex-Confederates did not question the moral lesson of the war, they were treated cordially – in fact, they were sometimes contrasted favorably with “loyal” noncombatants. Especially after 1880, [GAR] posts and encampments occasionally socialized with veterans from the other side.

[In 1894], white Northerners and white Southerners were engaged in a veritable love feast of reconciliation, complete with Blue-Grey reunions, Lost Cause nostalgia, and Confederate war monuments (including the first to be permitted at Gettysburg).

When it came to drumming the lessons of the war into the next generation, however, the ex-Confederates were doomed forever to play the heavy, always on the side of error, always vanquished by the hosts of the righteous. In the words of GAR commander William Warner, “we were eternally right and . . . they were eternally wrong.”

The line dividing cordiality from hostility ran between those actions (such as lecture invitations) that implied only sociability between former foes and those (such as the erection of Confederate monuments and waving the Confederate flag) that seemed to be aimed at subverting the message of national salvation.

Union veterans commonly expressed the division by saying that while the former rebels might be fine fellows, their principles were, and always would be, wrong. In 1874 [a Massachusetts veteran] . . . objected to the decoration of Confederate graves on Memorial Day by saying “he had nothing but the kindest feelings toward those who fought against us . . . but . . . let it be understood that we distinguish between loyalty and disloyalty; the latter is the treason against which we fought, and the former we pay respect and tribute to.”

In 1891, [GAR CIC] John Palmer allowed that the Confederates had been gallant and said the GAR was willing to accept them as fellows “on the broad grounds of American citizenship and unconditional loyalty.” But he went on to denounce several GAR men who had marched in Atlanta parade that included the Confederate flag. In New York a GAR member was dishonorably discharged for toasting Jefferson Davis at a Southern banquet.

In general, Grand Army posts objected most strenuously to those behaviors or symbols that implied honor to the Confederate cause – a flag, a monument, a toast to a president, flowers on a grave. Nor was it with the proper exegesis of battles, for those conflicts were by definition one-time only events. The worry was not so much about the lauding of individual Confederates (unless they were symbolic individuals such as Davis), for they would die eventually.

Instead, GAR posts worried about transmitting the moral of the war to the next generation intact. If monuments were to call forth “public valor and virtue in all coming time,” the lessons of war could not be subject to historical change. And if the virtue of the Union was to be timeless, so must be the infamy of the Confederacy.”

(Glorious Contentment, the Grand Army of the Republic, 1865-1900; Stuart McConnell, UNC Press, 1992, excerpts, pp. 181; 186-188-190-192)

Republicans and Panamanian Secession

The postwar Republican party in 1903 was not unfamiliar with exporting revolution for commercial and party purposes as it had supported revolts in Hawaii in 1887, which ended in the overthrow of Hawaiian sovereignty in 1898. The Columbian government would not move fast enough for Roosevelt the First, and the machinery of regime change was put into motion.

Bernhard Thuersam, www.Circa1865.com

 

Republicans and Panamanian Secession

“On November 3, 1903, a group of revolutionaries led by Manuel Amador staged a bloodless uprising in Panama City and succeeded in severing the province of Panama from the Republic of Columbia of which it had been an integral part. Under normal circumstances such political upheavals in Latin America would have caused little comment in the United States, but the Panama revolution was in no sense a normal affair.

An agreement had already been made with the New Panama Canal Company to purchase the rights of a defunct French corporation that earlier had attempted to construct a canal through the isthmian jungles; but all efforts to obtain a new grant of authority from the Columbian government proved to be unsuccessful, so unsuccessful, in fact, that there seemed to be little immediate hope that the United States would able to accomplish its self-appointed task of joining the Atlantic and Pacific Oceans.

Guided by motives of self-interest, the independent Republic of Panama would offer no impediment to the work of American engineers . . . In sum, the Panama uprising was, to all outward appearances, a most satisfactory revolution.

Viewed in the light of other developments, however, the whole Panama affair carried suspicious markings of American imperialism.

In the first place, the Roosevelt administration, in its anxiety to obtain Columbian approval of a suitable canal treaty, had exerted the most obvious sort of pressure on that government. During the spring and summer of 1903 Roosevelt had personally referred to Columbian officials as “inefficient bandits,” “contemptible little creatures,” and “homicidal corruptionists.”

He even threatened that country with action that “every friend of Columbia will regret” in the event some favorable solution was not soon reached.

In the second place, key figures in the Roosevelt administration had been exceedingly intimate with some of the leading figures in the Panamanian revolution. William Nelson Cromwell, an attorney for the New Panama Canal Company, for example, had contributed $60,000 to the Republican national committee in 1900 and through it gained an entry to the highest circles of that party.

Finally, the course of the United States government prior to and during the . . . revolution was open to suspicion of the gravest sort. An official of the State Department had sent an unfortunate inquiry to the American consul at Panama City asking about the uprising several hours before it occurred. Did this mean that the United States government had known in advance about the outbreak and had assisted the revolutionary party in planning it?

By like token, how did it happen that the USS Nashville arrived in Colon on the evening of November 2 and, on the day following the revolution, landed United States Marines there to prevent Columbian troops from seizing the Panama Railroad?

Above all, why did President Roosevelt recognize the new republic on November 6, receive [the new] minister from Panama on November 13, and authorize the signing of a canal treaty on November 17? Had Roosevelt personally engineered the revolt?

Certainly there was plenty of circumstantial evidence pointing towards the complicity of the American government; and although the Panama incident was still shrouded in secrecy, if the Democrats could uncover a few of the real facts underlying it both President Roosevelt and the Republican party would, in all likelihood, be faced with a scandal so infamous that political disaster must inevitably follow.”

(Arthur Pue Gorman, John R. Lambert, Louisiana State University Press, 1953, excerpts, pp. 297-300)

 

The Force Bill Fight in Congress

With Benjamin Harrison in the White House in 1889, the Republican party moved quickly to restore its political hegemony and construct numerous barriers to future Democratic victories. In a two-pronged effort the McKinley Bill would establish high tariff rates to protect northeastern manufacturers from foreign competition and encourage campaign contributions; the Force Bill ostensibly prevented corruption in Federal elections – but in reality gave Federal district judges the power to manipulate congressional elections in the South by shearing as much authority as possible from local election officials.

Bernhard Thuersam, www.Circa1865.com

 

The Force Bill Fight in Congress

“When Congress assembled in December, 1889, the Republicans were in complete control of both branches for the first time in sixteen years. With a great deal of satisfaction, therefore, their leaders revived the partisan measures that a Democratic majority in one house had previously thwarted.

In the opening days of the session they prepared several items of legislation designed to strengthen and lengthen Republican power. Their high tariff supporters were to be rewarded with the McKinley bill with its inflated schedules; the [treasury] surplus was to be obliterated by a veritable orgy of Federal spending; and any subsequent restoration of the Democratic party to power was to be hampered by a set of Federal election laws that would weaken the Solid South with Negro ballots and, if necessary, Northern bayonets.

If the Democrats were to survive the onslaught that the Republicans planned for them, they would require unflagging minority leadership in Congress. Shrewd parliamentary leadership would be needed there to employ effectively the minority’s somewhat limited resources.

The elections bill . . . was designed to appeal to lovers of human, rather than property rights. Its provisions were to be simple, just, and, to all outward appearance, eminently nonpartisan. Those who opposed its passage would place themselves in the position of defending Negro disenfranchisement, unconstitutional usurpation by Southern whites, and downright criminality. To attack the elections bill would be equivalent to a shameless confession of guilt.

Both measures were designed to cripple the Democratic party. The Tariff bill was not simply the negation of avowed Democratic principle; it was both the repayment of Republican campaign debts and the promise of future contributions.

“Fat-frying” had made Republican victories possible in 1888; high tariff schedules would now satisfy old customers and establish a new group of beneficiaries whose financial support might ensure Democratic defeat indefinitely.

The ulterior motives behind the elections bill were equally clear. Pious declarations that it was not a political weapon might assist its passage, but once it became law, the President would be empowered to enforce its provisions with the full support of the Army and Navy.

By this time it was clear to everyone that the Republicans were not motivated by humanitarian impulses in their efforts to protect the Negro in his constitutional rights; they were attempting to restore the political control over the Southern election machinery which they had exercised during the Reconstruction era”

(Arthur Pue Gorman, John R. Lambert, Louisiana State University Press, 1953, excerpts, pp. 145-148; 157)

Lincoln’s Pecuniary Interests at Council Bluffs

Though popular histories portray Lincoln as a simple and self-educated man who rose from a lowly background to become president, he was in reality a shrewd politician and wealthy corporate attorney. His clients before 1860 included the Illinois Central Railroad, then the largest railroad in the world, and an annual income of about $5000, more than triple that of the Illinois governor. After the War, Lincoln’s heavy-handed policy of military might was continued by his generals sent to eradicate the Plains Indians in the way of government-subsidized transcontinental railroads.

Bernhard Thuersam, www.Circa1865.com

 

Lincoln’s Pecuniary Interests at Council Bluffs

“A year prior to his nomination to the presidency — to be exact, in August, 1859 — he had visited Council Bluffs, Iowa, to look after his real estate holdings there and incidentally see the country.

A contemplated railroad to extend westward from the Missouri River to the Pacific coast was a live, but no new topic. For years such a possibility had been discussed, and in the first national campaign conducted by the Republican Party in 1856, a Pacific railroad was made a rather prominent issue. Shortly before his trip to Council Bluffs, Abraham Lincoln had purchased several town lots from his fellow [Illinois Central] railroad attorney, Norman B. Judd, who had acquired them from the Chicago and Rock Island Railroad. Council Bluffs at this time was a frontier town, containing about fifteen hundred people.

General [Grenville] Dodge . . . relates that “during Lincoln’s visit, some of the citizens of Council Bluffs took him to a high bluff known as Cemetery Hill, just north of the town. He was greatly impressed with the outlook; and the bluff from that time has been known as Lincoln’s Hill . . .

From here he looked down upon the place, where by his order, four years later, the terminus of the first trans-continental railway was established.”

The platform of the Republican National Convention that nominated Abraham Lincoln for president in May 1860 at Chicago, declared in the sixteenth plank:  “That a railroad to the Pacific Ocean is imperatively demanded by the interests of the whole country; that the Federal Government ought to render immediate and efficient aid in its construction . . . ”

General Dodge [said]: “There is great competition from all the towns on both sides of the Missouri River for fifty miles above and below Council Bluffs, Iowa, for the distinction of being selected as [the] initial point. President Lincoln, after going over all the facts that could be presented to him, and from his own knowledge, finally fixed the eastern terminus of the Union Pacific Railroad where our surveys determined the practical locality — at Council Bluffs, Iowa.”

(Lincoln and the Railroads, John W. Starr, Jr., Arno Press, 1981 (original 1927), excerpts, pp. 196-202)

 

America’s Conservative Catastrophe

Ambrose Bierce defined “Conservative” in his Devil’s Dictionary as “A statesman who is enamored of existing evils, as distinguished from the Liberal, who wishes to replace them with others . . .” Italian’s of the medieval period gave the title of “conservator” to guardians of the law; English justices of the peace originally “were styled custodus pacis – conservators of the peace.” In the modern sense, the word implies the principles of thought and action which opposed the radicalism and political innovation of the French Revolution.

Bernhard Thuersam, www.Circa1865.com

 

America’s Conservative Catastrophe

“[A Tory] party in the old English sense scarcely existed in [British] America. Political debates usually occurred between two factions of Whigs, both attached to the Whig idea of liberty, but differing as to means and the relationship with the Crown. The triumph of the Patriots in the Revolution expelled from the Thirteen Colonies what little Toryism existed there, and along with it many of the moderate Whigs.

For all that, recent scholarship inclines toward the view that the American Revolution was no revolution truly, but simply a War of Independence – a revolution (in Burke’s phrase concerning the Glorious Revolution of 1688) “not made, but prevented.”

The intellectual leaders of the Americans during the troubled period of Confederation, were men, most of them, of a conservative tendency – John Adams, Gouveneur Morris, John Jay, Hamilton. Even Jefferson . . . was no frantic innovator.

Most other Southern leaders, such as Pinckney or Mason, differed more about means than about the ends of society: their view of the state was conservative – viewed that is, from a twentieth century vantage point. Even some eminent radicals of the time, notably Patrick Henry, grew steadily more conservative as responsibility settled upon them.

And the Federalist Papers, written to obtain acceptance of the Constitution, reflect the conservative concepts of moderation, balance, order and prudence – together with those conservative guarantees of prescriptive usage, arrangement of political checks, restrictions upon power, protection of private property, and restraints upon popular [democratic] impulses.

During the early years of the United States, the chief political contests many be regarded as long, acrimonious debate between two powerful conservative interests – the mercantile interests of the North, the agricultural interests of the South – confused by lesser issues and personalities.

The catastrophe of the Civil War dealt a grim blow to reflective conservatism, North or South. In the Gilded Age, little political principle of any kind could be distinguished. As the United States grew into the greatest power in the world . . . conservative concepts were discussed again . . . [though the] Great Depression and ascendancy of Franklin Roosevelt seemed to quash this renewal of conservative thought.

Until the first administration of Franklin Roosevelt, the term “liberal” had not been popular among American politicians; but Rooseveltian liberalism swept everything before it during the 1930s and 1940s. Not until the 1950s did there appear, or reappear, a strong body of conservative thought, expressed in books and periodical literature, to challenge the dominant liberalism . . .

[An] American conservative, at least as the term is employed popularly, is a person who believes strongly that the old pattern of American society ought not to be much altered. Typically, such a person holds by the Constitution, maintaining that it should be strictly interpreted; he endeavors to oppose the drift toward political centralization; he dislikes organizations on a grand scale, in government, in business and industry, in organized labor; he is a defender of private property; he resents the heavy increase of taxation and many of the “transfer payments” of the welfare state; he is unalterably opposed to the Communist ideology . . . and sighs, or perhaps shouts O tempora! O mores! at the decay of private and public morality.”

(The Essential Russell Kirk: Selected Essays; George A. Panichas, editor, ISI Books, 2007, excerpts, pp. 14-16)

Du Pont and His Powder Industry

E. I. Du Pont’s position as an anti-slavery advocate may have been more about containing black people in the South and forbidding them into the North and territories, as was common among Republicans. He may also have been opposed to the war but made a fortune through powder orders by providing 4 million barrels to the Northern government. Du Pont’s revolutionary “mammoth powder” for heavy artillery allowed greater range for bombarding American cities in the South.

Bernhard Thuersam, www.Circa1865.com

 

Du Pont and His Powder Industry

“. . . Du Pont, a strong Whig and anti-slavery partisan could hardly feel much enthusiasm for the [Mexican] war, even if it did bring him government powder orders. [In the postwar] Ohio and Indiana farmers were industriously clearing away timber land, and potent charges of Du Pont powder were needed to extract the stumps. This was the first era of railway building, and powder was a necessity for railroad contractors. William Astor and his Oregon Fur Company needed powder for hunting in the Northwest. Mining was also beginning to develop.

Du Pont did not need a war, but the gods smiled and gave him one. In 1854 England, Turkey, and others went to war with Russia, and guns in the Crimea needed powder. Du Pont filled [orders from both England and Russia, and] shipments of the “black death” went forth to the far corners of the world.

During the American Civil War Du Pont was again the patriot – at least the Northern patriot. Naturally the war brought Du Pont large orders and he was the mainstay of the Northern government.

The Civil War created a virtual partnership between Du Pont and the government. When the war was over, this relationship was not disturbed . . . [and] Working hand in glove with the government became a regular practice for Dupont.

The last decades of the nineteenth century witnessed the formation of powerful combines and trusts in American business. It was only natural that Du Pont should be transformed from a simple powder company into a gigantic combine with international ramifications.

The development came as a result of the Civil War [and] Government orders had been so reckless that the supply of powder on the market proved a drug to the entire industry. The government sold its surplus at auction prices sand the bottom fell out of the powder industry.

Beginning in 1872 the Du Pont Company gradually brought “order” into the industry, and in 1907 it was not only supreme in the field, but had virtually united all powder companies in the country under its guidance, control, or ownership.

The result of this monopolistic policy may be seen in the fact that by 1905 Du Pont controlled the orders for all government powder orders. Having established this monopoly, Du Pont turned again to price-fixing [and] national prices were established from which there was no deviation.

During the World War Du Pont supplied 40 per cent of the powder used by the Allies, and after 1917 its orders from the United States government were enormous.”

(Merchants of Death, A Study of the International Armament Industry, H.C. Engelbrecht & F.C. Hanighen, Dodd, Mead & Company, 1934, excerpts, pp. 29- 36)

Remember the Maine

President William McKinley had to be goaded into war against Spain by the yellow journalism and fake news of Hearst and Pulitzer, but his dispatch of the USS Maine to Cuba provided the incident, as Roosevelt’s dispatch of the US fleet to Pearl Harbor did 43 years later. Lincoln’s bludgeoning of Americans seeking independence in 1861-1865, cleverly disguised as a war to emancipate slaves, left future imperial-minded presidents with a reusable template for war.

Bernhard Thuersam, www.Circa1865.com

 

Remember the Maine

“Henry Luce coined the phrase “The American Century” as an expression of the militant economic globalism that has characterized American policy from the days of William McKinley. Luce, the publisher of Time and Fortune, was the child of missionaries in China – a product, in other words, of American religious and cultural globalism. It is no small irony that this preacher’s kid was the chief spokesman for a global movement which, in its mature phase, has emerged as the principal enemy of the Christian faith.

The approach to Christianity taken by the postmodern, post-civilized, and post-Christian American regime is a seamless garment: At home, the federal government bans prayer in school, enforces multiculturalism in the universities, and encourages the immigration of non-Christian religious minorities who begin agitating against Christian symbols the day they arrive; abroad, the regime refuses to defend Christians from the genocide inflicted by Muslims in the Sudan, while in the Balkans it has waged a ruthless and inhumane war against the Serbs of Croatia, Bosnia, Kosovo and Serbia.

The inhumanity of NATO’s air campaign against villages, heating plants and television stations reveals, even in the absence of other evidence, the anti-Christian hatred that animates the Washington regime.

Luce did not invent the American Empire, he only shilled for it. His American Century began in the Philippines 100 years ago, when the American regime refined the policies and techniques discovered in the Civil War.

The oldest and best form of American imperialism is the commercial expansion advocated by the Republicans – McKinley, Taft, Hoover and Eisenhower – who warned against the military-industrial complex. Although all of these free-traders were occasionally willing to back up the politics of self-interest with gunboats, they preferred to rely, whenever possible, on dollar diplomacy. McKinley had no hesitation about establishing American hegemony in Cuba and the Philippines, but he had to be dragged into war.

Free trade, these Babbits believed, could be the route to market penetration around the globe, and one of the early slogans of commercial imperialists was the “Open Door.” Sometimes, however, the door had to be kicked in by the Marines.

As one spokesman for American industry put it 100 years ago, “One way of opening up a market is to conquer it.” This is what Bill Clinton meant when he justified his attack on Yugoslavia on the grounds that we need a stable Europe as a market for American goods.

Even the most tough-minded Americans are suckers for a messianic appeal; it must have something to do with the Puritan legacy. Even bluff old Bill McKinley, in declaring war on the people of the Philippines, a war that would cost the lives of more than 200,000 civilians, proclaimed the aim of our military administration was “to win the confidence, respect and affection of the inhabitants . . . by assuring them . . . that full measure of individual rights and liberties which is the heritage of a free people, and by proving to them that the mission of the United States is one of benevolent assimilation.”

The new American globalism has a logic all its own, one based on universal free trade, which destroys local economies; open immigration for non-Europeans and non-Christians, who can be used to undermine a civilization that is both Christian and European; and universal human rights, which are the pretext for world government.”

(Remember the Maine, Thomas Fleming; Perspective, Chronicles, August 1999, excerpt, pp. 10-11)

 

Losing the South’s Conservative Tradition

When Southern members left Congress in early 1861, nearly all conservative restraints enforced on that body were removed and the seeds of the Gilded Age were sown. The war of 1861-1865 will be forever seen as the unnecessary crime against liberty that it was, and the ending of the second experiment in government undertaken on these shores.

Bernhard Thuersam, www.Circa1865.com

 

Losing the South’s Conservative Tradition

“To those who fought and suffered during the long and fearful years of the War Between the States a tribute is always due. To the survivors of that momentous conflict – in which the South displayed unequaled bravery and marvelous determination – sincere reverence cannot too often be paid.

The young men and women who lived in the South after 1865 were tragic figures. They were the lost generation of the South, who led hard, bare and bitter lives, when young people of the South before and since were at play and in school.

That Tragic Era from 1865 to 1880 was a period when the Southern people were put to torture – so much so that our historians have shrunk from the unhappy task of telling us the truth. That was a black and bloody period – when brutality and despotism prevailed – a period which no American can point with pride. To the generation of Southerners who struggled in the years after the war in the sixties we owe the redemption of the South and the preservation of its society.

[The War and Reconstruction] cost the South heavily – but they also cost the nation. The South paid for theirs in an economic collapse and carpetbag domination extending over a period of nearly thirty years. But the nation also paid its price – it lost the powerful influence of the conservative Southern tradition.

In antebellum times the South had steadied the nation’s western expansion by its conservatism, but when the South was broken and destroyed, we saw a period of western expansion, of European immigration, of speculation, of graft, and of greed – unknown before in the annals of our history.

The nation after the war – especially the North and West – entered into an era of expansion, of worship for the new, of so-called progress, for which we still pay the price in our periodic overproduction. We should learn that economic wealth may be amassed, yet the fickle turns of business fortune can destroy it in a few years. Witness the economic collapse of our nation in the last few years after a period of unrivaled business growth.

The eternal national values are then those intangible contributions to national life such as the old South gave – not wealth, not progress, but those great qualities of tradition and conservatism and individuality which neither Depression nor hard times can destroy.

May the faith of the old South be ours, so that we can rebuild our State and Nation – and as we do so may we add the South’s contribution to American life not only its heritage of conservatism, of tradition and individuality, but also that spirit of silent strength in the hours of adversity – that spirit shown during the War and Reconstruction.”

(The Tragic Era, Dr. Julian S. Waterman, Dean, University of Arkansas Law School, Memorial Day speech at Fayetteville, Confederate Veteran Magazine, July, 1931, excerpt, pp. 275-277)

Unproductive Republican Economic Policies

April, 1865 witnessed the victory of Northern industrial capitalism over the conservative, agrarian South – no longer could Southern statesmen restrain the North in the halls of Congress. Post-1865 America saw the rise of corporations, the completion of Manifest Destiny and near-extermination of the Indians, and the gilded age of “evil robber barons.”

Bernhard Thuersam, www.Circa1865.com

 

Unproductive Republican Economic Policies

“Historians have tended to treat the Civil War as a boon to industry and the American economy. Thomas C. Cochrane cites several prominent historians . . . who variously praised the impact of the conflict on wartime production and its stimulating effect on postwar economic and industrial development.

Cochrane . . . examined statistical data on industrial production and found that, in general, there was not a strong case for a positive impact and that the war had a retarding effect on industry and the economy. Cochrane also found little support for the claims of beneficial effects of the Civil War on postwar development. He concludes with this speculation:

“From most standpoints the Civil War was a national disaster, but Americans like to see their history in terms of optimism and progress. Perhaps the war was put in a perspective suited to the culture by seeing it as good because in addition to achieving freedom for the Negro it brought about industrial progress.”

[Charles and Mary] Beard’s claim that the Civil War was a spur to industry and the rise of the American economy is based on the lasses-faire philosophy of the Republican Party and its success in implementing its major policy goals, such as subsidies to the intercontinental railroads, the establishment of a national currency and the protective tariff.

The Republican’s economic philosophy was not truly laissez-fair. In fact, their policy agenda was the opposite . . . in that it advocated special treatment for big business and a much larger role for the federal government. This can be seen in Republican policies to subsidize railroads, provide protective tariffs [for select private industries], and increase government debt and government control over money and banking as well as in their attitude toward labor.

Their policies [of tariffs and subsidies] . . . are now considered economically wasteful . . . and considered nothing more than special interests seeking a handout from the taxpayer through the government. [That Republican policies were productive] ignores the negative effects on the agriculture, service and cultural sectors. The Republicans’ policy would be better labelled as mercantilist in that it facilitated rent-seeking behavior.

Capital diverted to railroad building would surely have been put to good use elsewhere in the economy . . . [and] Moreover, had railroads not been highly subsidized, a better built, lower cost, and more timely system could have been put in place.

Tariffs were a centerpiece of Republican policy. They reversed a relatively free-trade policy . . . [and] protectionism forced consumers to pay higher prices for both imported and domestically produced goods protected by the tariff – that is, they purchased fewer of these products, used less desirable substitutes, and had a lower standard of living.

On net, the losses to consumers and the overall economy are greater than the gains to the protected producers and the tax revenue that accrues to the government.”

(Tariffs, Blockades and Inflation, the Economics of the Civil War; Mark Thornton and Robert B. Ekelund, Jr., Scholarly Resources Books, 2004, excerpts, pp. 84-87)

Corporate Tricks and Devices

Few, if any, Gilded Age tycoons were expert economists – but all understood theories of supply and demand, the law of diminishing returns, and assumed that every man was motivated by the selfish love of gain. Most also believed in unfettered competition, theoretically, unless bribed government officials could be used to handicap competitors. U.S. Grant’s notorious administration of corrupt and bought politicians helped pave the way into the Gilded Age – the predictable outcome of Lincoln’s revolution.

Bernhard Thuersam, www.Circa1865.com

 

Corporate Tricks and Devices

“Nobody expounded the folly of tampering with the laws of economics more eloquently than Yale’s great teacher of political economy, the dynamic William Graham Sumner. In his book What Social Classes Owe to Each Other, published in 1883, he had put the reformers to rout.

“The yearning after equality,” he had written, “”is the offspring of envy and covetousness, and there is no possible plan for satisfying that yearning which do aught else than rob A to give to B; consequently all such plans nourish some of the meanest vices of human nature, waste capital, and overthrow civilization.”

This emphatically did not mean that Sumner was opposed to a better life for everybody. On the contrary, as a man of high and generous principle – he had begun his working life as a clergyman – he was heartily in favor of it. But he believed in the wider extension of opportunity, not in changing the rules under which business was conducted. He argued that:

“[Instead] of endeavoring to redistribute acquisitions which have been made between the existing classes, our aim should be to increase, multiply, and extend the chances. Such is the work of civilization. Every improvement in education, science, art or government expands the chances of man on earth. Such expansion is no guarantee of equality. On the contrary, if there be liberty, some will profit by the chances eagerly and some will neglect them altogether. Therefore, the greater the chances, the more unequal will be the fortune of these two sets of men. So it ought to be, in all justice and right reason.”

Sumner would not have argued that there were not some ways in which legislation could protect the economically helpless. But he thought that most reform legislation was conceived in ignorance and drafted in folly.

“You need not think it necessary,” he would tell his Yale classes, “to have Washington exercise a political providence over the country. God has done that a good deal better by the laws of political economy.”

The irony of the situation lay in the fact that for generations men have been tinkering with economic law to their own advantage, and in the process had produced institutions which were emphatically not God’s work – as most of Sumner’s hearers presumably supposed them to be – but man’s.

The corporation, for instance, was not an invention of God’s. It was an invention of man’s. It was a creature of the state . . . [and] one of the great inventions of the nineteenth century . . . Yet be taking adroit advantage of the legislative acts which defined its privileges, one could play extraordinary tricks with it. Corporate devices could be used to permit A to rob B – or, let us say, more charitably, to permit A to drain off all the gravy in sight and leave none for B.

It was largely as a result of the discovery of tricks that could be played with corporations, and particularly with their capital stock, that the wealth produced in such a tremendous spate at the turn of the century flowed in large proportion into a few well-placed hands.”

(The Big Change, America Transforms Itself, 1900-1950, Frederick Lewis Allen, Harper & Brothers, 1952, pp. 67-69)

 

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