Tuesday, December 27, 2011

A Tale of Two Railroads

The history of American railroads often highlights the first transcontinental system - the joining of the Union Pacific and the Central Pacific in 1869 in Utah. This achievement was marred by the corruption and waste brought into the enterprise by the government. Subsidies, grants, and loans - even if well intended - distorted market forces and offered temptation to those inclined toward bribery and dishonesty. Sadly, the line was so poorly built - federal incentives encouraged quick building, but not careful building - that sections of it were immediately closed and had to be re-assembled. Because of these, and other, outrageous costs, the line went bankrupt.

Learning from these mistakes, James J. Hill decided to build another transcontinental network, the Great Northern Railroad. He refused to take any federal subsidies, loans, or grants, and in so doing, ensured a well-constructed railroad which would be financially sustainable and relatively free from corruption. Hill had been born into a family that was not wealthy, and he understood the business principles of working one's way up from the bottom. Historian Thomas Woods describes Hill's enterprise:

Many people have supposed that the railroads could never have been built without government largesse. But this is untrue. For one thing, the entire English railway system was built with private funds. Second, the history of the Great Northern Railroad provides an outstanding example of a businessman who prospered without any government help: railroad magnate James J. Hill.
Government help is not what it seems: it is not help. The government's attempt to "help" the first transcontinental system actually destroyed it. Even when the government has the best of intentions, its intervention into productive activity contaminates it with non-market forces. Sometimes, too, the government doesn't have the best of intentions, when corrupt individuals inside the government can personally profit from government spending schemes. James J. Hill understood this:
Hill was the entrepreneurial genius behind the Great Northern, which stretched from St. Paul to Seattle - the same market in which Henry Villard, equipped with the help of the federal government, would fail with his Northern Pacific Railroad. Hill, who came from a very modest background, eventually joined a group of friends in purchasing the bankrupt line.
Villard's Northern Pacific Railroad was another example of how to do everything wrong: he accepted subsidies, loans, and grants from the government. The line quickly went bankrupt. Because of the financial distortions it caused, it brought other businesses down with it. This is a type of ripple effect when non-market forces are introduced into the economy. Cengage's history textbook explains:
Jay Cooke's banking firm, fresh from its triumphant marketing of Union war bonds, took over the Northern Pacific in 1869. Cooke pyramided every conceivable kind of equity and loan financing to raise money to begin laying rails west from Duluth, Minnesota. Other investment firms did the same as a fever of speculative financing gripped the country. In September 1873, the pyramid of paper collapsed. Cooke's firm was the first to go bankrupt. Like dominoes, thousands of banks and businesses also collapsed. Unemployment rose to 14 percent, and hard times set in.
Under the leadership of Jay Cooke, the Northern Pacific not only was contaminated by intervention from the U.S. government, but its market dynamics were also distorted by the Canadian government. (The only thing worse than one government trying to help is two governments trying to help you.) After the Great Northern Railroad when bankrupt under Cooke's leadership in 1873, is was purchased and resuscitated by Henry Villard, who sadly repeated Cooke's mistakes, seeking help from the government in the form of subsidies, loans, and grants. Villard took the company into bankruptcy again in 1893. Finally, James J. Hill led a group of investors who bought the company and ran it successfully by avoiding any help from the government. Thomas Woods tells us that
Hill prospered. When most of the transcontinentals went bankrupt in the economic downturn of 1893, Hill both reduced his rates and turned a sizable profit. He went on to build steamships to carry American products to markets in Asia. It was a tremendous success at first, until it ran into the stupidity and destructiveness of the Hepburn Act of 1906, which regulated rail rates and gave teeth to the Interstate Commerce Commission.
Hill's strategy was so successful that he caused large exports to Asia, creating momentum for the American economy. Finally, Congress intervened, giving regulatory power to the Interstate Commerce Commission, which successfully supported the Asian economies, causing large imports from Asia. Market regulation had the power to weaken the American economy and create a trade imbalance - our reliance on imports from Asia - a problem we still have.

Monday, December 26, 2011

Railroads Get Derailed?

The creation of a transcontinental railroad system in the mid-1800's was a major engineering feat. It would also change the nation, drawing remote sections into closer contact - both commercially and culturally - with each other. The construction of this network was costly, and where much money is, much politics will soon follow. Historian Thomas Woods writes:
The transcontinental railroads in the latter half of the nineteenth century were typically built with substantial infusions of federal, state, and local government aid. This aid took two forms: loans and grants. The railroads sold the land to settlers for cash. In the process, they also created a market for their services. Those who lived near their railroad now had livelihoods that hinged on the railroad's success, usually because they needed it to ship their freight.
Although the intention was good, the government's intervention into the funding of the construction had unintended - and unfortunate - consequences. Government subsidies invariably distort normal market forces. For example, instead of connecting the various towns along the way in a straight line (the shortest distance between two points), construction companies paid by the mile could receive more money by building zig-zag or curving routes. Cengage's history textbook notes that
the Pacific Railroad Act granted land and loans to railroad companies to spur building a transcontinental railroad from Omaha to Sacramento. Under these laws, the U.S. government ultimately granted
huge amounts of land, and dollars paid by hard-working honest tax-paying citizens. Starting in 1862, millions of acres, and lots of money, was handed out - sometimes in return for bribes, sometimes as a response to political pressure, and usually with little rhyme or reason. But
Despite waste, corruption, and exploitation
Something good ultimately, unwittingly, and unintentionally came of the federal fiasco: despite the fact that this money produced largely no direct results - the federally subsidized railroads performed worse than the others, and often went bankrupt - large amounts of land and cash were transfered out of the hands of the government (where these assets produced nothing useful) and into the hands of ordinary citizens for private ownership (where the land could be agriculturally useful, and where assets generally benefit communities).

In the end, the nation's successful transcontinental railroads were either those built and financed with no government intervention and funding, or they were those which, built with government subsidies, had gone bankrupt, and were "turned around" after private owners rescued them from bankruptcy court.

Sunday, December 11, 2011

The Worst Attack?

What was the worst attack on America? There are many potential answers to this question: the British treatment of Boston during the American Revolution; the Japanese attack on Pearl Harbor; terrorist attacks on September 11, 2001. Part of answering the question would be defining the word 'worst'.

Perhaps the most devastating attack on the United States was the ratification of the sixteenth amendment in 1913. The allowed the government, for the first time in the nation's history, to levy income taxes. After 137 years, the government was now able to directly confiscate earnings of ordinary citizens.

Naturally, in order to be politically viable, the amendment had been introduced as something which wouldn't be used much or often, and which would only apply to a selected few of the "ultra-wealthy": as a Yale alumnus noted:

The tax code that started in 1913 as fourteen pages now exceeds sixty-seven thousand. An income tax that was promised to only apply to the wealthiest 1 percent in 1913 quickly grew to 5% in 1939 and then, following World War II, to almost 75% of all Americans. To soften the tax blow, the government did what it always does: it reframed the argument. When "War on Terror" was considered to be too aggressive it was changed to "overseas contingency operations," which is supposed to sound much friendlier. The same idea applied to our tax agency. The "Bureau of Internal Revenue" was renamed the "Internal Revenue Service" to, as the government puts it, "stress the service aspect of its work."
In a little over a century, the nation had left the vision of John Locke, who wrote that the government's responsibility to protect the property rights of citizens was second only to the government's task of protecting the lives of its citizens, and the nation had been subjected to a government which believed that its main mission was to confiscate the property of citizens and use it, not according to the will of the citizens, but the will of the government.

Saturday, November 26, 2011

Progressivism: War is Opportunity

It may seem odd that self-styled 'progressives' are eager to see their nation engaged in war. Isn't that opposed to the very sense of humaneness which progressivism allegedly espouses? Yet progressivists reliably seek war for their nations, and barring war, seek 'the moral equivalent of war' - as in 'war on poverty' or 'war on drugs' or 'war on disease,' etc. To explain this paradox, it must be remembered that the goal of progressivism is social engineering - to take control over the individual's life, and over the community's life, and allow an aristocracy of experts to shape society, utterly apart from the will of the individual, or the expression of the majority of voters. Thus we see President Woodrow Wilson, and his Democrat party, eager to push America into World War One. The question isn't whether or not it was the right thing to do; the question is why did they do it. War gives the government the excuse to exert more control over society than would normally be tolerated: roused by a national cause, people submit to rationing drafts, curfews and limits on the freedom of speech. The progressives
supported the war enthusiastically, even fanatically (the same goes for a great many American Socialists). And even those who were ambivalent about the war in Europe were giddy about what John Dewey called the "social possibilities of war."
The war was valuable to progressives, not because they had any interest finding justice for Europe, nor because they even cared which side of the war America would back, but rather because it would allow them to manipulate American society here at home, in the name of a war in a distant land. Progressives
ridiculed self-described pacifists who couldn't recognize the "immense impetus to reorganization afforded by this war."
Wilson explained that, although he was "an advocate of peace," he saw that "there are some splendid things that come to a nation through the discipline of war." Dewey recognized that the war would give an opportunity for the progressivists to force Americans
"to give up much of our economic freedom ... we shall have to lay by our good-natured individualism and march in step." If the war went well, it would constrain "the individualistic tradition" and convince Americans of "the supremacy of public need over private possessions."
America's entry into World War One, in 1917, was motivated by opportunism: the progressivists in the Democrat party saw that, in the process of placing the nation onto a wartime footing, they would have chances to engage in social engineering on a grand scale. They didn't care much about what was happening in Europe, or why; they knew that a war was a crisis, and a crisis is an opportunity for those who will exploit it.

Progressivism's European Roots

Progressivist policy makers, like President Woodrow Wilson, carefully studied their European predecessors. Not all aspects of progressivist theory came from Europe. Some aspects were American: Wilson's racism, which he expressed in deterring African-Americans from applying to universities, and which caused him to segregate the previously integrated departments of the federal government, arose from the Democrat party in the United States, which had worked to enact "Jim Crow" laws, poll taxes, and literacy tests to keep Blacks from voting. But other aspects of progressivism came from the other side of the Atlantic. As historian Jonah Goldberg writes,
No European statesman looked larger in the minds and hearts of American progressives than Otto von Bismarck.
Bismarck had learned the basic dynamic of progressivism, which is that the people must feel that the state is the bestower of paternal benefits, so that they will tolerate the government's intrusion into their private, social, and family lives.
"Give the working-man the right to work as long as he is healthy; assure him care when he is sick; assure him maintenance when he is old," he famously told
the civic leaders of his time; when 'the working-man' thus sees himself in the womb of the state, he will allow the state to regulate and tax, and will even serve the state to his own destruction. But that was Bismarck in Europe; in America, these same principles were at the base of the progressivist movement, but took on a slightly different appearance.
Woodrow Wilson wrote that Bismarck's welfare state was an "admirable system .. the most studied and most nearly perfected" in the world.
Wilson studied, and copied, Bismarck, and made no secret about it.
Wilson's faith that society could be bent to the will of social planners was formed
by his study of Bismarck, but his target was not Bismarck's Europe; Wilson wanted to shape American society, and in order to do so, he would have to ignore the will of the voters. There is no room in progressivism for John Locke's concept of 'majority rule,' but rather there is only a vision of an elite, an aristocracy, populated by experts, whose status allows them to ignore millions of ballots cast in free elections. This is Woodrow Wilson's progressivism.

Thursday, November 24, 2011

The President and the Teacher

The progressivist movement which attempted to take over America in the early 1900's had a number of leaders and heros. They shared a vision of a country which turned over power to a strong central government, taking rights and choices away from individual citizens, with the rationalization that the experts employed by the regime knew much more, and much better, than ordinary people - about everything from nutrition to foreign policy, from economics to road traffic. The best thing for the people to do was accept the wisdom of rulers, and not get in the way of the plans which the government wanted to implement. Historian Jonah Golberg explains:
The totalitarian flavor of such a worldview should be obvious. Unlike classical liberalism, which saw the government as a necessary evil, or simply a benign but voluntary social contract for free men to enter into willingly, the belief that the entire society was one organic whole left no room for those who did not want to behave, let alone "evolve." Your home, your private thoughts, everything was part of the organic body politic, which the state was charged with redeeming.
Among the leading progressivists we find a President, Woodrow Wilson, and a teacher, John Dewey. Not accidentally, the president was a former teacher who had been active in academic policy-making, and the teacher was involved in using federal policy to control childhood development in a comprehensive way. The progressivists saw childhood as golden opportunity to shape social and political attitudes before individuals reached an age at which they might begin to express a right to self-determination.
Hence a phalanx of progressive reformers saw the home as the front line in the war to transform men into compliant social organs. Often the answer was to get children out of the home as quickly as possible. An archipelago of agencies, commissions, and bureaus sprang up overnight to take the place of the anti-organic, contra-evolutionary influences of the family. The home could no longer be seen as an island, separate and sovereign from the rest of society. John Dewey helped create kindergartens in America for precisely this purpose - to shape the apples before they fell from the trees - while at the other end of the educational process stood reformers like Wilson, who summarized the progressive attitude perfectly when, as president of Princeton, he told an audience, "Our problem is not merely to help the students to adjust themselves to world life ... [but] to make them as unlike their fathers as we can."
The progressivist movement, then, started the educational process earlier, by adding kindergarten, and changed the purpose of universities from education to indoctrination. The goal in all of this was to ensure that citizens didn't not develop their own views, but rather accepted whatever the regime imposed.

Progressivist Government Controls Citizens

In his quest for power, Woodrow Wilson explained progressivism: as President, Wilson wanted to control both society and individuals. Progressivism was the political theory which justified this attempt to take away freedom on a massive scale. Wilson was a 'social Darwinist' and saw the government as the ultimate expression of development. Instead of human societies striving to create ever more liberty for citizens, Wilson believed that true progress was power being taken away from individuals and being consolidated in the hands of the government. Historian Jonah Goldberg explains:
From this perspective, the ever-expanding power of the state was entirely natural. Wilson, along with the vast majority of progressive intellectuals, believed that the increase in state power was akin to an inevitable evolutionary process. Government "experimentation," the watchword of pragmatic liberals from Dewey and Wilson to FDR, was the social analogue to evolutionary adaptation. Constitutional democracy, as the founders understood it, was a momentary phase in this progression. Now it was time for the state to ascend to the next plateau. "Government," Wilson wrote approvingly in The State, "does now whatever experience permits or the times demand." Wilson was the first president to speak disparagingly of the Constitution.
For the progressivist movement, then, the goal was not freedom; the goal was a single, central government amassing ever more power to itself and controls the details of both civic and personal life. They refused to place any limit on the authority of the regime. If government power was the goal, for Wilson and the progressivists, then 'rights' were the enemies:
Wilson reinforced such attitudes by attacking the very idea of natural and individual rights. If the original, authentic state was a dictatorial family, Wilson argued in the spirit of Darwin, what historical basis was there to believe in individual rights? "No doubt," he wrote, taking dead aim at the Declaration of Independence, "a lot of nonsense has been talked about the inalienable rights of the individual, and a great deal that was mere vague sentiment and pleasing speculation has been put forward as a fundamental principle." If a law couldn't be executed, it wasn't a real law, according to Wilson, and "abstract rights" were vexingly difficult to execute.
Wilson, taking office in 1913, was willing to discard both the Constitution and the Declaration of Independence - and with them, the rights and freedoms of ordinary citizens to make choices in their own lives. Why? The idea of the Democrat Party and the progressivists was that the government had the specialized knowledge of experts, and so the government should make important decisions, not the people.

Wilson's Progressivism Emerges

Woodrow Wilson took a carefully calculated path to power. He knew that he could create a powerful network of acquaintances in academia; he sought and took a series of positions as professor and as administrator at the university level. When he reckoned that between colleagues and former students, he had a large enough web of influential supporters, he began to target political offices. He began by writing more popular essays and articles, instead of the academic monographs he had been producing. Historian Jonah Goldberg recounts that
high among his regular themes was the advocacy of progressive imperialism in order to subjugate, and thereby elevate, lesser races. He applauded the annexation of Puerto Rico and the Philippines - "they are children and we are men in these deep matters of government and justice" - and regularly denounced what he called "the anti-imperialist weepings and wailings that came out of Boston." It's a sign of how carefully he cultivated his political profile that four years before he "reluctantly" accepted the "unsolicited" gubernatorial nomination in New Jersey, Harper's Weekly had begun running the slogan "For President - Woodrow Wilson" on the cover of every issue.
Fortunately for the Philippines, the majority of Americans embraced the notion that we should set a course toward independence for that nation. Wilson's progressivism incorporated the Anglo-Saxonism, ultimately a sort of racism, which believed that America was obliged, by its superiority, to bestow the benefits of paternalism upon lesser nations. It was against this arrogant progressivism that Warren Harding would advocate a return to 'normalcy' - a return to calmer vision of international diplomacy being based upon human equality. But Woodrow Wilson was not interested in equality, whether among foreign nations, or in the United States: he wrote
that giving blacks the right to vote was "the foundation of every evil in this country."
But Wilson and his progressivist movement not only opposed the rights of African-Americans to vote (it was they who enacted literacy tests and poll taxes to discourage the Black electorate), but they also opposed the federalist division of powers. The horizontal division of powers (executive, legislative, judicial), and vertical division of power (city, county, state, federal) was designed to prevent too much power from falling into the hands of one group - or the hands of one man. Wilson's political theory was
a sweeping indictment of the fragmentation and diffuseness of power in the American political system.
The very division of power which was designed to prevent the government from having too much control over the life of the individual citizen was the division of power which Wilson opposed because it would prevent his progressive movement from managing the details and institutions of society.

Tuesday, November 22, 2011

Indentured Servants - Getting to Freedom Can Be Tough

Many Europeans wanted to come to America to enjoy liberty. Yet the trip was expensive, and some could not afford the cost of the ticket. One way to make the trip was to become an indentured servant: to borrow the money to buy the ticket, and then work to repay the price after arriving in America. Thomas Sowell recounts how a number of people from central Europe went through this process:
Usually, a boat trip of several weeks on the Rhine to Holland preceded their transatlantic voyage. Then began their ocean travel, on wind-driven ships, averageing between eight and ten weeks on the water. Indentured servants were packed into small, ill-ventilated quarters on small ships perpetually pitching on the Atlantic waves - producing widespread seasickness among the passengers. The weakness and dehydration produced by seasickness made the ill-fed passengers particularly vulnerable to disease. Contemporary observers described the scenes below decks, "some sleeping, some spewing," some "devoured with live," some "beset with boils, scurvy, dysentery, many cursing themselves and others." At night, there were "fearful crys" and the groaning of "sick and distracted persons," some of whom were "tumbling over the rest, and distracting the whole company. . . ." These were the more or less normal conditions. In extreme cases of ships delayed at sea by weather, the suffering and the casualties could be worse. In 1749, two thousand Germans died at sea on voyages to Philadelphia alone.
It is shocking to realize the dangers and difficulties of the journey, and reveals how strong was the desire on the part of some people to come to America - and how desirable American liberty was at that time.
After a vessel docked in an American port, potential buyers of the passengers' indenture contracts came aboard. The indentured servants were brought out of their quarters, walked up and down to let the buyers see them, and sometimes feel their muscles and talk to them to form some opinion of their intelligence and submissiveness. Sometimes a middleman called a "soul driver" would buy a group of servants and then walk them through the countryside, selling their contracts here and there as opportunity allowed. The society of the time attached no moral stigma to this trade in human beings, and it was openly engaged in by individuals of the highest rank and renown. George Washington purchased the contracts of indentured servants to work at Mt. Vernon, just as he owned slaves. As late as 1792, the new American government devised a plan to import indentured German labor to help construct the city of Washington.
It is important to remember that, once the debt had been paid, an indentured servant was released into full civil liberty - he became an equal to the other colonists. Many of them rose to positions of economic prominence, merchants owning their own businesses.
Deaths on the ocean voyage were so widespread among the Germans that many children were orphaned by the time the ships finally reached America. These orphans were either adopted by relatives in America or apprenticed out to someone to learn a trade. One of these German orphans, John Peter Zenger, was apprenticed to a printer and in later years went on to establish his own newspaper. In 1734, his editorial criticisms of the governor of New York led to his being arrested and tried for libel. His acquittal was one of the landmarks in the development of the doctrine of freedom of the press.
This early German involvement with freedom of the press is no accident: since the time of Martin Luther, Germans had understood the value of expression. Limits on expression, or inabilities to express, directly affect civil liberties:
Like helpless people everywhere, the indentured servants were preyed upon by the dishonest. Some ship captains provided inadequate food or sold them into longer periods of bondage than actually required to work off the cost of their transportation. Germans who could not understand English were especially vulnerable.
Some individuals planned to become indentured servants, as an economic plan to arrive in the land of liberty; others would up as indentured servants by accident:
Many Germans left their homes with no plans to become indentured servants, but found that the mounting costs of travel to Holland and then across the Atlantic were more than they had bargained for. Others had family or friends in America whom they expected (or hoped) would pay their fare, and when this failed to happen, they were sold into indentureship. The term "redemptioner" was used to describe the kind of person who came looking to have his fare redeemed in one way or another, although there was no distinction made between such people and other indentured servants after both found themselves in that status.
The attraction of America was strong: certain regions of Europe suffered from bad rulers, from bad weather, or from struggling economies.
And yet, they kept coming - and generally in ever larger numbers. The Germans arriving in the port of Philadelphia alone in the 1740s and 1750s added up to more than 60.000 people, conservatively estimated. An estimated one-half to two-thirds of these were indentured servants. Although indentured servants were subject to many of the restrictions and punishments that applied to slaves - including corporal punishment - they did have a few legal rights during their years of indentureship, and those years did come to a conclusion. Often indentured servants received a modest payment in cash or in kind upon reaching the time for freedom, and many were given land. This was not always the best or the safest land. In the Mohawk Valley or in western Pennsylvania, for example, it was land in frontier areas, near Indians unhappy at seeing their ancestral lands invaded. Many whites who settled in such areas were killed or carried off into bondage by the Indians.
The pain and danger endured by these early settlers shows the strength of their resolve to creative religious and political freedom, and to seek economic opportunity; had they not settled here, America would have been a barely tolerable place - their cultural contributions cannot be overestimated.

Bringing Culture to America

More than bringing people and skills, the early settlers in North America brought culture - music, food, and other traditions. Whether America is a tapestry or a melting pot, neither would be thinkable without the influx of rich heritages. Thomas Sowell writes:

In 1683, thirteen Mennonite families established Germantown in Pennsylvania, now part of Philadelphia. Many other German religious denominations and sects followed, including Calvinists, the Amish, and others virtually unknown to the larger society. In 1742, Heinrich Muhlenberg arrived, and became the organizer of the Lutheran church in America and also founder of a prominent family whose achievements included creation of Muhlenberg College, an outstanding institution in Pennsylvania.

A diverse spectrum of religious heritages can be traced to German-speaking immigrants from places like Switzerland and Austria: Lutherans, Catholics, Calvinists, Amish, Mennonites, Reformed, and antecedents of today's Baptists: the Anabaptists. Beyond religious trends, they brought with them the arts - the music of Bach was popular in colonial era - and mathematics - it was the German philosopher Leibniz who had co-discovered calculus and other forms of advanced mathematics (along with Englishman Isaac Newton).

Thus began the "Pennsylvania Dutch" - Dutch being in this case an American mispronunciation of the word Deutsch for German. By 1745, there were an estimated 45.000 Germans in Pennsylvania. Most settled out on the frontier as it existed at that time, in order to acquire cheap land within their meager means. This made them vulnerable to Indian attacks, especially because of the reluctance of the colonial government to provide defense. Control of the government was largely in the hands of pacifist Quakers living safely in Philadelphia.

Creativity and ingenuity allowed these early settlers to survive, when the colony's government refused any military protection from the attacks. They were not military people, nor were they well-armed, yet they were annihilated or terrorized into retreat by the attacks on their farmsteads and villages.

In 1709, Germans established Neuberg - now called Newburgh - on the Hudson River, and then spread north into the Mohawk Valley. As in Pennsylvania, this was frontier territory, subject to Indian raids. The Germans of the Mohawk Valley region came as indentured servants - people bound by contract to work for a certain number of years (usually three to seven) to pay off the cost of their transportation to America. At least half of the white population of colonial America came this way. It was a scheme first tried with German and Swiss immigrants and later spread to the Scotch, the Irish, and others. The Germans who settled in the Mohawk Valley came as indentured servants of the British government, which paid half their transportation and settlement costs. More so than other groups, Germans left their home in groups, ranging from whole families to whole communities.

Although the idea of indentured servants has been criticized as thinly disguised slavery, it was in fact they only way in which many people could afford to come to America's freedom, and can be seen as simply a type of loan: once repaid, the former servant was released into full civil liberty.

The fact that German-speaking immigrants tended to arrive in larger groups, rather than individuals or isolated families, enabled them to contribute to American cultural formation. Music, dance, cooking styles, and clothing traditions were more readily preserved and transmitted this way.

The early German immmigrants - both in New York and in Pennsylvania - came from the Palatinate, a small region in the southwestern part of Germany, along the Rhine. Sixteen families of Palatines also settled in New Bern, North Carolina, in 1710. Eighteenth-century South Carolina also carried on a brisk trade in German indentured servants from the Palatinate.

German-speaking villages were common up and down the Atlantic coast, but usually not directly on the coast; rather, further inland. Names of towns and rivers, from Pennsylvania to Georgia, and from New York to Texas, reflect the contributions made by Germans to the founding of American society.

New York - Its Best Years

What was it like to visit the city of New York during its glory days? Author Eric Metaxas relates how it may have seemed to a passenger from Europe on a ship, steaming "past the Statue of Liberty and toward the fabled island of Manhattan, the city overwhelmed" a perceptive observer: "Manhattan at the end of the Jazz Age was a dizzying place for any visitor, even one as cosmopolitan as" a professor from Berlin's university:
New York seemed to exhibit the crazy, boundless energy of a bright-eyed adolescent in full growth spurt: the whole island seemed to be bursting at the seems in every direction, grinning as it did so. The tallest building on the planet, the Bank of Manhattan Trust building, had just three months earlier been topped by the silver spire of the newest leader, the Chrysler Building. But the Empire State Building, which would in a few months surpass them all - and hold the lead for forty years - was that very minute growing at the unprecedented rate of four and a half stories per week. The nineteen-building Art Deco masterpiece that would become Rockefeller Center was under construction, too, and far uptown, also under construction, was the George Washington Bridge - soon to be the longest bridge in the world, almost doubling the previous record.
The city was at its prime, as yet untouched by the ravages of the Great Depression, the rationing of the war years, and the inner-city poverty which would characterize the second half of the twentieth century; it wasn't perfect - still wrestling with the wave of organized crime sparked by Prohibition - but it was perhaps as good as it ever got.

Sunday, November 6, 2011

Wilson Introduces Segregation

After the end of the Civil War in 1865, African-Americans emerged into fuller participation in government. They voted by the millions, and Blacks were elected as Representatives and Senators in Congress. Most social institutions were desegregated and integrated. But this era of freedom was soon to be brutally repressed.

President Woodrow Wilson, representing the Democrat Party of southern whites, didn't like the idea of African-Americans exercising full voting rights, or holding elected offices. Before becoming President of the United States, he had been president of Princeton University, where he created policies to discourage African-American students from even applying for admission. Cengage's history text reports that, as the leader of the Democrat Party, he had little sympathy for African-American desires to attend universities,

nor did Wilson, at this time, view with any greater sympathy the campaign for African American political equality. He supported efforts by white southerners in his cabinet, such as Postmaster General Albert Burleson and Treasury Secretary William McAdoo, to segregate their government departments, and he largely ignored pleas from the NAACP to involve the federal government in a campaign against lynching.

We see, then, a giant step backwards. Blacks were voting in fewer and fewer numbers after Wilson became president. His Democrat Party, for example, at this time imposed "poll taxes" and "literacy tests" for voting in those states (like Mississippi) where the Democrat party had a strong hold on political power.

Not until Republicans, like Eisenhower, were elected to the White House would there again be a chance for African Americans to resume that fuller participation in government which they initially had after the Civil War.

Saturday, October 15, 2011

Who Will Become a Millionaire?

The American Dream about economic ascent begins in the area around the Rhine River known as the "Electoral Palatinate" at the end of the eighteenth century. Germany was then a land from which people emigrated. Craftsmen, farmers, and laborers climbed in the harbors of Europe into ships bound for faraway lands. Nobody knows the exact number of the millions of people who fled poverty. But what we do know, however, is which emigrant achieved the most in distant places: Johann Jakob Astor, born in 1763 in the small village of Walldorf near Heidelberg as the child of a poor butcher, died in 1848 in New York as the richest man in the United States. Ascents like his would later create the impression that in America even the simplest man could become rich, if only he tried sufficiently.

In Germany, on the other hand, often even the greatest effort didn't achieve much. The young Johann Jakob (he would later Americanize his name to 'John Jacob') saw this early in the case of his father, who traveled from farm to farm, in order to slaughter the cattle of the farmers. But most people couldn't afford to kill their animals and eat them, as the historian Alexander Emmerich writes in his biography of Johann Jakob Astor. Only on holidays did the older Astor earn reasonable money; the rest of the year, the family had to go hungry. For a while, Johann Jakob helped his father in his meager business, but then he made his way toward faraway places - at first, to London. There, his brother had learned the trade of building instruments. This is the first reason for the success that John Jacob Astor will later have: Astor had valuable flutes in his luggage, as he, merely twenty years old, arrived in America in January of 1784. The last few meters across the sea he finished by foot, and that might serve as an example of his determinedness. The South Carolina, the ship on which he traveled, actually got stuck in the ice near the city of Baltimore. Astor was too impatient to wait for warmer weather. He packed his things and walked over the frozen slabs of ice.

We see here two principles about immigration into the U.S.: first, temporary economic conditions can lead to permanent emigrations; Germany was mostly a prosperous nation, but during the few tough years it experience in the late 1700's people left. Secondly, immigrants are often very determined people - exceptionally decisive and adventurous.

Sunday, October 9, 2011

Learning How To Do Democracy

At more than one time in American history, the lessons of democracy had to be learned: first, in the colonial days, when each colony had its own internal republicanism in the forms of town councils and legislatures; then in 1776, when a grander scale of democracy was introduced; and later, as the nation expanded westward, small towns formed in the wilderness and had to develop democracy for themselves. Professor Szasz, at the University of New Mexico, explains:

Churches and Sunday schools served as the bulwarks of social stability. Not only did they provide venues for regular services, their rooms held a variety of social gatherings as well, thus functioning as training grounds for political democracy. The numerous church meetings introduced people to such basic democratic principles as how to conduct public meetings via accepted rules of order, how to speak to the issue at hand, and (usually) respect for majority rule. Thus, the church and political gatherings of the era overlapped and reinforced each other.

The churches on the western frontier were ideal places for democracy to develop: the Christian principles of tolerance and kindness meant that when a church building was used for a political gathering, all people were welcome to express their opinions. A fundamental respect for every person, especially those with whom you disagree, was encouraged. It is no accident that these western states were largely against slavery, and it is no accident that the first woman elected to Congress (Jeannette Rankin from Montana, elected in 1916) came from this region.

Thursday, October 6, 2011

Who Was Where?

In the early years of exploring North America, people from various parts of Europe made settlements and small towns. The ethnicity of these early groups would have a lasting impact on the formation of culture in the United States. As Cengages's textbook states,

In the mid-Atlantic region, settlers from all over northwestern Europe were creating a new ethnic mosaic. English colonists were probably always a minority, outnumbered at first by the Dutch, and later by Germans, Scots, and Irish, but New England was in every sense the most English of the colonies. New France was as French as New England was English. The farther south one went, the more diverse the population; the farther north, the more uniform.

Sometimes, reading history books, one might be tempted to think that the United States was formed mainly by the British: but evidence tells us that it was actually German and Dutch settlers who formed the core of American culture.

Monday, September 5, 2011

Stalin: Even Worse Than We Thought

For millions of people in eastern Europe, the end of World War Two simply meant exchanging the inhumane oppression of the Nazis for the inhumane oppression of the Soviet Communists. Like Hitler, Stalin wanted to dominate Europe and kill millions of people who represented any form of resistance to his expansion. As the Washington Times writes,

For several generations of foreign-policy students, the term "Yalta" was a code word for an ailing President Roosevelt bartering into communist slavery Poland and other Eastern European nations. The undeniable evidence was that Soviet dictator Joseph Stalin treated many of the “agreements” painstakingly reached by FDR, Stalin and Winston Churchill in the Crimean city in February 1945 as worthless “promises” to be crumpled and tossed in the trash bin.

The conference at Yalta was a meeting between the three military powers: the USA, the USSR, and England. They were personified in Roosevelt, Stalin, and Churchill. The purpose of the meeting was to decide what to do with the nations of Europe once the war was over.

The Harvard Russian scholar S.M. Plokhy sums up the key lesson from the Yalta Conference in a telling phrase: "Democratic leaders and societies should be prepared to pay a price for close involvement with those who do not share their values." And indeed a heavy price was paid for what happened at Yalta.

The problem with the conference is that there was no way to enforce the agreements about the structure of post-war Europe, and there had never been an intention on Stalin's part of following through on his agreements. Stalin said whatever sounded nice, and signed whichever documents were prepared, but secretly intended to do very different things. Harvard's Professor Plokhy draws the general conclusions that free societies must be very careful when negotiating with totalitarian societies. Essentially, one can never develop a sense of trust in such negotiations.

In hindsight - always a good vantage point from which to examine history - the scenario for Yalta was preordained. The Red Army already held sway over a wide swath of Eastern Europe, and Stalin’s appetite for more territory appeared unsated. He was in no mood to bargain over the spoils he had in hand, declaring, "This war is not as in the past; whoever occupies a territory also imposes on it his own social system." Such is what he proceeded to do, without a glance at the peoples he subjugated under communism.

Stalin's armies already occupied much of eastern Europe, and he viewed such territory as his own, to do with as he pleased. Having murdered millions of citizens in his own country prior to the war in order to solidify his grasp on political power, he certainly would not let either human decency or diplomatic treaties affect his actions in occupied lands.

Thus we have Stalin blithely agreeing to negotiations over the postwar Polish state that would include both his hand-picked communists and a non-communist delegation that favored free elections leading towards democracy. When the latter group arrived in Warsaw, under a safe-conduct pass, the Soviet secret police promptly hauled them off to jail; several were shot. So much for Stalin's "word of honor."

Although the conference was held in 1945, many of the papers from it were not made public until the fall of Soviet Communism around 1990. The millions of pages of declassified documents required years of reading and research. History professors around the world are learning new facts about the Yalta conference, which helps us to understand this attempt to organize the post-war world. Some historians have thought that Roosevelt's failing health may have affected his ability to work, but Professor

Plokhy insists that the record shows no sign that Roosevelt's physical condition hampered his performance. Perhaps. But several factors should be considered. His blood pressure soared from 186/108 to 260/150 between March and November 1944. Physicians tried to restrict him to a four-hour "workday" (he refused). A hacking cough and abdominal pains made sleep difficult.

Even though we now have more information about the conference, it seems that we may never know the exact extent to which Roosevelt's health did, or did not, affect his ability to work. But we do know, now more than ever, that Stalin's Soviet Communism was based strictly on the desire to dominate other nations, and that Stalin saw murdering and lying as useful tools to get what he wanted.

Wednesday, August 24, 2011

Corporate Growth

In the last few decades of the nineteenth century, and the first few decades of the twentieth, corporations grew, wages rose, the number of people working in industry increased, and the population of the United States grew steadily. A steadily growing population is one necessary precondition for a prosperous economy. Cengage's history book describes this era:

This growth in scale was in part a response to the enormous domestic market. By 1900, railroads provided the country with an efficient transportation system that allowed corporations to ship goods virtually anywhere in the United States. A national network of telegraph lines allowed constant communication between buyers and sellers separated by thousands of miles. And the population, which was expanding rapidly, demonstrated an ever-growing appetite for goods and services.

This prosperity, and its benefits to citizens at every income level, is founded upon an understanding of property. Although legal ownership is a central concept in any free society, it is balanced by a moral tradition of stewardship - that one is only temporarily in charge of one's property, and has a duty to use it wisely, fairly, and for the benefit of others. Legal ownership gives the individual power to make decisions; the moral tradition gives the individual guidance about how to make those decisions. Temple University's Mark Levin writes:

The key to understanding the free market is private property. Private property is the material manifestation of the individual's labor—the material value created from the intellectual and/or physical labor of the individual, which may take the form of income, real property, or intellectual property. Just as life is finite, so, too, is the extent of one's labor. Therefore, taxation of private property, or the regulation of such property so as to reduce its value, can become in effect a form of servitude, particularly if the dispossession results from illegitimate and arbitrary state action.

If the legal notion of private property is threatened, both the freedom of society, and its ability to attempt justice are inhibited.

the federal government should raise revenue only to fund those activities that the Constitution authorizes and no others. Otherwise, what are the limits on the Statist's power to tax and regulate the individual's labor and, ultimately, enslave him?

Taxes, although sadly necessary, must be kept to a minimum, or else both the individual and society will suffer a loss of freedom, the inhibition of justice, and a decrease in the ability to benefit either the person or the community.

Economics Changes Society

Karl Marx wrote that all history is economic history. While he may have taken it a bit too far, it is certainly true that culture can be influenced developments in the business world. In the second half of the 1800's, economic growth makes itself felt, as the historical narrative tells

about how the newly powerful corporations transformed America; how they intensified their search for a new forms of production and management; how the jobs they generated attracted millions of immigrants, southern blacks, and young single women to northern cities; and how they triggered an urban cultural revolution that made amusement parks, dance halls, vaudeville theater, and movies integral features of American life. [Cengage's history book]

While the business world was seeking to explore the capabilities of science and technology, society explored the new options it found in these developments:

The free market is an intricate system of voluntary economic, social, and cultural interactions that are motivated by the desires and needs of the individual and the community. [Mark Levin]

In a complex web of millions of individual actions, individual choices add up to form both economic and cultural trends. Each person minutely and indirectly affects the course of society:

while the symmetry between the free market and the civil society is imperfect—that is, not all developments resulting from individual interactions contribute to the overall well-being of the civil society—one simply cannot exist without the other. [Levin]

Because of the complexity, indirectness, and subtle manner in which these millions of economic actions and cultural preferences add up, it is impossible to predict their ultimate direction, and their progress will not be perfectly efficient. Despite difficulties, setbacks, false starts, and dead ends, the general pattern will emerge, yielding both individual and societal gains.

Tuesday, August 23, 2011

Free Markets, Free People, Free Society

As Americans explored the increasing economic freedoms of the 1800's, the nation prospered. The abolition of slavery, even if it meant a temporary setback for the businesses of the deep south, brought opportunities for millions of Americans. The defeat of the Populists, or People's Party, with their desire for increased taxes, encouraged the markets and workshops in small towns across the country. As the growth continued, small businesses turned into big businesses, and new ways of envisioning trade arose. Cengage's history book states:

Corporations were changing the face of America. Their railroad and telegraph lines crisscrossed the country. Their factories employed millions. Their production and management techniques became the envy of the industrialized world. A new kind of building - the skyscraper - came to symbolize America's corporate power. These modern towers were made possible by the use of steel rather than stone framework and by the inventions of electrically powered elevators.

But it did always go so smoothly. Although the rise of large corporations created wealth and job opportunities for millions of people, and raised the standard of living for almost all Americans, there were times when the system went bad. A good business environment depends upon a free market, in which everyone can compete fairly. But some corporations were in league with the government: a cozy relationship between a business and the government can lead to unfair advantages being given to that business: then there is no free market, and no fair competition. All corporations should face the fierce conditions of competition equally; only then will a truly free market create prosperity for lower, middle, and upper class citizens.

Temple University's Mark Levin writes

that the individual is more than a producer and consumer of material goods. He exists within the larger context of the civil society—which provides for an ordered liberty.

Free markets do more than raise the standard of living for the working class. Free markets acknowledge human dignity. The worker

sees in the free market the harmony of interests and rules of cooperation that also underlie the civil society. For example, the free market promotes self-worth, self-sufficiency, shared values, and honest dealings, which enhance the individual, the family, and the community. It discriminates against no race, religion, or gender. The truck driver does not know the skin color of the individuals who produce the diesel fuel for his vehicle; the cook does not know the religion of the dairy farmers who supply milk to his restaurant; and the airline passenger does not know the gender of the factory workers who manufacture the commercial aircraft that transports him—nor do they care.

Free societies arise from, and are sustained by, free markets.

Soothing Racial Tensions

Those who live in the United States are accustomed, when hearing the phrase 'racial tensions', to think of misunderstandings and frictions between African-Americans and Americans of European ancestry. But 'race' can refer to much more than simply Black or White. There are many other racial distinctions which can be made among humans, and which can be the occasion for miscommunication and even conflict.

A large number of Chinese immigrants entered the western U.S. in the second half of the nineteenth century. They came mainly to work on railroads: the few pennies per day they were paid was much more than they could have earned in China. Cengages's history book states:

As many as 300,000 Chinese immigrants arrived in the United States between 1851 and 1882, and more than 200,000 Japanese immigrants journeyed to Hawaii and the western continental United States between 1891 and 1907. They contributed in major ways to the development of two of the West's major industries: railroad building and commercial agriculture.

But different cultures do not always easily mix. Although the vast majority of Chinese, Blacks, and Whites developed cooperation and mutual respect as they lived in pioneer towns together, sometimes there were frictions. Professor Ferenc Szasz at the University of New Mexico writes that

Famed Methodist itinerant John "Father" Dyer reportedly staved off an 1880 anti-Chinese riot in the mining town of Breckenridge, Colorado. When an angry mob began to shout, "The Chinese must go," Dyer mounted the nearest steps and began to sing "All Hail the Power of Jesus' Name." He paused after several verses to launch into an extemporaneous sermon, preaching that God's love was intended for all humanity and that all men were brothers. Eventually the mob dispersed.

The pastors, priests, and preachers of the western U.S. worked to create a social harmony in which all races could live and work together.

Monday, August 22, 2011

Journalist Caught

Newspaper reporters often wish to present themselves as neutral and objective in their communication of facts to their readers; and some of them are. But some are not. The case of Walter Duranty has become a famous example. He wrote for the New York Times, and reported from Russia in the 1920's and 1930's. During these years, Soviet rule Joseph Stalin was creating a series of artificial famines which would ultimately kill several million people; Stalin was depopulating sections of the country which were not enthusiastic about his dictatorship.

Duranty, however, failed to mention any of this in his articles. In fact, he painted a rather pleasant picture of life in the Soviet Union, and assured his readers that there was no starvation. How and why would a journalist write such unquestionable falsehoods?

Columbia University Professor Mark von Hagen, who worked with the management of the New York Times to investigate Duranty's writings, commented that Duranty

frequently writes in the enthusiastically propagandistic language of his sources

and

Much of the 'factual' material is dull and largely uncritical recitation of Soviet sources, whereas his efforts at 'analysis' are very effective renditions of the Stalinist leadership's self-understanding of their murderous and progressive project to defeat the backwardness of Slavic, Asiatic peasant Russia.

Duranty has knowingly repeated the texts of the Soviet propaganda agency in his articles, despite his clear awareness that the claims were false.

The management of the New York Times, distancing itself from Duranty's work, commented that

Other writers in the Times and elsewhere have discredited this coverage.

It remains something of a mystery why Duranty would sacrifice his own credibility and professionalism to support the dictatorship which would ultimately kill millions of its own citizens.

Thursday, August 18, 2011

Money and History

It is impossible to keep political history, social history, economic history and cultural history completely separate from one another. These areas of life are all inter-related. When the United States began in 1776, and when it replaced its Articles of Confederation with the Constitution a few years later, it was clear that the political and religious freedom which Americans wanted needed to be harmonized with financial freedom. Although these areas of life many seem unrelated, the principle was clear: if you lose one, you'll soon lose the other. Having the freedom to speak your political opinion goes hand-in-hand with keeping taxes low. Having the liberty to exercise whatever religion you choose is inseparable from a free market economy.

It is no coincidence the end of slavery, being an expansion of personal freedom, gave rise to economic growth. Temple University's Mark Levin writes:

The free market is the most transformative of economic systems. It fosters creativity and inventiveness. It produces new industries, products, and services, as it improves upon existing ones. With millions of individuals freely engaged in an infinite number and variety of transactions each day, it is impossible to even conceive all the changes and plans for changes occurring in our economy at any given time. The free market creates more wealth and opportunities for more people than any other economic model.

Economic systems are very sensitive to any trend which seeks to reduce individual liberty. Just as the abolition of slavery increased personal freedom, a few decades later the Populists would try to reduce it. Most attempts at reducing individual liberty are hidden behind promises of more freedom, not less. The Populists, or People's Party, was a political movement formed in 1891 that claimed to work in the interests of labor and farmers, and pretended to seek more economic liberty in the free coinage of silver. But in reality, they wanted a graduated income tax, and government control business. The presence of the Populist Party, and its attempt to place candidates into elected offices, slowed economic growth.

Happily, the ordinary voters saw through the claims of the Populists, and by 1896, the People's Party was no longer a force in the nation's political life. Prosperity could continue. Cengage's history book states:

With the collapse of populism in 1896 and the end of the depression in 1897, the American economy embarked on a remarkable stretch of growth. By 1910, the United States had secured its status as the world's greatest industrial power.

The lesson is clear: personal political freedom and individual religious liberty lead to free markets and lower taxes - all of which brings prosperity for the entire nation.

Thursday, July 21, 2011

A Helping Hand During the Great Depression

When thousands and millions of Americans were unemployed, and even homeless, and when the farmers who produced the nation's food were suffering in the Dust Bowl drought of the 1930's, help was at hand from numerous charitable organizations. Some of them are still with us, like the Salvation Army.

One of the leaders of these helping organizations was Dorothy Day. She created not only one, but several, nation-wide movements to help the poor. But her story begins long before the Great Depression. Northwestern University's Collin Hansen writes:

It is perhaps symbolic that a mover and shaker like Dorothy Day survived the 1906 San Francisco earthquake. As she watched her mother help the earthquake's homeless, Day developed a sensitive heart toward "the least of these." But it was socialism — not the church — that first harnessed her activism. In 1917 police arrested the budding journalist while she protested at the White House for woman suffrage. The activist Day saw little use for a meek Jesus. "I wanted a Lord who would scourge the money-changers out of the temple," Day wrote in her autobiography, The Long Loneliness, "and I wanted to help all those who raised their hand against oppression."

Dorothy Day's desire to help the oppressed was an urgent desire, one that sought immediate and measurable action, not merely nice sentiment. The rhetoric of socialist activists would grab her attention. She would discover that, despite the rousing phrases of the socialists, real and substantive action would be more likely to come from spiritual, rather than Marxist, motives:

Nevertheless, the time Day spent in prison tried her commitment to secular activism. She even asked for a Bible and sought comfort from the Psalms. For years after she left prison, Day's interest in Christianity grew slowly but steadily. Love for the poor drew her to the Roman Catholic Church, whose huddled masses she met while reporting among immigrants.

Her socialist acquaintances were mostly opposed to religion, and would not bother to consider the important charitable work which the Christians were doing among the poor. Although not married, Dorothy Day had lived with a socialist man for several years. When it came to love or politics, he would rather dump her than be related to someone willing to consider the spiritual side of human existence.

Day's move toward Catholicism came at a cost. She split with her common-law husband, Forster Batterham, when Day gave birth to their daughter, Tamar, in 1927. Day, feeling the guilt of an earlier abortion, saw Tamar's birth as a sign of God's mercy and forgiveness, and had her baptized. Like many of Day's radical friends, Batterham would not tolerate religiosity. "It was not because I was tired of sex, satiated, disillusioned, that I turned to God," Day wrote. "It was because through a whole love, both physical and spiritual, I came to know God."

Dorothy would eventually prove her talent as a writer, editor, and reporter.

While writing for the Catholic magazine Commonweal in 1932, Day met the man who would steer her toward her life's calling. Peter Maurin, a French immigrant and former monk, urged Day to launch a newspaper that would spread Catholic social teaching. Maurin supplied the philosophy behind The Catholic Worker, but Day provided the journalistic know-how. The newspaper's pacifism and advocacy for the poor afforded Maurin and Day numerous opportunities to back their words with action. Yet on two occasions things became so difficult that Maurin asked Day to quit with him.

After 1933, the Great Depression got worse, year by year, and the farming crisis didn't help matters, either. In addition to writing, Dorothy Day found it necessary to take action. She began to create institutions, known as 'Catholic Worker Houses', in major cities. These locations would help anyone, regardless of religious belief - the unemployed and homeless.

By 1936, 33 Catholic Worker houses had sprouted nationwide as the growing network of newspapers opened their doors to the down and out. But some staff members lamented Day's commitment to the "undeserving" poor. They preferred to spend the limited funds on socialist propaganda. Day held her ground, and the dissenters left.

In addition to helping the poor, Dorothy Day was committed to the idea of pacifism. Reading the New Testament carefully, she came to the conclusion that it was utter against war.

Likewise, World War II tested the newspaper's integrity. When The Catholic Worker declined to choose sides, two-thirds of their readers quit taking the paper. Maurin wondered if they should give up, since the world evidently didn't want to listen. "God gives us our temperaments," Day remembered, "and in spite of my pacifism, it is natural for me to stand my ground, to continue in what actually amounts to a class war, using such weapons as the works of mercy for immediate means to show our love and to alleviate suffering."

Although she did influential work during the 1930's and 1940's, Dorothy Day lived until 1980. Looking back on her long life, she wrote:

If I could have felt that communism was the answer to my desire for a cause, a motive, a way to walk in, I would have remained as I was. But I felt that only faith in Christ could give the answer.

She was disillusioned by the idea of a central bureaucracy in a distant capital city, which was what the communists and socialists had created. Rather than look to a political or governmental structure to provide a solution, Dorothy Day saw that real action can be taken among the poor and among the oppressed by a spiritual community which is willing to live and work among them.

Running for President - Over and Over Again

William Jennings Bryan ran as a candidate for the U.S. Presidency several times, and never won. Despite this, he is an influential figure in history. Northwestern University's Collin Hansen writes:

Williams Jennings Bryan trusted a God who sided with common folk. Bryan made a name for himself in the Progressive Era by fighting the economic elites of his own Democratic Party. His oratorical skills catapulted him all the way to the party's nomination for President in 1896 when he famously harangued the gold standard. "You shall not press down upon the brow of labor this crown of thorns," Bryan thundered, stretching out his arms. "You shall not crucify mankind upon a cross of gold."

Jennings is difficult to categorize: by today's standards, he is neither a liberal nor a conservative. We are no longer debating about the exact relationship between the dollar and an ounce of gold, but in Bryan's era, the gold standard of currency was a divisive question. What is common to both eras is Bryan's sense of the common man. He reacted against any sense of aristocracy or elitism. Although he lost the 1896 election for the presidency, that did not stop him from running again:

Three times Bryan ran for President; three times he failed. Nevertheless, besides Woodrow Wilson and Theodore Roosevelt, Bryan dominated the era of reforms that ran from the 1890s to the 1920s. He championed four constitutional amendments enacted during this period—prohibition, direct election of senators, the income tax, and woman suffrage. Known as the "Great Commoner," Bryan opposed the business interests that he believed had undercut America's working classes. "There can be no good monopoly in private hands until the Almighty sends us angels to preside over the monopoly," he argued.

Bryan's support for these four amendments defines his political stance, and some of the issues of that time period. Although some of his views may be naive - Prohibition was a failure and income tax has caused misery for millions - his intent is unmistakable, and these measures may have even made sense in their time, if not in ours. Aside from his political views, he was also known for his speaking skills, which allowed him to communicate those views to millions:

Traits that won Bryan the masses made him controversial and unpopular among others. A great speaker during an age of oratory, Bryan came across as a loud demagogue to many business and political leaders. He stuck to his principles and resigned his position as secretary of state in Woodrow Wilson's cabinet as America prepared to enter World War I. But Bryan had appeared inept in his efforts to mediate the conflict, and his simple piety did not impress opponents. Yet according to biographer Michael Kazin, "admirers embraced him because he so publicly campaigned in the name of Christian principles and was never known to have transgressed them."

After three runs for the presidency, a term as Secretary of State, and four years as a congressman, Bryan left governmental politics, but stayed involved in social and communal causes. He was bitterly attacked by H.L. Menken and Clarence Darrow, especially when he dared to voice skepticism about Charles Darwin.

But Bryan did not entertain any retreat from culture. "Sometimes the Christian has sought to prepare himself for immortality by withdrawing from the world's temptations and from the world's activities," Bryan said. "Now he is beginning to see that he can only follow in the footsteps of the Nazarene when he goes about doing good and renders 'unto the least of these,' his brethren, the service that the Master was anxious to render unto all."

Bryan's political method was to learn what was on people's minds - which questions occupied the ordinary citizen - and then address them. He was a

politician with principles. William Jennings Bryan's towering personality cast a long and controversial shadow over American politics. Biographer Michael Kazin says Bryan "burned only and always to see religion heal the world."

Despite the anger and hatred directed toward him, he remained peaceful and calm. He didn't use his speeches to stir up rage against those who were attacking him; instead, he simply worked to find ways to improve the lot of the ordinary citizen.

Monday, July 4, 2011

How Did Good Businesses Get Bad Reputations?

It is common to read, hear, and see imagines of large corporations as the "bad guys": symbols of greed and heartlessness, eager to take money in any form, exploiting workers, insensitive to the concerns of the poor, and uncaring in regard to preserving the earth's environment. Business, you might think, is simply evil.

How did this stereotype develop? To accept these ideas, one would have to forget that millions of poor people have managed to improve their lives by working their way up in business. Every American, not only the rich and middle class, has experienced an increase in her or his standard of living because of business activity: even the poor have cell phones, televisions, and a host of other gadgets.

Columbia University's Professor Thomas Woods writes:

History textbooks love to highlight the villainous American businessmen who have "exploited" workers, taken advantage of the public, and wielded so much power. Government officials, on the other hand, are portrayed as benevolent, self-sacrificing crusaders for justice, without whom Americans would be working eighty-hour weeks and buying shoddy goods at exorbitant prices. This is what every students believes as he leaves high school (or college, for that matter), and it's hard to blame him. This kind of thing has been taught, day after day, for years.


Although we might disagree with Professor Woods' use of the word 'every' (surely not every student has fallen for this propaganda!), his generalizations are largely correct: and they hint at the source of this incorrect but pervasive view: one reason for painting such a dim picture of business is to make government look good.

It is, after all, the government which taxes heartlessly - even the poorest person must pay sales tax, property tax, gasoline tax, cell phone tax, and dozens of other taxes. It is the government which creates no wealth: the total amount of value in the economy remains the same as the government taxes and spends. Even when a government prints more paper money, this does not create value: it simply dilutes the pool of wealth, making each dollar worth a little less as each new one is printed. The government increases neither the total nor the average standard of living for Americans.

So beware over-simplified paradigm of "business bad, government good": remember that business is simply the activity of ordinary people going about their lives. Government is the activity of regulating people's lives. If there were no business, there would be no life to regulate.

Saturday, July 2, 2011

Getting a Prize for Lying

Scholars have arrived at slightly different numbers when they research how many millions of people starved to death when Joseph Stalin created famines in parts of his Soviet Union in the early 1930's. The famines, created in order to subdue regions which might question Stalin's authority, killed somewhere between four and ten million people. The numbers will remain forever approximate.

New York Times reporter Walter Duranty, who was in Russia at the time, at a dinner party with staff from the British Embassy, said that his own travels caused him to estimate between seven and ten million deaths.

Why, then, would Duranty write in his articles, published in the New York Times, that "there is no actual starvation," and again that there had been no "deaths from starvation"?

It became clear that Duranty was a big fan of Stalin's, and of their "planned system of economy." He wanted to give the Soviet Union a good image around the world, and so deliberately lied to millions of American readers. It later became clear that he was one of network of Americans who sympathized with the Soviets, and would manipulate information to keep the Soviet Union strong - while making America vulnerable in what would later become the Cold War.

Duranty wrote well, so well that he earned Pulitzer Prize for journalism. Both the New York Times and the Pulitzer committee would later publicly acknowledge that they had been fooled, and that Duranty was writing, not accurate and objective reports, but rather propaganda for Moscow.

Thursday, June 23, 2011

Japan Sneaks

To understand what happened at Pearl Harbor on December 7, 1941, one must go back at least a decade, and possibly more. Japan's imperial ambitions didn't fan into flame overnight. Politically and militarily, much thought and discussion had been given to the question of how Japan would dominate eastern Asia and control the Pacific Ocean. At the same time, other nations were not paying attention. Oxford's Michael Korda writes:

The year 1933 was pivotal in more ways than one. Japan's rearmament and intransigence were increasing at a rapid pace ...


In American, however, people were thinking mainly about economic survival:

Preventing the United States from collapsing into chaos and taking steps to rebuild its crippled economy and self-confidence were foremost in the president's mind, naturally enough, and neither he nor his Army Chief of Staff had much time to worry about events in ...


distant Japan. On the contrary, the U.S. Army was having a difficult time obtaining enough funding to keep itself in existence, let alone defend the nation against Japanese attacks:

War was far from Roosevelt's mind, and the problems of the Army farther still. Military appropriations were relentlessly cut back; the development and production of new weapons were slowed to a standstill, even for the most basic needs.

Japan, however, was building battleships, aircraft carriers, and airplanes at an ever-increasing rate, and developing new theories of warfare - all of which would be directed eventually at America.

Wednesday, June 22, 2011

Doubting the Pulitzer

Journalists and newspaper reporters of all stripes dream of winning the famed Pulitzer Prize. Walter Duranty did, in 1932, for his work as a New York Times reporter in Russia - at that time, the Soviet Union. Duranty's articles were detailed and well-written. They were also wrong: when millions died in the famine, or series of famines, which Joseph Stalin orchestrated to press his people into submission, Duranty assured American readers that there was no famine!

When, many years later, Duranty's falsehoods, written as propaganda to support the Soviet Union in the eyes of journalists and their audiences, his reputation was ruined. No longer regarded as a serious reporter, he was seen seen as someone who had deliberately lied to millions of Americans. Whether he did so because he believed in Stalin and wanted to support him, or because he had been paid by the Soviet government, is not clear.

In any case, the question arose: should his Pulitzer Prize be retracted? In 2003, the Pulitzer committee conducted several meetings to review the case. They wrote:

In recent months, much attention has been paid to Mr. Duranty's dispatches regarding the famine in the Soviet Union in 1932-1933, which have been criticized as gravely defective.

Although Duranty wrote many articles over several decades, the prize had been awarded specifically for thirteen articles in the newspaper and two in a magazine:

In its review of the 13 articles, the Board determined that Mr. Duranty's 1931 work, measured by today's standards for foreign reporting, falls seriously short. In that regard, the Board's view is similar to that of The New York Times itself and of some scholars who have examined his 1931 reports.

Although the Pulitzer committee found Duranty's work to be substandard, the worst examples of his falsified articles were written after 1931, while the prize was given for the work written in 1931. It was decided not to retract his prize, but rather to make a corrective statement:

The famine of 1932-1933 was horrific and has not received the international attention it deserves.

The Pulitzer committee wanted to accomplish three things: make a statement about the severity of the famine and the blatant ignoring of it by the media, rebuke Duranty for his negligence, and yet let the rebuke suffice instead of actually withdrawing his prize.

By its decision, the board in no way wishes to diminish the gravity of that loss. The Board extends its sympathy to Ukrainians and others in the United States and throughout the world who still mourn the suffering and deaths brought on by Josef Stalin.

In any case, the fact remains that a Soviet Communist dictator starved millions of his own people to death, and an America reporter refused to let the world know.

Sunday, June 12, 2011

The McKinley Legacy

President William McKinley was assassinated in 1901, throwing Vice President Theodore Roosevelt into office. But in the years before he died, McKinley's actions created important precedents. Harvard University's Alvin Felzenberg writes:

A strong “sound money” and high-tariff man, McKinley helped make the United States a world power. The Spanish-American War, commenced and ended upon his own terms, proved a trial run for American participation in World War I. Woodrow Wilson’s presidency might have ended on a better note had he followed McKinley’s example of including the opposition party in the peace negotiations.


McKinley understood the importance of international currency exchange - America was entering its peak industrial era, and needed a good trading medium. The tariff question is more complex: tariffs can be reduced or eliminated with those nations who do likewise, creating truly free trade. But against nations who impose tariffs, we must also levy, to create an equilibrium.

Mark Hanna was McKinley's campaign manager, both for his election and his re-election. Hanna and McKinley made a winning team:

In their two winning campaigns against the charismatic and populist “boy orator,” William Jennings Bryan, the two pioneered many of the techniques political consultants and their clients have employed ever since. As president, McKinley introduced them into the art of governance.


McKinley's victory in the Spanish-American War gave U.S. control over the Philippines. Difficult to manage, Roosevelt would eventually begin the process of spinning the Philippines off as an independent country (by 1935 the independence process would be almost complete, to be interrupted by WWII, and finalized in 1946).

The "Roaring Twenties" - Where'd the Money Come from?

The standard narrative presented by most American History textbooks talks about the booming economy of the 1920's: unemployment was almost unknown, and not only did Americans have jobs, but they had well-paid jobs; new standards of personal wealth arose - people sold their horses and bought cars, people got radios, telephones, and electricity.

What created these "good time"? Princeton University's Larry Kudlow explains:

Coolidge’s vice president was former Harding budget director and Chicago banker Charles Dawes. Coolidge kept on former-President Harding’s Treasury man, Andrew Mellon. Working with a Republican Congress during the mid 1920s, these men continued the “return to normalcy” policies of Warren Harding by cutting tax rates, reducing federal spending, and lowering the post-WWI Federal debt.


The timeless economic truths hold: lower taxes, reduce government debt, and people will prosper. The good times of the 1920's ended with the Great Depression - a time marked by increased government debt, higher taxes, and government interference in the free market. It is debatable whether or not regulation caused the Great Depression - some economists think that the reason is to be found in the tariffs - but it is in any case clear that the Great Depression was prolonged by government spending, government debt, government regulation of business, and taxes.