I’ve written about the pivotal election of 1896 on several occasions. But the most piercing observations come from others – and yes, you’re going to get them here today. First, here are Congressman Ron Paul and Lewis Lehrman in The Case for Gold:
The election of 1896 inaugurated the fourth party system in America. From a third party system of closely fought, seesawing races between a pietist/statist Republican vs. a liturgical/libertarian Democratic Party, the fourth party system consisted of a majority centrist Republican party as against a minority pietist Democratic party. After a few years, the Democrats lost their pietist nature, and they too became a centrist, though usually minority party, with a moderately statist ideology scarcely distinguishable from the Republicans. So the fourth party system went until 1932....The Transformation of 1896 and the death of the third party system meant the end of America’s great laissez-faire, hard-money libertarian party. The Democratic Party was no longer the party of Jefferson, Jackson, and Cleveland. With no further political embodiment for laissez-faire in existence, and with both parties offering an echo not a choice, public interest in politics steadily declined. A power vacuum was left in American politics for the new corporate statist ideology of progressivism, which swept both parties (and created a short-lived Progressive Party) in America after 1900. The Progressive Era of 1900–1918 fastened a welfare-warfare state on America which has set the mold for the rest of the 20th century. Statism arrived after 1900 not because of inflation or deflation, but because a unique set of conditions had destroyed the Democrats as a laissez-faire party and left a power vacuum for the triumph of the new ideology of compulsory cartellization through a partnership of big government, business, unions, technocrats, and intellectuals.
A fair number of Gentle Readers will be scratching their heads over the above. “The Democrats were a pro-freedom party?” they exclaim. “In what alternate universe?” Yet it was so. You have to know a bit more history than most to be aware of it – and yes, I’m aware that the Democrats of the pre-Civil War years supported the positions of the “slave states.” That was part of what cost them the allegiance of much of the nation. Murray Rothbard covered the gist of it in For a New Liberty:
The object of the classical liberals was to bring about individual liberty in all of its interrelated aspects. In the economy, taxes were to be drastically reduced, controls and regulations eliminated, and human energy, enterprise, and markets set free to create and produce in exchanges that would benefit everyone and the mass of consumers. Entrepreneurs were to be free at last to compete, to develop, to create. The shackles of control were to be lifted from land, labor, and capital alike. Personal freedom and civil liberty were to be guaranteed against the depredations and tyranny of the king or his minions. Religion, the source of bloody wars for centuries when sects were battling for control of the State, was to be set free from State imposition or interference, so that all religions—or nonreligions—could coexist in peace. Peace, too, was the foreign policy credo of the new classical liberals; the age-old regime of imperial and State aggrandizement for power and pelf was to be replaced by a foreign policy of peace and free trade with all nations. And since war was seen as engendered by standing armies and navies, by military power always seeking expansion, these military establishments were to be replaced by voluntary local militia, by citizen-civilians who would only wish to fight in defense of their own particular homes and neighborhoods....The Jeffersonian drive toward virtually no government foundered after Jefferson took office, first, with concessions to the Federalists (possibly the result of a deal for Federalist votes to break a tie in the electoral college), and then with the unconstitutional purchase of the Louisiana Territory. But most particularly it foundered with the imperialist drive toward war with Britain in Jefferson’s second term, a drive which led to war and to a one-party system which established virtually the entire statist Federalist program: high military expenditures, a central bank, a protective tariff, direct federal taxes, public works. Horrified at the results, a retired Jefferson brooded at Monticello, and inspired young visiting politicians Martin Van Buren and Thomas Hart Benton to found a new party—the Democratic party—to take back America from the new Federalism, and to recapture the spirit of the old Jeffersonian program. When the two young leaders latched onto Andrew Jackson as their savior, the new Democratic party was born.
The Jacksonian libertarians had a plan: it was to be eight years of Andrew Jackson as president, to be followed by eight years of Van Buren, then eight years of Benton. After twenty-four years of a triumphant Jacksonian Democracy, the Menckenian virtually no-government ideal was to have been achieved. It was by no means an impossible dream, since it was clear that the Democratic party had quickly become the normal majority party in the country. The mass of the people were enlisted in the libertarian cause. Jackson had his eight years, which destroyed the central bank and retired the public debt, and Van Buren had four, which separated the federal government from the banking system. But the 1840 election was an anomaly, as Van Buren was defeated by an unprecedentedly demagogic campaign engineered by the first great modern campaign chairman, Thurlow Weed, who pioneered in all the campaign frills—catchy slogans, buttons, songs, parades, etc.—with which we are now familiar. Weed’s tactics put in office the egregious and unknown Whig, General William Henry Harrison, but this was clearly a fluke; in 1844, the Democrats would be prepared to counter with the same campaign tactics, and they were clearly slated to recapture the presidency that year. Van Buren, of course, was supposed to resume the triumphal Jacksonian march. But then a fateful event occurred: the Democratic party was sundered on the critical issue of slavery, or rather the expansion of slavery into a new territory. Van Buren’s easy renomination foundered on a split within the ranks of the Democracy over the admission to the Union of the republic of Texas as a slave state; Van Buren was opposed, Jackson in favor, and this split symbolized the wider sectional rift within the Democratic party. Slavery, the grave antilibertarian flaw in the libertarianism of the Democratic program, had arisen to wreck the party and its libertarianism completely.
The Civil War, in addition to its unprecedented bloodshed and devastation, was used by the triumphal and virtually one-party Republican regime to drive through its statist, formerly Whig, program: national governmental power, protective tariff, subsidies to big business, inflationary paper money, resumed control of the federal government over banking, large-scale internal improvements, high excise taxes, and, during the war, conscription and an income tax. Furthermore, the states came to lose their previous right of secession and other states’ powers as opposed to federal governmental powers. The Democratic party resumed its libertarian ways after the war, but it now had to face a far longer and more difficult road to arrive at liberty than it had before.
That’s not history you learned in school, is it? Yet anyone willing to recur to primary sources can find all of the above, well documented and confirmed. Most germane to us of the present is how the currents of conviction in those years parallel recent events in our time.
Since the election of Ronald Reagan, conservatives and Republicans have been edging away from the authoritarian-paternalistic stances of the past and toward classical liberalism of the sort Rothbard described in the citation above. “There oughta be a law” has been giving way before “Mind your own business” as the prevalent conservative attitude. Yes, there are subjects where paternalism continues to hold sway – the subject of drug prohibition is probably the most prominent – but the overall inclination of Americans who identify themselves as conservatives and / or Republicans is to embrace a “no-harm, no-foul” attitude toward their fellow men...and therefore toward public policy.
Contrariwise, those who identify themselves as Democrats, “liberals,” or “progressives” have edged ever deeper into all-out totalitarianism. The most visible evidence is in the Left’s attitude toward freedom of expression and the reliability of electoral results. At one time those were the only things the Left would defend as integral to “freedom.” Their attitude was that as long as we could express ourselves freely and select our preferred officeholders, we were “free” – or, as Clarence Carson put it, we had our full rights to “agree to disagree.”
These trends are the fruits of the dynamics that govern organizations that pursue public power. The Democrats made capital out of the Great Depression and the incredibly inept statist response to it from the Hoover Administration. In an act of political deception that boggles the mind of contemporary observers, Franklin D. Roosevelt campaigned on a platform that opposed Hoover’s state-corporatist methods...and then adopted and intensified them after he was securely in the White House. He cemented himself there – and not coincidentally, committed the Democrats to his methods – by enlisting “the workers and peasants.” Hearken to Garet Garrett on this subject:
The American farmer was a powerful individualist, with a long habit of aggressive political activity. His complaint was that his relative share of the national income had shrunk and was in all reason too little. This was from various causes, notably, (1) the world-wide depression of agriculture, (2) the low level of farm prices in a market where competition acted freely, and (3) the relative stability of industrial prices in a market that enjoyed tariff protection against world competition. Everything the farmer sold was too cheap; everything he bought was too dear. What he complained of really, though he did not always put it that way, was the economic advantage of the industrial wage earner.The New Deal was going to redistribute the national income according to ideals of social and economic justice. That was the avowed intention. And once it had got control of money, banking, and credit it could in fact redistribute the national income almost as by a slide rule. The trouble was that if it gave the farmer a large share and left the wage earner's share as it was it would lose the support of labor. And if it used its power to raise all prices in a horizontal manner, according to the thesis of reflation, the economic injustice complained of by the farmer would not be cured.
The solution was a resort to subsidies. If the prices the farmer received were not enough to give him that share of the national income which he enjoyed before the world-wide depression of agriculture, the difference would be made up to him in the form of cash subsidy payments out of the public treasury. The farmer on his part obliged himself to curtail production under the government's direction; it would tell him what to plant and how much. The penalty for not conforming was to be cut off from the stream of beautiful checks issuing from the United States Treasury. The procedure was said to be democratic. It is true that a majority of farmers did vote for it when polled by the Federal county agents. The subsidies were irresistible. More income for less work and no responsibility other than to plant and reap as the government said. Nevertheless, it led at once to compulsion, as in cotton, and it led everywhere to coercion of minorities....
What the New Deal did for labor was to pass a series of laws the purpose of which was to give organized labor the advantage in its bargaining with the employer. As these laws were construed and enforced they did principally three things. They delivered to organized labor a legal monopoly of the labor supply; they caused unionism to become in fact compulsory, and they made it possible for unions to practice intimidation, coercion, and violence with complete immunity, provided only it was all in the way of anything that might be called a labor dispute. The underlying idea was that with this power added to it, together with a minimum wage and hour act that made overtime a way of fattening the pay envelope, organized labor could very well by its own exertions increase its share of the national income enough to equal or to overcome the farmer's new advantage. And this organized labor proceeded forthwith to do.
This industrial / rural alliance gave the Democrats a firm grip on power – during several periods absolute power – from 1932 to 2016. As for what happened in 2016...rather large weather we’ve been having, ain’t it?
Yesterday saw what might be Britain’s most important election of the postwar era. The Conservatives, headed by Prime Minister Boris Johnson, appear to have run the table, taking their first absolute majority in Parliament in many years. While it would be premature to forecast the consequences in breadth, one thing now seems certain: the United Kingdom will leave the European Union and resume its full national sovereignty, as the “Brexit” plebiscite dictated several years ago. Moreover, it will depart without “strings” that would perpetuate the EU’s hobbles on Britain’s economy and its control of its borders.
This is a reflection of the same dynamic that has animated the populist dynamic that put Donald Trump in the White House. Old party-to-policy alignments have lost much of their force; the voters are opposed to them. In America, “Mind your own business” voters have swayed the GOP away from previous authoritarian-paternalistic “It’s for your own good” stances and toward a more inclusive embrace of freedom. That includes the reassertion of our national sovereignty, for America is the Land of the Free...and the other nations of the world don’t like that.
British voters, appalled by the performances of both the Labourites and Theresa-May-style Conservatives, have insisted on a change, just as American voters elected to go “outside the box” in choosing Donald Trump. But there’s even more here that’s worthy of comment.
Nigel Farage, the head of the United Kingdom Independence Party (UKIP), issued a stunning decree: In those districts where pre-election polls suggested that a UKIP candidate could draw enough votes to result in the defeat of the Conservative candidate, UKIP would not campaign. He sensed the overriding importance of giving the Tories an unassailable majority, specifically so that Britain’s long-delayed exit from the EU could no longer be held hostage by minor parties within the governing coalition. Nigel Farage’s demonstration of patriotism over party suggests that Britain might have more leaders in its leadership than I had thought. It also reflects Farage’s understanding that the Tories and the UKIP are drawing ever closer on important matters of policy.
So: The evidence is accumulating that the Anglosphere, at least, is experiencing a dramatic political realignment: away from globalism and state-corporatism enabled by thoroughgoing regulation, and toward the classical liberal ideals of individual freedom, largely free markets, and national sovereignty.
Yes, there will be tariffs: in particular, to compensate for authoritarian governments’ subsidies to favored national enterprises, which unfairly tilt competition toward those nations’ goods in global trade. These are tools of bargaining. They can be highly effective when used in cognizance of their proper employment and the limitations on their utility.
Yes, there will still be some paternalism, especially about what goes on in public places. Don’t expect the police to tolerate mass orgies in the public streets any time soon...not that I would advocate such a thing in any case. And don’t expect public policy to do an about-face on the harder recreational drugs while popular sentiment remains as it is. That having been said, a gradual retreat of the police power from the personal lives of private citizens is under way.
All of it should be attributed to the dynamic that dominates all political parties: what works at the ballot box. Just as in 1896.
