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    The Statesmanship of Word and Deed: Abraham Lincoln

    December 29, 2021 by Will Morrisey

    Diana Schaub: His Greatest Speeches: How Lincoln Moved the Nation. New York: St. Martin’s Press, 2021.

     

    The distinction between speech and deed concerns the statesman somewhat in the way the distinction between theory and practice concerns the philosopher. The Greek word logos means both speech and the reason that can make speech coherent, make speech truly itself. If Plato takes preeminence among philosophers who consider the relation between logos and praxis, Abraham Lincoln may have earned that honor among statesmen. Or so one might well think, after reading Diana Schaub’s magisterially attentive meditation on his three “greatest speeches,” the Address to the Young Men’s Lyceum at Springfield, Illinois, the Gettysburg Address, and the Second Inaugural Address. In those speeches, Lincoln intended to recover the American Union, “re-conjoining word and deed, promise and performance,” without muddling them together in sophistical or demagogic appeals to passion. Reasoned speech requires thoughts and words free from contradiction; sophistry, the deliberate attempt to confuse minds, and demagoguery, the deliberate attempt to inflame them, both stand as perennial enemies of statesmanship and philosophy, including political philosophy. More profoundly and therefore more dangerously, certain schools of philosophy, gaining momentum in the universities during Lincoln’s lifetime, attempted to ‘synthesize’ theory and practice. These philosophic doctrines of ‘immanence’—melding thought and speech and deed in accordance with a new kind of logic which posits and then claims to overcome all contradictions in theory and in practice—brought on a politics not of statesmanship but of ‘leadership,’ a politics practiced by politicians who sought to persuade the rest of us that that they marched on the ‘cutting edge of History.’ Tyrannies hard and soft have resulted. By keeping straight the distinction between the natural rights of human beings discoverable by reason and the civil or conventional rights which may not fully protect those natural rights in practice, Lincoln, resisted the characteristic tyranny of the American regime of his time, the tyranny of slave-holding, based on the claim that human beings may rightly be owned by other human beings who enjoy neither a right to property themselves nor, allegedly, a property in their natural rights. If, as the Declaration states, governments are instituted to secure those unalienable but violable rights, and if tyrannical souls always live among us, ever ready to deploy the arts of sophistry and demagogy in their quest for unanswered rule, beckoning us to depart from “the timeless principles of self-government” as a prelude to replacing it with government by themselves without our consent, then “Lincoln’s greatest speeches matter as intensely today as when first delivered,” 

    There is, Schaub writes, a “necessary sequence of logos and praxis, the way in which our saying leads to our doing.” This introduces the element of timing into statesmanship. In politics as in warfare and love, timing matters. Lincoln’s three speeches address three crucial dates when the course of events in America turned: 1787 (the framing of the U.S. Constitution), 1776 (the issuing of the Declaration of Independence), and 1619 (the introduction of African slaves with the earliest English colonial settlements, an act that inflected both subsequent acts). In each of those years, persons who were founding new political communities chose between liberty and tyranny. Lincoln notices the distinction between chronos and kairos—natural time and the ‘revealed’ or ‘providential’ time marked when we date our years from the birth of Christ. And, just as the philosophers of ‘immanence’ would synthesize theory and practice, so they would synthesize natural and providential time, claiming that the course of events, now re-named ‘History,’ unfolds logically or ‘dialectically’ over time, leading to the End Time, the End of History, not as the culmination of a plan conceived by a Creator-God, a holy God, separate from His creation and from the events He guides within it, but as the culmination, the purpose, of the dialectical unfolding of the ‘Absolute Spirit,’ embodied in a nature that evolves toward that purpose. Lincoln is no historicist, neither a ‘progressive’ nor a ‘declinist.’

    The Lyceum Address concerns 1787 but it also invokes the memory of the president of the Constitutional Convention and his later Farewell Address, “verbal echoes” from which Schaub rightly detects in Lincoln’s speech. In that speech, George Washington calls America’s Constitutional union, these United States, “a main Pillar in the Edifice of your real independence,” as distinct from but motivated by the independence-in-speech seen in the Declaration. Washington calls the Union “a main prop of your liberty,” your self-government. Lincoln remarks the decay of some of these pillars and props. They have decayed because the sectionalism Washington warned against, regional factionalism, has corroded them. As Washington upholds the Union by urging his fellow citizens to obey the law, and especially the supreme law of the land, the Constitution, calling this “sacredly obligatory upon all,” Lincoln urges the citizens of his time to make reverence for the Constitution and the laws enacted under it their “political religion.” And as Washington warns “against the dangerous effects of ‘the strongest passions’ and the “cunning, ambitious, and unprincipled men” who would “usurp for themselves the reins of Government,” so Lincoln “disparages passion—calls it “our enemy”—and puts us on guard against the unbounded ambition of the republic-destroyers. Both statesmen regard virtue as indispensable to perpetuating America’s political institutions; institutions do not maintain themselves, however prudently designed they may be. “It is on this score especially that Lincoln’s address is the more profound one,” Schaub writes, “cut[ting] deeper in its analysis of the passions of both the few and the many, deeper in its grappling with the human temptation to tyranny, deeper in its portrait of the mob and its motived, deeper in its understanding of public opinion, and, consequently, deeper in its rhetorical presentation.”

    It is also important to notice Lincoln’s seemingly passing remark on the value of the American land, the territory ruled by the self-governing people. It is the most important feature of nature for Americans, aside from their human nature. “We find ourselves in the peaceful possession of the fairest portion of the earth, as regards extent of territory, fertility of soil, and salubrity of climate.” The youths he addresses know what he’s talking about. They know that the American Midwest consists of an immense expanse of rich soil crisscrossed by a river system that reaches south to the Gulf of Mexico. No other continent has that, and by the 1830s Americans now govern it and farm it, having ousted the many societies and replaced them with one unified federal state—a giant free trade zone. The political institutions he would have his fellow citizens perpetuate guard them from tyranny and their land from war. But those institutions now face the peril of lawlessness which, unchecked, will undermine not only those institutions but the prosperous way of life the institutions support. Although (with some exaggeration) he denies that the land can be seized by any foreigner or alliance of foreigners, homegrown disunion is another matter. For his part, Washington had devoted the second half of his Farewell Address to elaborate a foreign policy of nonintervention in foreign wars, the eschewal of inveterate hatreds and habitual affections for foreign nations; Lincoln’s America faced no such threat in the 1830s, its foreign policy limited to dealing with the weak and disunited Amerindian nations and tribes, and to the question of tariffs on foreign goods. But that favorable condition could change if disunion provided an opportunity for foreign powers to play divide-and-conquer in North America, as they had done with the Indians in the previous century.

    Lincoln would have Americans understand their circumstance as a sort of account book, a ledger in which they owe moral debts to the men who wrote the law that constituted their federal government, the means of their self-government in a republican regime wherein the lawmakers represent the people. Thanks to the Founders, Americans have legally inherited a portion of nature, the American land, and a government of liberty, a “political edifice,” a work of art, a convention that secures for them that land and secures—for most of them—another portion of nature, the rights inherent in their own nature as human beings. In guaranteeing the natural right of the people peaceably to assemble, the Constitution or supreme law of the land distinguishes “the people” from “a mob.” Mob violence is Lincoln’s immediate concern in the Address. For Lincoln (pace, Dr. King), “democratic citizenship does not admit of ‘civil’ disobedience,” since (as the Apostle Paul insists, speaking of monarchs) even unjust laws must be obeyed until repealed, lest acts even of righteous disobedience descend the slippery slope to unrighteous ones, animated by a spirit of disrespect for laws in general, preventing the perpetuation of our political institutions.

    Schaub carefully distinguishes between perpetuation and conservation or preservation. To conserve or preserve, say, a bowl of cherries “involve[s] altering the original…as a hedge against future need.” But to perpetuate is to keep something as it originally was, “to cause it to endure indefinitely.” “Lincoln’s subject of perpetuation requires an inquiry into the nature of time and causation. It hints at metaphysical as well as political questions.” Lincoln chooses the word with prudent irony respecting practice, too. The most impassioned advocates of slavery were called the “Perpetualists,” Schaub recalls. “Lincoln countered that the perpetuity of the Union could be secured only by placing slavery back where the founders had originally placed it, namely, ‘in the course of ultimate extinction.'” This, for the protection not only of American’s liberty but also for the protection of their ‘geography,’ their territory, the material foundation of their prosperity. 

    Americans secure their liberty through the political institutions Lincoln seeks to perpetuate. Mob rule threatens those institutions. The Framers famously separated three branches of government, assigning to each a distinct power. The lawless, wild, and furious judgments of worse than savage mobs, combine executive, legislative, and judicial functions in one set of hands—Thomas Jefferson’s definition of tyranny. What the mobs, and the spirit of mobs, would amalgamate in destructive passion Lincoln would separate in accordance with the spirit of reason, of making distinctions, of thinking on the lines of the principle of non-contradiction. Just as he distinguishes theory from practice, speech from deed, so in his address he insists on life-saving and liberty-saving dualities, dualities that exist not only perpetually, ‘abstractly,’ but over time, in the course of events, never to be synthesized in a grand culmination of that course, but always present, as the course is always present. And so “Lincoln gives two very different accounts of the founding generation; he gives two very different accounts of the lynchings that occurred in Mississippi and St. Louis; analytically, he divides the effects of mob rule into two categories (direct and indirect); he discerns two types of danger (current and prospective) and, accordingly, offers two different solutions (reverence and reason); finally, he examines the problem of the passions in its different manifestations in the few and the many (those timeless political categories)” which instance themselves throughout time.

    Schaub takes up “the most dramatic of these doublings,” his “stories of mob rule in action,” first. Lincoln concedes that the victims of the mobs deserved to die. This concession “disposes his audience to listen to him by validating their instinctive hostility to wrongdoers”; at the same time, “he renders their concern with justice less heatedly angry and more coolly calculative,” in part by adding a touch of humorous understatement to his narratives and by leaving race out of them. In a very Washingtonian move, “rather than appealing altruistically to their concern for others, he appeals instead to their self-interest, but in a way that demonstrates the linkage between [the vigilantes’ and their defenders’] self-interest and the cause of law-abidingness,” showing that people blinded by rage might turn on some of their own, and then on “the truly innocent.” Worst of all, “since popular opinion was in sympathy with their conception of justice the perpetrators went unpunished,” onlookers who have no sense of justice at all take heart. The “lawless in spirit” will then become “lawless in practice,” and the vigilantes, who “meant to crack down on crime,” embolden criminals. Seeing this, good citizens lose confidence in the regime of republicanism, since “the really dangerous opportunists are not the petty criminals but the tyrannically inclined,” the ultimate enemies of the rule of law and of republican self-government, to whom the desperate people will look “for deliverance” from lawlessness. Under these conditions, “‘We the People’ become willing to trade anarchic liberty for despotic security, or at least the demagogic promise of it.” In their passionate fear of lawlessness, they will fall prey to those who speak to them in the fake-rational accents of unreason. And he brings it all home to his listeners by citing a local instance of such violence, the murder of the Abolitionist publisher Elijah Lovejoy by a mob in Alton, Illinois, the previous year.

    What to do? “The solution is absolute law-abidingness” in practice and in sentiment. Inasmuch as the laws are their own, “democratic citizens should obey not out of fear but out of reverence.” Lincoln proposes the adoption of this reverence for the law as “the political religion of the nation”—the italics marking Lincoln’s acknowledgment of the strangeness of such a formulation in American ears, accustomed as they are to a religion that binds its adherents to the Kingdom of God in Heaven, no earthly kingdom or republic. Lincoln’s reasonable slippery-slope argument on the malign effects of lawlessness may be sound but it will not suffice; “he highlights the role of habituation and piety in shaping a deferential attitude toward the law.” He is asking students to think about education as part of his own effort to educate them to citizenship, to adulthood, to responsibility.

    And he sees the problem with this religion. “Law at its best seeks justice, but it is never identical to justice; moreover, sometimes law is used to establish and maintain injustice.” “Let me not be understood as saying there are no bad laws,” he concedes. “Not only was slavery legal in half the states of the union, but the entire nation was under a constitutional obligation to return fugitive slaves to bondage.” Nonetheless, “all disobedience,” including disobedience to bad laws, “is uncivil and destructive of civil government.” Washington and his colleagues had upheld their right to revolution, but revolution is uncivil, an appeal not to human law but to natural right. “Short of that exigency there is only acknowledgment of the majority’s legitimate power through its ballots to determine the motion of the body politic”; the majority rightly rules not because it is always right in its rule but because it has the “rightful authority” to rule, an authority “grounded in the truth of natural equality and its logical corollary, government by consent.” Even nonviolent civil disobedience violates civility; if Mohandas Gandhi or Martin Luther King can nullify a law, why not John C. Calhoun’s South Carolina? The same thing goes for abolitionists who peacefully break the fugitive slave law as well the mobs who murder them. However, Elijah Lovejoy acted as a publisher. He wasn’t breaking the law. “It might be possible to persuade even those who despised the abolitionists as fanatics that the promulgation of abolitionism is constitutionally protected speech.” This might then lead to asking “whether abolitionist doctrine is right or wrong.” And that in turn “would require the public to reflect on both the moral and the constitutional status of slaver, including the possibility of a disjunction between those two.” Lincoln here shows the way to reverse the slippery slope into lawlessness and tyranny, the way to climb back up that hill towards a civil way of life, a regime of liberty. He shows young men, that portion of the population most susceptible to impolitic passions, why they should want the reciprocal ruling and being-ruled of political life by showing them the attractions of being ‘politic’ or prudent, not boyish. At the same time, in other speeches, he showed politically immature abolitionists the error of their own ways, the folly of their often-inflammatory rhetoric, rhetoric which invites responses in kind from slaveholders—a dynamic that can only lead to disunion.

    Lincoln was far from unmindful of the immediate political circumstances in which he delivered his address. He was a Whig. Newly elected president Martin Van Buren, a Democrat, had delivered an inaugural address earlier in 1837 in which he viewed America’s future “without foreboding.” Van Buren put the entire blame for “local violence” on the backs of abolitionists. “For him the spirit of civility and compromise was to flow in one direction only. Deference, in word and deed, must be accorded the sensitivities of the slaveholders.” “Lincoln’s ultimate aim in the Lyceum Address is to dispel this democratic complacency,” which will exacerbate disunion, not prevent it. While democracy or majority rule flows from natural equality, when it oppresses the minority, it is an imperfect expression of it; democrats (and Democrats) need to see that. Two decades later, Lincoln would argue against Senator Stephen Douglas’s doctrine of ‘popular sovereignty’ in the newly settled American territories on these same grounds.

    Having raised the matter of majority rule and its relation to tyranny, “Lincoln now delves into that ancient staple of political thought: the distinction between the few and the many, including how that distinction affected the nation’s founding and how it will affect the future.” Looking back at the Founders, he “reveals that [the young Americans’] political ancestors were composed of two distinct human types, possessing divergent motives,” “two sets of animating passions.” In 1776 (and now Lincoln shifts his gaze to the revolution that issued in the Constitution, not ‘1787’ itself), the few, the Founders, were passionate for celebrity, fame, and distinction, whereas the many were united in the passions of hate for the British and revenge for injuries the British had inflicted upon them. These “self-serving passions,” ruling on the one hand the noblest, on the other hand the least noble minds, “were happily, but coincidentally, mustered for the cause of civil and religious liberty.” Both wanted popular self-government in America—an unproven “proposition,” not a self-evident truth, even if it rested upon self-evident truths. Securing self-evident natural rights may be the purpose of government, but can popular self-government do that? The Founders sought the glory that would attend to such a success, and until recently, during the lives of the founding generation, that glory itself proved a powerful motive for sustaining the proposition. The 1787 Constitution was designed to give future such lovers of fame pathways to celebrity and distinction that would keep the many safe from them, indeed, to engage the few in the task of continuing to secure the natural rights of the many. Separation of powers, checks and balances, federalism—these don’t suppress ambition but harness it “to the duties of office and the public good.” 

    Lincoln applauds the Framers’ work. The Constitution’s arrangement of ruling offices will indeed satisfy would-be Congressmen, governors, even presidents. But among these few there will number still rarer souls, those “(maybe just one) for whom even the highest office would be small potatoes,” one for whom the broad horizons of a large republic will seem painfully restrictive. An Alexander, a Caesar, a Napoleon (dead only a generation back) belong to “the family of the lion, or the tribe of the eagle.” “A natural predator behaves as if entitled to take what it likes,” as if a law unto itself. So much more will this “man-beast” who acts as if he’s a god, this “towering genius,” dismiss the protests of the many weaklings that he intends to put beneath him. (Indeed, as ‘King of Beasts,’ the lion must debase his human subjects.) It is noteworthy that family and tribe are sub-political groups; self-governing political communities consist of them, but are not reducible to them, unless disunion ruins those communities, giving the chieftains of those families or tribes, the warlords, a chance to elevate themselves to rule. [1] The tyrannical man-beast comes out of the less-than-political milieus of family and tribe, bringing his unpolitical habits with him as he quests for the supreme unpolitical, non-consensual office by means of deceptive speech and bold actions. 

    He can be stopped, but only if the many remain united with each other, attached to the government and the laws, and generally intelligent—smart enough to recognize an aspiring tyrant when they hear him. This generation lacks the passion of the people of the revolutionary generation, having no foreign enemy to hate (partly as a result of their representatives’ inclination to pursue Washington’s advice on permanent alliances). As for intelligence, they have no memory of the revolution or the revolutionaries, as nature in the form of death has silenced them in the march of time. The God of Biblical religion solves this dilemma by sending His Holy Spirit in the stead of His crucified and resurrected Son. For the American civil religion, Lincoln has proposed, is there a “political equivalent” of the Holy Spirit, who remains alive after the Apostles have died? Mere histories will not rekindle those passions; even the stories recorded in the Bible serve only as ways of sensitizing the reader’s mind to the presence of the Holy Spirit, who alone can turn a soul around. Lincoln points rather to the spirit of the laws, enunciated in “the fundamental charters that govern communal life,” where readers will follow the live thoughts of men now dead, think along their lines of thought, reason along with them. “A nation founded upon a text has an ever-renewable resource for perpetuity not available to other nations,” nations that rely on mere stories, traditions, which may come to seem irrelevant to life in changed circumstances.

    While “passion has helped us” up to now, Lincoln says, it “can do so no more,” and will soon “be our enemy,” incubator of lawlessness among the many, tyrants among the few. For the new generation of Americans, and for every generation after it, “a passionate and impassioning politics is likely to be divisive.” Unlike speakers who tell the young to ‘find your passion,’ Lincoln invites them to find it and then rule it with reason. We otherwise fall into “hyper-partisanship, hate-filled invective, insufferable self-righteousness, and general nastiness.” Add divisions based on territory, on land, and you head for civil war. Lincoln does not foolishly imitate the Enlightenment philosophes who imagined the rule of reason (and of self-conceived ‘philosophers’) simpliste. He persuades as Washington did, by invoking moral sentiments, mixing rational judgment with feeling, but avoiding passions, which would overbear reason. (Even compassion, seemingly so commendable, “quite naturally provokes anger at those who cause the suffering” which the compassionate soul feels along with the sufferer.) While “the old props” for American constitutional republicanism “were the passions of the few and the many during the revolutionary period” and beyond it, now we need “pillars rather than props”—pillars made of the “sober reason” recoverable by reading the writings of the Founders. “Self-government in the collective depends on self-government within the self,” on the rule of reason in individual souls. The call for reverence for the laws, for “political religion,” “nest[s] within this more comprehensive call for reason.” That is “political reverence is itself an instantiation of reason.” When Lincoln advises the young fathers-to-be to “let reverence for the laws be breathed by every American mother to the lisping babe”—struggling to learn to speak, and eventually to reason—who “prattles in her lap,” he puts the natural reverence of the child who “literally looks up, in love and fear, to its mother” in the service of “political reverence,” which “must be deliberately inculcated,” taught in homes and in young men’s lyceums. This won’t be a family of the lion or the lioness but a family of men and women who know that they need security beyond what the family can provide.

    Lincoln ends his Lyceum Address with a paean not to a mother but a father, a father with no natural offspring of his own but with political offspring—to George Washington, the Father of his Country. Let us revere “his name to the last,” so that ‘during his long sleep,” we have permitted “no hostile foot to pass over or desecrate his resting place.” This parallels Lincoln’s assurance at the beginning of his address that the foot of no foreign conqueror will ever do that. If American sons of Washington remain true to him, no native foot will desecrate his resting place, either; no factious, uncivil warrior will overturn the regime that aims at securing unalienable rights for its citizens. Schaub remarks that such an awakening of Washington from his grave will require “the Second Coming of Christ” and the fulfillment of “the Christian promise of the resurrection of the body and the life everlasting,” whereby the perpetuation of American political institutions will no longer be necessary. But until that day, it will be. “Lincoln suggests that the political order must contend against the same forces of sin and death that have characterized the human situation since the fall of mankind. The new pillars of intelligence, morality, and constitutional reverence, ‘hewn from the solid quarry of sober reason,’ are the political analogue to the rock of Peter.”

    What of Lincoln himself? Edmund Wilson, along with a host of others, accused him of being the Alexander, the Caesar, the Napoleon, the man-beast tyrant of America. And indeed, what would inspire a man of Lincoln’s towering genius (to say nothing of his towering height as a physical giant among the men of his generation) to work for the perpetuation of our political institutions instead of his ascendancy over their wreckage? In his own Farewell Address, delivered at Springfield, Illinois before his departure for the White House in the city named after Washington, he told his friends that he faced a task “greater than that which rested upon Washington,” who had the passions of the few and the many on his side, the side of republicanism and natural right. This “greater task of saving the Union” can indeed satisfy the soul of him who is by nature of the family of the lion and the tribe of the eagle, but who finds family and tribe insufficient for the securing of those natural rights only governments of, by, and for the people can secure.

    The Gettysburg Address begins squarely with ‘1776.’ The Declaration of Independence moves from abstract truths in its major premises to particular facts in its minor premises to a logical conclusion stating actions to be taken. Lincoln’s much shorter address integrates “highly abstract” language (“there isn’t a proper noun to be found, with the single exception of God) with recollections of specific events, also ending with a logical conclusion. It begins with an unusual formulation, “four score and seven years ago.” Schaub explains this King James Bible language as Lincoln’s reminder to his listeners, many of them ardent readers of Scripture, that the United States has gone past the Biblically noted human lifespan of threescore and ten years, “forc[ing] us to wonder whether there are similar limits on the lifespan of mankind’s political collectives.” “Brought forth” is another Biblical locution, an image of childbirth, associated however not with bloodlines nor with autochthony (“ours is not a blood-and-soil patriotism”) but with ideas. The American ‘child’ was conceived in liberty, not in a bedroom, and dedicated (baptized, as it were) to a proposition, that all men are created equal. The separation from physical nature is completed by the thought that it was a group of fathers, not a mother, who gave birth to the American nation. In this, the Founders resemble Moses, the nursing father of Israel, giver of laws given him by the nursing, providential Father God. [2]

    Schaub remarks the double meaning of “conceived”: physical-sexual and mental-ideational, action and thought—distinct but related. “Before the nation could be brought forth into practical realization, it had to be thought of or imagined.” “The new nation was conceived not in sin or sorrow”—adultery or rape—but “in liberty.” Since liberty means self-government, not license, the conception of the United States was as immaculate as a human act can be.

    And the nation so conceived was dedicated to a proposition of human equality. Lincoln here departs from the Declaration, which calls equality a self-evident truth, evidently because human nature, with unalienable rights, was created by God, whereas the United States was made by men, who can at best dedicate themselves, and their nation, to that equality. In this sense, equality isn’t an axiom but “a theorem that must be demonstrated in practice.” In choosing “proposition” instead of “axiom,” Lincoln “wants to highlight the needfulness of translating an abstract truth into concrete political form.” Self-government is “the corollary of equality,” but as the mob rule of the 1830s and the attempted secession of the 1860s demonstrated, not all Americans share the Founders’ view, that “We hold these truths to be self-evident.” The slaveholders and their apologists denied that all men are created equal; the generational transmission of what should be self-evident truths had fallen prey to sophists and demagogues who confused minds and whipped up passions that left those truths implausible to many. The Founders held human equality to be self-evident; the British regime and their American partisans did not. In proclaiming independence, the Founders made the British regime and its partisans ‘foreign.’ By Lincoln’s time, however, the sons of the new republican regime of popular self-government themselves had factionalized, one side attempting to found a still newer regime on American soil, a regime dedicated to the proposition that all men are not created equal, that some rule by natural right over others. 

    “In his opening paragraph, in thirty words, Lincoln has performed an act of remembrance. His description of ‘our fathers’ is meant to make his audience reverential. But, at the same time, the generative imagery conveys the message that each successive cohort of Americans is essential to the maturation or completion of the founding. The needed proof is ongoing.” The proof has implications beyond America. “At stake is the very possibility of political life based on such premises…. The failure of the American experiment would constitute the failure of popular government altogether,” in view of the almost uniquely favorable conditions that prevail on the North American continent. If a president duly elected under the Constitution may be rejected by a substantial body of citizens, does that not amount to a rejection of the Constitution itself? Does secession, like mob rule, not imply anarchy, or perhaps the proof of force, of bullets, over proofs of reason, of ballots? “The dynamic of despotism was such that the rejection of first principles led inexorably to an assault not only on majority rule but on other constitutional rights as well”—an assault seen even before secession, in the censorship of abolitionist literature in the southern mails and the ‘gag rule’ in Congress. The defense of slavery finally required the planned death of civil liberty in America, the abortion of the nation conceived in liberty.

    What is being dedicated at Gettysburg is a cemetery, a house of the dead. But, as Schaub writes, Lincoln “goes to some lengths not to utter the word ‘cemetery,” calling it instead “a final resting place for those who here gave their lives that that nation”—the one “so conceived and so dedicated”—might live. The resting place has been placed on a battlefield, a field of action, and that action must continue if that nation is to live. The battle itself had instanced a rare invasion of the Confederate troops on territory held by the Union, on the remaining land of liberty. If America has remained secure from foreign invasion, as Lincoln expected in the 1830s, it has not remained secure from internal invasion by troops commanded by a seditious faction. Altogether, Lincoln judges it “fitting and proper” to dedicate a part of the battlefield to those who have rested from the task of defeating the attempt to sunder the American republic and to deny the principles of that republic in theory and in practice, ruining the regime that makes the extensiveness, fertility, and salubrity of the American land serve the good of the people on it. Parts of that land, including Gettysburg, have become battlefields in the struggle over what regime will rule that land and that people.

    “But in a larger sense,” Lincoln writes, “we can not dedicate—we can not consecrate—we can not hallow—this ground.” Schaub calls Lincoln’s “But” “the most significant use of the word in the literature of the English-speaking peoples.” It was the action of the soldiers, not the words uttered by the speakers and heard by the audience, which has already dedicated, consecrated, and hallowed it. “Lincoln pivots from words to deeds.” As a speaker who is also a doer, Lincoln would emphasize we in each segment of that segment, three ‘we’s’ that parallel the three he’d enunciated in the previous paragraph, where he said, “we are engaged in a great civil war,” “we are met on a great battlefield of that war,” and “we have come to dedicate a portion of that field.” In that paragraph, he called attention to our actions, things “we” have successfully done; in this third paragraph he calls attention to the inadequacy of speech alone to accomplish the ends it proposes. Unlike the consecration of the host in the Roman Catholic Church, words have yet to be made flesh in American; God has created all men equal in their rights to life, liberty, and the pursuit of happiness, but dedication to securing that equality in a political regime has not sufficed to such a securing. Lincoln therefore “speaks for practical effect,” urging his listeners to put the words of the Declaration into practice. “Lincoln, like Pericles before him in his Funeral Oration, must redirect the energies of his audience to something more productive than mourning.” He wants Americans not so much to dedicate a cemetery to those who can no longer act but to dedicate themselves to right action in “the cause of self-government,” a cause “proper to us as Americans, and proper to us as free and equal human beings.” In so doing, he “remind[s] the listener of the essential similarity of the living and the dead,” whose cause is the same as our cause. “We must act as they did. It is not enough for the nation to have been dedicated or for the cemetery to be dedicated; we must be dedicated.” Lincoln thereby turns the truths of the Declaration (it was, after all, only a declaration) “into a task.” 

    To do this, he begins with the dedication of the nation and of the cemetery, moves to the devotion to the cause seen in the actions of the dead soldiers, and finally to resolution: “that we here highly resolve that these dead shall not have died in vain—that this nation, under God, shall have a new birth of freedom—and that government of the people, by the people, for the people, shall not perish from the earth.” Schaub observes, “whether used as a verb or a noun,” ‘resolve’ “is a practical word that has both mathematical and political applications.” Legislative assemblies pass resolutions; mathematicians solve problems, prove or disprove propositions. Here and now, “the answer to the question of whether the nation will endure is to be found through resolve. To be effective, dedication and devotion must take the form of resolve,” replacing unsteady and often self-contradictory passions. In real life, in which the rational laws of Nature and of Nature’s God prevail, there’s no such thing as a lion-eagle. Tyranny is incoherent.

    To be untyrannical, civil laws must comport with natural laws. As Lincoln maintained in the Lyceum Address, there can be bad laws. If all laws were bad, if law itself were bad, no one would reverence them and no one would resolve to obey them. Behind any set of laws stands the regime that enacted them. “Lincoln’s fidelity to republicanism is visible…in the trusting manner by which he addresses fellow citizens”; “letting them know what needs to be done and how it can be done, he leaves it to them.” At Gettysburg he talks about these dead and us, the living, but not about himself. Today, “humility has disappeared as an element of rhetoric” (Muhammad Ali put a stake in it) but it is “in no way at odds with loftiness of aim.” “After all, mere personal fame and fortune are not particularly lofty, whereas the achievement of self-government is.” The Union, the nation under God, and the republican regime are all greater than even Lincoln, and Lincoln knows it. 

    Lincoln even submits himself to the laws of grammar. He is “a master of prepositions,” those words that indicate “the relations between things.” Such relations are not synthetic; the things retain their integrity, even and in some cases especially in relation to one another. His best-remembered set of prepositions is “government of the people, government by the people, government for the people.” Schaub “giv[es] these relations a Lockean gloss,” suggesting that government of the people refers to the social contract, the consent of the governed, that government by the people refers to the form consent takes “in a constitutional democracy,” and government for the people means government for the people’s benefit, for the common good. Such government is never ‘over’ the people. Another possibility is that government of the people means exactly that: the people are governed, but they govern themselves. The people both rule and are ruled—Aristotle’s definition of politics strictly speaking. They govern themselves for their own good, to secure their unalienable natural rights with conventional laws. 

    The problem has been that “the people” have excluded slaves from the regime. The “new birth of freedom” the nation—now more fully understanding what God requires of the nation that lives under Him—will now recognize “the civic claims of black Americans” and do so, it should be noticed, not only by abolishing slavery and the laws that buttressed it but by changing the regimes of slaveholding—oligarchies with aristocratic pretensions—which had prevented the United States from being a fully republican regime. “The principle for which the war was fought was the principle of free elections,” the principle that prefers ballots to bullets, the legal set of actions that bespeaks freedom. The old birth of freedom acknowledged the universality of natural rights but did not fully embody it; its conception was right, but the child was bound too tightly by the swaddling clothes. As Schaub nicely puts it, “the liberty of the opening” of the Address “was associated with conception, not birth, whereas freedom itself is now the thing born.” Now, “the original conception in liberty could progress toward the actual birth of freedom as a consequence of the renewed dedication to equality.” In this regard, one good effect Lincoln had a fellow American was to bring Walt Whitman to his senses or, more precisely, to his right mind. In his poetry, Whitman famously intoned, “Do I contradict myself? Very well, I contradict myself. I am large, I contain multitudes.” Yet when thinking of the emancipation of American slaves, when thinking as it were prosaically, he called it “that parturition and delivery of our at last really free Republic, born again, henceforth to commence its career of genuine homogeneous Union, compact, consistent with itself”—no longer self-contradictory. Lincoln might be said to write prose poetry, poetry governed by reason not impassioned effusion.

    “It’s important to remember that the freedom Lincoln heralds is an infant freedom, in need of further maturation.” It will need Constitutional amendments to solemnize it. For its maturation it will also need to acquire “moral and intellectual virtue through the disciplines of habit and study,” since “as a nation, we have done better in extending freedom than in educating for it.” Lincoln began this task at the Young Men’s Lyceum and continued it as president. 

    The supreme teacher is God. “According to Lincoln, the superintendence of God plays a role in the new birth of freedom.” His “hint here of a politically active, justice-seeking, providential order, setting certain limits upon human action, will come to fruition in his Second Inaugural,” to which Schaub now turns.

    “If Gettysburg is Lincoln’s war speech, then the Second Inaugural is his peace speech”—peace being the purpose of war, as Aristotle teaches. “Just as he fought the war with resolution rather than fervor, he wages the peace with charity rather than pride.” Lincoln knows that Biblical charity differs from mere material generosity or liberality; it means loving the good for other persons. Charity thus requires knowing that person as he really is, knowing what the good is, and knowing what the good is for that person. In 1865, reconciliation of the American factions “requires truth-telling and an inquiry into the cause of the war.” It requires education. In a later speech, Lincoln will make equal education of whites and newly freed blacks a central task of Reconstruction, as he planned it, along with conferral of the right to vote on the freedmen.

    In our own days, the New York Times (which I understand to be a newspaper published in New York City’s Borough of Manhattan) has formulated an educational curriculum called the 1619 Project. Schaub judges that “the Second Inaugural is the original and better 1619 Project.” While both ‘projects’ “share the conviction that Americans must fully feel and acknowledge the nation’s foundational wrong,” slavery, Lincoln’s version is superior in “historical accuracy,” “psychological realism,” and “political prudence.” He takes account of obstacles to reconciliation, which included “the temptations of northern moralistic arrogance, southern regressive resentment, white race hatred, and Black rage”—none of which have disappeared in the near century and a half since Lincoln wrote. By interpreting the war in a way “designed to blunt the force of each of these passions,” Lincoln follow “the spirit of reparative atonement.”

    Once again, the word “I” enjoys no prominence. And unlike the Gettysburg Address, the Second Inaugural doesn’t use “we” very often, either. This time, the noteworthy word is “all.” The war was ‘us-versus-them,’ as any war must be. The peace speech “is a speech about the whole, about how to put ‘the whole population’ of a fractured country together.” Here as before, he shapes “public sentiment,” that “conjoining of judgment and feeling,” now to “support the practical and immensely difficult work ahead.” To do so, he directs American minds to consideration of the past, initially to the time of the First Inaugural in 1861. He recalls that at that time “no one wanted war,” that the conflict “was over the Union,” that the unwanted war came anyway as a result of actions taken and choices made, and finally that the war was therefore no accident but the “logical result” of those actions and choices. In considering the actions and choices of that time, he clearly favors the Unionists while still assigning some moral responsibility for the war to them.

    What, then, caused the war? It wasn’t immediately a war of religion, since both sides, as Lincoln puts it, “read the same Bible, and pray to the same God,” invoking “His aid against the other.” The war came instead from a difference of opinion over slavery. Although “slavery and color are entwined with one another” in America, Lincoln “does not use the word ‘race,’ characteristically inviting his readers to think of a difference between peoples that is “only skin deep.” He describes slavery as “a peculiar interest,” a condition whereby, in Schaub’s elaboration, “human beings become a commodity in which other human beings”—the “oligarchic few”—hold “an economic interest.” In a speech delivered before he became president, he had “described how the meaning of the Declaration was obscured by the lust for profit: ‘the plainest print cannot be read through a gold eagle,'” the coin of the American realm at that time. If the few are of the tribe of nature’s eagle in a grandly dangerous sense, the many are of the tribe of conventional eagle in a petty but in some way no less dangerous sense, at least when it comes to countenancing slavery, and therefore tyranny, in their midst. Lincoln now declares, “All knew that this interest was, somehow, the cause of the war,” and in honesty every American should understand this to be true, despite the niaiseries of the Confederacy’s defenders, then and now, who pretend it was all a conflict over ‘states’ rights.’ (States’ rights to be sure, but the states’ rights to do what, if not to enact and preserve laws enforcing slavery? No one familiar with the Congressional debates of the 1850s can honestly believe that slavery wasn’t the issue that divided the American house.)

    “Lincoln now declares that the abolition of slavery is more fundamental than a Confederate victory would have been, even though such a victory would have dealt a death blow to the nation and a devastating blow to the cause of self-government.” Popular governments had failed before, and have failed since, but “a war fought between white citizens over the fate of Black slaves that leads to the emancipation of four million men, women and children is something both ‘fundamental and astounding.'” One is tempted to call it ‘exceptional.’ 

    But what has God to do with it? During the war, in their prayers, Unionists and Secessionists alike have “weaponized” “the bond of Christian belief,” praying to the one God to rally to “their side.” Midway through the speech, Lincoln makes religion “the main topic,” as he attempts “to reverse this partisan appropriation of divine power.” But if reverence for the laws could be offered as America’s civil religion in the 1830s, that will no longer suffice during a civil war, when a faction has broken the supreme law of the land by sundering the Union. Religion must now address the condition of war. True enough, “God may be the God of Battles, but not in the sense traditionally understood and invoked.” First, the God of the Bible makes the curse of Adam, that he shall work by the sweat of his brow, universal. If you do not work by the sweat of your brow but coerce others to work for you, you are a tyrant and no faithful lover of God or of neighbor. Work is the means of liberty in this post-lapsarian world. Free labor brings what human beings may in this life enjoy when it comes to hope, energy, progress, and improvement; free labor cultivates thought, empowering reason to rule in practice. This implies a firm if toned-down judgment against slavery. But also, “Judge not that ye be not judged,” a Biblical monition Lincoln aims at the victorious Unionists. He wants no triumphalism among the winners, who have also lost many of their own sons. In both the Lyceum Address and the Second Inaugural, Lincoln urges his fellow citizens to understand self-government as the rule of reason, the rule of the distinctively human capacity, despite the radical change in circumstance that nearly three decades of political turmoil, civil and uncivil have wrought. 

    “How to explain these unanswered prayers?” It could be that there is no God to hear them, but Lincoln “either rejects or suppresses this atheistic possibility.” God doesn’t always answer our prayers because His purposes are not our purposes and, absent revelation, we don’t know what those purposes are. In the Civil War, “God’s intention has disclosed itself slowly and through our mutual suffering.” That suffering has indeed been mutual, an experience that unites rather dividing us, because all human beings have sinned, and rightly suffer. “While using religion for political purposes, Lincoln does so to encourage humility rather than pride or certainty,” the way we sinners prefer to use it. Slavery, Lincoln tells his fellow citizens, has not been “Southern slavery or African slavery but ‘American Slavery'”; sin “belongs to the nation, the punishment is meted out to both North and South.” Northerners didn’t own slaves who harvested cotton and tobacco, but they wore the first and smoked the second; in fact, even free blacks (one in ten of all black Americans) enjoyed those privileges, too. “Lincoln’s strategy is to nationalize the wrong,” not “to racialize it.” He invites all Americans to pray not for victory, which by now was nearly assured, but for peace. 

    One might still ask, was the suffering God inflicted upon Americans just? How can such an immense punishment, more than Americans would suffer in the two world wars of the next century, be the act of a just God? Lincoln replies that God has been not only just but merciful. Have Americans shed as much blood in shooting and cutting each other as have been drawn by the slaveholder’s lash? Hardly. And “the shedding of blood is fundamentally not an assault on a body but on a being made in the image of God,” whose injuries the God who made him might well in justice avenge. Have they spent as much treasure in this war as they accumulated “by the bond-man’s two hundred and fifty years of unrequited toil,” since he first was brought here to Jamestown, Virginia in 1619? No. With her usual perspicacity, Schaub notes that Lincoln writes “bond-man” here, not “slave.” “Bond-man” is “an old English term” emphasizing the “personhood” of the servant. The King James Bible uses it “to remind the Hebrews of their deliverance,” as when the prophet tells them to “remember when thou wast a bondman in Egypt,” eventually “redeemed” by the LORD. Lincoln draws the analogies of the Israelites to African-American slaves and of the American people to Pharaoh. He might also be reminding Americans that they were bondmen in America, under ‘Pharaoh’ George III. If that civil war pitted English against English, this civil war, also a “war between brothers” in a House Divided, “is divine chastisement for the other brothers’—the Black brothers—enslavement.” Had they not suffered even more severely than the American English had suffered at the hands of the men the Declaration calls “our British brethren”?

    Schaub suspects that Lincoln learned of the malign inheritance of 1619 from William Grimshaw’s History of the United States. Grimshaw writes about the Dutch slavers who sold slaves purchased on the eastern coast of Africa to Virginia planters at that time, an event he describes as “a climax of human cupidity and turpitude.” He went on to describe the then-ongoing emancipation of slaves in the North to advocate an end to “domestic bondage in the remaining states, citing the words of the Declaration and the instruction of George Washington” in his Last Will and Testament to emancipate the slaves at Mount Vernon. Lincoln himself “consistently argued that political necessity left the founders no choice but to accommodate the pre-existing colonial injustice, even as they pronounced it a grievous wrong,” but in the Second Inaugural he now “adds the somber thought that submission to necessity does not negate the weight of the past and its moral obligation.” Unlike the current 1619 Project, however, which “argues that the nation is irredeemably racist, racist from the beginning and racist throughout,” Lincoln regards 1776 not as “a continuation of the spirit of 1619 but its antithesis, and that “1787, too, although pragmatic in its compromises, was anti-slavery in principle,” unlike the Confederate constitution of 1861, which “enshrined the spirit of 1619” by stipulating that no law “denying or impairing the right of property in negro slaves shall be passed,” and that “the institution of negro slavery, as it now exists in the Confederate States, shall be recognized and protected” not only in the existing Confederate states but by any subsequent territories annexed by that confederation. 

    Schaub pauses to remark that “we should never forget that the enslavement of Africans was a global phenomenon,” with the Arab-Muslim trade beginning more or less as soon as Muslims advanced into Africa, a millennium before 1619; of the 10.7 million Africans who survived their cruel shipment to the Americas, 3.6 percent went to North America, the remainder to Central and South America and the Caribbean.  Of those who came to the United States, the vast majority arrived between 1810 and 1860; this “means that roughly 80 percent of those ever enslaved in North America were freed in consequence of the Civil War. The price was high: “One soldier died for every seven persons enslaved from 1619 to 1865; and one soldier died for every six persons freed by the 13th Amendment.” Even then, Lincoln implied, not every drop of blood “drawn from the lash” had been repaid by the blood of Americans; were it so, the judgment of the Lord would remain “true and righteous altogether.” 

    Southern theologians and laity alike didn’t like the sound of that. They explained away their losses in the war as a test of God’s chosen people, not as punishment for their sins. “Lincoln does what he can to help southerners admit their error,” but (as it happened) to little more effect than his plea in the First Inaugural for southerners not to secede had had. 

    Undeterred, Lincoln ends his speech by calling on Americans to “strive on to finish the work we are in” in the spirit of malice toward none, charity for all. “The aim of the speech has been to arrive at this call to action,” in that spirit—in Schaub’s words, “to imbue the demands of duty with an overarching spirit of kindness and patience.” Having “started with all Unionists in the first paragraph,” he expands “all” to both Unionists and Disunionists in the second, widens it to include “the slaves and their stolen labor” in the third. “Finally, Lincoln calls on his listeners to feel ‘charity for all,’ to strive ‘to do all’ that accords with peace properly understood, closing with a global extension to all nations”: in Lincoln’s words, “to do all which may achieve and cherish a just, and a lasting peace, among ourselves, and with all nations.” Charity and peace: the Second Inaugural, with its new birth or baptism at the price of blood sacrifice, is America’s ‘new testament.’ [3]

     

    Notes

    1. Lion and eagle together make a griffin, the mythological being depicted in Christian iconography as the beast of the Apocalypse. On a more down-to-earth level, the lion is a predator on land, the eagle a predator from the air who attacks and devours the groundlings. These are predators the rich American land might support. For a consideration of the predator-tyrant at sea, Melville’s Moby-Dick may be consulted. The tyrant of the sea turns out not to be the whale but the man, Ahab, aided by his demonic familiars.
    2. For further discussion of Lincoln’s Biblical allusions on this point, especially Numbers 11, see Will Morrisey: Self-Government, The American Theme: Presidents of the Founding and Civil War (Lanham: Lexington Books, 2003, 178-179. 
    3. See Ibid. 180-181.

     

    Filed Under: American Politics

    Washington Politics during World War Two

    December 7, 2021 by Will Morrisey

    Nancy Beck Young: Why We Fight: Congress and the Politics of World War II. Lawrence: University Press of Kansas, 2013.

    H. G. Nicholas, ed.: Washington Dispatches 1941-1945: Weekly Reports from the British Embassy. Chicago: University of Chicago Press, 1981.

     

    The military, geopolitical, and diplomatic history of the Second World War may be described as familiar. But the war years also saw an important shift in American domestic government, whereby the New Dealers’ administrative state, envisioned by President Wilson and established by President Roosevelt, was firmly cinched in. Nancy Beck Young provides a scholarly overview of this task. The eminent Oxford philosopher and political observer Isaiah Berlin, who wrote the Dispatches for British Foreign Secretary Anthony Eden, offers a week-by-week account of these goings-on, along with any other “attitudes and movements of opinion in the USA considered to be of importance to Anglo-American relations.” Young’s account affirms Berlin’s preliminary assessment, that “the war transformed normal life in the United States far less than in the United Kingdom”; that whereas in Great Britain “everything was centralized and totally subordinated to the war effort…in the USA this was not so; that political and economic life to a considerable degree continued as before, and that this fact, in particular some of the pressures and internecine feuds between individuals and power blocs, inherited from the New Deal and even earlier times, continued to characterize it, and themselves affected the war effort”; this was especially so respecting “the attitude of Congress, which in this respect was very different from that of Parliament.” It could hardly have been otherwise, given the separation of executive and legislative powers in the United States Constitution. This notwithstanding, as Young, with the advantage of hindsight, can see much more clearly than Berlin, under the contentious surface of Washington politics at this time the delegation of power from Congress to administrative agencies was being prepared; the Supreme Court, evidently chastened by FDR’s landslide election victories, would draw back from its forthright defense of the Locke-Madison nondelegation doctrine in the years after the war. In doing so, it would attempt to ‘constitutionalize’ a fourth branch of government, now called ‘the administrative state.’

    During these years, Young writes, “members of Congress fought two wars, the well-known war against the Axis powers and the less well-known war about the New Deal.” In the latter conflict, “moderates and conservatives” in Congress “use[d] World War II to revise the New Deal” in a struggle “about the nature of the state,” a struggle that limited the New Deal regime but also preserved it. Young forthrightly describes the New Deal as “a revolution,” one that “the legislative branch redefined in the decade following its creation,” a redefinition issuing in “the vital center warfare state liberalism of the 1950s.” The scaling back of the New Deal was essential “to institutionalize the New Deal economic order.” This became possible because Congress saw a regime-based factional disputes between “hardcore conservatives and liberals (New Dealers),” a circumstance in which moderates could position themselves to serve as a balance-wheel between the two sides, thereby establishing “the dominant patterns for postwar politics: the solidification but never complete acceptance of New Deal statism” wherein debate continued “about the scale, scope, and purpose of the federal government.” 

    Although Keynesian economics and economic regulation thereby survived, such “social issues” as refugee policy, racial discrimination, and “hunting Communist spies” persisted unresolved, as they “were not important enough for moderates [in Congress] to waste their political capital on, especially when struggles about the economy were intense, and, from their perspective, more relevant to the war effort.” The regnant Democratic Party itself factionalized on the non-economic issues, with Southern Democrats (for example) successfully resisting attempts to end legal segregation in their region. And even on economics, while Southern and Western Democrats supported the New Deal generally, they resented the use of “their regions as colonial economies for the northeast,” as mere sources of raw materials for industrial capitalists and workers there. Meanwhile, among conservative Republicans and Democrats, the efforts of some at “overcoming isolationism, a key component of conservatism since the end of World War I, proved to be the biggest obstacle” to unity. The Pearl Harbor attack weakened isolationism for the remainder of the war, and the threat of Soviet communism kept it in abeyance for the duration of the Cold War that followed. Conservatives were thus freed to concentrate their minds on preventing “the federal government leviathan from becoming permanent and eliminating individual economic liberty,” a threat they saw in President Roosevelt’s use of executive orders not as means of enforcing Congressional legislation but as “a device for unilateral policymaking initiatives”—a tactic Senator Robert Taft of Ohio saw as an attempt to make Congress “the mere shell of a legislative body.” Indeed, during the war Congress increasingly turned less to legislating and more to overseeing executive branch activities, with committees investigating the conduct of the war and the presence of Communists in the federal government. 

    The economic dimension of the New Deal regime centered on what Young calls “resource management, especially taxation and price control.” In their opposition to this, “conservative congressmen learned, much to their chagrin, that the New Deal was too powerful to be erased, while liberal congressmen lamented it was not powerful enough to be expanded.” This “New Deal ethos”—meaning reliance on an activist regulatory government—became “a permanent part of the American polity, but in an altered form skewed away from welfare and toward warfare,” at least during the war years themselves. The struggle was nothing less than “a contest over the meaning of the Constitution in the twentieth century.” While “lawmakers compelled President Franklin D. Roosevelt and the mushrooming federal bureaucracy to scale back some of the more grandiose plans for empowering nonelected experts,” it “constructed a resource management policy regarding taxation and price control that made permanent a circumscribed but still activist state.” By the 1940s, a substantial number of Congressmen had grown “weary of the president,” but with “the coming of the war” they could scarcely enjoy “the luxury of divorcing themselves from the White House” and its resident Commander-in-Chief. “The war necessitated the political deference to the White House, but this short-term solution constituted an institutional mistake from a long-range perspective” by “further entrench[ing] a presidency-centered orientation to the federal government.” At the same time, the need to fight the common enemies overseas diluted the “ideological underpinnings” of the political struggles of the 1930s, bringing instead a “liberalism” that “was more pragmatic” and thus more palatable to moderates. Conservatives, who would have liked to use wartime Congressional committee investigations as means “to destroy the New Deal,” couldn’t go too far without being seen as hindrances to the war effort. Neither liberals nor conservatives could press the advantages they enjoyed as forcefully as they would have liked. 

    This notwithstanding, liberals had the edge. Although the Price Control Bill of 1941 and the Emergency Price Control Act of 1942 provoked “increasing hostility to the administration” in Congress, serious opposition proved impossible in the face of accusations that anyone who opposed these measures—which effectively transferred substantial lawmaking powers from Congress to federal agencies, substituting regulations for actual laws—was ‘objectively’ pro-fascist, obstructing the orderly conduct of the war by enabling war profiteers to rip off their fellow Americans. The New Dealers could continue “to operate over the separation of powers”; “Congressional Democratic success on resource management early in the war defined what was and was not possible in the highly charged partisan war over New Deal liberalism.” 

    The test came in the 1942 Congressional elections “The Republican Party ran against the domestic war effort,” with its “command economy” of rationing, price control, limits to commerce and trade. With full employment suddenly restored thanks to the war industries, the Democrats lost in their domestic saliency what they gained from patriotic sentiment. “Wage and price controls angered both workers and farmers, two key constituencies for the Democrats.” And even wartime patriotism proved a mixed blessing for New Dealers early in the war, since the United States and its allies met frightening battlefield reverses. As a result, conservative Republicans made substantial electoral gains, although Democrats maintained majorities in both houses. With New Deal liberals weakened, “moderates and conservatives forced a redefinition and constriction of liberalism away from the experimental approaches of the 1930s, previewing what would dominate domestic politics in the postwar years.” Whereas “FDR had originally planned for his 1943 State of the Union address to be a forceful brief for postwar domestic reform,” his allies in Congress and on the Supreme Court persuaded him that such an appeal “would be read as a declaration of war on Congress,” ruining his relations with it “for the duration of his tenure.” Hence FDR’s prudent rhetoric about how “Dr. New Deal” would now stand aside for “Dr. Win the War”—a change of physicians not even conservatives could protest. 

    Sharp disagreement on tax policies continued, however. Senator Sam Rayburn complained that “the president paid too much attention to ‘bad advice from some smart alecks he has around him,” meaning his well-educated, liberal minded advisors who had “no appreciation for how Congress functioned.” From then on, Young observes, “all of Congress’s efforts to assert its coequal role with the president the burgeoning imperial presidency presented a major, ongoing challenge to lawmakers interested in following the edicts of the Constitution regarding governance.” 

    Although “labor politics proved the most contentious of the wartime resource management issues before Congress,” the exigencies brought on by the war forced both liberals and conservatives, union leaders and businessmen, to strengthen the underlying structure of the New Deal regime, “prevent[ing] a return to the pre-New Deal ethos.” Could the United States government “compel work in a total war”? Could “and should” that state “compel employers to disregard gender and race”?

    These questions were paramount because “the production of war material as the leading U.S. contribution to the war effort,” with some 10.5 million new workers taking jobs during the war, a number that “far outstripped civilian workers among the other Allied and Axis nations.” When FDR coined the phrase “Arsenal of Democracy,” he stamped it on real metal. Even the notorious internment of Japanese American citizens served the domestic side of the war effort; the Works Progress Administration built and oversaw most of the internment camps, where the internees were put to farm work.

    Objections to compulsory labor centered on the meaning of such a policy for the American regime. Young quotes a Democrat Oklahoma congressman, Wesley E. Disney, who explained that both democratic self-government and the federalism which supported it were threatened: “I think that the States and the legislatures and the courthouses are where democracy is. This thing up here”—the federal government—is “the superstructure of democracy,” but it’s “down here” in the states and municipalities “where you and I, the humblest citizens, has a right to assert himself.” Federally mandated and regulated work “turns the individual over to an administrative system where he has no legal right to assert himself and no recourse to the ballot.” Ohio Republican Senator Robert A. Taft argued similarly: since “we are fighting for a democratic system of government,” we shouldn’t “suspend any more of our own freedom than necessary” to win that fight.

    Seeing what they supposed to be an opportunity, several union leaders called strikes, demanding higher wages for their members. This backfired in the short term, as Americans had no patience with workers attempting to use a national crisis for their own material benefit, especially since other Americans were being pushed into working without the benefit of union membership. In the long run, however, the political economy of the war accustomed Americans to bureaucratic rule by a centralized state; also, seeing that the unions were not allowed to exploit their organized power in wartime, Americans saw that their sway could be limited in peacetime. There would be no proletarian takeover of the United States, although union members did win wider powers to file grievances against employers. Such compromises more fully instantiated the New Deal to a degree that might have proved impossible had the Depression ended without American entry into a world war.

    Refugee policy proved unresolvable. After the surge in immigration prior to the First World War, sentiment against Europeans increased during the war itself, and Congress shut the door in the 1920s. In the months before Pearl Harbor, the debate over Roosevelt Administration policies strengthening military preparedness became entwined with some extraordinarily nasty rhetoric about the alleged menace of “Jewish bankers”—to the extent that Nevada Democrat M. Michael Epstein was compelled to remind his colleagues that “we live in a democracy” founded on the principle that “all men are created equal regardless of race, creed or color; and whether a man be a Jew or Gentile he may think what he deems fit.” Unfortunately, when it came to admitting Jewish refugees from the Nazi-ruled nations, “race and racial prejudice not governmental theory dominated,” and FDR “was unwilling to do much to alleviate the problem.” In this, compromise was no option, and the “restrictionist anti-Semites” in Congress shrewdly avoided any “anti-New Deal rhetoric” in the debates. As for those House of Representatives members who supported sending Jewish refugees to Palestine, in Young’s estimation they displayed “self-promotion more than commitment to mitigating the refugee crisis.” Almost all were from New York State, playing to the substantial number of Jewish constituents there. The senators who supported political Zionism, including Missouri’s Harry Truman, were more principled, “motivated more by political ideology than state voter demographics.” In this, they courageously opposed constituent sentiment, as 75% of Americans opposed refugee immigration and nearly half held European Jews “partially responsible for the actions Hitler had taken against them.” Even after the enormity of those actions began to be understood and publicized, many blamed the messengers, with more than 50% of the respondents in one poll complaining that “Jewish Americans had too much influence in the country.” Such attitudes made it “all but impossible for Congress to act on the most significant wartime humanitarian challenge before it.” In this, democracy acted as it often had done in ancient Greece: against justice. Although American republicanism or representative government was designed, in Madison’s famous words, “to refine and enlarge the public views,” it proved unable to do so, despite Congressional hearings in which members discussed the possibility of Hitlerian genocide as early as mid-1939. As early as 1933, Republican New York Congressman Hamilton Fish had submitted a resolution condemning “economic persecution and repression of Jews” in newly-established Nazi Germany; during the war, he sponsored numerous temporary tourist visa applications for European Jews and he even undertook “secret, unauthorized diplomatic relations with the British and the French to try to have space opened for a million refugees in Africa”—all to the indignation of Roosevelt, who regarded foreign policy as his exclusive domain and evinced little sympathy for the victims. Fish simply lacked the political standing to take meaningful charge of the matter. “Because there was no dominant voice in the war era about this matter, the restrictionists carried the day, at least until the war ended” and “the discovery of the death camps proved that the brutal facts” served “as a better leader than any president of member of Congress.” Neither the democratic republicanism left over from the old regime nor the administrative statism advanced by the new regime vindicated the natural rights of foreigners.

    What about the natural and civil rights of American citizens? In the third and last domain Young chooses to consider in detail, the New Dealers’ stated esteem for civil liberties (and especially civil liberties for African Americans) within the framework of an administrative state that might threaten those liberties were also subordinated to the war effort.

    Putting the matter plainly, Young writes, “The fulmination of racist southern demagogues dominated the political discourse and prevented an expansion of New Deal economic liberalism to include civil rights liberalism.” This is clearly but not adequately stated, inasmuch as civil rights liberalism would have been consistent with the principles if not the practice of the old regime, grounded as it was on equal natural rights. In fact, the pre-New Deal progressivist liberalism endorsed so-called ‘race science’ as one dimension of progress; some Americans had done so before Progressivism existed, as seen in the writings of John C. Calhoun and many others. Lynchings of innocent black Southerners continued, albeit more discreetly than before. This notwithstanding, Northern blacks continued to align themselves with the New Deal, encouraged by the favorable stand taken on civil rights by northern Democrats and frustrated by the failures of latter-day Republicans to act vigorously in their defense. The Supreme Court’s ruling in the 1944 case, Smith v. Allright, reversing a 1935 ruling, backed up civil rights advocates by judging the Texas practice of all-white political primaries unconstitutional. But this, Young insists, only “emboldened” the Southerners, who used it as a talking point for continued assertion of ‘states’ rights.’ In the untender words of South Carolina Democrat Ellison D. Smith, “I’m still for white supremacy and those who don’t like it can lump it. Those who vote for me I’ll be much obliged. Those who don’t can go to hell.” 

    While standing on solid ground respecting civil rights, Young much more dubiously classifies the investigation of Communist penetration of the U.S. government as another civil liberties issue. “The earliest anti-Communist activists targeted the New Deal in the continuing congressional assault on liberalism and the statist policies developed in the period” beginning with the establishment of the New Deal itself. Young dismisses these efforts as attempts “to halt the New Deal, not to root out communism,” but she fails to consider the New Dealers’ endorsement of a ‘popular front’ strategy in the mid-thirties, whereby New Dealers welcomed socialists and communists in a coalition conceived as ‘one big Left.’ Given the malignant character of the existing communist regime in the Soviet Union, why might this intention not reflect poorly on New Deal liberalism, and surely on the judgment of New Dealers? In his capacity as chairman of the House Un-American Activities Committee, Texas Representative Martin Dies (himself a New Dealer, during the first Roosevelt term) proceeded to “damage the New Deal coalition and narrow the options for reformers in the postwar era.” 

    The core of Young’s error may be seen in her claim that “circulation of rumors conflating a legitimate political ideology—liberalism—within the mainstream of the American political tradition with communism—a political ideology that for better or worse terrified many Americans”—did the aforementioned damage. Congressional conservatives “implied [that] New Deal liberalism was actually foreign and antithetical to the nation’s political tradition.” But was it? The New Dealers’ immediate ideological predecessors, the Progressives, surely did not regard their enterprise as integral to the American political tradition. They rejected natural rights for historical rights and dismissed the U.S. Constitution as the product of an outmoded ‘Newtonian’ understanding of nature, to be rightly replaced by the more accurate ‘Darwinian’ understanding of nature as evolutionary or ‘historicist.’ The New Dealers made Progressivism more practical, less ‘idealistic,’ but they never backed away from historicism and from the rejection of the Constitutional separation of the separation of powers. They continued to regard the Constitutional as an ‘elastic’ or ‘living’ document—that is, one properly to be ‘reinterpreted’ in ways unrelated and indeed opposed to the plain meaning of the words on its pages. Obviously, this is not to say that New Deal liberalism was ‘as bad as’ or ‘the same as’ communism or fascism. The historicism of Hegel is not the historicism of Marx, the historicism of Marx not the same as that of Woodrow Wilson or of John Dewey (themselves not identical). But the New Deal coalition in its broadest form blurred these distinctions, easily lost during a war in which the Soviet Union fought on our side—sort of—until the end of the war when Stalin decided to hold on to his territorial gains and to install communist regimes on the nations his troops had conquered.

    “Dies willed to postwar anti-Communists a method and a language through which liberalism could be discredited. His work to that end far surpassed any of the economic conservatives during the 1940s or the social conservatives who fought against refugee and civil rights reforms.” This “crusade against statist political solutions” to social and economic problems “slowly expanded and threatened the center left warfare state iteration of the New Deal order made permanent in the 1940s.” She cannot simply mean the tactics of Wisconsin Republican Senator Joseph McCarthy in the early 1950s, which failed to derail that moderate New Dealism; she must mean the critique of New Dealism, and of the anti-anticommunism of many Democrats in the 1970s and 1980s, enunciated by Governor and then President Ronald Reagan. But Reagan, who had been a Democrat (albeit one who supported the anti-communist Harry Truman not the Popular Frontist Henry Wallace in the late ‘Forties) scarcely qualifies as a ‘McCarthyite.’ 

    These flaws aside, Young does provide a serviceable overview of American politics during the war. The collection of dispatches authored by Isaiah Berlin sent from the British embassy where he was posted, necessarily provides a more detailed account of these struggles, one in many ways sharper-eyed than that of Young but nonetheless oddly consonant with her latitudinarian views of communism. To his credit, Berlin seems to have sobered up about the communists after the war, perhaps as a result of his 1945 conversation with the Russian poet Anna Akhmatova, who had been cruelly persecuted by Soviet operatives for decades.

    Berlin understands that as a democratic republic the United States is largely ruled by public opinion; his task was to provide British Foreign Secretary Anthony Eden and Prime Minister Churchill with “information about changing attitudes and movements of opinion in the USA on issues considered to be of importance to Anglo-American relations.” The “rapturous unity” that followed the Pearl Harbor attack quickly gave way “to an atmosphere of criticism”—not of America’s involvement in the war but of inefficiencies attendant to fighting it, particularly in the Office of Civilian Defense, where James Landis was quickly brought in to assist the stumbling Director, Fiorella La Guardia, who had retained his office as mayor of New York City while signing on the the federal post. “It is typical of Mr. Roosevelt’s administrative methods, when one of his officials is criticized, not to displace him but to appoint somebody else to do the same job.” 

    When it came to the American public’s opinion of Great Britain, Berlin saw that much work needed to be done. “I am concerned by the indications that the innate inclination to think and hear ill of our country and of us so readily comes to the surface,” although “the heads of the Administration are wholeheartedly convinced that our two countries must work in the closest harmony during the war and after.” And even some senior administrative officials prefer to “deal with international problems…untrammeled by consideration of the views of other governments.” He can only recommend “unremitting effort, patience and much wisdom to remedy” the difficulties, “clearly stand[ing] or fall[ing] by what we are,” understanding “that Americans are foreigners to us and we to them.”

    The year 1942 sees little in American military activity, although “the news of the landing of United States forces in Africa” in late fall “was like cool water to a parched throat,” counteracting as it did “the feeling of frustration and meaninglessness which has been a depressing feature in recent months.” Berlin understands that no troops would arrive in Europe until the following year. In the meantime, he keeps track of American domestic politics, including the Congressional elections.

    Given the entrance into the war of the Soviet Union on the side of the Allies, Berlin reports frequently on the investigations of Congressman Martin Dies into the presence of Communists in the Roosevelt Administration, beginning with the Board of Economic Warfare, chaired by the Communist sympathizing Vice President, Henry Wallace. Berlin disparages Dies’ efforts, wishing that he would pay more attention to America’s native fascists, who “are still uncurbed and very vocal in their advocacy of the new form of ‘America First,’ which consists of concentrating on the defense of the American mainland and Hawaii to the exclusion of all else.” By contrast, the American Communists, “following the strict Party line” dictated by the Kremlin, “are for all-out war effort with no discussion of wages.” This has caused a split between the thoroughly anti-Communist American Federation of Labor and the Congress of Industrial Organizations, as fourteen of the forty-four unions in the latter consortium “are reported to be under Communist domination,” and not just by Dies. Similarly, the Catholic Church, with its many Irish-American (and therefore anti-English) members, finds itself split between isolationists, led by the “Radio Priest” Father Charles Edward Coughlin, and such supporters of the war effort as New York’s Cardinal Francis Spellman, a Roosevelt confidant who served as FDR’s emissary to Pope Pius XII. Berlin finds “a considerable fear of Communism” in both official and business circles, “while in the country generally there is no enthusiasm for Russia comparable to that felt in the United Kingdom.”

    Berlin classifies “the anti-Administration forces” in the election campaign into seven main groups: “virulent subversive bodies” that adhere to some form of fascism; the former members of the disbanded America First Committee (“timid businessmen and all those who fear and distrust the central government”); first- and second-generation German- and Italian-Americans, mostly anti-Fascist but “connected by ties of sentiment with their European kinsmen or anxious not to be reminded of the Europe from which they have escaped”; “Anglophobes or Russophobes,” such as “the Irish and Roman Catholics”; those Republicans who “think it important to maintain active political opposition in order to achieve a more effective prosecution of the war”; “groups with special grudges against the administration,” such as the small businessmen without defense contracts; and “Wall Street, fearing State Socialism.” Taken together, this amounts to thirty percent of the population “willing to discuss peace terms with the German Army if Hitler were disposed of” and ten percent who “would make peace with Hitler on the status quo.” “For a “far too wide a section of the American people this is not even yet a really popular war,” nor will it become so “until a great body of American troops begins to take part in actual fighting.” In response to Stalin’s impatience with Americans for failing to open a second front against the Axis in Europe, “a few newspapers…have “ask[ed] what Russia did to open a Second Front when the democracies were at bay in the West.”

    On domestic matters, “numerous speakers in Congress have been publicly and privately exclaiming against usurpation of their legislative powers by growing power of bureaucracy,” sentiments Berlin attributes to corporate interests who regard the New Deal as an effort to “bind them more and more closely to central government by systematic economic subventions for which they and their representatives in Congress pay price of political independence.” Business interests point to the fact that “business enterprise is winning the war by its efforts” in manufacturing war supplies and that “the end of the war will provide unprecedented opportunities for business expansion,” which private enterprise must seize in order to “sav[e] the country from a permanent bureaucratic totalitarianism.” However, “political observers [have] agreed that past interpretations of [the U.S.] Constitution, particularly under wartime presidents, gave [the] President immense undefined powers” on the basis that the safety of the state is the supreme law. 

    Some corporate interests, fronted by the potential presidential candidate Wendell Willkie and the publisher Henry Luce, envision a postwar American “economic imperialism.” Willkie “has failed to make any substantial inroads into [a] Republican machine which remains essentially nationalistic,” a fact that, Berlin worries, “does not augur too well for an enlightened post-war policy on [the] part of [the Republican Party.” Both Republican factions are opposed by Vice President Wallace and others who “are dreaming of a kind of world New Deal,” having prepared “blueprints to reorganize the world in order to secure the best distribution of persons and things with a bold programme, which ignores racial and political differences” and aims at “spending the vast natural resources of the United States upon world reconstruction.” Berlin deprecates this one-worldism as “the New Deal as the New Islam, divinely inspired to save the world.” “The clash between those who plan world social and economic arrangements and the dynamic militant technocrats [of capitalism] is perhaps the most important political manifestation at the moment.” While “the isolationist tradition must be expected to reassert itself” after the war “to a degree that cannot now be measured,” “against it may be set perhaps a growing recognition that for [the] United States to get into one war may have been bad luck but to have got into two looks like something wrong with the system.” Berlin himself evidently favors “a United Nations outlook,” but sees clearly enough that such a thing will run into American opposition to the Soviet Union, which “the new Congress is very far” from esteeming.

    In the Congressional elections, the Democrats suffered “much heavier losses than anyone expected both in House and in Senate,” retaining only “nominal control” of the House and similarly unsure control of the Senate, given the Southern Democrats’ tendency to ally with the Republicans against the Administration on “domestic and economic issues.” The Democrats will lose experienced committee chairmen. They now control only half of the state governorships, with Republicans winning in “most important states, such as New York and California.” “For the first time since New Deal came into power Republicans are within striking distance of control in both House and Senate.” Although Berlin cautions that many elections were decided on local interests, not the “big vital and topical national issues which have provided Democrats with big majorities of [the] last few years,” he sees that of the “three great political forces” supporting the New Deal—the labor unions, the farmers, and the average American who had been thrown out of work by the Depression—only labor now supports the Roosevelt Administration. The farmers have lost manpower to conscription and resent this; the Forgotten Man has found employment in the war industries. While “isolationism was not an issue in [the] election,” neither has pre-war isolationism been judged an electorally punishable crime by the voters. The “New Deal must therefore lean for its power not on Congress but on [the] patronage and power of an Administration in office”—much enhanced by the construction of a centralized administrative state. Thus, “despite congressional losses the leaders of [the] New Deal are in no mood to compromise.” 

    In sum, by the end of 1942 Berlin judged that “dislike for the New Deal is, I think, now directed mainly against theoretical ‘intellectual’ planning and its exponents,” with “a large part of American sentiment” evidently “unwilling to be committed to endorsement for this country of [the] degree of social planning which is apparently winning favor with British and European thought.” This has discouraged some of the New Dealers themselves—for example, Secretary of the Interior Harold Ickes, who has been quoted as having said “The New Deal was beat.” 

    The beginning of 1943 features discussion of Vice President Wallace’s most recent effusion, calling an international air force and an “international authority for world projects.” His “enthusiastic praise for Wilson whom,” he judges, “the people of the United States had failed,” prefaced a warning that Germany was already planning World War III, a horror that “only economic justice and international cooperation could prevent.” Congresswoman Clare Booth Luce dismissed Wallace’s “global thinking” as “globaloney,” much to the delight of the conservative press, and “it is clear that Mrs. Luce expresses popular sentiment prevailing at this moment on [this] subject more accurately than do her opponents,” which include Mrs. Roosevelt. For himself, Berlin prefers the more sober Cordell Hull; the Secretary of State has won the respect of conservative Republicans while “genuinely abhor[ring] isolationism as a species of sin.” The shift in Republican opinion reflects a sense that pre-war isolationism has begun to fade, replaced by “varying degrees of nationalism” in opposition to “liberal internationalists whether of [the] Wallace or [the] Hull variety.” Berlin continues to worry about American “dreams of world domination” after the war; “while they may yield to Mr. Hull’s or the President’s wiser counsels, their strength must not be discounted.” Americans worry more about “Russian post-war purposes” than Berlin evidently does; the felt “need to prevent spread of Russia and Communism over Europe after the war” prevails not only “among churches and the Republican Party” but in the State Department, the military, and “sections of [the] Office of Strategic Services.” Later in the year, Massachusetts Republican senator Henry Cabot Lodge would give a speech in which he reasoned that “since the other great powers conceived their vital interests clearly—Britain with her desire to preserve her Empire, Russia with her territorial aims in Eastern Europe—it was high time for the United States to do likewise if they are not to be left without the strategic imports which at the present rate of expenditure they will have need of after the war”; he went on “to pour a practical man’s scorn on the notion of world or regional reorganization unsupported by a previous attempt to harmonize their national purposes by the major allies.”

    Speculation and preparation for the 1944 presidential campaign has seized Washington by March. Minnesota Governor Harold Stassen appears as a rising star on the Republican side, mixing internationalism (a world police force, supervision of airways and seaways by a United Nations organization, lowering of trade barriers, a declaration of universally recognized human rights) with “a strong anti-New Deal bias in internal affairs.” Some Democrats are rumored ready themselves against a Roosevelt fourth term, too, including Postmaster General and Democratic Party National Chairman James Farley, who hopes to draw Catholic voters away from FDR toward James F. Byrnes. Berlin considers this unlikely; Byrnes is a loyalist (FDR had appointed him first to the Supreme Court and then to two major posts in his wartime administration); further, “persons close to [the] White House say that the President is fully resolved to stand again.” 

    Foreign Secretary Eden’s arrival in Washington sparks suspicions in some quarters that the Brits harbor “a desire to mediate between Russia and the United States,” an “attempt by Britain to recover her traditional position as the manipulator of balance of power between Russia and [the] United States as formerly between France and Germany,” a game Americans do “not wish to see…started again.” In April, the president sent his Assistant Secretary of State for Latin American Affairs and ‘Brain-Truster’ Adolf Berle out to assure Americans that Russia will be too busy after the war with the “vast task of internal reconstruction” to undertake a project of expansion into Europe and that, even it it does, the “notion of a cordon sanitaire of buffer states on Russia’s western border was an outworn concept of bad old diplomacy and stultified by modern air power.” Such talk was embarrassed in the following month, when news of the Soviet massacre of Polish army officers in the Katyn Forest reached the United States, but Berlin is reassured that “strong pro-Polish sentiments in [the] United States outside [the] Catholic Church has been rare.” Indeed, pro-Soviet sentiments had been bolstered by Stalin’s conciliatory May Day speech, wherein he announced the dissolution of the Comintern, which “all sides consider…as a deliberate step on the part of Stalin towards [an] understanding with the West,” with “Russophile liberals acclaim[ing] it without reservation as confirming their brightest hopes.” Berle thinks that “Stalin had decided to make clear to the Russian public that [the] era of revolutionary adventures and international conspiracies was over.” Roosevelt knew differently, but didn’t much care. Near the end of the year he told the Greek ambassador that “no fuss would be made by the United States Government about the incorporation of the Baltic States by Soviet Russia, and that after much trouble an appropriate formula to cover this had at last been found”; moreover, FDR confessed that “he was thoroughly tired of the Polish problem, and had told the Polish Ambassador so in clear language.”

    At mid-year, the New Deal shifts a bit to the ‘Right,’ spurred by FDR’s concern that the Southern Democrats might break with the party altogether if the likes of Wallace are not reigned in. FDR had lost patience with Wallace as an administrator; his chairmanship of the Board of Economic Warfare had “failed to do what was expected of it, to resolve inter-departmental disputes in external economic affairs without requiring perpetual reference to [the] President”; the Board’s chief of staff, Wallace ally Milo Perkins, had “maladroitly administered” his underlings “and was a principal source of both confusion and delay in many fields.” “Only old Jacobins of [the] New Deal who follow Wallace and Perkins feel betrayed and they must support [the] President in any case.” Although Berlin could not know it at the time, this prepared the way for the replacement of Wallace with Harry Truman on the Democratic Party ticket as the vice-presidential candidate in 1944. “The New Deal once again has been sacrificed to [the] war effort.” Moderate public opinion in the country “seems profoundly bored with Wallace and New Deal ideals,” issuing a collective yawn in response to his July speech, in which he signaled his intention “to continue as principal champion of New Deal liberalism.” “The present policy of the left wing of the New Deal is to continue to support the President with remorseless fidelity despite his deviations, while fiercely attacking interests which they conceive to be hostile to him, whether or not this suits the President’s actual purposes.” Dr. New Deal had indeed given place to Dr. Win the War.

    1944 begins with the embarrassment of the risible Willkie. The Soviets by now are driving the German army back across Eastern and Central Europe, reigniting the Polish question. Willkie published an article “warning the minorities”—i.e., Europeans now occupied, or about to be occupied, by the Red Army—against “undue agitation but advocating the need for an equitable arrangement, to be found in consultation with Russia, to adjust the status of the border states.” Even such a mild hint has proven a target for Pravda, “which suddenly pitched into him as a political gambler, meddler and opportunist of the first water”—this, after frequently praising him in the past as “a true friend of the USSR.” “As there are few persons in this country familiar with the sardonic pleasure which the USSR is liable to take in tripping up its over-zealous bourgeois suitors when these are guilty of tactless behavior, there is very general surprise” at this move, felt most acutely by the “completely dazed” Willkie. (This minor tempest didn’t prevent Willkie from defeating Dewey in the Republican Party primary election in Wisconsin, a few months later.) As for American Poles, some “are trying to pin their hopes on Churchill inasmuch as they do not expect any further genuine aid from the President.” In Washington, Berlin observes, “there is no great love for Russia but there is great respect and admiration, and general sentiment, discernible in the press and in conversation of young ‘tough-minded’ Washington and other executives whose temper is likely to shape American policy in future years, is that Russia is doing [the] only sensible thing for a rising great continental power”; such American ‘realists’ expect that they may well come to a “direct understanding with Russia,” without the British as an intermediary.

    Berlin is pleased to report that the leading Republican presidential ‘hopeful,’ New York governor Thomas Dewey, opposes any such move, being suspicious of “Russian secretiveness” and sympathetic toward Churchill, “who, he felt, was being blackmailed into a European invasion which would be bloody though doubtless inevitable.” Dewey is firmly allied with the firm anti-Communist, John Foster Dulles, who entertains such globalist illusions as “international control of military establishments” and “protection of religious and intellectual liberty,” despite the existence of the Soviet Union, which might be expected to have a say in postwar arrangements. Berlin is nonetheless encouraged that both men are “genuinely favorable to American participation in world affairs” and to “an Anglo-American alliance.” 

    D-Day brings on “a general tone of opinion” that is “sensible and not over-enthusiastic,” as Americans expect “large casualties.” “There is no observable change in [the] normal life of the country.” Given the “almost automatic tendency of [the] United States press and public to attribute all good things to American authorship there has been relatively little emphasis on primacy of American troops” in the invasion, although perhaps not enough credit given do “justice to our part in [the] enterprise.” 

    The July party conventions yield no surprises. Dewey wins the Republican Party nomination, though he is no one’s real favorite and distrusted by GOP ‘machine’ politicians; “he looked to them a disturbingly cold, tight-lipped, uncommitted and, from their point of view, tricky personality, who might easily not prove wholly amenable” to them “and was, above all, very much not one of themselves.” As it happened, the hapless Willkie would die less than a month before the election. The Democrats—an “unstable amalgamation of interests (conservative Southerners, northern Negroes, labor unions, left-wing radicals, Catholics, foreign-born groups and large city machines) brought together by fortuitous, historical and geographical circumstances and held together more by a common interest in retaining political power than by any single political or economic philosophy,” but “happily for us…not generally divided over [the] President’s foreign policy”—have “finally acquiesced in [the] fact that Mr. Roosevelt was their only possible leader for [the] coming election.” The drama thus centered on the selection of his running-mate. FDR smartly let the Wallaceites and anti-Wallaceites “fight it out” within limits he imposed by circulating a list of acceptable candidates while protesting his preference for Wallace. “In so doing he deftly transferred bad feeling which was inevitable in [the] selection of a Vice-President whatever happened, from his own shoulders to those of party bosses.” The bosses, “who held [the] balance of power” between the liberals and the Southern conservatives, chose Senator Harry Truman, whom Berlin judges as “something of a lightweight,” albeit a likeable, honest, affable, and modest one. He has won accolades during the war for his fair-minded chairmanship of a special Senate committee charged with investigating waste, scandal, and inefficiency in the war effort. “He has never been one of the closest intimates of [the] White House,” and “his capacity to fill [the] presidential chair in an emergency raises obvious questions.” From an electoral standpoint, however, he is an improvement over the silly and controversial Wallace, and that is likely what won the favor of Party bosses. “No one can say with any assurance what will happen to the Democratic Party in [the] next four years, though, depending on post-war conditions, extensive realignments [are] seen quite on the cards.” 

    Unsurprisingly, FDR wins reelection, albeit with a smaller popular majority than in his three previous presidential campaigns. When it came right down to it, “To Roosevelt’s Gladstone there was no discernible potential Disraeli.” “Almost as significant as [the] President’s own re-election was [the] defeat both in primaries and in [the] elections themselves of leading isolationists in [the] Senate and also [the] House.” “For the first time since Woodrow Wilson it is not wholly certain whether the isolationists can on paper muster [the] fatal one-third of Senators required to block a treaty”—namely, the treaty proposing a postwar ‘United Nations.’ Such opposition clearly come to the surface in the Senate debate following the Dumbarton Oaks conference in August; concerns about American sovereignty and involvement in future foreign wars win little sympathy from Professor Berlin, a firm advocate of Anglo-American alliance. The main cloud on the Democrats’ political horizon remains the Southern part of their coalition, consisting of men who “are uneasily wondering whether they are not traveling in the company of a Frankenstein’s monster,” namely, the liberal groups who will, they anticipate, toss them aside at some opportune moment. Berlin correctly predicts that “the combination of Republicans and Southern Democrats…will one day burst through” the existing party framework and radically transform the present party system to allow for the new political and economic realities,” although “this seems unlikely during Mr. Roosevelt’s regime.” 

    The Yalta Conference of February 1945 settled the borders of the Central and Eastern European states, in effect insuring that the Communists would rule them. This was not understood by many at the time. Berlin concerns himself primarily with the ‘optics,’ remarking that “to have the American public believe that Yalta was an American success would be a cheap price to pay for acceptance of American participation in settlement of European problems.” By June, “the myth of Mr. Roosevelt as a great and wise mediator between the powerful figures of Mr. Churchill and Marshal Stalin, whose policies might otherwise have come into open collision,” had become “deeply embedded in the popular consciousness of the American people.” Berlin correctly reports that the “Polish settlement will be [the] main center of controversy,” with “Congressmen from Polish areas of Illinois and Michigan” condemning Yalta “as another Munich.” He regards such protests as manageable, as Americans generally “sympathize with the Poles but accept the inevitable,” namely, Communist rule over a nation now occupied by the Red Army. 

    Roosevelt’s death follows in April. “There is everywhere a recognition that his abiding place in history is secure if only because he brought into existence a full-fledged new policy in domestic and in foreign affairs alike…. Moreover, he has altered, perhaps in perpetuity, the concept of the duties and function of the United States Government in general and of the Presidency in particular. It is so far a cry from the days when President Coolidge could say ‘The business of the Government of the United States is business’ that most Americans scarcely realize that the tradition of positive action towards social welfare with which the automatically identify the duties of any United States President…and which now seems so permanent, was established so recently and by the efforts of relatively so few men and women.” “If there is strong, and probably justified, expectation of the relaxation of centralized Washington control and of profoundly personal government,” in the eyes of most Americans, FDR’s policies, foreign and domestic, “will and should be carried on in the manner for which he had, in the end, secured the positive approval of the vast majority of the nation.”

    In the event, the Communists begin to overplay their strong hand, in America and internationally. In New York City, the Communist Party has allied with the Democratic machine pols of Tammany Hall, “combin[ing] some of the dirtiest and most effective politicians in New York City.” “New Dealers seem to have realized too late what they had let themselves in for,” as this sort of thing diminishes the likelihood of “a straight New Deal victory in 1948, say under Mr. Wallace”—as it indeed would prove. In foreign policy, President Truman, eventually the beneficiary of such Popular Front-like dealings, has sent FDR’s trusted advisor Harry Hopkins to Moscow in an attempt “to convey to the Kremlin the dangerous effect of present Soviet policies [in Europe] upon American public opinion and the United States Government and to collect sufficient information about the present Soviet position to enable the American Government to determine its course of action whilst reassuring public opinion that it has an ‘independent policy’ of its own.” 

    The defeat of the British Conservative Party and the consequent removal of Churchill as Prime Minister causes an initial “a shock of astonishment” among Americans “that was almost reminiscent of the reactions to the Pearl Harbor bombing.” They cannot understand what they took to be “a strange ingratitude on the part of the British electorate.” Berlin calculates the effects: first, British foreign policy “in the coming weeks” will be watched carefully, “and this in itself will have the salutary effect of arresting the recent trend to ignore our role and concentrate on the purposes of the Big Two”; American support for Great Britain will shift, as “liberals and left-wingers,” highly critical of Churchill’s firm opposition to the Communist in Greece, “will once against tend to rally to our side,” now that the Labour Party controls the government; finally, American conservatives and business interests now “feel very much alone on a choppy collectivist sea,” whereas “the pressures on the Truman Administration from ‘left of center’ seem likely to increase.” 

    The final major events Berlin assesses are the nuclear bomb attacks on Hiroshima and Nagasaki and the consequent surrender of Japan before the Soviets could intervene in the Pacific. “The psychological impact of these events upon the public, especially of the atomic bomb, was greater than anything America had experienced in the war, even Pearl Harbor, and profound changes in the currents of thought seem inevitable.” Initially, “stories of the atomic bomb appealed to everything most typical in the American nature,” as “the lurid fantasies of the comic strips seemed suddenly to have come true” while at the same time fantasizing that the Bomb “will end all war” and nuclear power “will revolutionize human life.” Almost immediately, “along with a thrill of power and the instinctive pleasure at the thought of Japan in abject surrender, America’s deep-rooted humanitarianism has begun to assert itself and this secondary revulsion has been very marked in private conversation although it has not yet appeared in the press,” as “there is a good deal of heart-searching about the morality of using such a weapon, especially against an enemy already known to be on his last legs.” Berlin seems most interested in the Bomb’s political effect: that it “is doing more than Pearl Harbor or the war to obliterate the last vestiges of the isolationist dream, and in this sense it is a new weapon in the hands of the internationalists.” Almost as satisfyingly, “the fact that the bomb is a British-American-Canadian invention has been recognized,” giving “a fillip” to the notion of “Anglo-American teamwork.” 

    As for the Soviets, Americans expect them to be developing a nuclear weapon of their own. By August, it has become “daily more evident that the United States of America sees Soviet Russia as its only rival for world supremacy and at the same time has no desire to become unnecessarily embroiled with her.” News of a treaty between the Kremlin and the anti-Communist Chiang Kai-Shek regime in China proves an “immense relief,” since “the possibility of America becoming involved in a Far Eastern dispute on China’s side has hung like a cloud over all those who hold that peace primarily depends on the cultivation of harmonious relations between the two great world powers.” The Communist Chinese would soon have a say in that, but Berlin returns to London well before Mao’s victory.

    Taken together, Berlin and Young show how the regime change effected by the New Deal was consolidated during the Second World War, and in many ways thanks to the exigencies imposed on Americans by that war. As a member of the British Embassy staff in Washington, Berlin understandably concentrates his mind on President Roosevelt and his operatives; with the advantage of hindsight, Young can offer a more balanced account that delves into the actions of Congressmen. Both recognize the importance of public opinion in consolidating the regime change, as such earlier Progressives as Woodrow Wilson had emphasized, a generation earlier. If a democratic republic would now become a mixed-regime republic with a powerful ‘aristocratic’ element seen in an empowered permanent bureaucracy, popular voices would still continue to be heard and to be attended to, albeit in more problem-ridden ways. Confident that it could assuage the worries of ‘the democracy’ by a combination of presidential rhetoric or ‘leadership’ and bureaucratic regulation of largesse, the new elites looked to the future confidently. For a long time, they were right to be confident.

     

     

    Filed Under: American Politics

    New Deal or No Deal: American Economic Policies, 1914-1946

    November 17, 2021 by Will Morrisey

    Benjamin M. Anderson: Economics and the Public Welfare: A financial and Economic History of the United States, 1914-1946. Indianapolis: Liberty Fund, 1979 [1949].

     

    With exceptions too inconspicuous to remark, nobody loves a banker. Except other bankers. Sometime banker, sometime college professor Benjamin M. Anderson insists that “there is a great fraternity of bankers, both in the United States and in the world outside. They trust one another. They tell one another the truth about highly confidential matters. They go far out of their way to be of service to one another and to one another’s customers.” William Jennings Bryan, he isn’t.

    Writing in the late 1940s, Anderson happily recalls the world prior to World War I. “There was a sense of security then which has never since existed. Progress was generally taken for granted,” since “the experience of the preceding century, so far as social and economic evolution was concerned,” consisted of “a prolonged period in which decade after decade had seen increasing political freedom, the progressive spread of democratic institutions, the steady lifting of the standard of life for the masses of men.” True, there had been “occasional sharp setbacks”—severe, short financial crises followed by severe, short economic depressions. “But they did not approach in length or depth the depression of 1929-39, or in depth the much less severe depression of 1921.” Even during the downturns, “it was axiomatic that revival would come again.” Overall, and not only in economic life, “it was an era of good faith,” when “men believed in promises,” including “the promises of governments”; “treaties were serious matters.” “No country took pride in debasing its currency as a clever financial expedient,” as for example in 1933, when the United States government suspended gold payments, reduced the dollar to some 59% of the old gold parity and repudiated the gold clause in its bonds. No politician “boasted of their achievements in unbalancing the budgets or termed the deficit ‘investments.'” As late as 1913, “men trusted the promises of government and governments trusted one another to a degree that is difficult to understand today”; indeed, “Japan and Mussolini would never have started on their careers of aggression if the great democratic nations had kept faith with one another.” 

    Anderson emphasizes trust, faith, because “industry, commerce, and finance depend on credit.” Credit depends upon a measurable way of gauging profit and loss, surplus and debt. The gold standard gave governments that way. “The whole world was…far safer financially when each of the main countries stood on its own feet and carried its own gold.” The United States’ Federal Reserve banking system, instituted in 1913, could have prevented even some of the bank ‘panics’ that did occur, had it been “wisely handled,” but it wasn’t. “There was no such thing in prewar days as the kind of international cooperation which we saw in the 1920s, under which a dangerous boom was prolonged and turned into an almost uncontrollable inflation through the cooperation of the Bank of England and the Federal Reserve System of the United States.”

    The First World War thus was not only a calamity but an unanticipated one, foreshadowed by the gold hoarding of Germany in 1912-14 and, in reaction, that of England of France in 1914; the imperial and regime conflicts between an absolute monarchy and two commercial republics reminded a generation that the original term for ‘economics’ was ‘political economy.’ These actions were policy decisions.

    For that reason, Anderson firmly rejects economic determinism: “Political, moral, cultural, and religious forces are coefficients with economic forces in the determination of historic events, and the influence of outstanding personalities in strategic positions is often far more significant than any economic determinist will concede.” When war hit, “the American financial system met the shock with no formal governmental aid, although there was good cooperation and good understanding between New York and Washington.” Stocks declined, but not drastically. “The investor was safer in the unregulated market of 1914 than when protected by the Security and Exchange Commission in 1937.” Except for the South, where cotton exports to Europe declined badly, the crisis ended in November 1914, righted by the warring Europeans’ need for goods and leading to American “war prosperity.” Although corporations used some of their profits to increase dividends to shareholders, they “prudently recognized that they were in an extraordinary situation, that war profits could not be expected to last, and that it was well to provide for contingencies.” Wages lagged behind wholesale prices, improving profits. By contrast, “in World War II wages rose far faster than wholesale prices, and corporate profits and additions to corporate surpluses were far more moderate in relation to the national income. In World War I the thing was left to the natural play of the markets. In World War II we had elaborate government policy”—beginning with the Renegotiation Act of 1942—designed “to hold down corporate profits and to encourage wage increases.” 

    When the United States entered the war in April 1917 (in large measure because Germany had been sinking U.S. merchant vessels, interfering with trade), the federal government didn’t take on many loans “for future generations to pay,” financing the war mostly with tax revenues and war bonds. The government didn’t borrow directly from the Federal Reserve. The government did fix prices but understood “that price fixing ought not to be pushed in advance of the development of machinery for commodity control,” such as rationing. “In World War I we knew these things very well. Proposals for the fixing of all prices met very little sympathy form President Wilson, who was a good economist. [1] “We established a pretty comprehensive system of commodity control of scarce essentials needed for war or for the life and health of the people.” Such price controls as were imposed affected wholesale prices; “we did very little about retail prices,” which were left to market forces within the framework of wholesale price controls. Unlike the New Dealers, the Progressives “did not look upon a great war as primarily an opportunity for accomplishing sweeping social reforms or for reconstituting the basic principles of economic life.” The newly-formed Federal Reserve Board worked well under these emergency conditions, enabling “a smoothness and simplicity in handling huge financial transactions that would have been incredible under the old system,” which depended on the friendly cooperation of the several major private banks.

    Things began to go wrong in the aftermath of the war. Anderson begins his analysis with the basics: “Right prices are prices that move goods. Right prices cannot be foreseen in advance. They must be found out experimentally in the open market,” in the equation of supply and demand. Price controls therefore make sense in a major war, but continued interference with market equations will lead to serious crises when peace returns. In the United States, exports didn’t decline after the war because Europeans needed manufactured goods, given the wartime destruction of factories; the Europeans paid for these good with loans extended by American banks. “It is the duty of a lender to an embarrassed debtor to see to it that the debtor mends his ways and reorganizes his affairs so that the loan may be a good loan.” But the war’s loser, Germany, “was going to pieces financially” and American bankers “were lending to Europe overgenerously,” demanding inadequate reforms in exchange for their money. “Economic abnormalities” were bound to arise. “The heart of the business situation is the outlook for profits”; therefore “the heart of the credit situation”—the indispensable condition of good faith in economic, social, and political relations—is “the quality of credit and the quality of credits rests on the outlook for profits.”

    There lay the danger. “Our great export trade was based, not on revival in Europe, but on the failure of Europe to revive.” That couldn’t last, even with the salutary end of wartime price controls. “Europe was buying goods in enormous quantity on credit from every part of the world, and building up throughout the world a fictitious prosperity similar to that which we had in the United States. Reaction and collapse were inevitable.” 

    Agriculture was the first sector to feel these effects. As observed, industry had used the wartime boom “as an opportunity to accumulate additional capital funds and to increase liquidity.” Even after the stock crash in 1920, United States Steel was stronger financially than it had been at the beginning of the war. But farmers had used their wartime earnings “as a foundation for rising prices of agricultural lands and increased mortgage debt” on those lands—quite understandably so, since “a wise investor will ordinarily buy the kind of thing that he knows and understands,” and ‘the farmers knew land.” Unfortunately, land is an illiquid investment, insusceptible to the tactic of quick sell-offs or immediate reductions in the labor force. The Great Depression began early for the farmers. The stockbrokers, by contrast, were able to arrange a well-timed mass purchase of a few key stocks, sparking a rise in market confidence which caused a rapid snap-back in stock prices. Unlike American agriculture, American finance and industry took off. Japanese bankers, industrialists, and government officials did the opposite, clamping down on “freedom of the markets” by holding prices high above the world level for years, resulting in industrial stagnation throughout the decade followed by a banking crisis in 1927. “It was a stupid policy”; it resembled the policy of the New Deal, a decade later. “In contrast, in 1920-21 we took our losses, we readjusted our financial structure, we endured our depression, and in August 1921 we started up again.” That rally “was not based on governmental policy designed to make business good,” and Americans did it “without outside help” from foreigners. “From the standpoint of New Deal economics,” this policy “was extremely benighted,” as “it was not regarded as the function of the government to provide money to make business activity.” Instead, the American economy saw “a great spurt in the application of new technology to industry,” which didn’t cause unemployment but “helped to generate an immense increase in employment” in the new industries that resulted. Output per wage earner increased, which was good, and, thanks to the Federal Reserve’s policy of purchasing government bonds, bank credit expanded, which proved to be very bad, by the end of the decade.

    Meanwhile, bankers understood that America’s wartime shift from a debtor to a creditor nation required “a liberal foreign trade policy,” without which exports would find no markets in devastated Europe. The Republican Party had long supported high tariffs, but they initially reversed this now-incorrect policy for a year or two after the war. But the 1920 elections brought younger, less experienced Republicans to office, including “a man little trained in economics, who looked at economic issues from the standpoint of political tradition and emotion, Warren G. Harding.” In 1922, tariffs were raised and “the seeds of death were planted into our industrial revival.” “The young student of economics, sociology, and history is easily impressed with the doctrine that history is made by impersonal social forces, irresistible in character,” but “when one sees history being made from the inside it is impossible to avoid the conclusion that a vast deal depends upon the strengths and weaknesses of the leading participants.” Harding was weak. Wilson was strong, favoring free trade against tariffs and attempting to keep the peace with the League of Nations.

    Anderson deplores “our absence from the League of Nations” primarily because France then was left with too much influence in it. The peace treaties dismantled the Austro-Hungarian Empire, “which had been a great free trade area,” leaving behind a “Balkanized” Central and Eastern Europe with trade barriers everywhere. And Americans had insufficient leverage to moderate French revanchisme against Germany, whereby impossible-to-pay reparation exactions and the prevention of industrial revival contributed to the collapse of 1929 and to the rise of the Nazis. In the years 1918-24, Germany was “economically a hollow shell.” “Invaders could scarcely have done a more efficient job of denuding her of resources than her own war government,” which had loaded the Reichsbank with “government paper” in anticipation of easy repayment after (the Kaiser’s men assumed) Germany’s victory made her the master of Europe. When that didn’t happen and the debt came due, German bankers found themselves in a fix, one exacerbated by the “wholly fantastic” reparations demanded by the French. Germany attempted to inflate its currency as a means of maintaining its generous welfare payments and employment-making public works. With inflation, “thrift became folly,” the middle class “was pretty much wiped out,” and the republican regime itself fatally weakened. Continued “French insistence upon payment [of reparations] regardless of Germany’s ability to pay made the German situation pretty helpless.” 

    In its domestic policies, France went on a splurge of deficit spending, under the slogan, “The Boche will pay.” But the hated Boche was bankrupt. “The one difference between the policies followed in France in this period and the policies advocated by the New Deal spenders for the United States is to be found in the fact that the French were ashamed of” its deficit spending “and tried to conceal it and to find excuses for it, whereas the New Deal spenders would glorify it and call it ‘investment.'” Quickly seeing that the Boche couldn’t pay, the French occupied the Ruhr, Germany’s industrial hub, in 1923, substituting “military decisions” for “business contracts.” Both the Germans and the French would pay for that. 

    With that, the Americans did intervene with their wartime allies to assist Germany. “Great sums were not required to stabilize a country when internal financial reforms were insisted upon in connection with the loan”—as per the sound banking practices Anderson noted previously—and even in the democratic-republican regimes “it was not difficult for the finance minister of an embarrassed country to persuade his people to submit to the necessary reforms when the outside help could thereby be obtained.” The 1924 Dawes Plan provided a comprehensive settlement for Germany, and it worked, despite continued French exactions. It was foolishly abandoned in 1929; reparations were drastically reduced, but the banks called the German loans prematurely. Anderson holds this act of unsteadfastness “responsible for the collapse of Germany” two years later.

    Back in the United States, the Republicans’ tariffs on foreign manufactures hurt American farmers because Europeans got such low revenues from sales of manufactured goods to the U.S. that they couldn’t pay for American farm produce. Protective tariffs on European farm produce didn’t help, inasmuch as “the protective tariff did no good to a commodity where an export surplus existed. The agricultural tariff “constitut[ed] one of the first of the many ingenious devices for spoiling markets and perverting the price mechanism in the interest of special classes, which we have later come to know at the New Deal.” In this sense, the New Deal began in the mid-1920s. At the same time, banks and other investors overreacted to the anticipated benefits of the Dawes Plan, buying German and other European bonds in too-large quantities relative to a realistic assessment of the ability to repay; as indicated earlier, the Federal Reserve bought large amounts of U.S. government securities, vastly expanding bank credit and thereby causing “the illusion of unlimited capital.” There is, alas, no such thing as unlimited capital. “Our tariffs would not allow the Europeans to earn dollars here in adequate amounts to buy our farm products and to meet service on the past debts, so we proceeded to lend them the dollars they needed for these purposes!” Anderson exclaims. 

    His patience with such things temporarily exhausted, Anderson pauses to offer another brief lesson in elementary political economy. “Capital” consists of producers’ goods, not consumers’ goods, such “instruments to be used in further production” as machinery, bridges, and railroads, not hats, shoes, and ice cream. There are five main sources for capital: building (whether by raising a barn, letting fruit trees grow, or improving a tool); consumer savings, business (using profits to add to one’s surplus instead of paying dividends); taxation for capital purposes (that is, paying down public debt); and new bank credit. The latter can be dangerous, if unrestrained, since “credit and debt are merely different uses for the same thing”; the growth of bank credit “should be held in proper relation to the growth of the industrial activity of the country” and diversity of collateral must be maintained, since one kind of collateral may have little value at a given time. Since “a bank must always be prepared to pay its depositors on demand,” carefully “protect[ing] its cash” for that purpose, these precautions are indispensable. “Quantity of money and credit are less important than quality of money and credit.”

    During the First World War, bank expansion of credit was necessary to raise, equip, and transport a four-million-man army to Europe and sustain them for the duration of the conflict, in the process “transform[ing] our industries from a peacetime to a wartime basis.” We also needed to finance shipments to our allies. But in the 1920s, without any such crisis, “without justification, lightheartedly, irresponsibly, we expanded bank credit by more than twice as much, and in the years which followed we paid a terrible price for this.” The Federal Reserve System “was not created for the purpose of financing a boom, least of all for financing a stock market boom.” Moreover, in the United States, commercial banks’ reserve requirements are legally fixed, giving our bankers less room for “judgment and experience in deciding how much reserve” to hold. In foreign countries, “a banker, foreseeing a crisis, would try to increase his reserves before the crisis came,” but American bankers “accustomed for two generations to having their minimum reserves fixed by law…had no such grasp of the theory of bank reserves as the best foreign bankers had.” As a result, they kept the legal minimum cash reserve on hand. “When the reserve requirements were lowered by the wartime legislation of 1917, a dangerous situation was thus created.” The Federal Reserve System increased that danger in its policy of easy money and credit expansion throughout the 1920s. In the United States, France, England, and indeed anywhere, “a high degree of banking concentration is incompatible with the exercise of free banking judgment, and the substitution of government policy in credit matters for the free exercise of banking judgment is one of the most dangerous things that can come to a country…. We should preserve competitive banking. Banks should be under pressure all the time to meet their engagements at the clearinghouse every day, so that the banker may be compelled to keep his bank liquid, to hold slow paper to a minimum, and to limit bank credit to proper bankable transactions. When, however, five hundred to a thousand banking offices are under the jurisdiction of a single central office, there is no such pressure on the individual offices; and if there can be a concerted policy among a few great central offices, the competitive pressure is so greatly lessened that unsound policies can be carried very far.”

    Since the expansion of bank credit in the 1920s wasn’t needed for commerce, it was used for capital purchases but also for speculation, particularly speculation in real estate mortgage loans—an “ominous increase in illiquid assets,” in lands and buildings. This caused a ‘bubble’ in real estate prices in the United States, “an unwholesome and a precarious” position. “Speculation in real estate and securities was growing rapidly, and a very considerable part of the supposed income of the people which was sustaining our retail and other markets was coming, not from wages and salaries, rents and royalties, interest and dividends, but from capital gains on stocks, bonds, and real estate, which men were treating as ordinary income and spending in increasing degree in luxurious consumption.” Anderson criticizes Federal Reserve System chairman Benjamin Strong, President Coolidge, and Treasury Secretary Andrew Mellon for encouraging stock market investment under these circumstances. “The more intense the craze, the higher the type of intellect that succumbs to it.” Money flowed out of Europe to invest in the American stock market, further weakening Germany’s already dubious financial condition.

    By 1928, the Federal Reserve was mindful of the problem, sort of. Its governors wanted “to restrain the use of credit for stock market speculation,” avoid tightening money in foreign countries, and not “let money grow tight in business uses at home.” It wasn’t possible to fine-tune credit and investment to that extent; these “efforts at restraint were handicapped and inconclusive,” and “the wild speculation ran on for a year and nine months after the restraining efforts began.” The catastrophic stock market plunge in September 1929 “demonstrated that fundamentally wrong policies had been pursued”: “cheap money and rapid expansion of credit”; high tariffs interfering with the movement of goods and preventing our European debtors from paying their debts with goods.” But to have reversed the policies in time “would have meant humiliation” for the Republican Party in a presidential election year. 

    Nonetheless, had we “taken our medicine in 1929 and early 1930,” although we would still “have had a severe depression,” the federal government could have ended it by undergoing “an orderly liquidation and readjustment”—lowering our tariffs, to enable foreign debtors to pay with goods. But with “the Hoover New Deal,” Washington instead turned “to frantic economic planning,” which Anderson calls “back seat driving by a man who doesn’t know how to drive and who, except in wartime, doesn’t know where he wants to go.” “Those who condemn the New Deal for its agricultural follies in 1933 and succeeding years, and above all, for loans to farmers which held back cotton which otherwise would have gone into the export trade, should not credit Roosevelt’s New Deal with originality on this point.” In the aftermath of the stock market debacle, the Republicans nonetheless sustained their policy of “artificially cheap money” and, in a “crowning folly,” raised tariffs instead of lowering them with the Hawley-Smoot Tariff Act of 1930. This spurred protectionism all “over the world,” cutting off markets, limiting trades, and boosting both unemployment in export industries and the prices of export commodities unemployed and employed persons alike needed to buy. Not coincidentally, in Anderson’s judgment, the Nazis became the second-largest party in the Reichstag in 1930. Even so, “If the governments had acted” to lift tariffs in the winter of 1931-32, “Hitler never would have come into power, and we should have saved the democratic regime in Germany.”

    The Americans weren’t the only culprits. French revanchisme continued to play its part; England, with its strong labor unions, which wanted no reduction in wages, even in the face of the downturn, along with too-heavy investment in illiquid assets by the Bank of England, took the damaging step of going off the gold standard in order to devalue its currency, a serious “breaking of faith with the world” which inspired fears about every currency. Given that credit or faith sustains financial transactions, now “governments could no longer trust governments in financial matters” and “the confidence of central banks in one another was gravely shaken.” The value of gold rose sharply, since “gold’s greatest competitor is the confidence men have in the paper promises of governments and central banks to pay gold.” This didn’t faze the Americans, who “were very strong in gold.” “Our whole financial tradition rested on the principle that we would pay gold. Grover Cleveland in the middle 1890s had defended our currency with gold payments under very much more adverse conditions,” and it worked. In 1907, the bank runs had prompted bankers to restrict cash payments by banks but to continue to allow depositors to write checks to pay debts. Only “absolutely necessary cash was provided by the banks.” But in 1933, banks were obliged to pay five percent of their deposits in cash; five percent doesn’t sound like much, but banks never keep much more than that on hand for withdrawal by depositors. The banks’ cash reserves were rapidly depleted by terrified depositors.

    Why? Because “men’s memories are short. Men come into positions of great responsibility fairly late in life, and the interval between 1907 and 1933 was too great an interval”; “there was no man left of the heads of great New York banks in the panic of 1907 who was still in that position in 1933,” and “the same thing was generally true over the country.” When the New Dealers came to power in 1933 “with virtually every bank in the country closed, control of the banking situation passed both from the banks and from the Federal Reserve banks to Washington,” which under the new administration pursued a policy of “deliberately shutting out the banking community from its councils,” having decided the bankers had caused the Depression. In one way they were right. The 1920s credit expansion, masking “the scarcity of real capital” with speculative loans and investments which boosted the stock market beyond the value of the overall economy, had “misled governments and induced them to place debt payment schedules higher than they should have been.” But of course the governments had done their part, with punitive reparations, high tariffs, and (in the United States) the misuse of Federal Reserve powers. 

    Roosevelt and his colleagues doubled down on government control of the economy; in their minds, the Republicans had done some good things, but not nearly enough. They failed to see that “a liberal foreign trade policy is contradictory to governmental economic planning, and the movement toward governmental economic planning grows rapidly when foreign trade is cut off. This was recognized a long time ago. One of the original economic planners was the German philosopher Fichte, a follower of Kant and precursor of Hegel,” who urged that governments adjust, “in proper proportion,” the several producing classes in each country by means of fixing the prices of commodities and manufactures while “render[ing] impossible direct trade between citizens and the foreign world,” reserving such trade to the state. So it was with the New Dealers. They “did not want either foreign trade or gold. They wanted internal regimentation.” For them, it wasn’t enough to take the role of backseat drivers; they aimed at putting themselves “in the driver’s seat.” If they “lacked economic understanding…it cannot be denied that they had a good deal of imagination regarding economic matters.” In Germany the matter went to its extreme, as the country in effect “substitute[d] the tyranny of Hitler for the tyranny” (as the bank-haters called it) “of gold.” Hitlerite venom spat at Jewish bankers gave his tyranny its genocidal edge, even as Leninist venom against the “harmful insects” of capitalism gave such an edge to that tyranny. This combination of bad economics and bad ideologies led to the military and political crises that prevailed for the six decades between 1930 and 1990.

    An interesting economic experiment ensued. The widespread use of automobiles in the previous decades had “largely destroyed the usefulness of the small village” in American life, as “people did their business and sought their social life in the county seat and other nearby larger cities.” This weakened the small banks. But now, under the New Deal, the cities suffered and villages well removed from city centers survived. By accident, they found themselves out of the way of FDR’s policies, which included “blanket authority…to do pretty much as he saw fit regarding money and banking,” authority to seize the people’s gold and gold-backed certificates, preparatory to abandoning the gold standard. This again violated the public trust. “There is no need in human life so great as that men should trust one another and should trust their government, should believe in promises, and should keep promises in order that future promises may be believed in and in order that confident cooperation may be possible. Good faith—personal, national, and international—is the first prerequisite of decent living, of the steady going on of industry, of governmental financial strength, and of international strength.” Having promised to maintain the gold standard in his party’s platform, FDR committed “an act of absolute bad faith.” Since first England and then the United States broke faith with their citizens and with governments around the world, we now see “a world full of hot money, jumping about nervously from place to place, seeing no safety anywhere, but going from places that seemed unsafe to places that seemed less unsafe,” preventing men from making long-range plans of investment. 

    “By 1937 the gold standard in its old form had ceased to exist. There remained no important country in the world where paper currencies would be automatically and regularly redeemed either in gold or in gold bars.” This put peoples at the mercy of their governments, since “the recipient of gold does not have to trust the government stamp upon it, if he does not trust the government that stamped it.” Pieces of paper stamped by the government “will be accepted on faith if the government or the bank which has issued the paper has proved itself worthy of confidence by a satisfactory record of redeeming the paper in gold on demand”; “gold is an unimaginative taskmaster,” demanding only issuers of paper currency “keep their promises on demand or at maturity,” which in turn requires that “they create no debts without seeing clearly how these debts can be paid.”  

    A major complaint about banking practices seen in the 1920s current in the 1930s was “the alleged excess of savings over investment in the period 1924-29.” Supposedly, hoarding money in banks retarded investment. But “all of the real savings of this period” was in fact invested; the critics were really complaining that the bankers refused to invest “all of the rapidly expanding bank credit” afforded by Federal Reserve policies. On the contrary, Anderson argues, “far too much new bank credit” was invested. The banks weren’t too ‘conservative’ but too ‘liberal,’ and that contributed to the stock crash. “Men must be induced to save for the future by a reward, and that reward is interest”; banks can offer interest because they invest depositors’ savings by offering loans which, in aggregate, profit the banks after they’ve paid the interest due to depositors. The rate of interest the banks offer provides “the equilibrating factor which brings savings and consumption into balance.” Derange it and you violate the indispensable ‘credit’ or trust that makes ‘the economy’ prosper.

    The New Dealers’ fondness for labor unions further complicated matters. “The idea that the purchasing power of labor is the mainspring of business activity seems to be incredibly naïve,” inasmuch as the “the prospects of profit or losses” determine “industrial decisions.” Sure enough, when the National Industrial Recovery Act came into effect, production dropped. “The theory that shortening hours and raising wages would increase business activity was conclusively exploded in this six-month period of actual test,” and the Act additionally imposed a further burden, administratively-imposed regulations “subject to change without notice.” Minimum-wage regulations alone forced an estimated half-million black Americans onto relief in 1934. Finally, in raising the price of manufactured goods, the Act frustrated the New Dealers’ agricultural policy, which aimed at bringing farm products “the same purchasing power in relation to manufactured goods that they had in the base period 1909-14.” 

    During the 1932 campaign, FDR had promised a 25% reduction in government spending. A conversation with John Maynard Keynes in 1933 persuaded him that “government control of investment” was needed, which included economic stimulus at the cost of government deficits. [2] This failed. By contrast, in 1921, during the previous depression, “the government did not know about the new wisdom of Keynes.” It acted “to protect its own solvency, to protect the currency, to reduce public expenditure as rapidly as possible from the wartime levels, and to cut taxes”; “business recovery was for the people to bring about and not for the government to engineer.” The depression ended in a matter of months. In 1934, with the government bureaus multiplying, there was no one in Washington “who knew all the new bureaus that had been created and could see the government as a whole.” This suggests that a modern economy is too large and complicated for coherent rule ‘from above,’ except in one way: “The New Deal tax policy from the beginning has been more concerned with the redistribution of wealth than with raising revenue.”

    Such redistribution damages investment. To invest in a new business with sufficient capital backing, the bank account of the small businessman won’t do. He needs a loan. since “the mortality among new ventures is high,” especially among firms founded upon “a real innovation,” bankers fund such enterprises reluctantly, unless the innovator has a record of success. “In American economic history such new ventures have often been financed by men of fortunes sufficiently large so that they could scatter their risks.” But if the government raises income taxes to the heights implemented by the New Dealers, why risk your money? Confiscatory inheritance taxes, intended to counter the formation of an oligarchic class, remove yet another motive for risking capital. Anderson agrees that “there is good ground for the belief that vast fortunes involve undesirable political and social potentialities, and that public policy should be direct: (a) toward making sure that such fortunes cannot be accumulated in antisocial ways, and (b) toward holding down the growth and the transmission of vast fortunes to the extent that this can be done without checking the accumulation of capital and the spirit of enterprise.” To do this without inhibiting the spirit of enterprise, legislators should impose inheritance taxes that allow “a great fortune…to reach grandchildren and great-grandchildren” only if the each new generation “add[s] very substantially to it by productive activity”—a tax rate not to exceed 50%.

    All of these policies contributed throughout the 1930s to a real instance of the imagined problem of the 1920s: “unused capital and unused technological knowledge.” “The war set them to work, but it took the war to do it,” war being the one government program that does stimulate economic activity, especially if your side wins. Technological progress doesn’t lead to net unemployment, although it does make many jobs obsolete when the manufactures they supported become unnecessary. “Where did the workers go” when automobiles and other technological innovations displaced buggies, whips, and smithies? “The answer is to be found in many things, and first in the great increase in the service industries” and also into design work for newer and more elegantly styled cars. “It manifested itself also in an immense demand for education, and one of the major places to which our people went from factory labor and farm labor was to school.” Women moved from agricultural and factory work to “lighter, more interesting, and better paid occupations” in offices and hospitals.

    The Second World War brought a lot of women back to the factories. Otherwise, the Roosevelt administration reorganized the American political economy not only to win the war, as Wilson had done, but “as a means of pushing further the New Deal program of the redistribution of wealth” via “a tremendous increase in taxes,” “borrowing from the people instead of borrowing from the banks” (i.e. deficit spending), restriction of bank expansion, and price fixing along with commodity controls. “If you have enough regimentation, if you have control of all commodities and all prices, if you have control of every man’s pocketbook and every man’s bank balance, if you have control of the farmer’s consumption of his own productions, and if you have a sufficiently powerful and efficient Gestapo, you can take great liberties with money and credit.”

    In the event, businesses adjusted to the New Deal state, which was indeed something new and lasting. Between 1930 and 1940, the federal government saw a 73% increase in federal civilian employees, not counting the 2.9 million men and women who worked on federal relief projects. In the same period, the federal budget rose from $3.44 billion to $9.06 billion and, as the saying goes, never looked back. As the economic historian Robert M. Collins observes, although Keynes’s General Theory wasn’t published until 1936, FDR got a running start on the kinds of policies it recommended, and 1938 marked “Roosevelt’s first acceptance of fiscal policy as a legitimate tool for economic stabilization,” as he advanced a plan “to pump approximately $7 billion into the economy”—an “important turning point for the New Deal.” This, along with low interest rates determined by “central control” (the Federal Reserve) and “redistribution of wealth through taxation to increase the propensity to consume” were the trademarks of Keynesian ‘demand-side’ economic policy, which held that the way out of an economic depression was to spend your way out of it. World War II “provid[ed] striking evidence of the effectiveness of government expenditure on a huge scale,” in the minds not only of professional economists but of many business owners. The latter accommodated themselves “to the fiscal revolution and successfully turned aside the thrusts of those who sought to limit seriously [their] dominion” over American economic life. “The dynamism of American business illuminates an important trend in the relationship between state and society in modern America—the conscious effort to build a corporatist sociopolitical order that would avoid the dangers of both statist regimentation and laissez-faire waste and social tension.” (3) By the time Collins wrote this, however, this Keynesianism ‘of the right’ had more than begun to outlive the usefulness ‘pragmatists’ attributed to it. 

     

    Notes

    1. Anderson lavishes praise on Wilson, “the greatest man, the most upright man, and the most far-seeing man who has held great public office anywhere in the world within the memory of men now living.” One might demur, but Anderson’s assessment makes his book interesting because it means that he is sympathetic to the Progressives but bitterly critical of the New Dealers, who in so many ways continued the Progressives’ preference for administrative statism and ideological historicism.
    2. “Keynes was a dangerously unsound thinker” whose “influence on the Roosevelt administration was very great.” Keynes held the principle that “purchasing power must be kept above production of production is to expand.” According to him, “supply creates its own demand.” Earlier modern economists, notably John Stuart Mill, stipulated rather that “purchasing power grows out of production”—that, for example, “supply of wheat gives rise to demand for automobiles, silk, shoe, cotton goods, and other things that the wheat producer wants.” That is, “aggregate supply and aggregate demand grow together” and that economic prosperity occurs when these are in equilibrium. “The doctrine expects competition and free markets” bring about such equilibrium. “When there is an excess of bank credit used as a substitute for savings, when bank credit goes in undue amounts into capital uses and speculative uses, impairing the liquidity of bank assets, or when the total volume of money and credit is expanded far beyond the growth of production and trade, disequilibria arise, and, above all, the quality of credit is impaired. Confidence may suddenly be shaken and a countermovement may set in.” This, as Anderson has explained, is what happened in the years before the Great Depression. Only “free prices, telling the truth about supply and demand,” can serve as the information necessary for making rational investment.
    3. Robert M. Collins: The Business Response to Keynes, 1929-1964 (New York: Columbia University Press, 1984. As Collins goes on to say, the group that suffered the most from New Deal policies, especially during the war, were not “big business, big agriculture, and big labor,” which prospered from government contracts and other programs, but the small businesses. As a result, the Chamber of Commerce, whose leaders came to accept New Deal economics, lost membership, having drifted away not only from the sentiments but from the interests of its constituents. But by the 1950s, the Republican Party itself, under the presidency of Dwight D. Eisenhower, had more or less surrendered to the ‘welfare state,’ and the economics propounded by Ludwig von Mises and defended by Anderson became peripheral for a generation, until the combined effects of economic stagflation and inflation in the 1970s brought its warnings back into currency. 

    Filed Under: American Politics

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