03 Jul On the 4th, Looking Backward to go Forward
I tried to find something in my archives that I could reprint for the 4th of July that was, at once, fitting yet optimistic. I really did.
But I failed.
It’s the nature of my temperament, I suppose, and of the times in which we live, that make it difficult to find much hopeful about which to write – or about which I’ve written, or…whatever. That’s not to say that I am not, on occasion, optimistic. I am – about a great many things. It’s just that it’s more practical, in most situations, to address the issues and patterns that threaten the conditions and institutions that enable our peace and prosperity. It’s not easy, in other words, to write hopefully about the nation and its near-term outlook, and it hasn’t been for a long, long time.
That said, Independence Day is and always should be a time for excitement, for appreciation of the good things our Founders enabled and the hope that those good things will be preserved, in some small measure at least, for generations to come. Warnings and indictments can have (most of) the remaining 364 days of the year. On the 4th, however, we should be thankful and hopeful.
To that end, the following are excerpts from the 4th chapter of the book I’ve been working on for some time. Tentatively titled The Dictatorship of Big Capital, this book picks up where the last one left off, arguing that capital market perversions like ESG and “stakeholderism” are the byproducts of the centralization of power and capital, in Washington and on Wall Street. Without the concentration of political power in the hands of the administrative state and the concentration of capital in the hands of a scant few financial services companies, ESG and stakeholderism would have been largely irrelevant movements. They would have been sideshows.
Given this, I warn that the current fight about the politicization of business and the capital markets isn’t the end of it. It is only the beginning. As long as power and capital remain concentrated in so few hands, the temptation will be to use them for political ends. Therefore, the ultimate solution to issues raised by ESG and stakeholderism is to de-centralize power and capital, to remove said temptation as well as the ability to act on it.
Fortunately, the blueprint for decentralization of political and economic power has already been drawn for us. And as luck would have it, the drawing of that blueprint started 249 years ago tomorrow. To wit:
The American Founders were either the luckiest collection of men ever assembled on earth, or they were the most learned and most prescient. Or, perhaps, they were some combination of the two.
Although the American Revolution is often considered a product of the Enlightenment – influenced by the likes of Locke and Montesquieu, to name but two – it was, in truth, less a revolution of the Enlightenment than a revolution during the Enlightenment. As revolutions go, it was placid, and narrowly constituted. As Russell Kirk noted, “The American Revolution…was – as Burke had said of the Glorious Revolution of 1688 – ‘a revolution not made, but prevented.’”
The American Revolution did not seek to overthrow and replace the existing worldview. It did not target the Church or religion more broadly. Indeed, it embraced religion and the religious spirit. The American patriots were not utopians or Gnostic zealots. They were farmers and merchants and lawyers, who felt they were being denied what they should, by right, have been guaranteed by Great Britain. Again, to borrow from Kirk, “The American colonists stood up for their prescriptive rights; their claims and expectations were moderate, and founded upon a true apprehension of human nature and natural rights; their constitutions were conservative.
If the American Founders can be said to have had “passions” in their pursuit of the ideal government for their newly created nation, they almost certainly centered on the proliferation of liberty and prosperity, and the virtue necessary to preserve both. And in this sense the American Revolution is more counter-Enlightenment than anything else. While the Enlightenment would conclude with the likes of Hume, Bentham, and Kant upending virtue ethics and replacing it with the value ethics of deontology and consequentialism, the American Founders held firm to their beliefs in the necessity of virtue and its capacity to enable eudaimonia. Even Jefferson, the Founder likely most deeply influenced by Enlightenment-thought, still believed that it was government’s responsibility to guarantee the unalienable rights of “life, liberty, and the pursuit of happiness.”
Among the usual suspects to have influenced the Founders – the Greeks, the Romans, Locke – one can find a handful of figures who are not often considered in such conversations, a small group of thinkers who valued reason and the abolition of superstition but who nonetheless shared with the Founders and one another a belief in the criticality of virtue in the pursuit of the good life….
The Prussian statesman and first German Chancellor, Otto von Bismarck, is alleged to have said that “God has a special providence for fools, drunkards, and the United States of America.”… Although the quote is almost certainly apocryphal, at least part of it is also almost certainly true – or, at least, it was true when Bismarck purportedly uttered it. Whether or not God retains his special providence for the United States to this day is debatable, but it is probably also irrelevant. In those heady days before, during, and after the American Revolution, God smiled brightly on the new nation, providing it with a host of social, political, and economic thinkers imbued with the very virtues they frequently advocated – courage, wisdom, temperance, humility, prudence, and perseverance – and imbued as well with several generations’-worth of good luck.
In combination, the Founders’ luck and sagacity led them to embrace some of the most important and powerful ideas that the greatest cultures and minds of Western Civilization ever produced. Between the Greeks and the Romans, the Founders made an excellent start. By adding the contributions of ancient Israel, secularized and amended by the Enlightenment’s most potent virtue ethicist, Baruch Spinoza, they made their new creation exponentially more effective. And by sprinkling on the very best sentiments of the “Celtic Mind” embodied by Adam Smith and Adam Ferguson, the Founders appeared to have done what might have seemed impossible: they fashioned what seemed to be the ideal government to meet their passions for “the proliferation of liberty and prosperity,” and the “virtue necessary to preserve both.”…
Tocqueville famously observed that “In America I saw the freest and most enlightened men placed in the happiest circumstances that the world affords, [but] it seemed to me as if a cloud habitually hung upon their brow, and I thought them serious and almost sad, even in their pleasures.” At first, he concedes that he was baffled by this: “It is strange to see with what feverish ardor the Americans pursue their own welfare, and to watch the vague dread that constantly torments them lest they should not have chosen the shortest path which may lead to it.” And while such a phenomenon was not exactly new or unique, its ubiquity was. The “spectacle,” Tocqueville continued, “is as old as the world; [but] the novelty is to see a whole people furnish an exemplification of it.”
After contemplation, however, Tocqueville came to the conclusion that this restlessness, this sort of constant, manic desire to improve one’s position and one’s conditions, was, in fact, a byproduct of the animating ideas of the American experiment: “The equality of conditions leads by a still straighter road to several of the effects that I have here described. When all the privileges of birth and fortune are abolished, when all professions are accessible to all, and a man’s own energies may place him at the top of any one of them, an easy and unbounded career seems open to his ambition and he will readily persuade himself that he is born to no common destinies.”
Tocqueville did not necessarily approve of this mindset, finding it exhausting and the cause of much anxiety. He thought that the Americans had merely swapped one barrier to success for another, the “privilege” of birth and status for “universal competition.” Nevertheless, he acknowledged that this swap would inevitably lead to materially greater comfort and prosperity. In short, the greater the effort put forth by a people to achieve true equality, the greater the material well-being of a nation would be. Equality spurs competition, he noted, which spurs greater concerns about equality and, in turn, greater competition. “Among democratic nations, men easily attain a certain equality of condition, but they can never attain as much as they desire. It perpetually retires from before them, yet without hiding itself from their sight, and in retiring draws them on. At every moment they think they are about to grasp it; it escapes at every moment from their hold.”…
In the end…Tocqueville concluded that the Founders’ passions – liberty, prosperity, equality – were well served by the government they created. What he questioned was whether the American people would, in the long run, be ideally served by those passions: “In democratic times enjoyments are more intense than in the ages of aristocracy, and the number of those who partake in them is vastly larger: but, on the other hand, it must be admitted that man’s hopes and desires are oftener blasted, the soul is more stricken and perturbed, and care itself more keen.”
Of course, even as he was concerned for Americans’ stricken and perturbed souls, Tocqueville also noted that Americans possessed an advantage over their democratic counterparts in other nations, namely the virtue and federal spirit that their Founders had so desired and which, in practice, enabled self-interest to be “rightly understood. “[T]he inhabitants of the United States.” Tocqueville wrote, “almost always manage to combine their own advantage with that of their fellow citizens.”
“In the United States,” he continued, “hardly anybody talks of the beauty of virtue, but they maintain that virtue is useful and prove it every day.” (68) According to Tocqueville, this was one of the key outgrowths of the Founders’ wise deliberations, the evidence that Spinoza, the Founders, Smith, and Ferguson were correct that man’s interests could be tamed by the application of virtue. He noted that “the doctrine of self-interest rightly understood…finds universal acceptance” among Americans, who, he says, are “are fond of explaining almost all the actions of their lives by the principle of self-interest rightly understood” even as they “show with complacency how an enlightened regard for themselves constantly prompts them to assist one another…”
Finally, according to Tocqueville, all of this – Americans’ industriousness, restlessness, and keen ability to temper their self-interest, rendering it “enlightened” and “rightly understood,” – was fostered and perpetually reinforced the decentralized nature of administration under the Founders’ constitution and localization of the processes the Americans used to address the communal concerns of their day-to-day lives:
Americans of all ages, all conditions, and all dispositions constantly form associations. They have not only commercial and manufacturing companies, in which all take part, but associations of a thousand other kinds, religious, moral, serious, futile, general or restricted, enormous or diminutive. The Americans make associations to give entertainments, to found seminaries, to build inns, to construct churches, to diffuse books, to send missionaries to the antipodes; in this manner they found hospitals, prisons, and schools. If it is proposed to inculcate some truth or to foster some feeling by the encouragement of a great example, they form a society. Wherever at the head of some new undertaking you see the government in France, or a man of rank in England, in the United States you will be sure to find an association.
