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Want to know some of the backstory to how my book came together? Then check out this Q & A, posted today by the University Press of Kansas. In this interview, I talk about the challenges of researching this book and how my account is different from others.
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Order my book from the University Press of Kansas
President Andrew Jackson’s conflict with the Second Bank of the United States was one of the most consequential political struggles in the early 19th century. A fight over the Bank's reauthorization, the “Bank War,” provoked fundamental disagreements over the role of money in politics, competing constitutional interpretations, equal opportunity in the face of a state-sanctioned monopoly, and the importance of financial regulation—all of which cemented emerging differences between Jacksonian Democrats and Whigs. As Stephen W. Campbell argues here, both sides in the Bank War engaged interregional communications networks funded by public and private money. The first reappraisal of this political turning point in American history in almost 50 years, The Bank War and the Partisan Press advances a new interpretation by focusing on the funding and dissemination of the party press.
Drawing on insights from the fields of political history, the history of journalism, and financial history, The Bank War and the Partisan Press brings to light a revolving cast of newspaper editors, financiers, and postal workers who appropriated the financial resources of pre-existing political institutions, and even created new ones, to enrich themselves and further their careers. The Bank propagated favorable media and tracked public opinion through its system of branch offices while the Jacksonians did the same by harnessing the patronage networks of the Post Office.
Campbell’s work contextualizes the Bank War within larger political and economic developments at the national and international levels. Its focus on the newspaper business documents the transition from a seemingly simple question of renewing the Bank’s charter to a multi-sided, nationwide sensation that sorted the American public into ideologically polarized political parties. In doing so, The Bank War and the Partisan Press shows how the conflict played out on the ground level in various states--in riots, duels, raucous public meetings, politically orchestrated bank runs, arson, and assassination attempts. The resulting narrative moves beyond the traditional boxing match between Jackson and Bank president Nicholas Biddle, balancing political institutions with individual actors, and business practices with party attitudes.
Praise for The Bank War and the Partisan Press
"This welcome and highly readable book breathes new fire into Jackson's dramatic Bank War of the 1830s. It successfully links this epoch-turning event with a modern awareness of the power of government institutions, the functioning of the press, and a measured awareness of how the nation's financial and economic system actually worked. Through the words and actions of key players, notably Nicholas Biddle and Amos Kendall, it demonstrates that the key disputes were not over the powers of 'the state' but whom should benefit from their exercise." -- Donald Ratcliffe, author of The One-Party Presidential Contest: Adams, Jackson, and 1824's Five-Horse Race
"A fresh assessment of Andrew Jackson's famous Bank War has been long overdue. Deftly interweaving the threads of party politics, finance, journalism, and communications, Stephen Campbell's The Bank War and the Partisan Press offers a revealing new take on this pivotal yet dimly understood episode. Observers of American government and banking, and the interconnections between the two, will find this book essential reading." -- Daniel Feller, professor of history and director of The Papers of Andrew Jackson, University of Tennessee
"Campbell breathes new life into the history of the Bank War by examining how the burgeoning partisan press, the US Postal Service, and the wider network of internal improvements nationalized this conflict. With this new spin on an old topic, the battle between Nicholas Biddle and Andrew Jackson over the fate of the Bank of the United States offers much insight into how critical American institutions worked in the 1830s and how they led to the formation of a new political order." -- Sean Patrick Adams, professor of history, University of Florida
Are you interested in my scholarly work? Then check out this recently published piece, where I discuss some of the ways in which President Andrew Jackson used the Post Office and other federal agencies to kill the "Monster Bank." Many thanks to the editors at We're History for publishing this preview of my forthcoming book!
I am honored and grateful to have been interviewed by Colin Woodward, the host of the Amerikan Rambler Podcast. In this interview, we talk about my background and upbringing in the San Francisco Bay Area, ill conceived Trump-Jackson comparisons, the perils of the academic job market, the history of rock music, and my forthcoming book. Enjoy!
No discussion of libertarianism would be complete without mentioning Austrian school economist Murray Rothbard. The famous anarcho-capitalist broke with conservative economists like Milton Friedman on some key issues, but shared most conservatives’ opposition to the Civil Rights movement and any state-sponsored efforts to ameliorate economic inequality, which he regarded as entirely natural. Unsurprisingly, he criticized central banking and praised the gold standard. Later in his career, Rothbard, although he was the son of Jewish immigrants, dabbled in the types of anti-Semitic arguments that Reason propagated as historical revisionism, which might explain why a white nationalist in Ohio recently cited Rothbard as an influence. In graduate school I first came across Rothbard’s name since he had produced one of the few monographs on the Panic of 1819. To my knowledge, no one has yet updated Rothbard’s early-1960s work, though Sharon Ann Murphy and others have researched similar topics.
To anyone who has spent time examining topics of economic history on Twitter and Wikipedia, it should be clear that Rothbard’s disciples and intellectual descendants exert a disproportionate influence on social media relative to what their raw numbers would normally predict. Perhaps this reflects libertarians’ glorification of business and technology. One need only look at the number of entries on Wikipedia that have sections and subheadings showing the Austrian point of view. It’s almost as if some organization instructed a bunch of their lackeys to go on Wikipedia, search out every topic remotely related to economic history, and then edit the entries so that their propaganda is unavoidable for students and professors. Sometimes their presence lies far outside the realms in which they can plausibly claim expertise. Do we really need to hear the Austrian criticism of Jared Diamond’s prize-winning work, Guns, Germs, and Steel? Imagine going on Wikipedia and seeing what the official stance of the Catholic Church is on every historical event! Recall that a few years ago I found that the Wikipedia entry on the Panic of 1837 was in terrible shape and that the only reference listed was a PDF from some random dude I had never heard of who worked at the Ludwig Von Mises Institute. I spent quite a bit of time correcting this entry and wrote about the experience for Perspectives on History.
In the academy, libertarianism is a bit more common than one might think, which is to say that academia is not the monopoly on progressive orthodoxy that critics often allege. Anonymous reviewers will sometimes leave clues to their identities and intellectual leanings. If they’re using the terms “public choice,” “coercion,” “tyranny,” or “rent-seeking,” you’re probably dealing with a libertarian. Inflation and taxation are “theft” under libertarian discourses. Call them out and they will reply that you are trying to “smear” them. A non-trivial amount of libertarians thrive in business schools, economics departments, the departments of philosophy, history, and political science, and law schools. Economics departments have the reputation of being anti-union and more conservative than most other academic disciplines. I suspect there are many professors in the hard and social sciences who just don’t care that much about politics, and since many libertarians and conservatives are highly motivated voters, apathy or acquiescence on the part of others effectively makes for a win for the political right. I have written before about how student evaluations and grade inflation are manifestations of running colleges like a business—a pernicious neoliberal phenomenon that elevates administrators, prioritizes flashy dorms and athletics departments at the expense of actual learning, devalues the labor and artistry of teaching, and treats students like customers. Indeed, it is a quintessentially libertarian philosophy for students to think of themselves as consumers who choose (again, choice!) the best professor with the greatest value (i.e. the softest grader with the least amount of work). Most students, professors, and parents object to the alarming rates of student loan debt, which now exceeds credit card debt, and yet few see how this is very much a part of the same customer-based model that they seem to admire.
My own experience with economic history in the antebellum era provides anecdotal confirmation of what we already know about most libertarians: of the 5-10 libertarians I know in this subfield, all are white men. I’ve held back on posting this for a long time, partly because I’m no big shot and partly because many of the libertarians I’m thinking of have been personally nice to me. I’ve thanked some of them in the acknowledgments of my book and note that they have helped me understand some economic concepts. Upon further reflection, however, I realized that being a nice guy is not a valid excuse for pushing terrible policies that harm others. We should be stressing policy in our discussion of politics, not personality. Judge Kavanaugh, by many accounts, is a “nice guy” but we know exactly how he’d rule on most legal issues. A crucial selling point in George W. Bush’s campaigns was that he was the guy you wanted to have a beer with, as opposed to the reputedly effete John Kerry. Tell that to the hundreds of thousands of Iraqis displaced by an unnecessary invasion that Kerry would almost certainly have not authorized. Tell that to the victims of Hurricane Katrina. One libertarian historian I know is a descendant of slave-owning Louisiana Whigs and is on record calling Lincoln the worst president in US history. One can talk at length about Lincoln’s war powers and denial of civil liberties but putting two and two together, it’s not hard to see that what this man is really enraged about was that Lincoln brought about a war that destroyed his family’s ill-gotten wealth.
As for why there are so many libertarians in economic history, I have asked a number of other academics and have never received a satisfying answer. I can only think that it relates to the large number of libertarians in economics and business departments; a nostalgia for a time when the United States was on the gold standard, had little national debt, and lacked a modern welfare state; and a phenomenon, peculiar to academia in the United States and perhaps an unfortunate if unintended consequence of the “cultural turn” of the 1980s, that sorts more quantitative and empirically-minded academics in one camp while those interested in more theoretical topics such as race and gender fall into another camp (this division is not a rigid one and might be breaking down). I only offer this as a tentative and imperfect dichotomy since libertarians are often deeply skeptical of econometrics and excessive jargon in the economics profession—something that I happen to share with them.
Recent reporting based on a FOIA request by the group called “UnKoch My Campus” has brought to light a major scandal and conflict of interest at the libertarian Mercatus Center located at George Mason University. The university gave the Kochs a say over hiring and firing in exchange for generous donations. The same conservative infrastructure that has done so much damage to the environment and the discourse on human-caused climate change has elevated scholars with a minority viewpoint who, I’d bet, would not have normally succeeded based on their own intellectual merits. They received outside help. In unison they’ve carefully crafted their talking points on the work of Duke historian Nancy MacLean. By managing to point out some interpretative and factual errors in MacLean’s otherwise penetrating book, Democracy in Chains, the Koch minions have tried their best to insinuate that by implication, all of MacLean’s work must be faulty and everything else presented in these posts must similarly be suspect.
Then there are pseudo-scholarly organizations that operate on the margins of academia but still manage to attract unsuspecting readers. I’ll never forget teaching an upper division class on the Jacksonian period several years ago when one student kept bringing up “DiLorenzo” a bunch of times and I was like, who the heck is this guy and why have I never heard of him? It turns out DiLorenzo is a senior fellow at the Ludwig Von Mises Institute (LVMI). He’s a Lincoln iconoclast who has conflated Nazism and socialism, an interpretation so absurd and so thoroughly debunked by academic historians that it need not merit a reply here. Ex-convict, poser, con man, and wannabe historian Dinesh D’Souza recapitulated this garbage only to be destroyed and humiliated by professional historians. The LVMI hosts 20 senior fellows and 0 are women. Of the 89, associated scholars, only 7 are women. Now take a look at the gender ratio of the LVMI’s staff to see that women serve in subservient positions in larger numbers. Based on profile pics, which is admittedly tricky and imprecise, very few senior fellows and associated scholars are people of color and none, as far as I can tell, are African American. No respectable organization would tolerate this kind of racial, gendered, and power imbalance. Many academic conferences in the discipline of history now refuse to accept all white male panels. In 2018, we have a good ole boys club and sausage fest in Auburn, Alabama trying to tell the rest of us about the nuances of liberty.
According to the Southern Poverty Law Center, the LVMI, a think tank located in Auburn, Alabama, espouses “a radical libertarian view of government and economics inspired by the Austrian economist Ludwig von Mises, whom the institute says ‘showed that government intervention is always destructive.’” What a simplistic statement! Indeed, the institute, which publishes material that is not subject to independent, blind peer review, aims to “undermine statism in all its forms,” and its recent interest in neo-Confederate themes reflects that. One of the LVMI’s senior fellows, Walter Block, once stated that slavery “was not so bad – you pick cotton and sing songs.” Block also argued that white business owners had the right to exclude black customers at Woolworth’s because no one should be forced to associate with people against their will. In a libel lawsuit against the New York Times that a judge dismissed, 17 of Block’s fellow faculty members at Loyola University New Orleans wrote a joint letter calling on the university to “take the long overdue and necessary steps to condemn and censure Professor Block for his recurring public assaults on the values of Loyola University, its mission and the civil rights of all.”
LVMI founder Lew Rockwell argued that the Civil War “transformed the American regime from a federalist system based on freedom to a centralized state that circumscribed liberty in the name of public order.” Desegregation in the civil rights era, he said, resulted in the “involuntary servitude” of (presumably white) business owners. In the past, Rockwell has praised the electoral success of European neofascists like Joerg Haider in Austria and Christoph Blocher in Switzerland. Both Rockwell and institute research director Jeffrey Tucker are listed on the racist League of the South's Web page as founding members — and both men deny their membership. Tucker has written for League publications, and many League members have taught at the institute's seminars and given presentations at its conferences. Rockwell, who is also vice president of the Center for Libertarian Studies, runs his own daily news Web site that often features articles by League members. From 1978 to 1982, Rockwell was Ron Paul’s congressional chief of staff. He later wrote anonymously for the Texas libertarian’s newsletters, which sympathized with the militia movement and peddled a lot of bigotry against blacks, gays, and Jews. The newsletter referred to African Americans as “animals” in at least one instance and lamented the fall of apartheid South Africa as “destruction of civilization.”
Whatever the merits of limited government, individualism, and free market economics, those who promote these views have made common cause with a lot of truly awful people. What does it say about the neoclassical worldview if it appeals to neo-Confederates, neo-Nazis, militiamen, Troglodytes, and lunatics? I write this while experiencing the daily horror that is the Trump administration.* Beyond the small number of libertarians who have voted for Democrats, most have stood idly by as an illegitimate president has broken virtually all norms. Their criticisms are hollow based on their actions. However much they may protest the debts run up under recent Republican presidents, libertarians are ultimately complicit for the manner in which Republicans have subverted and usurped democracy.
I’d like to see more libertarians become vocal in calling for the removal of Florida’s felon disfranchisement law that permanently bars nearly 1.5 million Floridians from voting. A high percentage of these felons are African Americans. A state that permanently disfranchises voters for felonies is an oppressive state if I’ve ever seen one; the kind of state that libertarians should condemn. To be fair, there are probably some libertarians who do recognize this as an affront to individual liberty and a textbook case of the New Jim Crow. But far too many are silent. Libertarians know how African Americans vote. They don't vote for libertarians. Indeed, more African Americans voting would threaten to upset the hierarchy led by white male property owners that libertarians seek to protect. Their preference for property over voting rights is a major contradiction in a movement founded on "liberty."
If you are a libertarian academic, I have a number of questions for you. I’ve shown you throughout this blog series how a good many people out there who also identify as libertarian hate central banks, support the gold standard, sided with rapacious tobacco companies against the imperatives of public health, propagated climate denialism, vouched for financial deregulation and low taxes, opposed civil rights protections for women and minorities, rejected the minimum wage, sought to overturn collective bargaining, minimized the importance of slavery in explaining the Civil War, benefited from Koch donations, conceptualized taxes as theft and coercion, backed voter suppression, and expressed sympathy for white nationalism. Are these your positions? If not, how many of them do you reject? If you reject most of them, are you really, then, a libertarian?
I’m not sure why I should ever debate you or take you seriously if you share the same ideology as that of the types of people I have described in these posts. Sure, there are some sophisticated libertarians out there. But why would they use the term given its association with racist cranks, cooks, and clowns? Do they not realize that attaching oneself to libertarian ideology would be immediately met with scorn and ridicule? Either the respectable, scholarly libertarians out there should cease associating themselves with this hateful ideology or, if they choose to retain the label, they should fully accept the likely outcome that a large number of academics may ostracize them. Libertarianism does stress personal responsibility, does it not?
Libertarians have a pretty terrible record on race. I have already mentioned that in the context of US history, about 80-90% of the time, calls for limited government, low taxes, and deregulation are inextricably linked to—and often function as thin disguises for—racial animus. Certainly this does not mean that racists advocated for limited government in every circumstance (hence the 80-90% figure). Early-19th century US historians can point to the Fugitive Slave Acts, Gag Rule, the abolitionist mail controversy of 1835, books by Donald Fehrenbacher and David Ericson, the three-fifths clause, a recent publication by Matthew Carp on the use of the army and navy to extend slave-based imperialism, the work of John Majewski on Confederate nationalism during the Civil War, and other examples, to show that there were plenty of times in which southerners supported an active federal government if it protected slavery. Nor am I saying that an active federal government is always good merely because racists consistently opposed it. Indeed, as I have already claimed, spying, torture, mass incarceration, penalties for drug consumption, crony capitalism, and military expansion are some of the chief examples in which I share the libertarian position, even if the philosophical assumptions that undergird these positions differ.
Nonetheless, if I am permitted to draw a rather sweeping generalization based on patterns I have detected in teaching both halves of the US survey course, there are a few reasons why the racism—limited government connection makes sense. It was because of the federal government, personified in the Union army, that slavery came to an end and much of the South’s planter class lost the wealth it had accumulated from decades and even centuries of forced labor. It was because the federal government, by enacting social security and recognizing collective bargaining rights during the New Deal, that the stranglehold of Big Business over government was temporarily broken. It was because of the federal government, through Brown v. Board, the Civil Rights Act of 1964, and the Voting Rights Act of 1965, that African Americans and other protected classes won access to equal accommodations in public facilities and the right to vote. The same holds true for environmental and women’s rights. These victories need not be construed as a zero-sum game (how are they not a victory for everyone?), but if one sympathizes with those who may have lost out in these victories—the planter class, authoritarians, custodians of tradition, and men of Big Business—then it would make sense why you would be attracted to an ideology that stressed limited government and states’ rights. If I had to guess, a good many of today’s libertarians are white southerners who have some emotional connection, through a direct DNA lineage or otherwise, with the Confederacy. The connections between libertarian ideology and racism are numerous and warrant further investigation with specific examples. This list is by no means exhaustive:
Cliven Bundy. This guy is a real piece of work. A rising star-turned-martyr among Tea Partiers, truck drivers, gun owners, Klansmen, and militiamen, Bundy is the epitome of your stereotypical older white man who feels personally aggrieved by the federal government and yet spends quite a bit of time talking about “the Negro.” His specific beliefs about the power of the federal government and respect for local sheriffs are so asinine and juvenile that they do not merit any extensive expatiation here. Just watch this extremely racist video. This madman actually wondered out loud whether African Americans would be better off picking cotton, as they did under slavery, than receiving welfare. Given how much I’ve read about slavery in the Old South, it pains me deeply to even write that. And then ask yourself whether it is common or uncommon to see so many who wave the Gadsden flag rallying to his side.
The Tea Party: In 2013, according to one survey, nearly 40% of libertarians identified as part of the Tea Party movement. Ostensibly a “grassroots” phenomenon that received generous funding from SuperPACs like Freedom Works and wide amplification from conservative media that just so happened to coincide with the ascent of the nation’s first African American president, the Tea Party is a prime example of politicized (and inaccurate) historical interpretation. They claim to be concerned mostly about taxes (hence the acronym Taxed Enough Already), the national debt, and bank bailouts, just as the Founding Fathers presumably wanted liberty in the form of low taxes. Since admiration of American history—or at least a certain type of romanticized American history—is intrinsic to the Tea Party movement, we should emphasize that contemporaries of this famous 1773 event which eventually became known as the “Tea Party” actually called it “the destruction of the tea” at the time. The term “Tea Party” came from the writings of a shoemaker, George Robert Twelves Hewes, who experienced the original dumping of large quantities of tea into Boston harbor firsthand but did not apply the term “Tea Party” until he wrote about his experience in the 1830s, about sixty years after the fact.
Tea Partiers should also be aware that the American Revolution, as scholars like Gary Nash have written, was more than just a tax revolt. It was also an opportunity to reorganize society and a multi-sided civil war that upended, and threatened to upend, multiple forms of hierarchy. Those who have looked into the Tea Party, beyond the surface-level slogans about freedom and liberty, have found that its followers seem to be much more concerned about racialized issues like immigration and Obama’s birth certificate than their professed concern about taxes. Christopher Parker and Theda Skocpol have produced valuable studies on this topic. And let’s not forget that the current president*, whose rise can be viewed as a direct consequence of Tea Party racism and anti-intellectualism, and whose legitimate claim to occupy the White House is increasingly called into question with each passing day, attained much of his political fame through birtherism. In one peer reviewed study by Eric D. Knowles et al., the authors concluded, “Broadly, the data support claims that the Tea Party is—for some White supporters, at least—a racially motivated movement. Anti-Black sentiment was associated with Tea Party identification across time points. This relationship, however, appeared to be masked by assertions of national decline and the embrace of libertarian ideology.” The authors add: “White identification appears to be a product of immersion in the [Tea Party] movement.”
Share this insight with a Tea Partier and you’ll most likely get an apoplectic conniption. Few accusations elicit more anger from Tea Partiers than the charge of racism. Yet when you ask Tea Partiers themselves what issues and policies they are most concerned about, time and time again the responses show much more preoccupation with racial issues than raw economic ones. And consider that the chief symbol of the Tea Party, the Gadsden flag, has been historically connected with white supremacy. It still is today. How can one not come away with this conclusion when looking at political protests where the Confederate, Nazi, and Gadsden flags are flown simultaneously? At the center of a famous lithograph by R.H. Howell, based on a drawing by Henry Cleenewerck, is the mantra: “OUR MOTTO: Southern Rights, Equality of the States, Don’t Tread on Me.” Cleenewerck witnessed a public demonstration in Savannah, Georgia, after Lincoln’s election in 1860. The demonstrators burned Lincoln in effigy. The men attending this demonstration were committing treason in the form of secession so that they could protect the $3 billion in slave property from a president who pledged to protect slave property in the South. Notice that the snake featured in this lithograph is very similar to the snake portrayed in the Gadsden flag. And both the anti-Lincoln demonstration of 1860 and today’s Tea Party movement use the phrase “Don’t Tread on Me.”
The Alt-Right: This article explores how many members of the fascist-leaning, white nationalist alt-right, including Richard Spencer and Gavin McInnes, got their start in libertarianism. David Neiwert, a journalist who has written extensively on the radical right and various hate groups, expanded upon these links in a recent Twitter thread. Many self-described libertarians, according to Neiwert, are actually just right-wing authoritarians. A shockingly large number of libertarians have absolutely rolled over for Donald Trump, who is easily the most authoritarian leader in the history of the US presidency. Neiwert tweeted, “Recall that alt-right founder Richard Spencer started out dabbling in libertarianism. Many other alt-righters claim it in describing their origins: Milo Yiannopoulos. Tim “Baked Alaska” Gionet. Augustus Invictus. “Crying Nazi” Christopher Cantwell….Proud Boys founder Gavin McInnes still describes himself as libertarian. To this day, large numbers of Proud Boys I’ve spoken with describe themselves as libertarian. So do many of the “III Percent” and Oath Keeper militiamen I’ve interviewed.” Spencer lives in Whitefish, Montana, a region of the country where the “don’t tread on me” slogan and white nationalism are popular (think of the neo-Nazis and Aryan Nation types in Couer d’Alene, Idaho). If so many libertarians are more than willing to give up their supposed reverence for individual liberties in the support of authoritarians, we have to look beyond individual liberties to see what animates libertarians. Racism is a strong candidate.
Holocaust Denialism: Journalist Mark Ames spent many hours searching for the February 1976 issue of Reason Magazine. It took him a long time to track it down, he suspected, because the current editors of Reason were understandably ashamed of what that particular issue showcased: a hotbed of Holocaust denialism pitched as “historical revisionism.” Reason has now made the issue available, but Ames’s discoveries were notable for showing how Ron Paul, the Koch Brothers, Murray Rothbard, and Holocaust deniers were linked in an incestuous web of wealth, power, and bigotry. Check out the whole issue in hard copy and one will find “Buy Gold!” advertisements. One gets the sense that an elaborate conspiracy involving the Rothschilds is only a page or click away. The gold standard is discreditable enough on its own given the historical evidence, but its embrace by racist cranks doesn’t help. The pages of Reason add to a substantial body evidence showing that while not every libertarian is a racist, their ideology clearly appeals to racists; and indeed, libertarian polices would not be nearly as popular as they are without the presence of such a large number of racists in American society—something Trump’s election made clear.
The Demographic Makeup of Libertarians: Related to this, a number of observers and the study linked above have pointed out that libertarians are disproportionately white men. Of these, I have noticed quite a few believe in conspiracy theories. According to the study, 7 percent of Americans identify as libertarian (though a 2014 Pew Research Center survey brought the number to 11 percent). Of those, two-thirds are men (68 percent) and nearly all are non-Hispanic whites (94 percent). Why is this the case? Cathy Young, a libertarian journalist interviewed in a New Republic article by Jeet Heer suspected that “for a variety of reasons (whether innately psychological, culturally driven, or shaped by life experience), women are less likely to be drawn to political philosophies that emphasize self-reliance and risk. Women are also more likely to rely on government services, both as clients and as employees.” Historically, women like Jane Addams and Eleanor Roosevelt were key to building the U.S. welfare state that libertarians abhor. And libertarianism is generally hostile to the types of collective efforts that challenge sexism, including anti-discrimination laws, affirmative action, and paid leave. I cannot help but think this is related to the current gender gap in today’s politics: women favor Democrats over Republicans by significant margins.
One editor at Reason, Jesse Walker, agreed that the libertarian gender gap is real, arguing that for “various historically contingent sociological reasons, the American libertarian movement has drawn a lot on subcultures that are heavily male (computer programmers, for example), and that in turn had something of a self-perpetuating effect.” Aside from computer programming, libertarianism overlaps with other male-dominated subcultures such as science-fiction fandom, the gaming community, Men’s Rights Activists, and organized humanism/atheism.” A more direct and cutting analysis came from journalist Kevin Drum at Mother Jones. Hardcore libertarianism, he opined, is a fantasy where the strongest and most self-reliant folks end up at the top of the heap, and a fair number of men share the fantasy that they are these folks. They believe they’ve been held back by rules and regulations designed to help the weak, and in a libertarian culture their talents would be obvious and they’d naturally rise to positions of power and influence.
In the first post of this series I discussed libertarians’ philosophical assumptions. Now it’s time to explore their preferred policies. If libertarians argued in good faith, we would expect them to arrive at their policies by carefully following the logic of their assumptions. More often than not, it seems, the opposite is true: they start with their preferred policy outcome and then seek ways to rationalize it. I might normally be inclined to give libertarians the benefit of the doubt in saying that a lot, if not most, people operate this way. The problem is that they often make a bit fuss about demonstrating their hyper-rational argumentation, which makes it all the more necessary to point out the farce that their carefully constructed arguments just so happen to almost exclusively reward the propertied white men who are the bankrollers and vanguard of libertarianism. In other words, if you claim to stress principles over outcomes, and yet your principles consistently result in terrible outcomes, you might want to reexamine your principles!
As I did in the last post, let me start off by outlining the positions I share with libertarians. I agree that the war on drugs has been wasteful of taxpayer dollars and extremely destructive to communities of color. We have created a moral hazard whereby our prisons are run like businesses—the more people we incarcerate, the more some companies profit. We should dismantle the New Jim Crow, whether it is mass incarceration or Voter ID laws. Like libertarians (at least the honest ones), I think we should break up the big monopolies, whether they be Sinclair media, Wall Street investment firms, or telecommunications companies. I give credit to libertarians for wanting to deconstruct America’s empire and for refusing to back down in their denunciations of torture, spying, and the disastrous wars in Iraq and Afghanistan.
Although I share these positions with libertarians, it is worth underscoring that we arrived at these conclusions based on different assumptions. It is all fine and dandy that libertarians abhor imperialism, but many have adopted this position primarily because they’re deficit hawks. For me there are much better reasons to resist imperialism. I tend to dislike Dow Chemical and Monsanto profiting from the release of chemicals during the Vietnam War that caused numerous health problems for both Americans and Vietnamese. I tend to dislike the numerous foreign interventions the US conducted in Latin America, especially when they overthrew democratically elected regimes (Guatemala in the 1950s or Chile in the 1970s) in order to support American-based corporations like Dole Fruit Company. I tend to dislike unnecessary wars like Iraq that are based on false pretenses and outright lies connecting Saddam Hussein to Osama bin Laden and weapons of mass destruction. What are the other flawed positions that libertarians commonly hold?
Gold Buggism: Have you come across someone on Fox News or Fox Business who is shilling for you to buy gold or reverse mortgages? Chances are, you’re talking to a libertarian snake oil salesman. I’ve written before how the gold standard was one of the major causes of the Great Depression; how it was a rigid and inflexible system; how industrial production began to recover the moment the US and other advanced countries abandoned the gold standard; how prices, growth, and employment are more, not less, stable under fiat currencies managed by central banks; how a poll of 40 of the nation’s top economists showed that none of them advocated a return to the standard; how the gold standard combined with bad policy to spread crippling deflation, etc. And yet the ideal still persists. Old ideas die hard. It persists in large part because of libertarians. Even Milton Friedman, the darling of the right, criticized the gold standard. Keynes called it a “barbarous relic.” If you’re looking for scholarly treatment on this subject, I recommend Barry Eichengreen, Randall Parker, Peter Temin, and Ken Mouré as authorities.
Supply Side economic theory: It is revealing how often appeals to “balance,” “objectivity” and presenting “both sides” can be whittled down to thinly veiled demands that experts present a widely discredited theory as a legitimate perspective in media or in the academy. Most appeals to “both sides” emanate from political conservatives or libertarians who insist on having their simplistic, fantastical theories aired aloud without any scrutiny or criticism. When I explain the characteristics of supply side theory—that it attempts to encourage investment by curbing labor unions, reducing taxes for upper income earners, cutting regulations, and privatizing public goods—I quickly move on to whether it has worked in the way that its adherents have promised. These are things we can measure. The results are in: supply side economics is not an effective way to promote growth, higher standards of living, lower prices, and a reduction in unemployment. The Fox News crowd will whine that any professor who points this out is brainwashing students into accepting radical socialism by actually engaging in analysis and interpretation without assuming that facts can speak for themselves. Yet applying libertarians’ own standard of Enlightenment-based empiricism to test the efficacy of supply side economics is by no means a radical interpretation! It’d be an egregious dereliction of duty as a professor if I did NOT point this out.
Ronald Reagan may not have taken the libertarian position on every issue, but for all intents and purposes, we have been operating under the supply side framework since the early-80s, even with two Democratic presidents, who were quite moderate on most issues of political economy. Raising tax rates for upper income earners from 35 to 39.9% is hardly socialist or radical as Republicans would have you believe and let us not forget that Bill Clinton cut welfare, signed NAFTA, and deregulated banks with the repeal of Glass-Steagall.
We have enough evidence to show that the implementation of supply side economics has been ineffectual at best and counterproductive at worst. Remember, it was because of deregulation that a lot of investors could not distinguish between the toxic and healthy parts of Collateralized Debt Obligations, which introduced more (not less) uncertainty to an already panicky environment. Noted libertarian, Ayn Rand acolyte, and former FED chair Alan Greenspan severely underestimated the extent of the damage that befell global markets in 2008. A libertarian today might fault deregulation for contributing to monopolization since this necessarily interferes with equal opportunity for business owners and limits consumer choices. But what is the appropriate solution? It lies in the rigorous enforcement of antitrust legislation. Herein lies a contradiction in libertarian thinking. For what else is breaking up monopolies but an interference in the free market that libertarians champion?
On the question of economic performance, supply siders can’t really say much. Growth was higher under the post-WWII, Keynesian paradigm when taxes were higher, labor unions were more powerful, and regulations effectively constrained CEO pay, money in politics, and financial malfeasance. There is no discernible relationship between cutting taxes and employment. To demonstrate this, all you have to do is show a graph of tax rates during the same years as the unemployment rate. Tax rates for upper income earners have followed a downward trajectory, more or less, since JFK's tax cut in the 1960s, but unemployment follows a much shorter cycle.
What cutting taxes does contribute to is greater income inequality and higher deficits, which Republicans use as an excuse to obstruct every Democratic program that requires money, all the while benefiting from an apathetic public that ignores that Republicans were the ones who created the deficits in the first place! Besides, growth itself should not be the end-all-be-all of how we manage an economy. This is twentieth-century thinking. We should also consider factors like peoples’ well-being, sustainability, resource extraction, etc.
Wildly inaccurate predictions about the state of the economy: It’s very difficult to accurately predict the stock market, but libertarians have been particularly ineffective prognosticators. That these hucksters continue to retain their positions of power in media and government suggests that they must be comfortably aligned with business interests for their power cannot possibly rest on any intellectual credibility. Larry Kudlow, Rick Santelli, Arthur Laffer, Bill Fleckenstein at Prudent Bear, all made predictions that were repeatedly off the mark. A lot of this stems from the fact that they have a poor understanding of economics. And they obsess over the wrong things. They fixate on the value of the dollar all the while ignoring employment (sometimes you need to devalue your currency to restore jobs as the 1930s showed). This relates to their anti-intellectual fealty to the Gold Standard. As the economist JW Mason once tweeted after attending an academic conference, rich people may hate inflation more than socialism. For a brief interval around the 2008 financial crisis, I was in contact with a libertarian who had also written about my research topic. Periodically he would send me links from Prudent Bear, all predicting the imminent collapse of the US dollar (this was post 2009, when we were already recovering). He claimed the FED was “papering over” the toxic assets that had contributed to the collapse of Lehman. What a load of crap it was. Since fiscal policy was not up to the task, the FED’s purchase of $4.48 trillion in government assets, while not perfect, was probably one of the wisest things we could have done to ensure a recovery. If the reputation of Marxists was that they accurately predicted 8 out of the last 5 recessions, the same can be said of libertarians. But the whole “printing money” obsession has got to go. A weak dollar has benefits for sectors like tourism and an inflationary economy helps debtors—take a look at the student loan crisis, which exceeds total credit card debt among Americans, and you can see why an inflationary target of 4% makes much more sense than 2%. And yes, “printing money” during a recession actually works. It may be counterintuitive but a lot of concepts in economics are like that. A worldview that is so consistently wrong in its predictive capacity should be cast aside as irreparably faulty. And the moment you point out that some nut job like Fleckenstein or Santelli makes a wildly irresponsible prediction, a respectable libertarian will reply, “well, he’s not really a libertarian.” To which I respond, wow, there sure are a lot of fake libertarians out there!
Immigration: This topic deserves much more consideration than I am able to give it here. But libertarian economist Dave Brat running on an anti-immigrant platform that successfully primaried Eric Cantor? Gimme a break. If libertarians clearly stand for eliminating barriers to trade for the benefit of the vaunted consumer who can make rational choices, they would immediately recognize that this involves not just the free exchange of goods across borders, but laborers, too.
Civil Rights: Former Chief Justice William Rehnquist believed that Plessy v. Ferguson, an infamous Supreme Court decision that condoned segregation during the Jim Crow era, was decided correctly. The implication was that Brown v. Board, which overturned Plessy, was not settled law. Ask a libertarian which side they’d take when African American college students organized sit-ins at Greensboro, North Carolina in 1960, demanding equal access and equal accommodation at Woolworth’s lunch counter. I’ll give you a hint…their ideological sympathies do not lie with the students. They’d rather support the racist business owners because any attempt to regulate their business, no matter how righteous, how imperative, how majoritarian, is ultimately an infringement on their “liberty.” I wonder if the African American students at Woolworth’s would be satisfied with the facile, glib rejoinder that they had the “liberty” to seek out another business that would serve them.
Ask a libertarian how they feel about the Civil Rights Act of 1964. They might reply with Barry Goldwater’s famous phrase, “Extremism in the defense of liberty is no vice!” I know, how dare we use the power of the federal government to demand that private businesses, which cannot be separated from the public dollars that support the police departments that protect them and the roads that enable access to them, provide equal accommodations without discrimination! As I like to say, 80-90% of the time in US history, when a person advocates limited government, they are really expressing racial anxieties. This was certainly the case with white southerners in the antebellum era who opposed federal support for internal improvements. They were really concerned about a northern president who might one day use broad constitutional to wipe out their “peculiar institution.” If history doesn’t repeat but rhymes, we might say that white southerners sang a similar tune one hundred years later when they opposed FDR’s New Deal, or when they signed the Southern Manifesto and found Richard Nixon’s southern strategy of “states’ rights,” “law and order” and “tough on crime” as more respectable ways of saying that they wished to impeach Earl Warren or enshrine segregation.
Labor Rights: Ask a libertarian how they feel about Lochner v. New York (1905). Some might follow Justices Roberts and Scalia in viewing this decision as judicial overreach and a problematic assertion of a court providing extra (substantive) protection of property rights in the form of contracts, beyond what the Constitution already stated. But others would find in Lochner a desirable outcome for it protected a small business against regulation. Lochner was the infamous 5-4 Supreme Court case that struck down as unconstitutional legislation from New York mandating maximum work hours for bakeries. It put forth the dubious theory of “liberty of contract” whereby workers who were dissatisfied with a contract offered by one employer had the “liberty” to walk down the street and seek out a better contract with another employer.
This theory seems plausible on the surface but immediately breaks down under the slightest bit of critical thinking. There is a reason that Lochner, like Plessy, has a pejorative connotation. An employer offering $11/hour would not differ greatly from the same business down the street offering $11.50. It is surprising that an intellectual movement founded upon praising open competition would miss this reality about competitive businesses. In addition, many industrial workers in the Lochner era were immigrants, many of them from Asia, Mexico, and southern and eastern Europe, who often did not speak or write English very well, and thus would have easily lent their names to exploitative contracts. These contracts were sacrosanct according to advocates of “substantive due process,” which meant that they superseded the regulations passed by democratically elected state legislatures (hence the libertarian propensity to favor property over democracy). Liberty of contract was a fictitious right; one concocted by union-busing business owners. Industrial workers were not asking for this right and in any case, it would have been very unlikely to result in a better contract. What they were asking for was what labor organizer John Mitchell called “industrial liberty.” Freedom for Mitchell meant more than merely choosing the field of one’s employment. True liberty came from workers’ wages, the ability to care for their family if any of them got sick, and the ability to educate one’s children. No amount of “choice” could grant this. This is why labor historians refer to liberty of contract as the liberty to work under a bridge. Do you really want the liberty to work a 16-hour day? Though it reached its decision by contorting the First Amendment rather than the Fourteenth Amendment, the Roberts Court, in the recent Janus case, has confirmed that it stands by the anti-unionism of the Lochner Era.
Robert Kuttner, in an article written for the American Prospect, persuasively argued that the libertarian worldview ignores the ways in which governments can create more freedom. For all their complex theorizing about freedom, libertarians overlook the instances in which:
A young person from a poor family who does not need to incur crippling debt to attend university is a freer person. A low-income mother who cannot afford to pay the doctor attains a new degree of freedom when she and her children are covered by Medicaid. A worker who might be compelled to choose between his job and his physical safety becomes freer if government health and safety regulations are enforced. The employee of a big-box store who can take paid family leave when a child gets sick is freer than one whose entire life is at the whim of the boss; likewise a worker with a union contract that provides protection from arbitrary dismissal or theft of wages. An elderly person saved from destitution by a government-organized Social Security pension has a lot more liberty than one bagging groceries at age 80 to make ends meet, or one choosing between supper and filling a prescription.
Public Safety and Public Health: Because libertarians harbor a reflexive antipathy to the Progressive Era and the German welfare state model, they have absolutely nothing of substance to offer on questions of public health and public safety. My guess is that most libertarians despise trial lawyers, arguing that their presumably frivolous lawsuits ultimately damage the consumer in the form of higher prices. Yet without trial lawyers, we would have never discovered that Du Pont manufactured and distributed Teflon products that contained the highly toxic and carcinogenic chemical known as C8, despite knowing about C8’s danger. Du Pont was one of the “merchants of death” exposed by the Nye Committee Report, which brought to light some of the weapons manufacturers and other firms that stood to benefit from US entry into WWI.
Climate Denialism: Even worse than having nothing substantive to offer, libertarians have deliberately manufactured doubt and uncertainty about the harmful consequences of human-caused climate change. Bromides about technology and innovation won’t save us, especially if they don’t involve any serious examination of our lifestyle. This topic deserves its own post since I regard human-caused climate change as perhaps the most important issue of our time. Suffice to say that one of the best accounts of the history of denialism was written by Naomi Oreskes and Erik Conway in Merchants of Doubt. The two authors show that conservative and libertarian think tanks like the Cato Institute and American Enterprise Institute, reinforced by the op-ed pages of the Wall Street Journal, recapitulated the arguments of tobacco companies when it came to climate denialism. Here’s an idiotic, anti-learning, anti-intellectual, and anti-knowledge article written by the neo-Confederate Ludwig Von Mises Institute (LVMI) on the topic of climate change. Reason Magazine, an organ managed by the Reason Foundation, which lists oil and chemical magnate, David Koch, as one of its trustees and officers, promulgated the denialism of James Delingpole. It did not matter that five different independent investigations came to the conclusion that climate scientists at the University of East Anglia did not manipulate data as Delingpole alleged. Generously funded by nearly unlimited dollars from fossil fuel companies and a well lubricated and interconnected web of right-wing think tanks and media outlets, the denialist movement exacted considerable damage. The so-called “Climategate” scandal led to a precipitous drop in Americans’ beliefs about the scientific consensus of human-caused climate change. Libertarians, for all their concern about freedom and opportunity, never seem to consider that future generations may also want the same freedoms and opportunities that can only be achieved by a more long-term, sustainable capitalism. Funny how the short-term profits of the Koch Brothers trump any concern for the future of humanity.
Support for Authoritarian Regimes like Pincohet and Apartheid South Africa: Many of the “The Chicago Boys,” a group of Latin American economists educated at the University of Chicago under the tutelage of Milton Friedman, worked under the Chilean dictatorship of Augusto Pinochet. On September 11, 1973 (notice the date), the American CIA backed the coup d’etat that installed Chilean dictator Augusto Pinochet, replacing leftist Salvador Allende, who was democratically elected. Pinochet’s authoritarian regime went on to torture tens of thousands of prisoners, drove an estimated 200,000 Chileans into exile, and executed some 3,000 victims in what has been described as a “political genocide.” For libertarians to have supported such a brutal dictatorship makes for a MAJOR contradiction since libertarians are supposed to stand for individual liberty! That libertarians supported Pinochet’s Chile and Apartheid South Africa provides compelling evidence that subservience to American corporations and business interests overruled any philosophical concerns about an individual’s right to be free from coercion and tyranny.
It’s election season again. Most people have made up their minds about which candidate or political party they will support in November. Persuasion seems rare nowadays in the age of ossified tribalism and “alternative facts.” But I wouldn’t be an educator if I didn’t believe that persuasion was still possible. Many an 18-year-old, novice to the realm of political conversations and higher order analysis, have fallen under the spell of libertarianism. Late-night or early-morning dorm-room conversations, inspired by bong hits, frequently meander toward the types of policies and ideas that would entail the minimum amount of hassle and governmental interference in their lives (assuming one can stay on topic long enough to discuss politics before moving on to pop tarts or video games). An ideology that promises to end the prosecution of victimless crimes like recreational drug use and prostitution all the while outlawing crony capitalism, torture, spying, and endless wars in the Middle East makes for an appealing worldview to some.
For this first of four blog posts, I will lay out what I regard as some of the most essential philosophical assumptions and precepts that most libertarians hold. I would submit that most college students, once they became aware of all of the implications of libertarianism—especially who benefits and loses under libertarian policies—would find the ideology distasteful and immoral. They need to look at the entirety of the ideology and the historical context in which libertarianism came to be, beyond just a superficial understanding of who withholds judgment on bong hits and acid trips.
Libertarianism is as much a philosophy as it is a political and economic movement. It is often used interchangeably with the term classical liberalism to denote its divergence from modern liberalism on the use of state powers to promote economic security and social justice (outside the US the word liberal usually means limited government). While conservatives and libertarians differ on a handful of key issues, they share most of the same policy goals. This is why noted libertarian and Kentucky senator Rand Paul campaigns and caucuses as a member of the GOP and why the constituencies and demographic makeup of the Republican Party and Libertarian Party are similar.
Centrists, liberals, progressives, leftists, and Marxists have argued for decades that libertarianism is simplistic and flawed, and yet whenever they point to the innumerable examples of disreputable figures who self-identify as libertarians, so-called respectable libertarians will point out that these types, in fact, are not true libertarians. So to stave off any accusation that I am lumping together disparate thinkers into one amorphous group, I will note that within the umbrella of libertarianism there is significant diversity of thought. There are paleolibertarians, anarcho-capitalists, former Republicans, etc. In no particular order, here are the chief characteristics libertarianism:
* the individual (as opposed to the village, nation, or region) is the primary organizational unit and bedrock of society
* To achieve prosperity and happiness, government should promote the maximum amount of individual liberty
* liberty is most often defined as an individual’s right to property, free from government interference
* principles, not outcomes, should determine how one wrestles with a particular issue
* Inequality—whether social, political, or economic—is natural. It follows that any attempt to redress inequality, however well intentioned, causes more harm than good
* Markets operate best and most efficiently when they are “free”; that is, unencumbered by taxes, tariffs, subsidies, monopolies, and regulations.
* Choice in the marketplace is an inherent virtue. Growth and prosperity proliferate under free markets because most humans make rational decisions when faced with meaningful choices.
* freedom of association is critical. A government that makes individuals interact with one another to avoid discrimination is coercive
* The only type of relevant discrimination is one that comes from the state, not from other individuals
The libertarian emphasis on choice is vulnerable to a number of criticisms. Conservatives and libertarians castigated the Affordable Care Act (aka Obamacare) for presumably constraining Americans’ opportunity to choose their preferred insurance policy and doctor (or even the “freedom” to have no insurance policy at all). Let’s leave aside the overall assessment that the main flaw in the ACA was that it did not go far enough: there was no public option, it preserved the for-profit model of health coverage based on rapacious and health insurance companies, Republican politicians did everything within their power to obstruct, tie up in court, or deliberately refuse to implement key components of the law, and a radically conservative, pro-business Supreme Court scuttled key provisions of the law by giving states the choice to opt out of Medicare expansion. The errant assumption on the part of libertarians is that choice, rather than regulation, will bring down insurance premiums or prescription drug prices. The last thing senior citizens want to do is spend hours and hours shuffling through the endless piles of virtual paperwork, looking for the best deal on an insurance policy.
On a broader philosophical level, I often find that this whole emphasis on individual choice is kind of a canard put forth in dishonest ways. We should not fetishize choice as libertarians do when it is so easy to think of ways in which we are bombarded with too many choices (a Satellite TV package with 1,000 channels, almost all of which are execrable, is a great example). Traditionally we are told that alcoholism is a choice, but can we really blame the individual if genetics plays a central role in whether someone is susceptible to addiction? Teachers often tell students that they have a choice about whether they can behave respectfully or defiantly in the classroom, but what if some students grew up in impoverished circumstances in parts of town where lead paint and air pollutants exceeded healthy levels? We now know that lead exposure is correlated to impulse control and crime rates. Should we blame the individual when choices made by city planners limited their ability to succeed?
We give you the choice to buy gas-guzzling automobiles while ignoring the importance of oil in our catastrophic decision to invade Iraq in 2003. Several decades ago in California, we used to give people the choice to sit in “smoking” or “non-smoking” sections of restaurants. I’m glad we no longer have that choice. Among those who fought tooth and nail alongside greedy and morally repugnant tobacco companies against sensible regulations were libertarians. Given America’s obesity epidemic, I fully support taxes on sodas and categorically reject the characterization that this tax constitutes a “nanny state.” In countless instances, we see that choice is an illusion. A fraud. Why would we want the choice to poison ourselves? That’s not freedom. Quite the opposite. Platitudes about choice and free will seem obsolete when apps and Big Data, stored and manipulated by Silicon Valley tech gurus (many of whom, ironically enough, are libertarians), now determine choices for us.
Is inequality natural, immutable, and inevitable, as libertarians contend? This sounds like the discredited pseudoscience known as Social Darwinism. No one denies that there is a tremendous variation of talent and work ethic among human populations. But disparities in outcomes among races often result from deliberate government policy. Even race itself is a social construct. The examples are too numerous to mention here. Just think of how Irish, Italian, Jewish, and Polish immigrants to the United States in the late-19th century, while having pale skin, were not considered “white” by the predominantly Anglo-Saxon ruling class. The same is true of economic inequality. Tax cuts and deregulation did a lot more to bring about the uptick in economic inequality we have seen since the 1980s than peoples’ propensity to work.
Separating the state and market, moreover, is an arbitrary, artificial construction characteristic of eighteenth and nineteenth century Enlightenment thinking. Whether we are talking about corporations in the early statehood of New York, as Brian Murphy’s work does, or today’s political economy, the boundaries between public and private are often so thin as to be indistinguishable. It’s impossible to separate markets from the governments that shape them. Outside of purely theoretical exercises, we cannot envision a market that is divorced from the armed forces, a court system that decides the manner in which it will protect private property, monetary authorities that determine the value of currencies and exchange rates, subsidies to transportation, energy, and agricultural sectors, public treasuries that demand and collect taxes, religious values that influence norms and customs, etc. Even when the state is not acting as an influential historical agent—and many historians within the subfield known as American Political Development (APD) did make this point—there is no doubt that the state established powerful boundaries between which society and markets developed. It is not so much a question of whether the American state is weak or strong, but a question of what segments of the population benefit from government largesse
To more fully understand libertarianism and its implications for policy, it is helpful to think about the historical context in which libertarianism came to be. While today’s libertarians can plausibly trace their intellectual lineage to Enlightenment era philosophers like John Locke, William Blackstone, Adam Smith, and David Hume, modern libertarianism was, in fact, a mid-20th century creation. Much like the legal philosophy of originalism, modern libertarianism formed as a backlash to the New Deal and Civil Rights Movement. Both ideologies were, and are, reactionary in nature. Austrian thinkers Friedrich Hayek and Ludwig Von Mises are usually credited as the intellectual godfathers of today’s libertarians. An Austrian economist is one who promotes a libertarian point of view. Hayek worried that New Deal-style programs would lead to totalitarianism and put us all on a “road to serfdom” to use the phrase of his influential 1944 book.
As FDR’s landslide 1936 reelection attests, New Deal programs were highly popular with the American public. Federally-guaranteed deposit insurance in the form of FDIC reduced the likelihood of crippling bank runs; social security cushioned seniors from descending into poverty; the SEC prevented insider trading; Glass-Steagall separated the rules governing investment banking and commercial banking; the Wagner Act recognized the legality of labor unions; the FHA and GI Bill helped Americans buy homes; the AAA subsidized farmers. While far from perfect on questions of Jim Crow and white supremacy, the New Deal effectively created an entire middle class. Any reasonable person would look at this history and see that these were significant steps in the right directions and foundations upon which to build further gains. Libertarians don’t want you to know this history. They want you to think that these programs represented an irreversible form of tyranny; a serious assault on private enterprise and everything that made America great. Make no mistake: this is the perspective of wealthy business owners. So by embracing libertarian principles today, people should be aware that they are adopting the preferred policies of entrenched robber barons who didn’t want to pay income taxes; who didn’t want to recognize labor unions; who didn’t want to contribute to retirement pensions, etc.
There’s also a jaw-dropping arrogance in assuming that private industry will always do the best job at solving complex programs. Appointing (not electing) a businessman as president* is a libertarian point of view. Running public colleges like a business is a libertarian point of view. Libertarians ignore the numerous historical examples of government not acting as a deterrent to economic growth, but an enabler of it. How else would one look at subsidies to the railroads, the Morrill Land Grant Act, the Homestead Act, the Newlands Act, and putting a man on the moon? You sometimes need government to spread risk, to jumpstart certain industries that might otherwise flounder, and to insist on a certain long-term investment thinking that Wall Street, with its emphasis on the next quarter’s profits, seems incapable of doing.
The most glaring flaw in libertarian thinking lies in its rather absolutist defense of individual property rights, which necessarily precludes all other valid forms of liberty: the liberty derived from labor rights and collective bargaining; women’s rights; environmental rights; public education; civil rights and freedom from discrimination; the liberty of future generations when it comes to human-caused climate change. Even when these latter rights are supported by huge majorities of the population, thus giving them legitimacy in any society that calls itself democratic, libertarians will cry “coercion,” “theft,” “tyranny,” and “rent-seeking” as if to delegitimize them. A democratically elected state legislature passes regulations to allow for clean air, clean water, and public health? Libertarians will say that these interfere with the “free market” and the natural, inalienable right to property. The libertarian vision of liberty is thus, narrow, traditional, and backwards. It cements the status quo of pre-existing power structures by protecting those who have already accumulated property (i.e. white men). This is unhealthy and immoral since we already live in an era of unmistakable wealth and income inequality. And besides, why should people today have advantages merely because their father, grandfather, or great grandfather just happened to be at the right place at the right time? Whenever someone launches into an abstruse discourse about liberty, a sensible question to ask is: who benefits from your vision of liberty? If the answer is invariably propertied white men, you need to reconceptualize your vision of liberty.
Over a decade of college-level teaching, especially with the help of Eric Foner’s well acclaimed Give Me Liberty! textbook in the US survey course, has helped me understand that there are multiple visions of liberty. Two sides in a controversy can use the term “liberty” and mean very opposite things. Here are a few examples: 1. A slave owner uses the term “liberty” as his right to property but the slave views liberty as autonomy and freedom; 2. An industrial worker uses the term “liberty” to mean a minimum wage, health care, etc, but the business owner emphasizes liberty of contract; 3. At Woolworth's lunch counter, an African American customer wants freedom from discrimination and civil rights but the business owner’s concept of liberty is freedom from what he views as excessive taxation and regulation (or the right to discriminate); 4. Exxon Mobil wants the “liberty” to pollute and maintain proprietary trade secrets but young people today want the liberty to have access to clean air and water. In each of these cases, which are based on real historical examples, the libertarian ends up siding with the interests of a very small segment of the population, against the wishes of the majority.
When faced with a conflict between democracy and property, libertarians will almost always choose the side of property. Thus, it makes more sense to find the roots of modern libertarianism not in Locke, Smith, and Blackstone, but in John C. Calhoun and Roger B. Taney. These latter men enshrined the property rights of southern slave owners against democratic majorities that threatened to use the state’s power of taxation and regulation to threaten this property. In the Dred Scott decision of 1857, Taney accepted Calhoun’s absolutist defense of property rights based on the 5th Amendment, declaring that this liberty overruled the nearly 80-year precedent of Congress regulating the practice of slavery in the western territories. As we shall see in subsequent posts in this series, this proto-libertarian thinking was a tyranny of the minority that appealed especially to those who harbored deep racial anxieties.
Bucking Conventional Wisdom: Henry Clay was NOT the Chief Driving Force Behind Biddle's Re-Charter Effort in 1832
A few years ago I submitted an article manuscript on the Bank War to a prominent journal in my field. In one sentence I repeated the received wisdom that Henry Clay’s presidential ambitions in 1832 figured prominently in Nicholas Biddle’s decision to apply early for a new BUS charter, four years before the current one would expire. This is the standard, conventional view of the re-charter controversy. Presumably a reluctant Biddle got caught up in Clay’s desire to be president.[i] The citation I gave in the manuscript was to Robert Remini’s 1991 book on Clay. An anonymous reviewer hammered me for this, saying that this was not Remini’s best work and that I should look into this more. So I did. And ultimately I came to a very different conclusion about what impelled Biddle to apply early. And Henry Clay had very little to do with it. In recent weeks I have heard this received wisdom come up at least 2-3 times by other scholars in my field. As someone who cares a lot about getting the details right in a project I’ve dedicated a major part of my life to, I feel obligated to write this post. I’m really not looking for a fight here, but my motivations for doing this are to present what I think is the best and most detailed evidence and in doing so, to challenge, complicate, and perhaps even overturn that received wisdom.
A lot of what follows below is from my book, which is due to come out in January with the University Press of Kansas. I have added in some things for clarity and to walk the reader slowly through all of the evidence. Most of my book deals with how both sides in the Bank War engaged nationwide communications networks funded by public and private money. The Bank used its interregional network of branch offices and subsidized newspaper editors with loans and printing orders while the Jacksonians appropriated the powers of the federal bureaucracy, including the Post Office, to defeat the Bank. So the topic of this post is only a sub-argument of one chapter. If what you read below seems a bit too insider baseball and lacks context, you can always buy my book! I'm such a great capitalist, right?
My basic point is this: it was not Clay and Webster, but Thomas Cadwalader and the Bank’s board of directors, who were most influential in pushing Biddle for re-charter. On September 1, 1831, Biddle attended an important board meeting in Philadelphia with the Bank’s leading stockholders, directors, and managers. The purpose of this gathering of financial higher-ups was to comment on the condition and future of the Bank. Biddle submitted a report to the stockholders detailing the Bank’s assets and liabilities, and the Bank paid for its printing and dispersal. One section stated, “[The Bank’s] circulation is in all respects equal, and in most respects superior, in value, to any metallic currency of the same amount” and went on to say that never had there been any paper currency, spread out over such an extensive country, that was comparable to the Bank’s bills and notes in its security, convertibility, and uniformity of value. This was strikingly similar in tone and language to the early-1830 reports on the Bank’s currency presented in the Senate by Samuel Smith and in the House by George McDuffie. One likely explanation is that Biddle had authored all three reports.[ii]
According to the Bank’s charter, this type of meeting only happened every three years, which meant that the next meeting would not convene until September 1834. If one assumed that procuring a bill to re-charter the Bank, and then passing it through Congress, would take several months, then waiting until the next triennial meeting to authorize an application to re-charter would fall perilously close to the Bank’s expiration in March 1836. Most businessmen dread uncertainty and for an institution as economically influential as the BUS, it was not unreasonable to wonder if the Bank, once discontinued, might have to wind up its affairs and call in all of its obligations with potentially disruptive consequences. Put another way, if the Bank wanted to apply without unsettling risks, it needed to apply now. The power that the stockholders invested in the Bank’s president and directors was broad and elastic: “if at any time before the next triennial meeting… it shall be deemed expedient by the president and directors to apply… for a renewal of the charter… they are hereby authorised to make such application.”[iii]
Having received the go-ahead from the board, Biddle needed to find the right time to submit his application for re-charter to Congress, which involved delicate political considerations and a range of options. I would group the four different options as follows:
Option 1: pass the Bank bill and try to get a 2/3 majority to override the president’s veto. This was only a remote possibility. Party discipline was already a key attribute among Jacksonian politicians and enough congressmen would rally to the president’s aid under almost any circumstance.
Option 2: modify the Bank’s charter enough to assuage Jackson’s objections. In many ways this is what actually transpired (see Chapter 4 of my book), but many Bank War scholars have missed or downplayed the ways in which Jackson was fairly consistent in his opposition to the Bank. Biddle hoped to reach an agreement with Jackson over a significantly modified bill to re-charter with the likes of Treasury Secretary Louis McLane, William Berkeley Lewis, and Secretary of State Edward Livingston acting as intermediaries. McLane had authored a report praising the Bank’s functions and recommending re-charter “at the proper time” while the president had refrained from criticizing the Bank in his third annual message to Congress, feeding rumors that Jackson might be softening his stance.[iv] The most intimate of Jackson’s correspondents knew otherwise. As a somewhat irritated Jackson wrote to John Randolph, “You have done me no more than justice when you repelled with indignation that I had changed my views of the Bank of the United States.” The president declared emphatically, “I have uniformly on all proper occasions held the same language in regard to that institution.”[v] In volume 10 of the Jackson Papers, see Jackson’s letters to John Coffee and Alan Ditchfield Campbell for more of his consistency on the Bank question. The unfortunate reality for Biddle was that he almost never corresponded with Jackson directly and the intermediaries he used may have overestimated their ability to persuade the president. When viewed in combination with Jackson’s call for a substitute national bank in 1829 upon entering office, Jackson’s letter to Randolph illustrates that, contrary to what some scholars have speculated, the president was rather consistent in opposing the BUS even if many of his cabinet members were open to a modified re-charter.[vi]
Option 3: wait until after the presidential election of 1832: There were some who cautioned Biddle not to provoke Jackson until after the presidential election. This contingent included one of the Bank’s cashiers, Edward Shippen, Senator Samuel Smith of Maryland, and McLane. Jackson, they said, would interpret an early application as a hostile act and would place the Bank question at the center of the upcoming election. As I show below, this was Clay’s view in 1830.
Option 4: Submit now because Jackson would certainly veto in his second term if he won reelection. The men who vouched for option 4 assumed that while an early application carried risks and Jackson’s future behavior was unpredictable, the president would have almost no incentive to compromise with Biddle during a second presidential term. Submitting early could potentially corner Jackson into taking an unpopular stance, which would weaken his support before the fall elections. Representatives Charles Fenton Mercer and George McDuffie in the House and Senators Clay and Webster were in this camp. On December 15, 1831, Clay wrote to Biddle, asking if the Bank president had decided to apply early. Clay stated, “The course of the President, in the event of the passage of a bill, seems to be a matter of doubt and speculation. My own belief is that, if now called upon [Jackson] would not negative the bill; but that if he should be re-elected the event might and probably would be different.” This was hardly a gung-ho, ringing endorsement of an early application as Clay expressed some doubts about Jackson’s views. We should emphasize that Biddle informed Clay a week later, on December 22, that “nothing is yet decided” on whether he would apply early.[vii]
There’s an important context to consider when we look at Clay’s letter to Biddle from December 1831. In September 1830, the Kentuckian wrote a missive to the Bank president. I’ve summarized much of it, but interested readers can look to pages 263-264 of the Seager and Hay volume. Essentially, Clay argued that to renew the Bank’s charter, they needed the president to acquiesce because they would never get a 2/3 majority in both houses of Congress. He wrote, “If you apply at the next Session of Congress, you will play into the hands of that party. They will most probably, in the event of such application, postpone the question, until another Congress is elected.” The Jacksonians, Clay predicted, would point out that there were still several years remaining in the Bank’s charter and that they ought to ascertain and follow public sentiment. In the event of a presidential veto, Clay believed that the BUS would become “the controlling question in American politics” and that “The friends of the Bank would have to argue the question before the public against the official act of the President, and against the weight of his popularity.” Unless Biddle could be assured that the president would sign the legislation, Clay held, Biddle should not submit early. The Kentuckian recommended that Biddle wait until after the election of 1832. Biddle wrote back in November 1830, largely agreeing with Clay.[viii] Something had clearly changed by December 1831, when Clay was now advocating an early re-charter. One could presume that Clay’s nomination as the National Republican candidate was one key difference, but what should be emphasized in my view is that Biddle had numerous correspondents, each with different bits of advice.
In the face of conflicting recommendations, Biddle dispatched Thomas Cadwalader to Washington to count votes in Congress and meet with prominent members of the Senate and Jackson’s cabinet. A senior BUS officer and director, Cadwalader was connected to Biddle through marriage and served as the Bank’s acting president when Biddle was absent. Excerpts from a series of letters written between the two men testified to the degree to which Biddle trusted Cadwalader’s opinion. “With you I have no reserves,” Biddle wrote in one letter, and in another, he confided, “I have not said this to anybody except yourself.” As further testimony to the close relationship the two men had, we might consider that Biddle dispatched Cadwalader to Great Britain to negotiate with Baring Brothers concerning payments on the public debt, and all without informing the Bank’s public directors. On December 25, 1831, the ever cautious Cadwalader stated to Biddle, “I do not yet decide – but incline to suppose that after the council at the Treasury, I shall advise the Comee to start the memorial.” A few days later, Biddle firmed up his decision. In a letter to Smith explaining why the Bank was moving forward at this time, Biddle underscored, first and foremost, the desires of the Bank’s stockholders and the need to avoid uncertainty.[ix]
To review, Biddle only made his decision for an early re-charter after hearing from Cadwalader, a colleague and close confidant. In his letter to Smith, the first reason he gave for an early application was avoiding uncertainty—something the Bank’s directors and stockholders emphasized. Clay’s advice in December 1831 marked a shift from a more thoughtful missive he wrote to Biddle in September 1830, where he predicted an early application would play into the Jacksonians’ hands. And while there is some evidence to show that Biddle was uncertain about an early application, he had also been waging a public relations campaign since early 1830 that included small bribes, vote counts, correspondence with financial theorists, loans to members of Congress and printing orders for newspaper editors like Gales and Seaton. Finally, Jackson predicted in his 1829 annual message to Congress that the Bank’s stockholders would submit an early application. He ended up being right.
Some might look at all of this and say, so what? Is there a major theoretical point at stake? My answer is “probably not,” but it’s also important to get the details right and the story straight. There’s a particular problem in the Bank War historiography of uncritically passing down received wisdom throughout the generations; of repeating things over and over that are ultimately based on thin evidence: state banks hated the BUS; Jackson hated paper money; Jackson and Biddle could have compromised. All of these subjects are very complicated. Wilentz and Baptist, who have perpetuated the interpretation that Biddle was caught up in Clay's presidential ambitions, cited only two letters in their endnotes--far less than the amount shown below. And in reexamining these letters from December 1831 and June 1832, respectively, I do not find clear evidence of Clay's political aspirations. The only clear evidence I can see is that both Clay and Webster advocated an early submission for re-charter, against the informed opinions of Biddle's other contacts. In their defense, Wilentz and Baptist were offering sweeping interpretations of broad spans of early American history, and as such, they emphasized breadth rather than depth. On the other hand, it is important to point out when major historians do not have sufficient evidence to support their claims.
I won’t be as bold to claim that what I’ve written above settles the matter once and for all. I’m open to hearing countervailing evidence. But given what I have laid out, I’d hope that any rebuttals would be quite detailed. Is anyone up to the challenge?
[i] Historians who have emphasized Clay’s role in Biddle’s decision to apply for an early re-charter include Robert Remini, Henry Clay: Statesman for the Union (New York: W.W. Norton & Company, 1991), 379; Sean Wilentz, The Rise of American Democracy: From Jefferson to Lincoln (New York: W.W. Norton & Company, 2005), 367–368; and Edward E. Baptist, The Other Half Has Never Been Told: Slavery and the Making of American Capitalism (New York: Basic Books, 2014), 250.
[ii] Niles’ Weekly Register, September 10 and October 8, 1831.
[iii] Ibid. Annals of Congress, House, 14th Congress, 1st Session, Appendix, 1812–1825. House Journal, 21st Congress, 1st Session, 11–28.
[iv] House Journal, 22nd Congress, 1st Session, 9–21; Register of Debates, 22nd Congress, 1st Session, Appendix, 25–33.
[v] Jackson to John Randolph, December 22, 1831, in Daniel Feller et al., The Papers of Andrew Jackson Volume 9, 1831 (University of Tennessee Press, 2013), 782–783.
[vi] For Jackson’s consistent opposition to the BUS, see Jackson to Van Buren, December 6, 1831; Jackson to Hamilton, December 12, 1831; Randolph to Jackson, December 19, 1831, in PAJ 9, 731–733; 768–769; 780–782. Cadwalader to Biddle, December 26, 1831, in Reginald Charles McGrane, ed., The Correspondence of Nicholas Biddle: Dealing With National Affairs, 1807-1844 (Boston: Houghton Mifflin, 1919), 160–161.
[vii] Shippen to Biddle, December 6, 1831; Mercer to Biddle, December 12, 1831; Smith to Biddle, December 17, 1831; Webster to Biddle, December 18, 1831; McLane to Biddle, January 5, 1832, in McGrane, ed., Biddle Correspondence, 88–91; 136–138; 140–146; 154–161; 165–168. Clay to Biddle, September 11, 1830 and December 15, 1831; Biddle to Clay, December 22, 1831, in Robert Seager II and Melba Porter Hay, eds., The Papers of Henry Clay, Volume 8: Candidate, Compromiser, Whig, March 5, 1829-December 31, 1836 (University Press of Kentucky, 1984), 263–264; 432–433; 435.
[viii] Clay to Biddle, September 11, 1830; Biddle to Clay, November 3, 1830, in Seager and Hay, eds., The Papers of Henry Clay, Volume 8, 263-264; 287-288.
[ix] To make the claim that Cadwalader and the Bank’s stockholders were more important in Biddle’s thinking than Clay and Webster, I had to consult a large number of letters, paying close attention to chronology. In December 1830, John Norvell wrote to Biddle, in reference to an early push for re-charter, “In any event, it appears to me to be the interest of the stockholders and officers to bring the matter at once to issue.” McGrane misspelled Norvell’s last name as “Norvall.” Norv[e]ll to Biddle, December 16, 1830; Cadwalader to Biddle, December 20, 21, 22, 23, and 25, 1831; Biddle to Cadwalader, December 24, 1831; Biddle to Smith, January 4, 1832, in McGrane, ed., Biddle Correspondence, 120; 146–158; 161–165. Biddle to Cadwalader, December 29, 1831, in Biddle Papers, LOC.
Disclaimer: This is my personal blog. While I do my best to offer reasonable conclusions based on verifiable, peer reviewed evidence, I neither speak for my employers, nor do I require my students to read or agree with the thoughts expressed here. Opinions are my own.