SDMB Retrospective US Presidential Elections 1824

[WillFarnaby]

@iiandyiiii

Which was a greater evil in 19th century America – slavery, or non-free-market economic principles and intervention by the government?

Considering slavery was in total opposition to free market principles and more generally in opposition to self ownership which was the foundation of liberalism, I view slavery as the most evil intervention by the government in the 19th century. Your question presents a false dichotomy. I am allowed to be against Clay’s and Hamilton’s cronyism and also against slavery.

[WillFarnaby]

Furthermore, considering Clay and Hamilton made no attempt to end slavery either rhetorically or legislatively, I don’t see anything redeeming whatsoever in these individuals in their facility as statesmen.

[BrainGlutton]

@WillFarnaby

Considering slavery was in total opposition to free market principles and more generally in opposition to self ownership which was the foundation of liberalism, I view slavery as the most evil intervention by the government in the 19th century.

But, it was not an “intervention by the government” as the phrase is generally understood, it was an institution predating the foundation of the U.S. government, which did almost nothing to actively support it (the Fugitive Slave Act being the only exception I can think of), and which at least put an end to the import trade in slaves. The slave-state governments supported slavery with all the force of law, but in the Jeffersonian-Jacksonian tradition, state governments don’t count as intervenors – do they?

[BrainGlutton]

@WillFarnaby

Furthermore, considering Clay and Hamilton made no attempt to end slavery either rhetorically or legislatively, I don’t see anything redeeming whatsoever in these individuals in their facility as statesmen.

If you’re going to hold all antebellum statesmen to that test, Jefferson and Jackson fail it too – in fact, almost all of them fail it, from the FFs through Buchanan. 'Ware Presentism.

[BrainGlutton]

@WillFarnaby

You asked what conservative meant in this context. I fought your ignorance.

And it’s still not clear what you mean by it. You accuse Hamilton of “cronyism” and “protectionism” and “promoting established interests,” but I have never before seen those things called “conservative” in any political-ideological sense.

[WillFarnaby]

@BrainGlutton

But, it was not an “intervention by the government” as the phrase is generally understood, it was an institution predating the foundation of the U.S. government, which did almost nothing to actively support it (the Fugitive Slave Act being the only exception I can think of), and which at least put an end to the import trade in slaves. The slave-state governments supported slavery with all the force of law, but in the Jeffersonian-Jacksonian tradition, state governments don’t count as intervenors – do they?

Ever heard of the Dredd Scott Decision? The US govt most definitely supported slavery. Absurd claim. The federal government did not recognize the self ownership of the enslaved.

The ban of the African slave trade was a protectionist move to increase the value of slaves currently held.

In any case I was asked which was the greater evil. I responded that slavery was and that it too constituted an intervention , specifically, a failure of govt to recognize property rights.

[WillFarnaby]

@BrainGlutton

If you’re going to hold all antebellum statesmen to that test, Jefferson and Jackson fail it too – in fact, almost all of them fail it, from the FFs through Buchanan. 'Ware Presentism.

Yes but I find the economic liberalism, however tarnished, of Jefferson and Jackson to be redeeming qualities.

[BrainGlutton]

@WillFarnaby

Ever heard of the Dredd Scott Decision? The US govt most definitely supported slavery.

Only by refraining from interfering with it. (Had the decision gone the other way, that would have been a classic instance of what RWs today call “judicial activism.”) The federal government did not “support” the institution the way slave-state governments did, and some factions of Congress were very concerned to at least keep slavery out of new territories.

[BrainGlutton]

@WillFarnaby

Hamilton’s ideas were that of English mercantilist “thought”, which was never a legitimate economic school of thought, but a conglomeration of paid pamphleteers promoting government support of this business or that. Hamilton read these pamphlets. In doing so he based his policies on what amounts to protectionist propaganda from proto-lobbyists. Whether or not he was aware of how his policies were promoting established interests, I don’t know, but that was their effect. Liberal capitalism arose as a rejection of this mercantilist system.

You know, I’ve never, ever before this thread seen Hamilton’s name mentioned in connection with mercantilism. His name appears nowhere in the Wiki article on Mercantilism. Googling “hamilton mercantilism”, the first hit I get is from the always-wrong-about-everything Conservapedia:

Mercantilism was a policy for a nation to increase its wealth based on exporting more goods to other nations and territories than importing from them, as well as giving subsidies to politically favored businesses, often under the guise of infrastructure development combined also with a central bank with monopoly power. An excess of exports over imports increased the balance of trade and the acquisition of gold by the nation. Also, acquiring and using colonies to supply raw materials and provide foreign markets was a key aspect of mercantilism. Mercantilism was the British policy at the time of the American Revolution. For this reason, the United States has initially rejected mercantilism, though many of the Federalists, especially Alexander Hamilton, were huge proponents of mercantilism, disagreeing only with who was in charge. The nineteenth century in the U.S. was primarily an economic conflict between mercantilsts versus capitalists in the North, as well as feudalists in the South with its institution of slavery. Eventually mercantilism triumphed with Abraham Lincoln and the Republican and the economy of the U.S. since then has been primarily mercantilist with socialistic welfare programs.

Now for Og’s sake, Will, please assure us you’re not drawing on anything like that as a source! Because its narrative is suspiciously similar to yours!

And the next hit I get is from the only slightly more credible the Ludwig von Mises Institute, whose assessment of Hamilton in relation to mercantilism is much more nuanced.

[BrainGlutton]

As for mercantilism being “never a legitimate economic school of thought, but a conglomeration of paid pamphleteers promoting government support of this business or that,” well, of course, it predated the emergence of economics as a discipline (and so did Adam Smith, who always called himself a “moral philosopher”). Otherwise, well, yes and no, mostly no:

Theory

Most of the European economists who wrote between 1500 and 1750 are today generally considered mercantilists; this term was initially used solely by critics, such as Mirabeau and Smith, but was quickly adopted by historians. Originally the standard English term was “mercantile system.” The word “mercantilism” was introduced into English from German in the early 19th century.

The bulk of what is commonly called “mercantilist literature” appeared in the 1620s in Great Britain.[9] Smith saw English merchant Thomas Mun (1571–1641) as a major creator of the mercantile system, especially in his posthumously published Treasure by Foreign Trade (1664), which Smith considered the archetype or manifesto of the movement.[10] Perhaps the last major mercantilist work was James Steuart’s Principles of Political Economy published in 1767.[9]

“Mercantilist literature” also extended beyond England. Italy and France produced noted writers of mercantilist themes including Italy’s Giovanni Botero (1544–1617) and Antonio Serra (1580–?); France’s, Jean Bodin, Colbert and other physiocrats. Themes also existed in writers from the German historical school from List, as well as followers of the “American system” and British “free-trade imperialism,” thus stretching the system into the 19th century. However, many British writers, including Mun and Misselden, were merchants, while many of the writers from other countries were public officials. Beyond mercantilism as a way of understanding the wealth and power of nations, Mun and Misselden are noted for their viewpoints on a wide range of economic matters.[11]

The Austrian lawyer and scholar Philipp Wilhelm von Hornick, in his Austria Over All, If She Only Will of 1684, detailed a nine-point program of what he deemed effective national economy, which sums up the tenets of mercantilism comprehensively:[12]

• That every little bit of a country’s soil be utilized for agriculture, mining or manufacturing.
• That all raw materials found in a country be used in domestic manufacture, since finished goods have a higher value than raw materials.
• That a large, working population be encouraged.
• That all export of gold and silver be prohibited and all domestic money be kept in circulation.
• That all imports of foreign goods be discouraged as much as possible.
• That where certain imports are indispensable they be obtained at first hand, in exchange for other domestic goods instead of gold and silver.
• That as much as possible, imports be confined to raw materials that can be finished [in the home country].
• That opportunities be constantly sought for selling a country’s surplus manufactures to foreigners, so far as necessary, for gold and silver.
• That no importation be allowed if such goods are sufficiently and suitably supplied at home.

Other than Von Hornick, there were no mercantilist writers presenting an overarching scheme for the ideal economy, as Adam Smith would later do for classical economics. Rather, each mercantilist writer tended to focus on a single area of the economy.[13] Only later did non-mercantilist scholars integrate these “diverse” ideas into what they called mercantilism. Some scholars thus reject the idea of mercantilism completely, arguing that it gives “a false unity to disparate events”. Smith saw the mercantile system as an enormous conspiracy by manufacturers and merchants against consumers, a view that has led some authors, especially Robert E. Ekelund and Robert D. Tollison to call mercantilism “a rent-seeking society”. To a certain extent, mercantilist doctrine itself made a general theory of economics impossible.[14] Mercantilists viewed the economic system as a zero-sum game, in which any gain by one party required a loss by another.[15] Thus, any system of policies that benefited one group would by definition harm the other, and there was no possibility of economics being used to maximize the “commonwealth”, or common good.[16] Mercantilists’ writings were also generally created to rationalize particular practices rather than as investigations into the best policies.[17]

Mercantilist domestic policy was more fragmented than its trade policy. While Adam Smith portrayed mercantilism as supportive of strict controls over the economy, many mercantilists disagreed. The early modern era was one of letters patent and government-imposed monopolies; some mercantilists supported these, but others acknowledged the corruption and inefficiency of such systems. Many mercantilists also realized that the inevitable results of quotas and price ceilings were black markets. One notion mercantilists widely agreed upon was the need for economic oppression of the working population; laborers and farmers were to live at the “margins of subsistence”. The goal was to maximize production, with no concern for consumption. Extra money, free time, or education for the “lower classes” was seen to inevitably lead to vice and laziness, and would result in harm to the economy.[18]

Infinite growth

The mercantilists saw a large population as a form of wealth which made possible the development of bigger markets and armies. The opposing doctrine of physiocracy predicted that mankind would outgrow its resources. The idea of mercantilism was to protect the markets, but it also helped to maintain the agriculture and those who were dependent upon it.

As an economic school of thought that’s only proto-, but still much, much more than “a conglomeration of paid pamphleteers.”

[WillFarnaby]

From your cite:

-However, many British writers, including Mun and Misselden, were merchants, while many of the writers from other countries were public officials.

-Mercantilists’ writings were also generally created to rationalize particular practices rather than as investigations into the best policies.

I think this directly supports my claim. They were basically lobbyists.

In any case. Now that we have touched up our definition of mercantilism, do you agree that the American System was mercantilist?

[BrainGlutton]

@WillFarnaby

From your cite:

-However, many British writers, including Mun and Misselden, were merchants, while many of the writers from other countries were public officials.

-Mercantilists’ writings were also generally created to rationalize particular practices rather than as investigations into the best policies.

I think this directly supports my claim. They were basically lobbyists.

In any case. Now that we have touched up our definition of mercantilism, do you agree that the American System was mercantilist?

If it was, so much the better for mercantilism, but let’s see:

The American System, originally called “The American Way”, was an economic plan that played a prominent role in American policy during the first half of the 19th century. Rooted in the “American School” ideas of Alexander Hamilton, the plan “consisted of three mutually reinforcing parts: a tariff to protect and promote American industry; a national bank to foster commerce; and federal subsidies for roads, canals, and other ‘internal improvements’ to develop profitable markets for agriculture.”[1] Congressman Henry Clay was the plan’s foremost proponent and the first to refer to it as the “American System”.

History

A plan to strengthen and unify the nation, the American System was advanced by the Whig Party and a number of leading politicians including Henry Clay, John C. Calhoun and John Quincy Adams. The System was a new form of federalism that included:

• Support for a high tariff to protect American industries and generate revenue for the federal government
• Maintenance of high public land prices to generate federal revenue
• Preservation of the Bank of the United States to stabilize the currency and rein in risky state and local banks
• Development of a system of internal improvements (such as roads and canals) which would knit the nation together and be financed by the tariff and land sales revenues.

Clay argued that the West, which opposed the tariff, should support it since urban factory workers would be consumers of western foods. In Clay’s view, the South (which also opposed high tariffs) should support them because of the ready market for cotton in northern mills. This last argument was the weak link. The South was never really on board with the American System and had access to plenty of markets for its cotton exports.

Portions of the American System were enacted by the United States Congress. The Second Bank of the United States was rechartered in 1816 for 20 years. High tariffs were first suggested by Alexander Hamilton in his 1791 Report on Manufactures but were not approved by Congress until the Tariff of 1816. Tariffs were subsequently raised until they peaked in 1828 after the so-called Tariff of Abominations. After the Nullification Crisis in 1833, tariffs remained the same rate until the Civil War. However, the national system of internal improvements was never adequately funded; the failure to do so was due in part to sectional jealousies and constitutional squabbles about such expenditures.

The American System did not enjoy universal success, however. In 1830, President Jackson vetoed a bill which would allow the federal government to purchase stock in the Maysville, Washington, Paris, and Lexington Turnpike Road Company, which had been organized to construct a road linking Lexington and the Ohio River, the entirety of which would be in the state of Kentucky. Jackson’s Maysville Road veto was due to both his personal conflict with Clay and his ideological objections.

Main points

The establishment of a protective tariff, a 20%-25% tax on imported goods, would protect a nation’s business from foreign competition. Congress passed a tariff in 1816 which made European goods more expensive and encouraged consumers to buy relatively cheap American-made goods.

The establishment of a national bank would promote a single currency, making trade easier, and issue what was called sovereign credit, i.e., credit issued by the national government, rather than borrowed from the private banking system. In 1816, Congress created the Second Bank of the United States.

The improvement of the country’s infrastructure, especially transportation systems, made trade easier and faster for everyone. Poor roads made transportation slow and costly.

This program became the leading tenet of the Whig Party of Henry Clay and Daniel Webster. It was opposed by the Democratic Party of Andrew Jackson, Martin Van Buren, James K. Polk, Franklin Pierce, and James Buchanan prior to the Civil War, often on the grounds that the points of it were unconstitutional.

Henry Clay’s “American System,” devised in the burst of nationalism that followed the War of 1812, remains one of the most historically significant examples of a government-sponsored program to harmonize and balance the nation’s agriculture, commerce, and industry. This “System” consisted of three mutually reenforcing parts: a tariff to protect and promote American industry; a national bank to foster commerce; and federal subsidies for roads, canals, and other “internal improvements” to develop profitable markets for agriculture. Funds for these subsidies would be obtained from tariffs and sales of public lands. Clay argued that a vigorously maintained system of sectional economic interdependence would eliminate the chance of renewed subservience to the free-trade, laissez-faire “British System.”

— United States Senate website[1]

Annual Message of 1815 (Seven Points)
Funds for national defense
Frigates for the Navy
A standing army and federal control of the militia
Federal aid for building roads and canals
A protective tariff to encourage manufacturers
Re-establishing the National Bank
Federal assumption of some state debt

So, no, it’s not mercantilism. The protective tariff is the only thing above that also was part of a mercantilist agenda. The American System was a new thing, a thing for the early industrial age. Mercantilism was a thing for the preindustrial Age of Sail, it was mainly about international trade, which the American System hardly touches on except for the protective tariff. The AS was all about developing the country’s internal economy, industry and infrastructure, and probably could work and thrive in the absence of any foreign commerce at all given the enormous size of America’s domestic consumer market. Mercantilism works best when the country has subject colonies to use as captive markets for its manufactures and suppliers of raw goods in a relationship that clearly benefits the mother country more than the colony (one of the grievances leading to the American Revolution). The American System does not depend on that in any way, unless you cast the West (that is, the Upper Midwest and the Louisiana Purchase) in that role, and I think you’ll agree the economic relationship between East and West at the time was mutually beneficial and non-exploitive, and that Clay was right in asserting his system was in the West’s interest no less than the East’s.

Now, having covered all of that:

1. What parts of the American System as outlined above do you find objectionable and why? How were these proposals bad for the economy at the time?

2. Where and how does “cronyism” come into it? And please don’t be vague, name the names of the cronies in question and their relations with Clay and other Whigs.

[BrainGlutton]

@BrainGlutton

Now, having covered all of that:

1. What parts of the American System as outlined above do you find objectionable and why? How were these proposals bad for the economy at the time?

2. Where and how does “cronyism” come into it? And please don’t be vague, name the names of the cronies in question and their relations with Clay and other Whigs.

I repeat.

[BrainGlutton]

Say, how is it that there’s only one party but it’s running four tickets?

[Elendil_s_Heir]

The major nominees each have their shortcomings, but I’d like to see Henry Clay given a chance in the White House. A smart guy, a Southerner committed to the Union, and a brilliant orator. Lincoln was a big Clay fan, in his young Whiggish days, and that’s good enough for me.

[BrainGlutton]

@Elendil_s_Heir

The major nominees each have their shortcomings, but I’d like to see Henry Clay given a chance in the White House. A smart guy, a Southerner committed to the Union, and a brilliant orator. Lincoln was a big Clay fan, in his young Whiggish days, and that’s good enough for me.

Certainly Lincoln from the beginning of his career was always strong for the American System – national bank, protective tariffs, internal improvements.

[Elendil_s_Heir]

Quite so. The Whigs, and then the Republicans, were the liberals of their day.