From Slavery to Libertarianism by Henry Mantel
"The necessary result, then, of the unequal fiscal action of the government is, to divide the community into two great classes; one consisting of those who, in reality, pay the taxes, and, of course, bear exclusively the burthen of supporting the government; and the other, of those who are the recipients of their proceeds, through disbursements, and who are, in fact, supported by the government; or, in fewer words, to divide it into tax-payers and tax-consumers." - Vice President John C. Calhoun
John C. Calhoun was a United States Senator, Vice President, and strong proponent of slavery. A well-educated and wealthy slaveowner himself, Calhoun believed that the ability of the government to tax its citizens through collective action would inevitably lead to the infringement of the liberty of the wealthy class. Calhoun warned that a "government based in the naked principle that the majority ought to govern" was sure to violate the liberty of property owners. Calhoun and other slave owners questioned the legitimacy of taxation to advance public purposes.
At the same time, Calhoun fought hard to maintain the institution of slavery in the South. "Slavery is an institution ordained by Providence," he said, "honored by time, sanctioned by the Gospel, and especially favorable to personal and national liberty." To Calhoun, freedom meant the free use of one's property, slaves included. He argued that the government did not have the right to tell him what he could or could not do with his property.
In 1857, the Supreme Court of the United States took Calhoun's side and issued what is known as one of the worst decisions in its history. In the case of Dred Scott v. Sandford, a 7-2 majority ruled that slavery was constitutional, expressly holding that "the right of property in a slave is distinctly and expressly affirmed in the Constitution." The Court's decision, which Chief Justice Taney hoped would diffuse tension between the north and south, just made things worse. The case is considered an indirect catalyst for the Civil War.
Shortly after the Civil War, the Gilded Age began. New technology brought rapid economic growth, while a lack of labor laws and an influx of immigrants lead to extreme wealth inequality (the wealthiest 2% of households owned more than a third of the nation's wealth.) Economic power concentrated into massive corporations, referred to as "trusts." American businessmen like John D. Rockefeller, Jay Gould, and J. P. Morgan grew obscenely rich while most workers labored in dangerous conditions and decried "wage slavery." Violence was often employed to break up labor strikes.
During this time, the wealthiest Americans were strong proponents of free market capitalism, or laissez-faire economics. Many industrialists subscribed to the idea of Social Darwinism and saw government aid to the unfortunate as immoral. While labor unions formed and fought for better working conditions and higher wages, the wealthy class put a lot of money towards keeping government from imposing any kind of regulations on businesses. Corruption was rampant and both major political parties served moneyed interests. It was not until the 1890s, when the Progressive Era began, that government began to address the problems caused by industrialization and laissez-faire economics.
However, even when government sought to improve conditions for workers, the Supreme Court stood in the way. The period between 1897 to 1937 is known as the Lochner Era, when the Court frequently struck down laws that it saw as an infringement on economic liberty and private contract rights. Many judges were firm believers in laissez-faire economics and treated any effort to redistribute wealth with contempt. This period takes its name from the case of Lochner v. New York, in which the Court struck down a New York law that forbade employers from forcing or permitting employees from working more than 60 hours in a week. According to the Court, the "right to purchase or to sell labor is part of the liberty protected by [the Fourteenth Amendment.]" A total of 159 statutes were struck down during the Lochner Era, including child labor laws and minimum wage regulations.
As the Progressive Era wound down, laissez-faire economic policy made a big comeback. Presidents Harding, Coolidge, and Hoover were all staunch conservatives who sought to limit government interference on the free market. The Roaring Twenties saw tax cuts, deregulation, and corruption. The economy expanded rapidly and wealth inequality grew, right up until the stock market crashed in 1929, kicking off the Great Depression. Even with mass unemployment and poverty, President Hoover did not believe the government should directly interfere with the economy and insisted that the crisis would play itself out. Hoover's hesitation to take action lead to his defeat to Franklin Delano Roosevelt.
FDR was a firm believer in government, despite coming from a wealthy family. His New Deal for America included spending on massive infrastructure projects, jobs programs, labor protections, bank regulations, higher taxes on the wealthy, and Social Security. Free market capitalists called FDR a traitor to his class. In response, FDR said, "the forces of 'organized money' are unanimous in their hate for me -- and I welcome their hatred." When the conservative majority on the Supreme Court struck down several New Deal programs as unconstitutional extensions of federal authority, FDR threatened to pack the Court with more liberal judges. The justices took the hint and started upholding New Deal projects, officially ending the Lochner Era.
FDR's brand of progressivism lasted well past World War II, even under conservative presidents. President Eisenhower spent billions building the Interstate Highway System. President Nixon, in response to unimaginable amounts of pollution, created the Environmental Protection Agency. Up until 1980, the top marginal tax rate never dipped below 70%. For a while, the proponents of free market capitalism had a hard time attracting support.
Despite the fringe nature of the libertarian ideology after the war, the true believers in economic liberty never stopped fighting. Barry Goldwater, backed by libertarians like Milton Friedman and William F. Buckley, ran for president in 1964 and campaigned on crippling Social Security and ending Medicare, which were both very popular at the time. Goldwater also strongly opposed the Civil Rights Act and school desegregation, arguing that liberty entailed the "freedom not to associate." Goldwater lost by a landslide.
In the 1970s, libertarian ideologues began to organize in earnest. Backed by wealthy businessmen, chief among them Charles Koch, organizations like the Institute for Humane Studies, the Cato Institute, and the Reason Foundation were founded in order to attract new talent and push for libertarian policies. These policy goals included privatizing Social Security, selling off public land, deregulation of industries, cutting taxes, and right-to-work laws. Nothing but the complete reversal of FDR's progressive policies would satisfy the leaders of the libertarian movement.
With the election of Ronald Reagan in 1980, the libertarians started seeing progress. Railing against "welfare queens" and declaring that "government is the problem," President Reagan cut taxes, busted unions, and deregulated industries. However, Reagan was unable to completely undo FDR's legacy because doing so meant hurting poor and middle-class whites. Reagan was forced to raise taxes to make up for the massive budget deficit his tax cuts had created.
Disappointed but undeterred, wealthy libertarians continued to pour money and energy into advancing the principles of economic liberty. For the last forty years, billions of dollars have gone towards influencing every branch of government and moving the overton window to the right. SuperPACs like Americans for Prosperity help get libertarian candidates at every level elected. Corporate universities like George Mason University churn out conservative economists, lobbyists, advocates, and judges. Groups like Turning Point USA and The Federalist Society seek to educate young people about the dangers of collective action.
All that money is paying off. After the Great Recession, the worst economic downturn since the Depression, wealthy libertarians had so much influence in Washington that the Republican Party worked to obstruct every serious attempt by President Obama to address the crisis. Over the last two years, while the GOP held a majority in both houses of Congress, they passed massive tax cuts for the wealthy, appointed corporate lobbyists as agency heads, confirmed an exceptional number of conservative judges, and sought to slash Social Security, Medicare, and Medicaid.
At the same time, like the Lochner Era, the conservative majority on the Supreme Court has frequently taken the side of corporate interests. In the case of Citizens United v. FEC, the Court held that corporations are free to spend unlimited amounts of money on elections. In 2018, the Court overruled a four-decade-old precedent and undercut public-sector unions' ability to collectively bargain as a violation of free speech. In Epic Systems Corp v. Lewis that same year, the Court ruled that employers can require their employees to submit to individual arbitration of wage-and-hour and workplace-condition claims while waiving the right to join class and collective action claims.
The effects of libertarianism are as clear today as they were in the Roaring Twenties, the Gilded Age, and pre-Civil War America: obscene wealth inequality, blatant corruption, and the exploitation of labor. All in the name of "liberty."
Further Reading:
Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for America by Nancy MacLean
Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right by Jane Mayer
The American Political Tradition and the Men Who Made It by Richard Hofstadter
John C. Calhoun was a United States Senator, Vice President, and strong proponent of slavery. A well-educated and wealthy slaveowner himself, Calhoun believed that the ability of the government to tax its citizens through collective action would inevitably lead to the infringement of the liberty of the wealthy class. Calhoun warned that a "government based in the naked principle that the majority ought to govern" was sure to violate the liberty of property owners. Calhoun and other slave owners questioned the legitimacy of taxation to advance public purposes.
At the same time, Calhoun fought hard to maintain the institution of slavery in the South. "Slavery is an institution ordained by Providence," he said, "honored by time, sanctioned by the Gospel, and especially favorable to personal and national liberty." To Calhoun, freedom meant the free use of one's property, slaves included. He argued that the government did not have the right to tell him what he could or could not do with his property.
In 1857, the Supreme Court of the United States took Calhoun's side and issued what is known as one of the worst decisions in its history. In the case of Dred Scott v. Sandford, a 7-2 majority ruled that slavery was constitutional, expressly holding that "the right of property in a slave is distinctly and expressly affirmed in the Constitution." The Court's decision, which Chief Justice Taney hoped would diffuse tension between the north and south, just made things worse. The case is considered an indirect catalyst for the Civil War.
Shortly after the Civil War, the Gilded Age began. New technology brought rapid economic growth, while a lack of labor laws and an influx of immigrants lead to extreme wealth inequality (the wealthiest 2% of households owned more than a third of the nation's wealth.) Economic power concentrated into massive corporations, referred to as "trusts." American businessmen like John D. Rockefeller, Jay Gould, and J. P. Morgan grew obscenely rich while most workers labored in dangerous conditions and decried "wage slavery." Violence was often employed to break up labor strikes.
During this time, the wealthiest Americans were strong proponents of free market capitalism, or laissez-faire economics. Many industrialists subscribed to the idea of Social Darwinism and saw government aid to the unfortunate as immoral. While labor unions formed and fought for better working conditions and higher wages, the wealthy class put a lot of money towards keeping government from imposing any kind of regulations on businesses. Corruption was rampant and both major political parties served moneyed interests. It was not until the 1890s, when the Progressive Era began, that government began to address the problems caused by industrialization and laissez-faire economics.
However, even when government sought to improve conditions for workers, the Supreme Court stood in the way. The period between 1897 to 1937 is known as the Lochner Era, when the Court frequently struck down laws that it saw as an infringement on economic liberty and private contract rights. Many judges were firm believers in laissez-faire economics and treated any effort to redistribute wealth with contempt. This period takes its name from the case of Lochner v. New York, in which the Court struck down a New York law that forbade employers from forcing or permitting employees from working more than 60 hours in a week. According to the Court, the "right to purchase or to sell labor is part of the liberty protected by [the Fourteenth Amendment.]" A total of 159 statutes were struck down during the Lochner Era, including child labor laws and minimum wage regulations.
As the Progressive Era wound down, laissez-faire economic policy made a big comeback. Presidents Harding, Coolidge, and Hoover were all staunch conservatives who sought to limit government interference on the free market. The Roaring Twenties saw tax cuts, deregulation, and corruption. The economy expanded rapidly and wealth inequality grew, right up until the stock market crashed in 1929, kicking off the Great Depression. Even with mass unemployment and poverty, President Hoover did not believe the government should directly interfere with the economy and insisted that the crisis would play itself out. Hoover's hesitation to take action lead to his defeat to Franklin Delano Roosevelt.
FDR was a firm believer in government, despite coming from a wealthy family. His New Deal for America included spending on massive infrastructure projects, jobs programs, labor protections, bank regulations, higher taxes on the wealthy, and Social Security. Free market capitalists called FDR a traitor to his class. In response, FDR said, "the forces of 'organized money' are unanimous in their hate for me -- and I welcome their hatred." When the conservative majority on the Supreme Court struck down several New Deal programs as unconstitutional extensions of federal authority, FDR threatened to pack the Court with more liberal judges. The justices took the hint and started upholding New Deal projects, officially ending the Lochner Era.
FDR's brand of progressivism lasted well past World War II, even under conservative presidents. President Eisenhower spent billions building the Interstate Highway System. President Nixon, in response to unimaginable amounts of pollution, created the Environmental Protection Agency. Up until 1980, the top marginal tax rate never dipped below 70%. For a while, the proponents of free market capitalism had a hard time attracting support.
Despite the fringe nature of the libertarian ideology after the war, the true believers in economic liberty never stopped fighting. Barry Goldwater, backed by libertarians like Milton Friedman and William F. Buckley, ran for president in 1964 and campaigned on crippling Social Security and ending Medicare, which were both very popular at the time. Goldwater also strongly opposed the Civil Rights Act and school desegregation, arguing that liberty entailed the "freedom not to associate." Goldwater lost by a landslide.
In the 1970s, libertarian ideologues began to organize in earnest. Backed by wealthy businessmen, chief among them Charles Koch, organizations like the Institute for Humane Studies, the Cato Institute, and the Reason Foundation were founded in order to attract new talent and push for libertarian policies. These policy goals included privatizing Social Security, selling off public land, deregulation of industries, cutting taxes, and right-to-work laws. Nothing but the complete reversal of FDR's progressive policies would satisfy the leaders of the libertarian movement.
With the election of Ronald Reagan in 1980, the libertarians started seeing progress. Railing against "welfare queens" and declaring that "government is the problem," President Reagan cut taxes, busted unions, and deregulated industries. However, Reagan was unable to completely undo FDR's legacy because doing so meant hurting poor and middle-class whites. Reagan was forced to raise taxes to make up for the massive budget deficit his tax cuts had created.
Disappointed but undeterred, wealthy libertarians continued to pour money and energy into advancing the principles of economic liberty. For the last forty years, billions of dollars have gone towards influencing every branch of government and moving the overton window to the right. SuperPACs like Americans for Prosperity help get libertarian candidates at every level elected. Corporate universities like George Mason University churn out conservative economists, lobbyists, advocates, and judges. Groups like Turning Point USA and The Federalist Society seek to educate young people about the dangers of collective action.
All that money is paying off. After the Great Recession, the worst economic downturn since the Depression, wealthy libertarians had so much influence in Washington that the Republican Party worked to obstruct every serious attempt by President Obama to address the crisis. Over the last two years, while the GOP held a majority in both houses of Congress, they passed massive tax cuts for the wealthy, appointed corporate lobbyists as agency heads, confirmed an exceptional number of conservative judges, and sought to slash Social Security, Medicare, and Medicaid.
At the same time, like the Lochner Era, the conservative majority on the Supreme Court has frequently taken the side of corporate interests. In the case of Citizens United v. FEC, the Court held that corporations are free to spend unlimited amounts of money on elections. In 2018, the Court overruled a four-decade-old precedent and undercut public-sector unions' ability to collectively bargain as a violation of free speech. In Epic Systems Corp v. Lewis that same year, the Court ruled that employers can require their employees to submit to individual arbitration of wage-and-hour and workplace-condition claims while waiving the right to join class and collective action claims.
The effects of libertarianism are as clear today as they were in the Roaring Twenties, the Gilded Age, and pre-Civil War America: obscene wealth inequality, blatant corruption, and the exploitation of labor. All in the name of "liberty."
Further Reading:
Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for America by Nancy MacLean
Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right by Jane Mayer
The American Political Tradition and the Men Who Made It by Richard Hofstadter
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