Classic Liberalism verses Classic Conservatism in the United States

            The fundamental principles associated with both philosophies, classic liberalism and classic conservatism, are well-known today, but the attachment to the two terms has flipped over the years between modern conservatism and liberalism. This is clearly evident through research and identification of platforms of political parties from the rise of the two party system until the modern age. The confusion arises through turbulent political clashes between the Federalists and Democratic-Republicans, the Whigs and Democrats, and the Republicans and Democrats. Through analysis of these various parties and their platforms, the definition of classic conservatism and classic liberalism and which parties cling to which philosophies will become much clearer.

            In all reality, the conversation can start with the Constitutional Convention. The nation was divided upon the system of government necessary to bring to pass the vision of the revolution. The Articles of Confederation supported a strong republic of individual States with a limited federal government to act as a mediator between the States, a representative to foreign nations on their collective behalf, and to organize a national army and navy for their protection. Opponents to this structure of government that favored economic policies that would benefit the growth of manufacturing through State control and protectionist tariffs meant to stifle competition to protect the State’s special interest groups, and pushed to alter the republic towards a nationalized central government. It is from this point that the classic conservative and classic liberal can be identified; and thus, their central principles traced through the history of various political parties.

            The result of the Constitution Convention was the creation of the Constitution, which was more of a product of the classic conservative; and the Bill of Rights, which was a product of the classic liberal. The Constitution was ratified only by a slim majority after the introduction of the Bill of Rights. It is from this foundation that the two groups can be defined. The champion for the Federalist Party, Alexander Hamilton, pushed for a financial program that was reminiscent of the British system of mercantilism, which promoted excise taxes, high protectionist tariffs, and a strong central bank. The Federalists also wanted a strong central government to help push his financial program forward, which would greatly benefit the wealthy manufacturing businessmen. Additionally, they favored a loose interpretation of the Constitution, so that it could be altered to fit their ever growing agenda. The Federalist Party and their political philosophies embody the essence of the classic conservative. The historian and political scientist, William A. Dunning, observed that classic conservatives hole true to the old ideals of the “royal and aristocratic classes of the old regime.”[1] The classic conservative would rather avoid the need for a constitution or set of laws that would restrict their ability to rule; and they consider such things to be “a hindrance to good government” and “the state is not a mechanism, but an organism.”[2]

            The opposition to this train of thought and practice, is the classic liberal. According to Dunning, liberalism “fundamentally…meant democracy.”[3] However, the definition of democracy today is a little different than even in Dunning’s time when his A Century of Politics was published in 1904. A modern observer typically identifies democracy as majority rule, but this was labeled as direct or pure democracy by the Founders. Looking at Webster’s Complete Dictionary of the English Language published in 1886, this older dictionary definition of democracy includes the concept that power resides in the People, but also that it means “a constitutional and representative government; a republic.”[4] Thus, the classic liberal desires a representative government through republican states. For the Democratic-Republican, their champion was Thomas Jefferson. Their principles called for limited government, favored an agrarian-based economy, and strict interpretation of the Constitution. Dr. Nigel Ashford, the Senior Programs Officer at the Institute for Humane Studies at George Mason University, has gone further to identify the ten core principles of the classic liberal, the tenth one on his list already listed, limited government. In a brief recorded lecture on the subject, he explains that classic liberalism is “a comprehensive philosophy, a way of thinking about human society, human life, and the world, which has implications for all of the major academic disciplines.”[5] The ten core principles of this this comprehensive philosophy are: “1) Liberty as the primary political value; 2) Individualism; 3) Skepticism about power; 4) Rule of Law; 5) Civil Society; 6) Spontaneous Order; 7) Free Markets; 8) Toleration; 9) Peace; 10) Limited Government.”[6]

            Since the creation of the two party system, the two dominant political parties were fundamentally split over their individual core principles, which has led to the many battles of word in the halls of Washington, to actual bloodshed on the battlefield. The Federalist Party took control of the nation through the presidencies of George Washington and John Adams, but the election of 1800 brought the Democratic-Republican, Thomas Jefferson into office. Power shifted between the classic conservative and classic liberal, which affected the direction of the nation ideologically. The Federalist Party lost favor in the sight of the nation, especially after the War of 1812, and the dominant political parties changed their titles.

            What is known as the Second Two Party System, came after the Federalist and Democratic-Republican parties. In the 1820s, the new Whig Party basically emerged to carry forth the Federalist classic conservative agenda, while the Democrat Party favored classic liberal position of the Democratic-Republican Party. The Democrats wanted a small national government, the end of the central bank, and economic freedom from federal regulations, such as high protectionist tariffs. They also opposed what they called internal improvements, but what can be defined as crony capitalism today. The Whigs supported Henry Clay, who took Hamilton’s economic agenda and labeled it the American System. They also supported government involvement to regulate and reform society through a growth in government and the federal bureaucracy. Like the Federalists, the Whigs were predominant in the Northern States, while like the old Democratic-Republicans, the Democrats were mostly in the Southern States. It is also at this time that the issue of wage labor, slavery, abolition, and anti-slavery activists intensified in the political arena, which increased the division between these two groups.

            The Third Two Party System then emerges with the Republican and Democrats on the eve of the Civil War. These of course are the two predominant political parties. Other political parties have come and gone where have supported combinations of political principles of the classic conservatives and liberals. The Republican Party is formed upon the principles of the Whig Party, as Abraham Lincoln admitted his political affiliation in a letter to Edward Wallace on October 11, 1859: “My dear Sir: you brother, Dr. William Wallace, showed me a letter of yours, in which you kindly mention my name, inquire for my tariff view, and suggest the propriety of my writing a letter upon the subject. I was an old Henry Clay-Tariff Whig. In old times I made more speeches on that subject than any other. I have not changed my views.”[7] Lincoln supported African colonization of the slaves like his mentor, Henry Clay, and in 1832 said: “My politics are short and sweet, like the old woman’s dance. I am in favor of a national bank . . . in favor of the internal improvements system and a high protective tariff.”[8] Despite the obvious flaw with slavery and the classic liberal philosophy, the Democrats advocated more for those principles.

            The victory of the Republican Party allowed for classic conservative principles to be put into place in American government during the Reconstruction Period, when there was less influence of the classic liberals in the political system. However, the classic liberal spirit could not be fully destroyed because of the Constitution and the Bill of Rights. The conflict continued between the dominant parties over time, but the Republicans and the Democrats have some blending of principles that make it difficult to classify which one is more conservative or liberal according to the old definition. With further research and analysis, it could be more accurate to say that the Republican and Democrats are collectively more classically conservative in their political principles, where the emergence of the Libertarian Party is taking the charge as the new classic liberal group. Also the misunderstanding of these classic terms and their origins in relation to historical and economic events continues to contribute to the confusion. This might also be the reason for Americans that tend to resonate with classic liberal principles, feel that they are being forced to vote between the lessor of two evils of two classically conservative political parties. However, this is a growing thesis for another essay.

Bibliography

Ashford, Nigel. "What is Classical Liberalism?" Learn Liberty. February 11, 2011. http://www.learnliberty.org/videos/what-is-classical-liberalism/.

DiLorenzo, Thomas J. “Lincoln’s Economic Legacy.” Mises Institute. February 9, 2001. http://mises.org/library/lincolns-economic-legacy.

DiLorenzo, Thomas J. Lincoln Unmasked: What You’re Not Supposed to Know About Dishonest Abe. New York: Crown Forum, 2006.

Dunning, William A. “A Century of Politics.” The North American Review Vol. 179, No. 577 (Dec., 1904).

Webster, Noah. “Webster’s complete dictionary of the English language (1886).” Internet Archive. Accessed on February 26, 2015. https://archive.org/details/websterscomplete00webs.

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[1] William A. Dunning, “A Century of Politics,” The North American Review Vol. 179, No. 577 (Dec., 1904):804.

[2] Ibid, 806.

[3] Ibid, 801.

[4] Noah Webster, “Webster’s complete dictionary of the English language (1886),” Internet Archive, accessed on February 26, 2015, https://archive.org/details/websterscomplete00webs.

[5] Nigel Ashford, "What is Classical Liberalism?" Learn Liberty, February 11, 2011, http://www.learnliberty.org/videos/what-is-classical-liberalism/.

[6] Ibid.

[7] Thomas J. DiLorenzo, Lincoln Unmasked: What You’re Not Supposed to Know About Dishonest Abe, (New York: Crown Forum, 2006), 124.

[8] Thomas J. DiLorenzo, “Lincoln’s Economic Legacy,” Mises Institute, February 9, 2001, http://mises.org/library/lincolns-economic-legacy.

Herbert Hoover's Economic Policies Contributed to the Market Crash of 1929

            The stock market crash of 1929 led to the Great Depression, but it was federal government policies that led to the stock market crash. Herbert Hoover and his administration implemented New Deal-like policies before the crash that hurt the economy. The 31st president felt that the economy could be stimulated through “government spending, protect jobs,” and policies that would prevent “wages from falling.”[1] Interventionist policies on the market had drastic effects for over three years of his presidency, and despite these failings, Hoover pushed forward. Instead of adhering to laissez-faire principles of capitalism and a free market, Hoover justified his doomed policies:

The past three years have been a time of unparalleled economic calamity. They have been years of greater suffering and hardship than any which have come to the American people since the aftermath of the Civil War.…

Two courses were open. We might have done nothing. That would have been utter ruin. Instead, we met the situation with proposals to private business and the Congress of the most gigantic program of economic defense and counterattack ever evolved in the history of the Republic. We put it into action.[2]

            As it became clear that a depression of epic proportions was unfolding, Hoover pushed forward with his failed economic policies. Railroads and construction companies maintained high wages according to Hoover’s urging; which eventually led to layoffs and as the economy worsened. The farming industry received subsidies and “marking cartels” were formed.[3] His policies worked more to treat the “symptoms of a disease,” but only made “the disease worse.”[4]

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[1] Mark Thornton, “Hoover, Bush, and Great Depressions,” Mises Institute, January 11, 2011, https://mises.org/library/hoover-bush-and-great-depressions.

[2] Ibid.

[3] Ibid.

[4] Ibid.

Were there parallels between the New Deal and Nazi Germany?

            It is not an uncommon story among the general populace that the New Deal and the Second World War helped the United States to recover from the devastating Great Depression. Even though this is the dominant narrative, there are many economists that challenge this theory that the New Deal saved capitalism and helped to bolster the United States economy (many books have been written on this subject alone). They would conclude that government intervention was not only a drawback to the New Deal policies, but American citizens lost free market liberties associated to capitalism in the process. There are also some individuals that have drawn parallels between FDR’s New Deal policies and European governmental programs promoted by fascists and national socialists, such as Nazi Germany.  

            The Civilian Conservation Corps (CCC) was a program that has been associated with similar youth organizations of Nazi Germany. The CCC program enrolled young men “as amateur forest rangers, marsh drainers, and the like, on projects designed to improve the countryside.”[1] They were provided with the basic essentials of shelter, clothing, and earned one dollar a day.[2] Until the military draft of 1942, two and half million young men went through this program.[3] The well-respected historian, John A. Garraty, was one who saw a similarity between the two nation’s programs for youth and said:

Both were essentially designed to keep young men out of the labor market. Roosevelt described work camps as a means for getting youth "off the city street corners," Hitler as a way of keeping them from "rotting helplessly in the streets." In both countries much was made of the beneficial social results of mixing thousands of young people from different walks of life in the camps. … Furthermore, both were organized on semimilitary lines with the subsidiary purposes of improving the physical fitness of potential soldiers and stimulating public commitment to national service in an emergency.[4]

            However, not only historians and economists of today have noticed these similarities through the lens of the past, but so did individuals living at the time during the implementation of the New Deal. The New York Herald Tribune published Mark Sullivan’s opinions on the New Deal on June 26, 1936; and he said, “The New Deal is the American variation of the new order that has been set up in three great European countries and some smaller ones. The term ‘New Deal’ is the American equivalent of the term ‘Fascism’ in Italy, the term ‘Nazi’ in Germany, and the term ‘Soviet’ in Russia.”[5] Even the press in Germany enthusiastically praised FDR’s New Deal policies. The Nazi Party newspaper, the Völkischer Beobachter, had commented that FDR’s New Deal exhibited “National Socialist strains of thought in his economic and social policies.”[6] Even Professor Garraty writes, that "Early New Deal policies seemed to the Nazis essentially like their own and the role of Roosevelt not very different from the Führer's."[7]

            Despite the similarities and federal policies that increased the size and scope of federal power in the United States, Americans did not follow the path of the Nazis or other European socialists. Americans have always had a deep-seated individualistic spirit and love for liberty that hails all the way back to the Revolutionary era. This spirit might be assaulted and even bent from time to time, but the antistatist tradition will continue to prevail, as long as Americans remember their heritage.   

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[1] Ralph Raico, ”FDR and the Collectivist Wave,” Mises Institute, June 2, 2011, https://mises.org/library/fdr-and-collectivist-wave.

[2] Ibid.

[3] Ibid.

[4] Ibid.

[5] Hubert H. Humphrey, The Political Philosophy of the New Deal, (Baton Rouge: Louisiana State University Press, 2015), 3.

[6] David Gordon, "Three New Deals: Why the Nazis and Fascists Loved FDR," Mises Institute, September 22, 2006, https://mises.org/library/three-new-deals-why-nazis-and-fascists-loved-fdr.

[7] Raico, ”FDR and the Collectivist Wave.”

FDR's New Deal Weakened Capitalism

            The definition of capitalism and how it should be practiced in the economy is as disputed and diverse as religion. Party politics and individual agendas based on their respective understandings of capitalism have hurt, manipulated, and/or benefited the economy based on the individual eye of the beholder. Economists have argued over the definition of capitalism and the effectiveness of Franklin Roosevelt’s New Deal on the United States economy since its inception and application. There are many economists, who feel that FDR’s New Deal not only weakened capitalism, but that it also prolonged the Great Depression.

Dr. Steve Davies, the education director at the Institute of Economic Affairs in London, defines capitalism as “a system of the free exchange of goods and services between individuals on a voluntary basis under the rule of law and in a system of private property rights. In other words, it is a system of voluntary exchange in which all parties to the exchange are better off.”[1] FDR’s New Deal policies did not promote a voluntary exchange; and in the end, both parties affected by the New Deal were not better off.

The New Deal did little to help economic recovery. It prolonged high unemployment in the United States; “From 1943 to 1940, the median annual unemployment rate was 17.2 percent. At no point during the 1930s did unemployment go below 14 percent.”[2] The job market was not helped by the state influenced hikes in wages and labor costs, either. The New Deal negatively affected consumer prices and led to a tripling of taxes. The tax burden was intense and dipped into every aspect of American life from “income taxes, higher corporate income taxes, higher excise taxes, higher estate taxes, and higher gift taxes.”[3] The ever increasing taxes and unemployment “meant there was less capital for businesses to create jobs, and people had less money in their pockets.”[4]

As wage rates increased through New Deal policies, businessmen looked to technological mechanization in their industries and disposed of many entry-level jobs that called for unskilled labor. This led to the destruction of hundreds of thousands of jobs in the United States, particularly in states that were still behind in industrialization, like the South. Since the Civil War, the main unskilled labor force had remained the African American population. As a result, according to economist David E. Bernstein, “New Deal labor policies contributed to a persistent increase in African American unemployment.”[5]

Some economist purport that the New Deal helped the economy because of the massive public works projects had created jobs and spent billions of dollars in the economy; however, many of those projects went to the wealthier western states and not the poorer southern states.[6] Economist Jim Powell advocates that FDR used the public works programs as a ploy to buy voter support from western “swing” states over the “already solidly Democratic” South.[7] This argument is also supported in that relief and public works spending seemed to increase during election years.”[8] When FDR commented on Social Security taxes, he confessed that they were devised for securing votes and not to improve the economy. He said that they “'were never a problem of economics. They are politics all the way through.”[9] Burton Fulsom Jr. states that FDR’s goal was to “Tie older voters to the Democratic Party.”[10] Regardless, government projects and jobs are supported by the tax payers; and the New Deal was not helping the private sector rise up out of the depression to create the revenue needed to support the increasing federal government.

According to economist Thomas J. DiLorenzo, all the New Deal and public works projects did was divert already existing revenue from the private sector to the government: “The billions of dollars spent on public-works programs also failed to reduce overall unemployment—despite employing some 10 million people—because of the economic law of opportunity cost: diverting those billions from the private sector (through taxes) to the government sector only rearranged the composition of employment—fewer private-sector jobs and more government jobs.”[11] The New Deal did not improve the economy, but its “most important initiatives were active obstacles to economic renewal.”[12] There are many myths surrounding FDR’s New Deal that economics like Steve Davies have been trying to disprove according to their definition of capitalism.

Davies is clear in his statements that the New Deal did not save capitalism, nor did it end the Great Depression. He explains that where Great Britain had risen out of the depression by 1933, the United States found itself in greater peril by 1937. The United States had maintained its high unemployment, “but in addition the federal government has built up an enormous debt.”[13] Additionally, World War II did not save the United States from the effects of the Great Depression; in fact, he states that “the Great Depression does not really end until 1947 or 1948, and the war simply conceals or covers up the continuing low level of real wealth-creating economic activity in the United States.”[14] In the end, the statistical data produced by economists that share Davies’ definition of capitalism clearly show that the New Deal weakened capitalism.

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[1] Steve Davies, “Capitalism is NOT Imperialism,” Learn Liberty, June 3, 2013, http://www.learnliberty.org/videos/capitalism-not-imperialism/.

[2] Jim Powell, FDR's Folly: How Roosevelt and His New Deal Prolonged the Great Depression, (New York: Three Rivers Press, 2003), vii.

[3] Ibid, ix-x.

[4] Ibid.

[5] Ibid, xi.

[6] Ibid, xii.

[7] Ibid.

[8] Ibid.

[9] Burton Folsom Jr., (2011), "Does Obama Have Any Idea Why New Deal Failed?," Human Events 67, no. 30: 25.

[10] Ibid.

[11] Thomas J. DiLorenzo, "New Deal for the World, A," Mises Institute, January 1, 1999, https://mises.org/library/new-deal-world.

[12] Alan Brinkley, (2008), "No Deal," New Republic, December 31. 12-13.

[13] Steve Davies, "Top Three Myths About the Great Depression and the New Deal," Learn Liberty, July 1, 2011, http://www.learnliberty.org/videos/top-three-myths-about-the-great-depression-and-the-new-deal/.

[14] Ibid.

Democratic Governments Must Tolerate Dissent

            A true democratic government absolutely has to tolerate dissent at all times. Democracy is a system where the people are in power and govern directly or through the election of representatives. The people are the voice of the government; thus, dissension or expressions of the people that differ from either the majority or minority must be allowed for the system of government to progress as structured. Any attempts to destroy the people’s voice to any degree then would destroy the democratic system of government.

            The Bill of Rights protects this right of expressing opposing opinions or dissension in the First Amendment: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”[1] It is a fact that not all people in the United States will agree with all of the laws of the federal, state, and local governments; but suppression of their viewpoints or dissension would be unconstitutional. Dissidents of the law, who share their views, must not be persecuted or silenced by the law. However, violence perpetrated by dissidents is also at odds with the democratic system of government.

            In the United States, Congress has the power to “suppress insurrections” or violent uprising against the government.[2] Dissension by itself is not a violent action, nor is it treason. A dissident believed of committing a crime against the country would still have their rights to be protected from illegal searches and seizures, a right to a speedy trial, and to be judged by their peers. However, it has been the case with the federal government to infringe upon these constitutional rights in times of war and crisis.

            John Adam’s administration passed the Alien and Sedition Act (1798), which was meant to silence, arrest, and fine their opposing party’s dissension towards their policies. Abraham Lincoln suspended habeas corpus—an action only allowed by Congress, not the Executive Branch—during the Civil War to incarcerate Northern dissidents, who opposed his administration’s actions. Woodrow Wilson’s administration resurrected the Sedition Act and the Espionage Act during the First World War, which allowed for further suppression of civil liberties once again. The bills passed during Wilson’s presidency witnessed similar outcomes and infringements against civil liberties that Adams and Lincoln allowed during their terms prior.

The Espionage Act of 1917 imposed $10,000 fines and as much as 20 years in prison for anyone saying or doing anything the state construed as “discouraging enlistments” in the military. The Sedition Act of 1916 imposed similar criminal penalties for any type of criticism of the government. All printed materials were censored; thousands were deported without due process of law; and state-sponsored vigilante groups conducted warrantless searches and seizures. The author Upton Sinclair was arrested for reading the Bill of Rights in public; the poet E. E. Cummings was imprisoned for three-and-a-half months for writing a letter to his mother saying that he did not necessarily hate Germans; and in New Jersey one Roger Baldwin was arrested for reading the Constitution in public.[3]

            Violent acts against the government are criminal actions that must be brought before the legal system; however, simply dissension is protected by the Constitution and should not be infringed. In the Virginia Resolution, which opposed the Alien and Sedition Act of 1798 stated that "the Liberty of Conscience and of the Press cannot be cancelled, abridged, restrained, or modified by any authority of the United States."[4] Any action to the contrary by the government to suppress free speech, even dissention, goes against the intended purpose of a democratic government. Government actions to suppress freedom of speech and other  constitutional rights during the Wilson administration is what led to Eugene Debs’ response after his conviction  in 1918, “They tell us that we live in a great free republic: that our institutions are democratic; that we are a free and self-governing people. This is too much even for a joke.”[5]

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[1] U.S. Constitution, amend I.

[2] U.S. Constitution, art. 1, sec. 8, cl. 15.

[3] Thomas J. DiLorenzo, “The Virus of Imperialism (Part II),” Mises Institute, September 9, 2013, https://mises.org/library/virus-imperialism-part-ii.

[4] “Virginia Resolution – Alien and Sedition Acts,” The Avalon Project, http://avalon.law.yale.edu/18th_century/virres.asp.

[5] John Milton Cooper, Jr., Pivotal Decades: The United States, 1900-1920, (New York: W.W. Norton & Company, 1990), 299.