Part One: Chapter II.

The Heritage of Jeffersonianism

To the young Virginia Republicans of the year 1800, Jeffersonianism seemed to be a comprehensive social philosophy peculiarly adapted to their needs. It offered a practical and humane program of national development in harmony with existing fact and native genius. It had not yet been distorted by the caprice of circumstance into a somewhat nebulous idealism, nor confined within the narrower limits of political equalitarianism and states-rights theory. By later generations jefferson has been interpreted too exclusively in terms of the Declaration of Independence, the glowing idealism of which has proved curiously elastic and has been stretched by later libertarian movements to meet their special and particular ends: by the jacksonian democracy in their struggle for manhood suffrage; by the Abolitionists in their attack upon a slave-sanctioning Constitution; by other idealists in their various crusades. The great name of jefferson, in consequence has come to be commonly associated with the conception of democracy and the idea of social justice. But to his young Virginia followers in the morning of the Republican movement, the perennial suggestiveness of their leader lay in the fact that he embodied for them the many-sided liberalism of French revolutionary thought, its economic and social idealism equally with political. They interpreted him more adequately, for they understood, as later interpreters frequently have not, how deeply the roots of his natural-rights philosophy went down into current economics. Of the different French writers who gave shape and substance to his thinking, the strongest creative influence on the mature jefferson carne from the Physiocratic group, from Quesnay, Condorcet, Mirabesu, Du Pont de Nemours, the brilliant founders of an economy that was primarily social rather than narrowly industrial or financial. Historically the Physiocratic school is as sharply aligned with idealistic agrarianism as the Manchester school is aligned with capitalistic industrialism. The conception that agriculture is the single productive form of labor, that from it alone becomes the produit net or ultimate net labor increment, and that bankers, manufacturers and middlemen belong to the class of sterile workers, profoundly impressed the Virginia mind, bred up in a plantation economy and concerned for the welfare and dignity of agriculture. Franklin had first given currency to the Physiocratic theory in America a generation earlier, but it was jefferson who spread it widely among the Virginia planters. He did more: he provided the new agrarianism with politics and a sociology. From the wealth of French writers he formulated a complete libertarian philosophy. His receptive mind was saturated with romantic idealism which assumed native, congenial form in precipitation. From Rousseau, Godwin and Paine, as well as from Quesnay and Condorcet, Game the idea of political justice and the conception of a minimized political state, assuming slightly different forms from filtering through different minds. The early doctrine of laissez faire, laissez passer-a phrase given currency by Cournay, the godfather of the Physiocratic school-proved to be curiously fruitful in the field of political speculation, as in economics. From it issued a sanction for natural rights, the theory of progress, the law of justice, and the principle of freedom. The right of coercion was restricted by it to the narrowest limits, and the political state was shorn of all arbitrary power. "Authority," the Physiocratic thinkers concluded, "should only employ the force of the community to compel madmen and depraved men to make their conduct conform to the principles of justice." So far jefferson went gladly with the Physiocrats, but in their acceptance of a benevolent despotism he discovered a denial of their first principles, and turned to the more congenial democratic group. With the political principles of Godwin and Paine he was in hearty accord. With them he accepted as an historical fact the principle that government is everywhere and always at war with natural freedom, and from this he deduced the characteristic doctrine that the lover of freedom will be jealous of delegated power, and will seek to hold the political state to strict account. From this same principle, following Paine, he deduced the doctrine of the terminable nature of compact, which he set over against the legal doctrine of inviolability. In this matter French liberalism and English legalism were at opposite poles. Replying to Burke s doctrine of irrevocable compact, Paine had written The Rights of Man, which jefferson did much to popularize in America, and with the broad principles of which he was in complete accord. "The earth belongs in usufruct to the living," Paine had argued, and the dead possess no rights over it. Government from the grave is a negation of the inalienable rights of the newborn; hence social justice demands that a time limit should automatically revoke all compacts. Since no generation can rightly deed away the heritage of the unborn, the natural limit of every compact is the lífetime of the generation ratifying it. "No society," jefferson said, "can make a perpetual Constitution, or even a perpetual law." In this suggestive theory of the terminable nature of compact is to be found the philosophical origin of the later doctrine of states rights. However deeply it might be covered over by constitutional lawyers and historians who defended the right of secession, the doctrine was there implicitly, and the southern cause would have been more effectively served if legal refinements had been subordinated to philosophical justification of this fundamental doctrine. With a frank contempt for all legalists jefferson believed that social wellbeing was not to be bounded by constitutional limitations or statutory enactments; that political action should be governed by reason rather than by historical precedent. He had discovered that the political state does not remain static, but gathers power by the law of physical attraction; with increasing power it becomes increasingly dangerous to natural freedom; hence a long-established and venerable constitution may become, by reason of its hold upon the popular affection, the most useful of agencies to cloak aggressions on the rights of the people. The love of profits is always seeking to overthrow the tale of justice. Human selfishness persistently distorts civic conduct, warping it from ideal ends. But the shortcomings of existing political states cannot abrogate the law of justice or destroy the love of freedom. To safeguard freedom from encroachment by the political state, and to establish the tale of justice, were always the great and difficult ends that jefferson aimed at, and as a follower of the Physiocratic school and a Virginia planter he tuned naturally to a laissez-faine agrarianism in opposition to a centralizing capitalism. But he was much too shoud a political thinker and too sagacious a party leader to rest his case upon abstract theory. In all his later writings and counsels he kept his mind elose to economic fast, and the jeffersonian movement was a long and effective training school in the economic basis of politics. It habituated the motley rank and file of the electorate to think in economic terms and to regard political parties as the instruments of economic groups. This was in keeping with the soundest eighteenth-century tradition, before romantic dogma had divorced politics and realism; and in so far jefferson agreed with his Federalist opponents, Hamilton and john Adams. A decade of acrimonious debate had made it plain to the common voter that the rea] struggle in America lay between the rival capitalist and agrarian interests, of which the Federalist and Republican parties were the political instruments. the Congressional enactments of the first twelve years had further clarified the issue. The funding plan had visibly increased the number and wealth of the rising capitalist group. The first banks were being erected and the complex machinery of modern credit-the hated "paper system" that had driven out the traditional metallic currency-was being rapidly built up. A small financial group in the northern cities was growing powerful from discounting and money-brokerage. The truth was slowly coming home to the farmers and small men that war is profitable to the few at the cost of the many; that from the egg of war-financing was hatched a brood of middlemen who exploited the postwar hardships and grew rich from the debts that impoverished the producing farmers. This ambitious class, hitherto negligible in America, was provided wíth the means to make a vigorous fight; it invoked the political state as an ally, and under Hamilton's leadership used the administration to serve its financial interests. It looked with open hostility upon every agrarian program, was cynical towards French romantic theories, and was restrained by no scruples. To loose the hands of this capable class from the helm of government, to keep America agricultural, and the Federal state secondary in all but necessary police powers to the several commonwealths, was the avowed and logical purpose of the jeffersonian Republicans. (1) The leaders of the movement were men who in capacity and training were worthy opponents of the capable Federalists. In surprising number they were from the Old Dominion, gentlemen of the best Virginia stock, who in the last decades of the eighteenth century engrafted upon a generous plantation tradition the Physiocratic doctrines of France. A finer rate of gentlemen America has never produced, and it was fortunate for the jacksonian movement, which produced no notable thinkers and contributed little to political and economic theory, that the preceding generation had given adequate form to the philosophy of agrarianism. That theory took definite shape between 1800 and 1820. In the days of Hamilton s control of the Treasury Department, the agrarian opposition was weakened by the Jack of such a theory; but the necessities of the situation were a prod to the young Republicans, and the philosophy of agrarianism rapidly crystallized. In its final form it was an extraordinarily interesting and native expression of two hundred years' experience of a society founded on agriculture-a reasoned defense of an older America against the ambitious of a younger and more vigorous. JOHN TAYLOR: An Agrarian Economist Tne intellectual leader of the young Republicans in the great attack on the economics of Federalism was a thinker too little recognized by later Americana. His just fame has been obscured with the cause for which he labored, and his reputation lies buried with the old agrarian régime. Nevertheless John Taylor of Caroline County, Virginia, "the philosopher and statesman of agrarianism," was the most penetrating critic of Hamiltonian finance and the most original economist of his generation. Unambitious, simple, honest, calm and dignified in bearing, he embodied the heroic virtues of the great age of Virginia. In his Thirty Years' View, Thomas H. Benton describes him thus: I can hardly figure to myself the ideal of a republican statesman more perfect and complete than he was in reality:-plain and who, a wise counselor, a ready and vigorous debater, acute and comprehensive, ripe in all historical and political knowledge, innately republican-modest, courteous, benevolent, hospitable,-a skilful, practical farmer, giving his time to his farm and his books, when not called by an emergency to the public service-and returning to his books and his farm when the emergency was over. He belonged to that constellation of great men which shone so brightly in Virginia in his day, and the light of which was not limited to Virginia, or our America, but spread through the bounds of the civilized world. (Chapter XVIII.) Taylor was a member of Congress at the time of the funding operations and contributed two notable pamphlets to the public discussion: the first, issued in 1793, entitled An Examination of the Late Proceedings in Congress Respecting the Official Conduct of the Secretary of the Treasury; the second, issued the following year, entitled An Inquiry into the Principles and Tendencies of Certain Public Measures. Twenty years later, in 1814, he embodied his matured convictions in a stout volume, printed at Fredericksburg, entitled An Inquiry into the Principles and Policy of the Government of the United States. The work is tediously prolix dressed, according to Benton, "in a quaint Sir Edward Coke style°-even more tediously moralistic; but in spite of very evident stylistic shortcomings, fit deserves, in the opinion of Professor Beard, "to rank among the two or three really historic contributions to political science which have been produced in the United States" (Economic Origins of ]effersonian Democracy, p. 323) . It was the fast of the eighteenth century works, solidly reasoned, keeping a main eye upon economics and refusing to wander off into the bog of constitutionalism, concerned rather with the springs and sources of political action and the objectives of political parties. It summed up adequately the agrarian argument against capitalism, analyzed the current tendencies, and provided a convenient handbook for the Jacksonian movement, from which the latter drew freely in the dispute over the Bank. Like Jefferson's, the agrarianism of Taylor was founded in the Physiocratic economy. He was convinced that the tiller of the soil was the only true economist, and that if republican America were to retain its republican virtues fit must guard against every system of exploitation, for in exploitation lay the origin of social caste. America had rid itself of the feudal principle of a landed aristocracy, which in the past had provided the machinery of exploitation, by the abolition of the law of primogeniture and entail, only to be confronted by a graver danger, the new aristocracy of liquid wealth. His main purpose, therefore, was an examination of the sources of power of the capitalistic order, and the successive steps by which fit had risen to power. His analysis is acute and reveals a mind concerned with the realities that lie beneath outward appearances. It is the economics of history that concern him most, for as fully as John Adams he was convinced that economics determine the form of the political state. In his analysis of the origins of government, he discovers in every society a master class that becomes the beneficiary of sovereign power: the political state is first erected and thereafter used to safeguard the past acquisitions and to further the present ambitions of a dominant economic group which calls itself an aristorcracy; and such an aristocracy imposes its will upon the exploited mass, crudely by the sword and purse, and subtly by the skillful use of psychology. Once in control of the political state fit intrenches itself behind certain fictions which profess to carry moral sanction. This political jugglery plays many tricks to catch the gullible; arrayed in the garb of patriotism, loyalty, obedience to authority, law and order, divine right, fit carries a weighty appeal. When these moral fictions fail, the fictions of the law step in, and such doctrines as the sacredness of contract translate the stealings of the master class into vested interests which the state is bound to protect. There is a fine irony in Taylor's implied references to Burke's doctrine of a changeless constitution based on a non-revocable compact, and Hamilton's doctrine of the public faith, which, he argues, were clearly designed to sacrifice the common good to the interests of a class: Law enacted for the benefit of a nation, is repealable; but law enacted for the benefit of individuals, though oppressive to a nation, is a charter, and irrepealable. . . . Posterity, being bound by the contracts of its ancestry, in every case which diminishes its rights, man is daily growing less free by a doctrine which never increases them. A government intrusted with the administration of publick affairs for the good of a nation, has a right to deed away that nation for the good of itself or its partisans, by law charters for monopolies or sinecures; and posterity is bound by these deeds.' But although an existing generation can never reassume the liberty or property held by its ancestors, it may recompense itself by abridging, or abolishing the right of its descendants. (Page 61.) The two theories to which he devotes chief attention are the natural aristocracy theory of John Adams, and the capitalistic aristocracy theory of Hamilton. The first of these takes its bias from stressing the inequality inherent in the nature of men; individuals are biologically unequal; and from this fact Adams deduces that the thrifty rise to opulence and the thriftless sink into poverty by reason of individual qualities. Society can neither keep a strong man down nor thrust a weak man up. Between the rich and the poor, the capable and incapable, a state of war exists, held in check by the strong hand in feudal and monarchical societies, but necessarily open and bitter in a democracy. Hence the inevitably failure of democracy wherever it is tried, and the necessity of nicely calculated checks in a republic to prevent the equal tyranny of an aristocracy and a mob. The second theory, the Hamiltonian, justifies itself by the saure theory of human nature. It accepts the fact of social inequality as inherent in men, but it sees no reason to pursue Utopian dreams. Recognizing the universal fact of economic control, it erects the state upon exploitation as preferable to anarchy. This capitalistic state it defends before a gullible public by eloquent appeals to the national faith, the security of property, the fear of lawlessness. Having thus analyzed the two theories Taylor seeks to cut the ground from under both by arguing that social classes cannot be historically explained by the fact of biological inequality amongst individuals, but rather by accidental opportunity, unscrupulousness, and brute force. All aristocracies, whether feudal, natural, or capitalistic, take their origin and uphold their dominion, not from superior excellence or capacity, but from exploitation, that beginning in a small way grows by what it feeds on ti]] it assumes the proportions of a colossus. Exploitation breeds a continually augmenting exploitation that conducts inevitably to caste regimentation. All aristocracies are founded in a social theft. They are not established in the morality of nature, but exist as parasites on the social wealth; they levy upon the producer; and the only preventive is to destroy the foundations on which they rest by taking from them the means of exploitation. In conjuring up phantom dangers of feudal aristocracies, Taylor pointed out, John Adams was fighting dead issues. No feudal aristocracy could arise in America; land was too plentiful and the quick jealousy of the people would strike it down. The danger to republican institutions was closer at hand; it was the poison of the new capitalism that was spreading its virus through all the veins of the national life. And in order that the American people might know something of the history of this innovating force which they must reckon with, John Taylor proceeded to open to them a page in the economics of capitalism. The aristocracy of credit, founded on "monopoly and incorporation," he pointed out, had arisen first in England with the growing power of the middle class; it had gone forward swiftly in consequence of the Napoleonic wars, and through the agencies of The Bank of England and the Consolidated Debt, it had secured control of the public credit. It had arisen first in America in consequence of the financial disturbance resulting from the Revolutionary War, and had further strengthened its position by the War of 1812. Ambitious men had taken advantage of the national necessities to create an artificial paper system identical with that of England. They had profited immensely from the funding operations and the National Bank; they were setting up their private banks in every city and town, and through the manipulation of credit were taking heavy toll of the national production. A money monopoly was the most dangerous of all monopolies, and the master of all. Taylor had grown up under the traditional domestic economy. He was habituated to think of production in terms of consumption, and of money as a stable measure of exchange. He could not adjust his mind to the theory of production for profit, of middleman speculation, as socially legitimate; and when that speculation extended to the national currency, and exacted its profits from the medium of exchange, he took alarm. Cold and silver are fairly stable commodities that allow of no sudden increase or diminution, and in consequence a specie currency does not readily lend itself to speculative juggling. But a paper system has no natural limitations. Expanded and contracted at the will of speculators, it subjects the business of the country to the exploitation of money brokers. Vast sums had thus been taken from the people by the fundíng operations. Cold and silver had been driven out of circulation, and with their disappearance a riot of speculation had begun by which only the brokers had profited. Such was the origin of the new money aristocracy that had already taken possession of the state and was using it for the sole end of exploitation. America must make choice between agrarianism and capitalism; the two were incompatible, John Taylor was convinced, and unless the ambitions of the paper-money aristocracy were held in check, the American producer would come under the heel of middle-class exploitation. So suggestive was the reasoning of Taylor, so interesting for the light it throws on the agrarian mind of the Virginia Republicans, that it will be well to set down his theses in compact form. As summarized admirably by Professor Beard, his argument runs thus: i. the masses bave always been exploited by ruling classes, royal, ecclesiastical, or feudal, which have been genuine economic castes sustaining their power by psychological devices Such as "loyalty to the throne and altar." 2. Within recent times a new class, capitalistic in character, has sprung up, based on exploitation through inflated public paper, bank stock, and a protective tariff, likewise with its psychological devices, "public faith, national integrity, and sacred credit." 3. In the United States, this class was built up by Hamilton's fiscal system, the bank, and protective tariff, all of which are schemes designed to filch wealth from productive labor, particularly labor upon the land. 4. Thus was created a fundamental conflict between the capitalistic and agrarian interests which was the origin of parties in the United States. 5. Having no political principles, capitalism could fraternize with any party that promised protection, and in fact alter the victory of the Republicans successfully entrenched itself in power under the new cover. 6. the only remedy is to follow the confiscatory examples of other classes and destroy special privilege without compensation. (Economic Origins of Jeffersonían Democracy, P. 351.) In the great battle of ideas that followed the conflict of interests, the Virginia agrarians armed themselves with trenchant weapons. In intellectual equipment they were a match for the ablest of the Federalists; in social idealism, in generous concern for the res publica, or common public business, in sober and practical humanitarianism, they were far superior. Between John Taylor of Virginia, spokesman of planter agrarianism, and Fisher Ames of Massachusetts, spokesman of Boston Federalism, the contrast could scarcely be greater. It is a contrast in social culture, in humane ideals, in interpretations of the native genius of America; and in the comparison it is not the Virginia Republican who suffers. 1 See Charles A. Beard, The Economic Orígins of Jeffersonian Democracy, Chapter XIII.