Saturday, May 31, 2014

The Gilded Age and The Myth of Competition

"A good many of these books are not of recent date, which does not make them any less informative and pleasant to read. It is a false analogy with science that makes one think latest is best." -- Jacques Barzun, Author's Note to From Dawn to Decadence
I'm juggling books this week, as usual. From the library, I have Northwest Passage by Scott Chandler, which is a graphic novel set in 18th century Canada. From my garage sale pile, I'm well into 33 1/3: Kick Out The Jams, which gives an interesting eye-witness account of the actual "concert" that the MC5 played before Grant Park turned into a war zone. Both of these I'll digest and write about on their own. The other book I'm reading is more episodic.
"Dramatic change and reform always captivate historians...And historians, who are usually liberal Democrats, dismissed a supposedly Republican era without examining labels."          -- H. Wayne Morgan, "Toward National Unity"
The Gilded Age is a collection of essays, edited by H. Wayne Morgan. This is the 1970 revised edition; the original book came about in response to an early 60s symposium. Basically, the writers here are tasked with re-examining the evidence and motives of post civil-war America. The title is an obvious nod to Mark Twain's popular parody of the time period.
"Republican centralism, promotion, regulation weres till new in American life. Far from being secure, the GOP ran for its life, and some commentators thought it would disappear like other third parties."
The editor's introductory piece does a good job of reminding us of all the cultural changes of the 1870s. The obvious interest to today's reader, and the topic of the first essay proper, is the rise of the giant corporation, which consolidated power among a few men, at a time when governmental power was seen as a thing to be avoided. The other important context of the time is the reversal of the GOP and Democratic parties' platforms from what they are today; the conservative Dems held congress while progressive Republicans fought to hold the presidency.
"Under most circumstances, the power and influence of the businessman were limited to the immediate environs of operation and seldom extended beyond state boundaries. Equally important, there existed among most businessmen of prewar days a nearly universal desire and a practical necessity for community esteem." -- John Tipple, "Big Businessmen and a New Economy"
 The first essay "Big Businessmen and a New Economy," takes an interesting look at the reaction against the newly rising corporations. Following the 14th Amendment, and the Supreme Court's interpretation of it as applying to legal entities, businessmen persued the benefits of consolidation. These new leaders considered themselves as protectors of the economy, using monopolies to keep wages high for workers and prices down for consumers.
"By bringing to bear superior economic force which to a great extent invalidated the tenets of the free market, the large organization put the big businessman in the favored position of operating in an economy dedicated to the idea of freely competing individuals, yet left him unhampered by the ordinary restrictions."
The United States was founded on a philosophy that assumed individual rights derived from natural law. As businessmen, individuals can govern themselves and agree to communal laws. The 18th century birthed the problematic existence of artificial individuals that didn't fit in to the scheme of nature, and so couldn't be governed by the common morality held by mankind.
"In the long run, the brutal realities of this cutthroat struggle were unpalatable to the public and big businessmen alike. But while the latter sought to shield themselves by erecting monopolistic barriers, the American people extolled the virtues of free competition and looked back fancifully to an earlier, more ideal state of economic affairs which, if anything, had been distinguished by a notable lack of competition."
This myth of competition is a hardy thing. In reality, war between economic entities leads to poor wages, cheap product and long working hours. Yet, one constantly hears rhetoric about the need to make America "competitive" again, in order to raise wages and open factories. Which is never going to happen in an unregulated economy.
"Somewhat paradoxically, they proposed to liberate competition by imposing new restrictions in the name of freedom. They were not too sure that unrestrained competition was the economic panacea they sought. Apparently it never occurred to them that to acknowledge the defective working of natural law against corporate immorality was an ingenuous admission that the sacrosanct principle of competition was invalid in the long run."
So, the people of the 19th century just didn't have the correct language to use. They were prevented from finding a solution in any kind of co-operative venture because of the built-in worship of individual competition. Letting individuals use their abilities to the fullest is the great American ideal, but if it leads to unfair leverage of power, what is one to do? Well, they passed the Sherman Act.
"The Sherman Act, even when bolstered by later legislation, failed to halt or reverse the combination movement. It made evident the ineptitude of any legislation that regarded competition as a self-perpetuating and natural guarantor of economic justice rather than an intellectual hypothesis without institutional support."
Despite many decades of intervening legislation, we still have corporations that threaten our supposed liberties with the usage of their own. Perhaps we need to finally grow up as a society and admit there should be limitations on our freedoms. Otherwise, we are giving up a public government that answers to our needs, to a corporate one that only answers to a board of directors.

No comments:

Post a Comment