Farewell To Reform
John Chamberlain
[Excerpts from Chamberlain's remarkable record of the
era of Progressive reform in the United States, with introductory and
critical comments by Edward J. Dodson - October, 2002. This excerpt
highlights, in particular, Chamberlain's evaluation of the activities
of Henry George and the "Single Taxers" who carried his
ideas and work in the 20th century]
John Chamberlain is another in a long line of
largely-forgotten figures who dedicated themselves to the long
struggle to preserve and expand the extent to which people live
under just law. He was broadly educated in the literature of
Western Civilization. Farewell To Reform was
Chamberlain's first book, and here he detailed the history of
the reform efforts during the late nineteenth and early
twentieth centuries.
Chamberlain's writing career took him to the New York Times,
where he contributed book reviews. The hardships caused by the
Great Depression drew him toward the interventionist and even
socialist perspective. However, in the late 1930s, Chamberlain
came under the influence of the writing of the great
individualist writer Albert Jay Nock. The story he documents in
Farewell To Reform demonstrates he was already very
familiar with the philosophical perspectives of Henry George.
He joined the editorial staff of Fortune in 1936, then
moved on to Life in 1941. In 1950, Chamberlain joined
the editorial staff of The Freeman, dormant since 1924.
Nock had run the original Freeman; now, Chamberlain
combined with Suzanne La Follette and Henry Hazlitt. In 1959 his
next book, The Roots of Capitalism, was published and
found a receptive audience. A book of articles he wrote for Fortune
was published in 1963 under the title, The Enterprising
Americans.
In Farewell To Reform Chamberlain documents what others
thought and how they acted upon their beliefs. He also adds
historical context and - from time to time - provides his own
insights and views for us to consider. A second printing of the
book occurred shortly after Franklin D. Roosevelt entered the
office of the U.S. Presidency, and, upon advice from Raymond
Moley and the so-called "brain trust" announced his
plans for a New Deal. In a forward to this new edition,
Chamberlain declares his skepticism:
|
The "reforms" of the New Deal will not lead to reform as it
is carefully defined in this book; they will not help to maintain "freedom
of contract," freedom from monopoly, freedom of competition.
Rather do they bear out the thesis; they tend to congeal capitalism. …[pp.
vii-viii]
A really free market demands roller-bearing movement of all its
variables. And when the next inevitable depression is upon us,
business men will have more difficulty in getting out from under. They
will find the system more congealed than ever.[p. viii]
[I]ndividual monopolies in different fields must lead to pressure for
trading advantages abroad - with what effect on the economic
organization of other countries also pressing for trading advantages,
or striving to maintain favorable balances of trade?[p. x]
With hours set at a maximum, wages at a minimum, and prices kept
level, the only way of cutting costs within an industry will be by the
road of technological improvement, i.e., by labor-saving devices.
Labor will have to remain constantly awake if it is to seize the
advantage of technology for itself. In other words, for every
improvement in processes, labor must strike for shorter hours and
increased pay. Can labor do it?[p. x]
However we look at it, Franklin D. Roosevelt is caught in the act of
gambling on a "return to prosperity." And, as the savior of
a nation from the vices of capitalism, it may be predicted that he
will not be able to stand prosperity. For prosperity is a concomitant,
given the psychology of capitalism, of a rising market. And what goes
up, as credit is created by the banks, must come down, as credit is
withdrawn by the banks.[p. xi]
CHAPTER ONE
A Pattern of the Nineties
The nineties saw the last full-throated attempt of the American dirt
farmer to seize a government he had not wholly owned since Jackson's
day, and had owned not at all since the Civil War had ended. It was an
attempt rendered the more desperate because of the sudden and
confusing transformation of American economic life.[p.3]
[T]he nineties, in spite of all the Populist clamor for the righting
of a deranged balance, witnessed, toward their close, the final steps
in the unchecked burgeoning of a flushed business enterprise. This
enterprise had swept across the continent in the pioneer's wake, or
even before him. It had, quite early, gobbled up choice sections of
land to be held out of use for speculative purposes. It had corrupted
legislatures in the interests of its railroad and traction lines, and
had monopolized coal, copper and the oil of Pennsylvania, Ohio and
California.[p.4]
[Grover] Cleveland, in the eighties and nineties, was the spearhead
of a thrust that was less Democratic, in the Jacksonian sense, than it
was of the Manchester liberal brand. Modern critics like to stress the
alliance between Republicanism and
laissez fair, but in truth the Republican Party is only for
the free workings of Adam Smith's eighteenth-century, mercantile and
hypothetically just God under circumstances that are favorable to the
most wealthy segments of the population. The true apostles of laissez
faire … were the American disciples of Herbert Spencer, men
like William Graham Sumner of Yale. [p.9]
[William Graham] Sumner, whose own political philosophy was firmly
grounded in Spencer, came to cross lances with men who themselves
flaunted the banner of the synthetic philosopher. A storm raged about
him at Yale; he was continually annoying the "Pittsburgh
millionaires" who made New Haven an educational stamping ground
for their sons in the early years of the twentieth century; …Sumner's
libertarianism, his championship of complete laissez faire as
against the status economy of the guild system of the Middle Ages,
with no governmental interference whatsoever with natural laws of
competition, was seen to have little grounding in the reality of 1890,
no matter how desirable it may have been in the realm of the
abstract.[pp.10-11]
We have called Sumner a libertarian. Yet he did not believe in the "natural
rights" of man, in the sense that Rousseau did. These rights -
the right to a living, the right to the paternal care of the state -
were, he argued, a hardship upon the "Forgotten Man" who was
the good citizen, who paid his taxes, kept his house and business in
order, exercised a due frugality, and raised his children to go in
Roman ways of staunchness, decency and sobriety. Abandon laissez
faire, said Sumner, and you force the superior man, the "forgotten
man" who has not need of legislation, to shoulder "duties"
when the logical time has come for him to enjoy rightfully the fruits
of his labor and care. You penalize thrift and diligence, and
ultimately make poverty desirable - since, by having nothing and
expending no energy, the shiftless man can call upon the thrifty to "support"
him.[p.12]
All this sounds completely rational on the face of it. But as it must
seem to a disillusioned world, there is more trust in Sumner than in
all of Rousseau. For the nature of power - the power of the "superior"
man - is that it becomes corrupt; it seeks to entrench itself by fair
means and foul; it will not observe the rules laid down by the
libertarian rationalist. It obeys its own inner compulsion; it has
laws of its own.[p.12]
What balked Sumner as a political scientist was his inadequate
definition of the State. …Government, he failed adequately to
see, is a fulcrum, not an entity - a fulcrum by which mean in
organized groups get predatory leverages which enable them to better
themselves at the expense of the less powerful, the less wary, the
less worldly sagacious.[pp.12-13]
The protective tariff … was simply another flagrant example of
using the government as fulcrum for a predacious wrench. In brief, the
"ins" were "in" through politics, through original
grants in colonial days, through preempting sites that were destined
to become valuable and making their claims good under the law, through
monopolizing natural resources, and so forth.[pp.13-14]
He did not believe in "the politics of acquisition and enjoyment"
when the rules were voided. He considered that labor should take care
of itself by organizing; "Industrial war," Sumner
said …, "is, in fact, an incident of liberty … a sign
of vigor in society. It contains the promise of a sound solution."
What he did not see was that labor, if it were to cope with court
decisions, and with the "government by injunction" that was
shortly to be employed…, must perforce interfere by political
pressure with the sacred "freedom of contract" that
prevented minimum-wage legislation, fixed hours of labor, and so
on.[p.14] …The disinherited could, by combining, force a
disgorging of the natural resources which the possessors had gone into
politics originally to get; …[p.15]
He did not see that the inevitable result of competition was
combination by means of jobbery. …He failed to realize
that if you posit "the right to property" (and by this I do
not mean to call into question the right of every man to his
toothbrush) as the basis of society, you posit incentives to getting
property, and jobbery is at once unleashed. The two are inseparable,
now and forever.[p.15]
In one way, Sumner was a forerunner of the muckrakers of the next
generation. His diagnosis of society agreed with theirs; his
prescriptions did not.[p.16]
Frederick Jackson Turner
It was on January 12, 1893, that a certain paper by Frederick
[Jackson] turner was read before the American Historical Association
in Chicago. ..and probably few historians paid any attention to it.
But the paper has been compared, in cultural significance, to
Emerson's notable address on "The American Scholar," …
The Turner paper, called "The Significance of the Frontier in
American History," contained in its title, no less than in its
body, the suggestion of one of those fertilizing concepts that have so
much to do with the way we dramatize ourselves. It meant simply that
there was a shortage of free land, except in arid districts, in sight.
The mobile, wayfaring American of the westward push would have to
settle down, if not in 1893, at least by 1910 or 1920. …The
American of extension was dying; the America of intension, symbolized
by the swelling civic spirit that moved through perverted Graeco-Roman
channels into the creation of the synthetic marvels of the Exposition,
was born on a national scale - but hardly in a form that would have
pleased the philosophers of the eighteenth-century
enlightenment.[pp.21-22]
The Homestead Act, passed in the sixties, portioned out to every
willing Union soldier a homestead of one hundred and sixty acres. With
the rush to the plains went a crying need for capital and no sooner
had a young man gained clear title to his acres than he was forced to
mortgage them to Eastern and foreign creditors. Industry boomed after
the war; the railroads became earth-hungry monsters: expansion was in
the air. The floods of money which the war had loosed upon the country
went into the building of the new West; and the important thing was
that the money was cheap.[p.26]
…The debtor class, the farmers of the Missouri Valley and
elsewhere, who had stocked their lands, built homes and planted
orchards on borrowed money, found itself ground between two
millstones: that of the pressing creditor and that of the disappearing
dollar bill. Never was there more need of an "elastic"
currency. As the mortgages fell due, and as the productivity of the
silver mines of the Western country increased, and as gold dwindled to
the tune of a mounting population, the farmers began to work out the
equation. The answer, logical enough in terms of the given situation,
was free silver, "the dollar of our daddies," the "honest
dollar."[p.27]
CHAPTER TWO
Windows on the New Century
[W]here free silver had been the "cowbird" of 1896 …,
imperialism became the cowbird of 1900. Albert J. Beveridge, not yet a
Progressive, not yet a historian with a true understanding of Lincoln,
looked with immense, cocky and portentous satisfaction upon the scene
as the new century opened. He glowed with the thought that Manifest
Destiny,
our Manifest Destiny, had crossed the Pacific with the
acquisition of the Philippines; the twentieth century, he remarked,
would be distinctively American.[pp.39-40]
It was true enough, as James B. Dill said, that trusts were
inevitable, that competition was the mother of combination, and that
all a "sovereign" people could do was to bring combinations
into social use. But the real thinking to be done was, and is, along
the lines of social use; and the realists of the industrial world of
1900 were concerned not at all with any such thinking.[p.41]
There were men, however, who tried to solve the problem as the
nineteenth century merged into the twentieth. Their discontent took
queer forms; it cut across many philosophical lines. Very often it
made no sense at all except as pure protest. It looked back to
Jefferson and Jackson; it looked across the ocean to the primitive
communism of Tolstoi. …It even looked forward to no government at
all, following Kropotkin and the anarchists. Altogether, discontent at
the opening of the new century made a crazy-quilt pattern.[p.42]
And the largest, most vocal, element in this discontent had been
schooled in the theories of the farm border of the nineties. As
Professor Turner had suggested, we were a nation that was not only in
one transitional stage, but in many simultaneous transitional stages.
Class distinctions had not been drawn in hard and fast lines; because
of this the prophets of discontent sounded a Babel of conflicting
tongues.[p.42]
But in spite of its lack of common objectives, the movement that was
generated in the nineties, only to broaden and deepen under pressure
of the business concentration of 1900, can at least be summed up as
neo-democratic. Behind this movement were three American theorists of
the nineteenth century, Henry George, Henry Demarest Lloyd and Edward
Bellamy. There were, of course … the foreign factors -- Marxian
socialism, brought to America by the German immigrants; the agitation
of the anarchists, which had been domesticated in the New World by
Johann Most, Alexander Berkman and Emma Goldman; but these
importations from abroad merely gave minor twists to the forces
running towards the La Follettian conception of social democracy. They
failed, in themselves, to capture very much of the national
imagination. Nor did the spectacle of the Fabian Society, founded in
London in 1884, achieve anything more definite in the way of American
influence than to open a few liberal minds to the programs offered,
respectively, by Bryan, Roosevelt, La Follette and Wilson. The
writings. of Sidney and Beatrice Webb, of Graham Wallas, the Utopian
novels of Wells, and the play-polemics of Shaw did help promote
leagues for industrial democracy and agitation for the use of the Best
Minds in politics, but the ground had been prepared for the English
seed by the Populists of the nineties.[pp.42-43]
Henry George, however, did capture the imagination of an impressive
group. His Progress and Poverty, published in 1879, offered a
startling, deep-searching analysis of the processes of preemption and
exploitation under a system that was incongruously combining a
conquest of the frontier with an industrial revolution. Given its
definitions, this book seems to me a matter of incontrovertible logic.
It became the Bible of an able and vociferous lot of men: Joseph Fels,
the millionaire manufacturer of Fels Naphtha soap; Tom L. Johnson, the
traction monopolist who became an enemy of the very process by which
he had amassed his own fortune; Peter Witt, the Populist who came
under the spell of Johnson; Brand Whitlock, humanitarian and artist;
U'Ren, the shy Cornishman of Oregon, and many others. Out of it the
Single Tax movement grew to dignified proportions in the stirring
years before the World War. Even to-day the Single Tax has its
adherents who cling to Progress and Poverty as the Christian
Scientists cling to the canon of Mrs. Eddy.[p.43]
Henry George was born in Philadelphia in 1839 of English and Scotch
antecedents. Tiring of school at the age of 15, he shipped on a
schooner bound for Melbourne and Calcutta. The conditions in British
India were among the first examples of the results of landlordism to
prey upon his fundamentally idealistic and religious mind; but the
germ of Progress and Poverty may be traced more definitely to
a conversation George had with an old miner aboard a schooner off the
Pacific Coast. The miner was uneasy about the growing problem of
Chinese labor. But what harm could it do, George asked, if the Chinese
working men were herded off to the cheap diggings? "No harm now,"
said the miner, "but wages will not always be as high as they are
to-day in California. As the country grows, as people come in, wages
will go down, and some day or other white men will be glad to get
those diggings the Chinamen are now working." [pp.43-44]
In his lifetime George was to see the California of the splendid idle
forties transformed much as the miner had predicted. Ten years after
the death of the evangel of the Single Tax, which occurred in October
of 1897, California had notoriously become the worst labor State in
the country. And before George's eyes, as he lived, was enacted the
drama of the Southern Pacific in State politics -- a drama that Frank
Norris later packed into The Octopus. Before the completion of
the first transcontinental railroad, when demand for space around the
Oakland terminus ran high, George witnessed the skyrocketing of land
values. All over California, wherever people congregated in the
Eldorado of the forty-niners, land was being held out of use for
speculative purposes, while the unfortunate late arrivals suffered
from lack of ability to get a foothold on productive acreage. Putting
two and two together, correlating the predictions of the old miner
aboard the schooner with the glaring fact of the monopolization of
land and natural resources that followed the free-for-all of
forty-nine, George wrote a preliminary article on the land
question.[p.44]
George had had a good preliminary schooling (his father was a book
publisher), but his real Alma Mater, so his son wrote, was the
forecastle and the printing office. He first took up the trade of
typesetter on his return from India. On a later trip West he became a
prospector; he did farm work and itinerant manual labor; and he joined
the printer's union. Returning East, in 1869, he set up a telegraph
news bureau in New York for a struggling paper in San Francisco, but
the bigger news monopolies forced him into bankruptcy. So Henry George
took to walking the streets of New York, from aristocratic Murray Hill
to the shabby East Side. It was the New York of Tweed's day, and of
Jay Gould's, a New York in which, "…side by side with the
palaces of the princely rich ..." went a degradation, "a
want and a shame, such as made the young man from the open West sick
it heart."[pp.44-45]
The immense chasm that opened between rich and poor in New York
confirmed the suspicions he had set forth in his preliminary article.
So, back in San Francisco again, George commenced to gather material
for Progress and Poverty. In 1877 he started work on it, and
after a year and seven months of struggle, during which period he had
often to pawn his own personal belongings, the book was finished.
Publishers were not anxious to take the risk of issuing such a
theoretical work; but finally D. Appleton undertook to market it on
condition that George himself would pay for the plates. George agreed,
and in January of 1880 the first trade edition was in the stalls --
and Progress and Poverty commenced to outsell the most popular
fiction of the day.[p.45]
George brought considerable passion and insight to the writing of
Progress and Poverty; so much was his heart in his work, as
his son tells the story, that he wept upon its completion. As an
economist, George was lucky to make his start with no inherited
paraphernalia of classical terms; his eyesight. was not blinded by the
apologetics of the members of the Manchester School, with their
rationalization of the industrial revolution. His work did not take
the turn of Das Kapital, we may be sure, because of the
American conditions out of which it grew; George did not despair of a
competitive society. He had seen relatively happy times on the
frontier, when there was room for everybody to compete. If you go to a
new community, he wrote, where the Anglo-Saxon (that prince of
competitors) is just commencing the race of progress, you will find an
absence of wealth, but no beggars; no luxury, but no destitution. But
as the community realizes the conditions which all civilized
communities are striving for, poverty takes on a darker tone. This,
George argued, is directly the result of progress. Hence George was at
one with Rousseau and the philosophers of the Enlightenment in wishing
to preserve primitive conditions.*
* Henry George "wishing to preserve
primitive conditions"? Here, Chamberlain is quite mistaken.
George understood the potency of specialization and
technological advances to improve the lives of people, if only
the socio-political arrangements and institutions of societies
could be established on the basis of just principles.
|
Seeking for the all-inclusive formula -- a "formula so broad as
to admit of no exceptions" -- that governed the relationship of
poverty to progress, George found it in the Ricardian analysis of
rent. Rent was equal to the difference in value between the wealth
that could be produced on a given piece of ground, and the wealth that
could be produced on land at the lowest level of subsistence. As land
is improved, as its social value is augmented, owing to growth of
cities, proximity of markets and so on, it naturally produces more,
but rent, George noticed, tended to swallow up the whole gain, and the
landlords pocketed what really should accrue to labor, on the one
hand, and to the entrepreneur, on the other. Thus
pauperization accompanies progress. To put it another way, the reason
why, in spite of increased productive power on the worker's part,
wages constantly tended toward a minimum which gave but a bare living,
was that, with the increase in productive power, rent tended to an
even greater increase, thus compelling a constant reduction of wages.
[p.46]
So George came to the conclusion that land should, through the medium
of the Single Tax on social value, be forced down toward its "use"
value. That done, George argued, both labor and capital would be able
to find plenty to do; there would be no need for any disheartening
talk about the class war, for there would be abundance for all who
would work. The tax on the social value of land would make it highly
unprofitable for the landlord to hold ground out of use; moreover,
rent on unused ground would tend to a minimum solely because of new
valuations pitched low to avoid the ravages of the tax assessor.
Speculation in land values would at once disappear, and with this
would go the inflation that leads to panics, depression and the
eternal round of the business cycle. And, of course, the income
derived from the land tax would immediately abolish the necessity for
all other forms of taxation, whether on improvements or on productive
labor.
One can hardly doubt the soundness of George within his orbit, for
liberty, as soon as equal access to the land is denied, becomes, as
the population mounts, merely the right to compete for employment at
starvation wages or the right to cry for the dole. But George, in
spite of his intelligent refutation of the one-sided Malthusian
doctrine, in spite of his disposal of the classical theory that
capital pays labor its wages, was hardly perspicacious all down the
line. He put Malthus to rout by showing that as population
increases human ingenuity finds ways to support it; he
demonstrated that wages come out of the wealth created by labor
itself. But he was a poor power philosopher; the problem of controls
eluded him. He failed to see that a land-owning class, with its
relation to the banking system which, in turn, is bound up with the
mortgage system, is, to all intents and purposes, synonymous with the
bourgeoisie itself. To make this bourgeoisie tractable, to take away
its sources of revenue and investment and dividends, would entail a
whole revolution, directed, to all practical purposes, against
capitalism itself. In 1913, for instance, it would have involved
separating Lee, Higginson and Company, and their Back Bay clientele,
from the Calumet and Hecla copper mines on the upper peninsula of
Michigan. Now just how could this have been done by appealing to the
Democrats or the Republicans to tax away all land and monopoly values
-- to make land, mines and rights of way common property? The slush
fund would at once have precluded any such demand. When the situation
is thought through, doesn't George's minimizing of any class struggle
seem like the act of the ostrich? And how would he, once his scheme
was in operation, prevent large-scale bribery of boards of assessment?
[p.47]
George's philosophy fails in that it doesn't make its appeal in terms
of the dialectical materialism that is the key to the power of
regeneration. The Single Tax can't be dramatized to interest
sufficient numbers of people. It is true that George offered, to the
socialists of his time, the distant hope that all of the values
of socialism might be achieved through the Single Tax, but he solved
no problems of the mechanics of capturing power; of seizing the
fulcrum that is the State, either through the ballot or otherwise, to
bring about a desired result. The Single Tax remains poised as a vague
expectation. For a time the theories of George were on the rise;
Single Tax colonies -- such as the one in Delaware that sheltered
Upton Sinclair for a period -- sprang up; but the demand for a
solution by killing monopoly by fiscal prestidigitation is now
disappearing. However intelligent and desirable it may be, the Single
Tax offers little for marching men in the modern world to take hold
of. Soviet Russia, more than any other single factor, has killed it --
and the voice of Bolton Hall, crying out in 1932: "It is monopoly
alone, not capitalists or capital, that George and his followers
fight. And we will go on fighting till we have taken all the rents of
the land created by the public, for public purposes, instead of taxes.
We know what we want, and we know how to get it" -- this voice
sounds like the puffed plaint of a lost soul strayed out of the
pre-war decade and calling with a querulous shrillness to a world that
has forgotten Henry George and all his works. Even such a confirmed
believer in the Single Tax diagnosis as Suzanne La Follette, when she
came to revive the Freeman at the end of the twenties, left
Henry George off the masthead of her magazine. She had come to
realize, she wrote, that the Single Taxers knew everything but how to
attain their paradise.[pp.47-48]
Henry Demarest Lloyd
More obviously in the main stream of the neo-democratic movement than
Henry. George was Henry Demarest Lloyd, the father of all the
muck-rakers that were to swarm over the social scene in the 1900's. …[p.48]
[H]e was verging on socialism in 1883 when, in an essay called "A
New Magna Charta," …he wrote that "the unnatural
principles of the competitive economy of John Stuart Mill will be as
obsolete as the rules of war by which Caesar slaughtered the
fair-haired men, women and children of Germania."
Wealth Against Commonwealth is a book that has failed to live,
in the way Progress and Poverty or Das Kapital have
lived, because it is less an exposition of fundamental principles of
economy than it is a reporter's book of facts. But as a book of facts
it is daring and first-rate. …[pp.53-54]
The book attacked all "cornerers" - the syndicates, the
trusts, the makers of pools. The majority, he said, cannot buy enough
of anything, but the coal syndicate thinks there is too much coal, the
iron syndicate that there is too much iron, and so on.
Lloyd and Henry George supplement each other at important points -
both were agreed on the menace of monopoly. But Lloyd, the reporter,
named his companies; and Lloyd, the thinker, went through Populism and
into socialism, basing his confidence on the imminence of a
cooperative commonwealth that would reorient a status economy in a
modern world that is the product of a contract economy. Men, he
argued, have become so intelligent, so responsible, and so cooperative
that they can be entrusted in great numbers with the care of great
properties owned by others - then why can't they be entrusted with
their own State, with the mills, the mines and the stores owned in the
interests of all?
Single Taxers
Working with the intellectual tools forged for them by Henry George,
a group of old-fashioned Americans, Jeffersonian in their tastes and
predilections, marched forth in the nineties and the early years of
this century to face down the hosts of predatory privilege. As
Populism spent itself, and as prosperity commenced to hum after the
Spanish-American War, the city radical came to the fore with his
protests that "the system," however productive of wealth it
might be, certainly did not diffuse its goods evenly throughout the
population. Bryan had objected to urban wickedness, but to Frederic C.
Howe, who had seen the worst sides of New York, Pittsburgh and
Cleveland, the city was, in spite of slums, graft and special
privilege, the shining "hope of Democracy." A dominant,
growing municipal corruption seemed, as the new century opened, to
call forth its dialectical opposite in a group of Reform mayors and
their henchmen; and Reform spread, as a matter of necessity, to the
State capitals. The urban reformers, diverse in personality though
they were, had one thing in common: they were afraid of regimentation,
of the party discipline of the socialists, of commitment to an
articulated creed. Two of them, Clarence Darrow (who served in the
Illinois Legislature) and Brand Whitlock (who became Mayor of Toledo),
might be called philosophical anarchists, so suspicious were they (and
still are) of the repressive instrumentality of the State. Henry
George appealed to these men because the State, in
Progress and Poverty, was reduced to a gang of tax collectors
who were, periodically, to raid the landlords. The Single Tax
doctrines, either swallowed whole or in part, provided gunpowder for
some excellent mayors at the turn of the century -- mayors in Detroit,
in Toledo, in Cleveland and in Chicago. Good government in the
American cities received enormous impetus from Progress and
Poverty.[pp.56-57]
The predecessor of Whitlock as Mayor of Toledo was, perhaps, the
first of the Henry George mayors. He was Samuel M. Jones, a sucker-rod
manufacturer and factory owner, who believed, quite literally, in the
Golden Rule and the Declaration of Independence. A noble-hearted
Welshman, he became, among other things, a literal Tolstoyan
anarchist. Nobody, he said, had a right to "rule" anybody
else; the exception to this blanket dismissal of "rule"
being, of course, the Golden Rule, which was matter of persuasion, not
of blood and iron. This "Golden-Rule" Jones, as he came to
be called, was a self-made man. He had been brought to America at the
age of three, and had made his money as an oil pioneer and as a
manufacturer of apparatus for oil wells. By going through the
competitive mill he came to understand the processes of industrialism
as well as either Tom Johnson of Cleveland or Altgeld of
Illinois.[pp.57-58]
Jones became Mayor of Toledo in 1897, and held office until his death
in 1904, when Brand Whitlock, his Single-Tax secretary, stepped into
the breach.[p.58]
The most prominent Henry George mayor of the pre-war decade came into
office in Cleveland in 1901. He was Tom L. Johnson, fat and
pleasant-faced, a reformer with a bubbling sense of humor, and a
delight in battling at the drop of the hat. For ten years as mayor he
carried on a resourceful, high-hearted, running fight against the
Cleveland traction ring of Mark Hanna and Horace Andrews, and
eventually got his desire - but only for a short period. …The
spectacle of a rich man -- for Johnson was rich --battling to rid the
land of the sources of his own easy wealth was something that other
rich men could not understand; a Chicago newspaper, thinking there was
some nigger in the woodpile, called him "the fat casuist of
Cleveland." But Johnson was in earnest.[pp.59-60]
He knew the methods of monopoly, for he had been a first-rate
monopolist himself. Born in Kentucky, the son of an impoverished
Confederate Army officer, he had come to maturity in the harsh
atmosphere of the Gilded Age. He was a believer in privilege because
he had never seen anything else; privilege was the way of the world.
His training as a monopolist came when he was very young: when he was
living in Virginia, just after Lee's surrender, he struck up a
friendship with a conductor on a train that ran into Staunton, and the
conductor gave him permission to sell papers on the train. Johnson got
fifteen cents apiece for the Richmond and Petersburg papers, and
twenty-five cents for the illustrated weeklies. For five weeks he held
the monopoly; then, with a change in railroad management, went a
change in the conductor, and Tom lost his graft. But the lesson
remained.[p.60]
When the Johnsons moved back to Kentucky, Tom entered the
street-railway business, going to work for the du Ponts, friends of
his father who had bought the Louisville franchise. He was
successively bookkeeper, cashier and superintendent of this mule-power
transportation system. His first sizable amount of money was made by
the invention of a fare box, which netted him twenty to thirty
thousand dollars. This, too, was based on a monopoly right -- the
exclusive right to a patent. He used the money to buy, at the age of
twenty-two, a majority interest in a street-railway franchise in
Indianapolis, where he got his first insight into the connection
between banking and monopoly. "The people's money," he
wrote, "goes into the banks in the form of deposits. The banker
uses this money to capitalize public service corporations which are
operated for private profit instead of for the benefit of the people."
But the connection between politics and monopoly still eluded him; it
was not until he had gone into the traction business in Cleveland that
he discovered, from Mark Hanna, the relation between political jobbery
and the original granting of franchises.[pp.60-61]
Mark Hanna completed Johnson's education, but the young monopolist
was still on the side of privilege. His own particular road to
Damascus was the railroad between Indianapolis and Cleveland, and his
conversion was much like Paul's, or Rousseau's; it came in a seemingly
blinding flash. A train-butcher offered Johnson a book called Social
Problems, by Henry George. Johnson thought it was about the "social
evil," and said he wasn't interested. But the train-butcher
persisted; he offered to return the half-dollar purchase price if
Johnson did not like the book. Johnson read it, and decided he was in
for a prolonged exploration. Progress and Poverty followed. He
didn't want to believe the George doctrine, but its influence was too
strong; it seemed to have no loopholes. Still fighting off his
salvation, he took Progress and Poverty to his Cleveland
lawyer, with a supplication: "You made a free trader out of me;
now I want you to read this book and point out its errors to me to
save me from becoming an advocate of the system of taxation it
describes."[p.61]
He also took the book to his Johnstown, Pennsylvania, partner in the
business of manufacturing steel rails. Both the lawyer and the
manufacturer wrestled with the book, made objections, read the book
again, and ended by succumbing, along with Johnson. Johnson knew from
his own experience that the basic facts of the book were right, and
the conclusions, as George put them, were irresistible. To think, with
Johnson, was to act; he sought out Henry George in Brooklyn. In 1886
he helped Father McGlynn, William McCabe, Louis F. Post and Daniel De
Leon in the George campaign for Mayor of New York, and in 1897 he
managed George's second campaign for the same office. The first fight
resulted in a coalition between Tammany Hall and the County Democracy,
who united on Abram S. Hewitt as a candidate to beat George and the
young Republican nominee, Theodore Roosevelt. Hewitt won, although it
is an old newspaper legend that George was counted out at the polls.
In 1897 George died on the eve of the election. Meanwhile Johnson, at
George's behest, had gone to Congress, had fought the high tariff men,
had gotten George's "Protection or Free Trade" read into the
Congressional Record, so that he might send it out to voters at
governmental expense during the campaign of 1892, and had started a
lifelong agitation for the Single Tax.[pp.61-62]
Johnson's greatest service to the neo-democratic movement was as
Mayor of Cleveland, where, in Newton Baker's words, he "set new
standards of city government" for the whole nation. Lincoln
Steffens called Johnson "the best mayor of the best-governed city
in America." As was the case with Jones in Toledo, Johnson found
himself with pulpit and press and Chamber of Commerce arrayed against
him. He got some help from E. W. Scripps's paper, the Cleveland Press,
but the other journals knew their masters' voices, and the masters
spoke for private ownership of public utilities and the five-cent
fare.[p.62]
The fight for the three-cent fare was carried on against all the odds
which the American legal system can throw up. Injunction followed
injunction; if ever there was a clear example of the use of the
judiciary in maintaining the status quo, "government by
injunction," it was in Cleveland in the early years of this
century. Taxation prevented another problem that was almost impossible
of correction -- but with the aid of Peter Witt's Tax School, which
smelled out inequalities in the rates, and by means of a continuous,
factual attack in both State and local campaigns, Johnson managed to
bring Cleveland to a point where his followers were able to commence
application of the Single Tax principles to the property of the entire
city. Johnson was beaten for Mayor in 1909 just before his death, but
the election of Baker, two years later, saved a good deal of the
Johnson program -- a program which, however, Baker was later to
foreswear by his actions on his return to Cleveland after serving as
Secretary of War under Wilson.[pp..62-63]
But city ownership, which Johnson advocated, and the three-cent fare
have fought a losing fight. Even while Johnson was campaigning for
municipal operation of traction lines, the theory of regulation of
public utilities by commissions set up by the States was spreading
over the country. The rising cost of living and labor was making the
three-cent fare equivalent to a demand that trolleys be operated at a
loss. The coming of the "jitney" bus, and, later, the large
passenger bus, made even the five-cent fare too small to be profitable
in many cities. And improvement in the transmission of electricity
made local electric light plants too expensive; the problem of power
control became State wide -- a matter for State and national action,
as it remains to this day.[p.64]
With the fight on the public utility monopolies waged by the Henry
George mayors went a persistent, organized and bold propaganda for the
Single Tax, spread by such disciples as only George could attract. The
Single Tax protagonists included Thomas G. Shearman of New York,
Colonel Josiah C. Wedgwood, M.P., of London, Surgeon General W. C.
Gorgas of the United States Army, Lawson Purdy of New York, Herbert
Quick, the novelist, Frederic C. Howe, even Sun Yat-sen and Leo
Tolstoi. The most indefatigable, earnest, unremitting Single Taxer of
them all, however, was Joseph Fels, maker of Pels Naphtha Soap, a
little twinkling man, as Steffens called him, who had an excess income
of $250,000 a year which he could not use himself. Fels became
interested in the land question by himself when he went to England
from Philadelphia to organize a British branch of his soap industry.
England being further advanced along the industrial road than the
United States at the end of the nineteenth century, Fels could not
help but observe the glut on the British labor market. He sought his
own reason for this glut; it derived, he saw, from the process of
taking land out of use to form the great estates. Return the land to
the people, he said, and the labor glut would disappear, wages would
rise, and prosperity would diffuse itself with some evenness
throughout the island. This was Henry Gorge, pure and simple, although
Fels did not know it until later.[pp.64-65]
After a few experiments with colonies in England, with gardening the
waste spaces in London for the benefit of the poor and at trying to
persuade British liberals to take up his ideas (and Henry George's),
Fels returned to America, with the notion of the Fels Fund Commission
in mind. This Commission was organized in 1909, with Daniel Kiefer, "the
most successful mendicant in America," as chairman, and with
Frederic C. Howe, Lincoln Steffens, George A. Briggs and Jackson C.
Ralston on the committee Bolton Hall and Fels himself were advisers
without votes. The Fels Fund sought to back men, not institutions.
Besides centralizing the Single Tax efforts, and relieving advocates
from the burden of collecting money, the Fels Fund made up the annual
deficit of Louis Post's Single Tax magazine, The Public,
published in Chicago. But the Fund, whether because of the World War
or the psychological impossibility of getting a sufficient human force
behind it, failed to accomplish much.[p.65]
The Single Tax has been called the only positive contribution made by
an American toward solving the perhaps insoluble problem of economic
democracy. As a matter of fact it was of eighteenth-century origin, a
scheme of the French physiocrats headed by Quesnay and Turgot. But
George gave it a new impress and a new force. When Quesnay "invented"
the impot unique, the fury of the industrial revolution had
not broken upon the Continent, and when George came to similar
conclusions, he, too was thinking in terms of a non-industrialized
community: California of the pioneers. A lingering afterglow of the
great Age of the Enlightenment, the Single Tax was drenched, as George
would have been the first to admit, in all the hopeful colors of the
language of "natural rights." Making as it does a shrewd
compromise between our traditional pioneer individualism and our
vaunted equal opportunity for all, the Single Tax was well calculated
to attract dynamic individuals who wished to preserve freedom of
economic activity in a situation that was coming to defy freedom.
Although George and Joseph Fels both insisted that all the benefits of
socialism would flower in time from the success of the Single Tax,
this eighteenth-century doctrine made its strongest bid for support
among people who would sooner be caught stealing than be found with
the Communist Manifesto of 1848 in their pockets.[pp.65-66]
The Single Tax is deceptively simple, deceptively perfect. On paper
it hasn't a flaw; all its implications flow directly from George's own
splendid definitions. But its definitions are just definitions; one is
not compelled to use George's geometry, for there are other axioms in
an Einsteinian world. George, for example, failed to explore the whole
question of the ownership of surplus value and whether or not creative
brains are as much a "natural" resource as a gold mine or a
prairie.[p.66]
And George, as I have said, had no effective approach to the problem
of power, a problem that must always remain central in any political
and economic discussion. This objection must have seemed paramount to
Clarence Darrow, one of the libertarians who was, at a certain stage,
a believer in the Single Tax. In the end Darrow came to feel that its
cock-sureness, its insistence on "natural rights," were
evidence of a Utopianism that could never be brought into relationship
with the here-and-now. Socialism, he came to believe, was much more
logical and profound --although, with his temperamental anarchic
leanings, this Chicago lawyer who deserted corporation work to defend
the underdog was never able to achieve more than passive interest in
an organized Socialist Party. He fought for Debs in 1894, defending
him on the "contempt" charge, and he was the attorney for "Big
Bill" Haywood and the other members of the Western Federation of
Miners in the Steunenberg trial at Boise in 1907, but that was his
limit. Even a "logical and profound" socialism was not in
accord with human psychology, in Darrow's ultimate belief. As for the
doctrine of Henry George, it placed too small a value upon human
selfishness (which cannot be said of Mr. Stalin); it was a hangover
from the days when philosophers believed that nature was good, not
indifferent, that only civilization corrupts.[pp.66-67]
And so the hard-boiled yet tender Darrow tossed the "Problem
Solved" chapters of Progress and Poverty aside, and
followed John Peter Altgeld in the political struggles that convulsed
Chicago and Illinois as a whole in the nineties. Altgeld was like
Darrow in his unwillingness to be deluded. He expected the worst; he
was conscious of the fate of the Jeffersonian Democrat in a
monopolistic age built on the Great Technology.[p.67]
William S. U'Ren
William S. U'Ren was born in Wisconsin… He studied law in
Denver, and went to Oregon in search of both health and opportunity. A
reading of Henry George's
Progress and Poverty led him, like so many others, to
political reform.[p.73]
Lincoln Steffens
The implications of Mr. Steffens's confession are that his generation
tried valiantly, throughout the fifteen-year period of the quest for
social justice, to understand plutocratic, industrial, monopolistic
America by means of Jeffersonian, agrarian, individualistic
shibboleths. It was like trying to stay the tides. The answer to
trusts was "trust-busting"; the answer to corrupt government
was "throw the rascals out"' the answer to a banking and
business oligarchy of a few men was Woodrow Wilson's "New Freedom"
for the small business man.[p.77]
Frederic C. Howe
Frederic Howe, confessing his defeat in 1925, at least saved himself
from jumping aboard the New Era bandwagon. He had not learned, he
said, to pursue the truth to its ultimate lair - at bottom he was a
moralist, not a realist or a scientist. He had not gotten rid of the
classifications ground into him in his youth; he still believed,
subconsciously, in "good" and "bad" people - the "good"
folk being those of Anglo-Saxon stock, country-club membership and the
amenities of Howe's own boyhood. At Johns Hopkins, from Richard T.
Ely, Albert Shaw, Lord Bryce and Woodrow Wilson, he had learned that
democracy must be "saved." The "best minds" could
save it - minds like Ely's or Wilson's. But the War and the peace
taught him, in the upper reaches of his consciousness, that only
economic stabilization could build a stable - that is, a "saved"
- world, and he came to realize that "liberals," such as
himself, could do nothing to bring this about.[p.79]
These liberal Americans - Steffens, Howe, Brand Whitlock - have all
been tremendously afraid of doctrine, of commitment to party or
program, even after they have been shown the feebleness of disembodied
ideas. This is, of course, in the spirit of pragmatism, the dominant
philosophy of the age; it runs all through William James; it is the
key to Dewey's indecision, his refusal to formulate ends. Steffens
became, at one time, a Single Taxer with no interest in Henry George;
he became, later, a socialist with no interest in Karl Marx. He had no
Pope. Brand Whitlock was even less interested than Steffens in
doctrine; an artist, a lover of beauty, he could not, and cannot,
abide a formula that may be quintessentialized in the phrase, "economic
determinism." "I have gone through every political
philosophy," he said after the War. "I can see nothing in
socialism. The philosophy of Henry George of a free state in which the
resources of the earth will be opened up to use is the only political
philosophy that has ever commanded my adherence. But the world is not
interested in such a simple reform. It wants too much government, too
much regulation, too much policing. And it may never change."[p.81]
CHAPTER SIX
The Economic Man
Free capitalism results, inevitably, in a larger and larger class of
unemployed, yes, but the dole, forced at the polls, and cannily
administered, can put off the evil day of necessary uprising. …The
fact that revolution is a long, devious, often undramatic process in
most cases, with ultimate success depending on a varied attack, both
on the positive and negative sides, [escapes orthodox Marxists
to-day]. There is no need to minimize the nature of the class struggle
in saying this; the class struggle is basic. But positive recourse to
physical attack is not the whole of force. Revolutionary France was,
in good measure, already a bourgeois nation before 1789 - the comedies
of Moliere prove as much.[p.191]
CHAPTER SEVEN
Philosophical Progressivism
Every movement of any vitality reaches a point where it brings forth,
as if by law, its philosophers, those who systematize its thought; and
the years of the quest for social justice were no exception. …J.
Allen Smith published his
The Spirit of American Government in 1907 - and the "economic
interpretation of the Constitution" was henceforth to be reckoned
with. Herbert Croly dropped his The Promise of American Life
into the controversy about a nation's future in 1909 - and both
Roosevelt's "New Nationalism" and the New Republic
were born, as strange a pair of brothers as ever came in the same
little. John Dewey's School and Society, a product of 1899,
was followed with an increasing number of papers dealing with
democratic education, education for active serve as against the
education for "conspicuous leisure" which Thorstein Veblen
had so elaborately spoofed in his chapter on "The Higher Learning"
in The Theory of the Leisure Class (1899).[p.199]
A broad social movement always has a deep continuity, which, though
it may often go underground for a time, must inevitably be present for
the tapping if the imaginations of men are to be touched. And the men
who provided the philosophical systematization of the 1912
progressivism, whether Rooseveltian or Wilsonian, were, each in his
own way, integers in a broad movement that had reached America in the
seventeenth and eighteenth centuries and had come to any early
efforescence in Jefferson, Patrick Henry and Tom Paine. With the
growth of the plutocracy after the Civil War this movement had been
channeled off to the farm border, where it was manifest in a series of
periodic revolts which culminated, as we have seen, in the Populism of
the nineties, and which had seeped through to the twentieth century by
way of certain key figures who kept alive the spirit of Jefferson, the
Grange and Henry George during the Spanish-American War and its
aftermath of what Veblen called "conspicuous waste." …The
rise of the Left in America, which had been made possible by a half
century of immigration from the congested centers of Europe where
Marx's predictions of the class war seemed all too sane, inevitably
conditioned, to a small extent at least, even those Progressives who
presumed to speak for the Jeffersonian state.[p.201]
The early industrial developments, "as exemplified by mills,
factories and shops," which followed the seizure of land in the
East and which preceded the construction of the great American
railroads, led to no swollen fortunes - a fact which Henry George
might have made much of if he had been disposed to implement his
defense of non-monopolistic capitalism. …But land was a different
matter, as John Jacob Astor had demonstrated, and land for railroads,
to be stolen or cajoled from the government along with subsidies for
building, offered a juicy opportunity for those who had observed the
methods of attaining to inordinate wealth. It was simply a matter of
persuading or packing a legislature, by bribery, "community of
interest" or the offer of stock, as the builders of the canals
and the capitalists of the great Western land companies in the
Mississippi and the Ohio territories had shown.[p.206]
CHAPTER TEN
Foray
As for Progressive government, the results of the three decades of
strife antecedent to 1919 are, perhaps, minimal. Oswald Garrison
Villard thinks we are no further along the road than we were in 1900.
This, I think, is susceptible of proof - and, to boot, we are on the
wrong road. If you think the tariff is at the bottom of our troubles,
it is to be noted that the tariff is still sky-high. But even if we
had a low tariff, it is doubtful that it could have stemmed the
down-thrust of depression. …Free trade, in the long run, cannot
prevent a dynamic capitalistic industrial machine from glutting
markets as the upcurve of greed succeeds the downcurve of fear in the
psychological cycle that is the concomitant of the business
cycle.[pp.307-308]
The pet political solutions of the Progressives, designed to make
government more responsible to the will of the electorate, have
notoriously been weak reeds. The initiative and the referendum have
produced nothing. Women suffrage has only added, in direct proportion,
to Republican and Democratic totals. Direct primaries have proved not
even a palliative; they have worked against strong labor and
independent party organization, which is the only hope of labor and
the consumer in the political field.[p.308]
This brings us to the definition of "reform," and its
alternative, revolution. Now, revolution (change of structure and
aims) inevitably carries with it connotations of untoward happenings,
of barricades or whatever may be their twentieth-century equivalent,
of whatever modern ingenuity can devise as substitute for the
guillotine, of the reign of terror induced by the menace of
counter-revolution.[p.309]
The curbing of the "money power," the abolition of "privilege,"
the opening up of opportunity by the Single Tax, the redemption of the
promises of the New Freedom, all of these have been made the basis for
a "return" demand - a demand for the evocation and
reestablishment of a vanished, and somehow more "moral" and "honest"
status quo. And all economic reforms that have been undertaken
in the spirit of Bryan, of La Follette, of Wilson, have worked in a
way precisely against the grain of Progressive or neo-democratic
hopes; instead of "freeing" the common man within the
capitalistic system, these reforms have made the system, as a long-run
proposition, more difficult of operation; and this, in turn, has
reacted upon the common man as employee, as small bond-holder, as
savings-account depositor, as insurance-policy owner. The value of
reforms, as I see it, is that they fail to achieve what they are
sanguinely intended to achieve; and in so failing they help make the
system which they are intended to patch up only the more unpatchable.
In other words, every vote for reform, entered upon intelligently, is
a Jesuitical vote for revolution.[p.311]
The "economic planners" start from the wrong end. They are
fond of demolishing the "Utopians," including the Marxists,
and then they proceed to create economists' Utopias. They "ends
in view" imply the prior existence of a radical party, dominated
by labor (including the white-collar worker) and the mortgage-ridden
small farmer, to say nothing of the 11,000,000 unemployed, which would
be compelled to put a majority in Congress before the creation of any
"board at the top" is undertaken. Otherwise, planning will
go on as at present. And it will be capitalist planning, done
piecemeal, depending on the Sixteenth Amendment and ultimately
invoking the dole on a broad scale.[pp.317-318]
So planned capitalism, being a contradiction in terms, seems no
permanent way out. …Political organization looking towards a
socialist America, or an "industrial democracy," … is
the sine qua non of any alternative to the present chaotic
order. This does not mean a reliance upon strict Marxist doctrine; for
… the group of men whom the Marxians are in the habit of
regarding as the "industrial proletariat" (those who work
with their hands and receive wages) is tending to decrease. The
advance of industrial technique means more and more products turned
out with less and less physical labor. Workers in factories, mills,
railroads and mines fail to keep pace with the increase in population,
or even decrease in relation to a static population. …As direct
labor goes down, overhead rises. In good times, amusement occupations
increase. And the result is that a group of human material which is
not good "revolutionary" material in the original Marxist
sense tends to grow up at the base of society. The increase in
unemployment, too, is not material for the classic Marxist revolution.
Marx expected as little from the "rotting" masses of the
unemployed as he did from employees with a petty bourgeois psychology.
The unemployed man is usually a potential scab. And a dole buys
him.[p.321]
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