Main currents in American thought An interpretation of American literature from the beginnings to 1920
his system are rigidly determined by economic law--he confidently
assigned all the residual increment to wages. Labor not only gets all
it earns, he argued, but far more, since what does not fall to the
just shares of the other partners falls to it--that is the “whole
remaining body of wealth.” If it be recalled that the total social fund
of inventions, machinery, trade processes, systems of transportation,
business methods, are alike in the service of all employers--the
no-profit entrepreneur equally with the high-profit--it follows that
the individual employer can derive from such social wealth no modicum
of profit above and beyond what his individual fertility has produced.
Where then can the income from such social fund flow except to wages?
“Every invention in mechanics, every discovery in the chemical art, no
matter by whom made, inures directly and immediately” to the benefit
of labor.[600] This, to be sure, on the hypothesis of “full and free
competition,” which may be interfered with by various means but which
in the long run prevails. How else shall one explain the constant rise
in the wage-scale that has marked the Industrial Revolution and that
has gone hand in hand with vast profits to the entrepreneur class?
It was a robust optimism that could lay down the theory that labor
is “the residual claimant to the product of industry.” Although
Walker prided himself on his discovery, it seems to have made slight
impression on later economic thought. Like too many members of the
classical school the apologist of the Gilded Age failed to keep his
feet on the plebeian earth; and his conclusions suggest how great
mischief _a priori_ reasoning may work in the speculations of academic
gentlemen. A moderate dash of realism might have lessened his buoyant
optimism; but Walker was too warm an admirer of capitalism, too eager
to assert the beneficence of industrialism, to inquire curiously into
the everyday facts of current exploitation. As a realistic statistician
he was far inferior to Carey. But why demand a plodding realism of the
economist when all America was romantic? If the economic theory of
General Walker was a pleasant blend of Ricardo and Colonel Sellers,
would it not hit the taste of the age to a nicety? Its sturdy optimism
was a soothing antidote to the Jeremiads of the Marxians and the shrill
demands of the single-taxers. The Gold Coast of America looked to its
official economists for a confutation of all economic heresies, and who
was so well equipped for that business as a doughty Colonel Sellers
armed with a sharp Ricardian sword?
In this brisk work Walker engaged with gusto. In his onslaught upon
Marx and Henry George he was untroubled by doubt. He first demolished
the structure of their theory and then impugned their honesty. His
condemnation of single-tax is bold and sweeping. There is a bitter
asperity in his denunciation of the economic heresies of _Progress
and Poverty_, and he dismisses the proposal to tax unearned increment
with the comment, “Every honest man will resent such a proposition
as an insult.”[601] His discussion of the economics of the question
is only casual and he hastens back to the safe haven of Ricardian
doctrine.[602] In his commentary on the Knights of Labor he is somewhat
vindictive for a well-bred gentleman. He charges the syndicalistic
attack on the profits system to immigrant foreigners, asserts that the
law of profit fertility is an insuperable obstacle to any proletarian
control of industry, and finally damns it as un-American. The honest,
native American “knows that for himself and his children the way is
open clear to the top”; his “spirit is that of civility, reciprocity
and fair play”; and he concludes:
Had it been left to our native population alone, not one of those
violent and reckless attacks upon production and transportation,
which have, within the past two or three years, shocked the whole
industrial system and have come near to produce a general crisis of
trade, would ever have taken place.[603]
Yet in spite of his genial optimism he discovered specks on the fair
picture of society. To the Ricardian logic the stupidity of men is a
constant irritant; if only men were rational the path of progress would
be so much easier! After economic law has been demonstrated with the
finality of a Euclidian theorem, it is disconcerting to see how the
multitude will not be reasoned with, but persist in following after the
last false prophet who cries in the market-place. The clamor raised
by single-tax was especially annoying. “That such an argument,” he
remarked a bit testily, “should for a moment have imposed upon anybody,
is enough to give one a new conception of the intellectual capabilities
of mankind.”[604] Fortunate it is for society, he concludes, that while
man proposes, economic law disposes. False prophets will have their
little day, but from their secure watch-tower the Ricardians calmly
look out upon a world of which they alone hold the key.[605]
II • The Conscription of Political Theory
When the social fabric is being torn rudely across by a changing
economics, political theory and practice will suffer from the attendant
confusions. The America of the Gilded Age accounted itself a democracy
and was outwardly content to make use of the familiar democratic
machinery; but until it was determined whether majority or minority
rule should prevail, whether the well-being of the many or the property
of the few should be the chief object of government, there would be
no serious effort to create a political state for adequate social
control. In the meantime the old individualisms would range the land
seeking what they might devour, and the common attitude toward the
political state would remain one of good-natured contempt. A shambling
government, corrupt and incompetent, awakened no man’s hope or
pride, and amidst the slovenly anarchisms of the times, with a crude
exploitation in the saddle, the state would be pretty much ignored
except when its services might prove useful to such exploitation. The
plutocracy would oppose the erection of a vigorous state until such
time as it felt strong enough to control its activities. The principle
of the majority-will held grave potentialities that might threaten the
eventual mastership of wealth, and until the plutocracy had created its
strongholds within the framework of the democracy it would bitterly
oppose any extension of democratic control.
Broadly two great movements were going forward side by side in the
unconscious drift of political tendency--the democratic and the
plutocratic. The former, drawn chiefly from agrarian and labor
elements with a considerable following of the middle and professional
classes, was determined to carry forward and supplement the Jacksonian
movement. It was honestly concerned for the development of the
democratic principle. It would purify government by the application of
civil service reform, it would steadily enlarge the bounds of social
control of economic forces, and it would strengthen the political
state to enable it to cope with corporate wealth and constrain the
ambitions of the plutocracy into conformity with democratic ends. To
such a democratic program the plutocracy was necessarily opposed. It
professed the warmest loyalty to the abstract principle of democracy
while bending every energy to emasculate effective democratic control.
The problem confronting it was the familiar Federalistic problem--how
to protect the minority from the majority and set property interests
above human interests; but the problem had been immensely complicated
by the strategic advances made by democracy. The democratic principle
could not be easily thrust aside, it must be undermined. And so while
awaiting the time when it should be strong enough to set up boldly
its mastery of society, plutocracy took refuge in two principles,
the superman theory and the _laissez-faire_ theory, both of which it
asserted to be democratic, the very essence of democracy. The former
was “The public be damned” theory, which held that the economic leaders
of society must be left free to manage their properties as they saw
fit; and the latter was the familiar doctrine of individual initiative,
that looked with suspicion on any interference by the political state
with economic activity. If a bureaucracy may stick its nose into the
citizen’s private affairs what becomes of individual liberty?
But the plutocracy was building its real defenses elsewhere. Shrewdly
aware of the potentialities of a Constitution that had been designed
for the protection of property interests, it followed two main lines
of development: it furthered the popular development of a cult of
the Constitution by praising the excellence of a system of checks and
balances, and spreading the view that to tamper with any provisions
of the instrument was little short of sacrilege; and at the same time
it bent every energy to extend the range of judicial prerogative and
bring the legislative branch under control of the judiciary. It sought
extra-constitutional indulgences that were dispensed by the courts in
the name of the police power. The way had been prepared by Marbury
vs. Madison and Dred Scott vs. Sanford, and during the Gilded Age a
broad path to judicial control was opened by the elaboration of the
“due process of law” principle discovered in the fourteenth amendment.
With the development of the plutocracy the extension of the doctrine
of judicial review went forward rapidly, providing an impregnable
defense for property interests that promised ill for the principle
of democratic control in the interests of the common well-being. The
democracy was being driven from the inner keep of the castle.
While the real struggle was thus going on in the court-room, with the
outcome in the hands of the judges, political speculation was playing
havoc with certain of our oldest and most cherished doctrines. Pursuing
the path suggested by Webster and Francis Lieber, it turned away from
the particularism of Calhoun to explore the reaches of a consolidating
nationalism. The inevitable drift towards unity--whether democratic
or plutocratic--was daily gathering momentum. The destruction of the
states-rights program and party had cleared the ground for a new
conception of the dignity and powers of the political state. With the
social shift from dispersion to centralization the federal government
was destined to grow in authority; and political theory was destined to
follow the same course, seeking to justify in principle what was being
accomplished in fact. The end of the philosophy of dispersion was in
sight. The tide was running toward an exaltation of the doctrine of
sovereignty, with the consequent exaltation of the abstract political
state. As the individual coalesced in the mass, the rights and dignity
of the individual would lessen in the presence of an engulfing
sovereignty. The traditional doctrine of natural rights was in for a
slashing attack. Centralization must destroy the shambling Jacksonian
structure and erect in its place a grandiose organic theory.
During the Gilded Age a number of systematic studies of political
theory appeared, amongst which the most significant were, Woolsey’s
_Political Science, or the State_ (1877), Bryce’s _The American
Commonwealth_ (1888), Woodrow Wilson’s _The State_ (1889), and
Burgess’s _Political Science and Constitutional Law_ (1891). Of these
the formal studies of Woolsey and Burgess may serve to illustrate
the changing thought of the times. Both are academic reflections of
the current drift of tendency, and both reveal the academic sympathy
with the master movement of centralization. The work of Woolsey was a
revision of classroom notes used between 1846 and 1871 and strongly