WEBVTT NOTE Part IV 1 00:00:00.000 --> 00:00:05.000 Our Enemy, The State by Albert J. Nock 2 00:00:05.000 --> 00:00:07.000 Part 4 3 00:00:07.000 --> 00:00:15.000 After conquest and confiscation have been affected and the state set up, its first concern is with the land. 4 00:00:15.000 --> 00:00:20.000 The state assumes the right of eminent domain over its territorial basis, 5 00:00:20.000 --> 00:00:25.000 whereby every landholder becomes in theory a tenant of the state. 6 00:00:25.000 --> 00:00:32.000 In its capacity as ultimate landlord, the state distributes the land among its beneficiaries on its own terms. 7 00:00:32.000 --> 00:00:38.000 A point to be observed in passing is that by the state system of land tenure, 8 00:00:38.000 --> 00:00:44.000 each original transaction confers two distinct monopolies, entirely different in their nature, 9 00:00:44.000 --> 00:00:52.000 inasmuch as one concerns the right to labor-made property, and the other concerns the right to purely law-made property. 10 00:00:52.000 --> 00:01:00.000 The one is a monopoly of the use-value of land, and the other a monopoly of the economic rent of land. 11 00:01:00.000 --> 00:01:07.000 The first gives the right to keep other persons from using the land in question or trespassing on it, 12 00:01:07.000 --> 00:01:12.000 and the right to exclusive possession of values accruing from the application of labour to it. 13 00:01:12.000 --> 00:01:20.000 Values that is, which are produced by exercise of the economic means upon the particular property in question. 14 00:01:20.000 --> 00:01:36.000 Monopoly of economic rent, on the other hand, gives the exclusive right to values accruing from the desire of other persons to possess that property, values which take their rise irrespective of any exercise of the economic means on the part of the landholder. 15 00:01:37.000 --> 00:01:49.000 Economic rent arises when, for whatever reason, two or more persons compete for the possession of a piece of land and it increases directly according to the number of persons competing. 16 00:01:50.000 --> 00:01:58.800 The whole of Manhattan Island was bought originally by a handful of Hollanders from a handful of Indians for $24 worth of trinkets. 17 00:01:58.800 --> 00:02:11.100 The subsequent rise in land values, as we call it, was brought about by the steady influx of population and the consequent high competition for portions of the island's surface, 18 00:02:11.100 --> 00:02:15.100 and these ensuing values were monopolized by the holders. 19 00:02:15.100 --> 00:02:19.800 They grew to an enormous size, and the holders profited accordingly. 20 00:02:19.800 --> 00:02:30.700 The Aster, Wendell and Trinity Church estates have always served as classical examples for study of the state system of land tenure. 21 00:02:30.700 --> 00:02:35.000 Bearing in mind that the state is the organization of the political means, 22 00:02:35.000 --> 00:02:40.500 but its primary intention is to enable the economic exploitation of one class by another, 23 00:02:40.500 --> 00:02:49.600 we see that it is always acted on the principle already cited that expropriation must precede exploitation. 24 00:02:49.600 --> 00:02:53.600 There is no other way to make the political means effective. 25 00:02:53.600 --> 00:03:04.100 The first postulate of fundamental economics is that man is a land animal, deriving his subsistence solely from the land. 26 00:03:04.100 --> 00:03:09.600 His entire wealth is produced by the application of labor and capital to land. 27 00:03:09.600 --> 00:03:13.900 No form of wealth known to man can be produced in any other way. 28 00:03:13.900 --> 00:03:18.820 Hence, if his free access to land be shut off by legal preemption, 29 00:03:18.820 --> 00:03:22.700 he can apply his capital only with the landowner's consent 30 00:03:22.700 --> 00:03:25.180 and on the landowner's terms. 31 00:03:25.180 --> 00:03:32.100 In other words, it is at this point, and at this point only, that exploitation becomes practicable. 32 00:03:32.100 --> 00:03:37.660 Therefore, the first concern of the state must be invariably, as we find it invariably is, 33 00:03:37.660 --> 00:03:41.460 with its policy of land tenure. 34 00:03:41.460 --> 00:03:45.060 I state these elementary matters as briefly as I can. 35 00:03:45.060 --> 00:03:49.500 The reader may easily find a full exposition of them elsewhere. 36 00:03:49.500 --> 00:03:55.220 I am here concerned only to show why the state system of land tenure came into being 37 00:03:55.220 --> 00:03:59.780 and why its maintenance is necessary to the state's existence. 38 00:03:59.780 --> 00:04:05.220 If this system were broken up, obviously the reason for the state's existence would disappear 39 00:04:05.220 --> 00:04:08.580 and the state itself would disappear with it. 40 00:04:08.580 --> 00:04:22.940 With this in mind, it is interesting to observe that although all our public policies would seem to be in process of exhaustive review, no publicist has anything to say about the state system of land tenure. 41 00:04:22.940 --> 00:04:29.020 This is no doubt the best evidence of its importance. 42 00:04:29.020 --> 00:04:33.580 Under the feudal state, there was no great amount of traffic in land. 43 00:04:33.580 --> 00:05:03.580 When William, for example, set up the Norman state in England after conquest and confiscation in 1066 to 1076, his associated banditti, among whom he parceled out the confiscated territory, did nothing to speak of in the way of developing their holdings, and did not contemplate gain from the increment of rental values. In fact, economic rent hardly existed. Their fellow beneficiaries were not in the market to any great extent, and the dispossession 44 00:05:03.580 --> 00:05:12.280 Feudal regime was a regime of status under which landed estates yielded hardly any rental value and only a moderate use value but carried an enormous insignia value. 45 00:05:13.580 --> 00:05:28.580 Land was regarded more as a badge of nobility than an active asset, its possession marked a man as belonging to the exploiting class, and the size of his holdings seems to have counted for more than the number of his exploiting people. 46 00:05:28.580 --> 00:05:32.940 and the size of his holdings seems to have counted for more than the number of his 47 00:05:32.940 --> 00:05:36.340 exploitable dependents. 48 00:05:36.340 --> 00:05:40.580 The encroachments of the merchant state, however, brought about a change in these 49 00:05:40.580 --> 00:05:42.300 circumstances. 50 00:05:42.300 --> 00:05:45.540 The importance of rental values were recognized 51 00:05:45.540 --> 00:05:49.820 and speculative trading in land became general. 52 00:05:49.820 --> 00:05:54.980 Hence, in a study of the merchant state, as it appeared full-blown in America, 53 00:05:54.980 --> 00:06:10.380 It is a point of utmost importance to remember that from the time of the first colonial settlement to the present day, America has been regarded as practically limitless field for speculation in rental values. 54 00:06:10.380 --> 00:06:22.140 One may say at a safe venture that every colonial enterpriser and proprietor after Raleigh's time understood economic rent and the conditions necessary to enhance it. 55 00:06:22.140 --> 00:06:26.140 The Swedish, Dutch and British trading companies understood this. 56 00:06:26.140 --> 00:06:32.420 Endicott and Winthrop of the autonomous merchant state on the bay understood it. 57 00:06:32.420 --> 00:06:34.660 So did Penn and the Calverts. 58 00:06:34.660 --> 00:06:40.420 So did the Carolinian proprietors, to whom Charles II granted a lordly belt of 59 00:06:40.420 --> 00:06:42.900 territory south of Virginia, 60 00:06:42.900 --> 00:06:46.060 reaching from the Atlantic to the Pacific. 61 00:06:46.060 --> 00:06:51.420 And, as we have seen, Roger Williams and Clark understood it perfectly. 62 00:06:51.420 --> 00:06:55.840 Indeed, land speculation may be put down as the first major industry 63 00:06:55.840 --> 00:06:58.820 established in colonial America. 64 00:06:58.820 --> 00:07:03.020 Professor Sikolsky calls attention to the fact that it was flourishing in the 65 00:07:03.020 --> 00:07:07.020 South before the commercial importance of either Negroes or tobacco was 66 00:07:07.020 --> 00:07:08.720 recognized. 67 00:07:08.720 --> 00:07:12.980 These two staples came fully into their own about 1670, 68 00:07:12.980 --> 00:07:16.300 tobacco perhaps a little earlier, but not much. 69 00:07:16.300 --> 00:07:20.820 And before that, England and Europe had been well covered by a lively propaganda 70 00:07:20.820 --> 00:07:27.020 of Southern Landholders advertising for settlers. 71 00:07:27.020 --> 00:07:32.220 Mr. Sokolsky makes it clear that very few original enterprises in American rental values 72 00:07:32.220 --> 00:07:37.820 ever got much profit out of their ventures. This is worth remarking here as enforcing 73 00:07:37.820 --> 00:07:43.340 the point that what gives rise to economic rent is the presence of a population engaged 74 00:07:43.340 --> 00:07:50.340 in a settled exercise of the economic means or, as we commonly put it, working for a living 75 00:07:50.340 --> 00:07:55.580 or again in technical terms applying labor and capital to natural resources for 76 00:07:55.580 --> 00:07:58.100 the production of wealth. 77 00:07:58.100 --> 00:08:01.620 It was no doubt a very fine dignified thing for 78 00:08:01.620 --> 00:08:04.900 Carteret, Berkeley and their associate nobility 79 00:08:04.900 --> 00:08:08.820 to be the owners of a province as large as the Carolinas. 80 00:08:08.820 --> 00:08:11.380 But if no population were settled there, 81 00:08:11.380 --> 00:08:14.580 producing wealth by exercise of economic means, 82 00:08:14.580 --> 00:08:18.460 obviously not a foot of it would bear a penny worth of rental value, 83 00:08:18.460 --> 00:08:21.780 and the proprietor's chance of exercising the political means would 84 00:08:21.780 --> 00:08:25.300 therefore be precisely nil. 85 00:08:25.300 --> 00:08:29.900 Proprietors who made the most profitable exercise of the political means have 86 00:08:29.900 --> 00:08:34.100 been those, or rather speaking strictly the heirs of those, 87 00:08:34.100 --> 00:08:37.900 like the Brevoets, Wendels, Whitney's, Astors and 88 00:08:37.900 --> 00:08:43.180 Gerlitz, who owned land in an actual or prospective urban centre 89 00:08:43.180 --> 00:08:48.380 and held it as an investment rather than for speculation. 90 00:08:48.380 --> 00:08:53.340 The lure of the political means in America, however, gave rise to a state of mind which 91 00:08:53.340 --> 00:08:59.900 may be profitably examined. Under the feudal state, living by the political means was enabled 92 00:08:59.900 --> 00:09:04.980 only by the accident of birth, or in some special cases by the accident of personal 93 00:09:04.980 --> 00:09:11.780 favor. Persons outside these categories of accident had no chance whatever to live otherwise 94 00:09:11.780 --> 00:09:41.780 than by the economic means. No matter how much they have wished to exercise the political means or how greatly they may have envied the privileged few who could exercise it, they were unable to do so. The feudal regime was strictly one of status. Under the merchant state, on the contrary, the political means was open to anyone, irrespective of birth or position, who had the sagacity and the determination necessary to get at it. 95 00:09:41.780 --> 00:10:11.780 In this respect, America appeared as a field of unlimited opportunity. The effect of this was to produce a race of people whose master concern was to avail themselves of the opportunity. They had but one spring of action, which was the determination to abandon the economic means as soon as they could, and at any sacrifice of conscience or character, and live by the political means. From the beginning, this 96 00:10:11.780 --> 00:10:18.380 Determination has been universal, amounting to monomania. 97 00:10:18.380 --> 00:10:22.820 We need not concern ourselves here with the effect upon the general balance of advantage 98 00:10:22.820 --> 00:10:29.060 produced by supplanting the feudal state by the merchant state. We may observe only that 99 00:10:29.060 --> 00:10:34.780 certain virtues and integrities were bred by the regime of status to which the regime 100 00:10:34.780 --> 00:10:41.580 Regime of Contract appears to be inimical, even destructive. Vestiges of them persist 101 00:10:41.580 --> 00:10:48.340 among peoples who have had a long experience of the regime of status, but in America, which 102 00:10:48.340 --> 00:10:54.860 has had no such experience, they do not appear. What the compensations for their absence may 103 00:10:54.860 --> 00:11:01.300 be, or whether they may be regarded as adequate, I repeat, need not concern us. We remark only 104 00:11:01.300 --> 00:11:06.700 and the simple fact that they have not struck root in the Constitution of the American character 105 00:11:06.700 --> 00:11:11.500 at large, and apparently cannot do so. 106 00:11:11.500 --> 00:11:17.820 2. It was said at the time, I believe, that the actual causes of the colonial revolution 107 00:11:17.820 --> 00:11:24.820 of 1776 would never be known. The causes assigned by our school books may be dismissed as trivial, 108 00:11:25.620 --> 00:11:30.180 the various partisan and propagandist views of that struggle and its origins may be put 109 00:11:30.180 --> 00:11:50.180 Great evidential value may be attached to the long line of adverse commercial legislation laid down by the British state from 1651 onwards, especially to that portion of it which was enacted after the merchant state established itself firmly in England in consequence of the events in 1688. 110 00:11:50.180 --> 00:12:09.180 The legislation included the Navigation Acts, the Trade Acts, Acts regulating the colonial currency, the Act of 1752 regulating the process of levy and distress, and the procedures leading up to the establishment of the Board of Trade in 1696. 111 00:12:09.180 --> 00:12:22.180 These directly affected the industrial and commercial interests in the colonies, though just how seriously is perhaps an open question, enough at any rate beyond doubt to provoke deep resentment. 112 00:12:22.180 --> 00:12:37.180 Over and above these, however, if the reader will put himself back into the ruling passion of the time, he will at once appreciate the import of two matters which have for some reason escaped the attention of historians. 113 00:12:37.180 --> 00:12:43.340 The first of these is the attempt of the British state to limit the exercise of the political 114 00:12:43.340 --> 00:12:50.620 means in respect of rental values. In 1763, it forbade the colonists to take up lands 115 00:12:50.620 --> 00:12:56.700 lying westward of the source of any river flowing through the Atlantic seaboard. The 116 00:12:56.700 --> 00:13:03.020 deadline, thus established, ran so as to cut off from preemption about half of Pennsylvania 117 00:13:03.020 --> 00:13:07.400 and half of Virginia and everything to the West thereof. 118 00:13:07.400 --> 00:13:13.240 This was serious, with the mania for speculation running as high as it did, with the consciousness 119 00:13:13.240 --> 00:13:19.740 of opportunity real or fancied having become so acute and so general, this ruling affected 120 00:13:19.740 --> 00:13:21.140 everybody. 121 00:13:21.140 --> 00:13:26.760 One can get some idea of its effect by imagining the state of mind of our people at large if 122 00:13:26.760 --> 00:13:30.760 stock gambling had suddenly been outlawed at the beginning of the last great boom in 123 00:13:30.760 --> 00:13:34.200 in Wall Street a few years ago. 124 00:13:34.200 --> 00:13:40.120 For by this time the colonists had begun to be faintly aware of the illimitable resources 125 00:13:40.120 --> 00:13:42.480 of the country lying westward. 126 00:13:42.480 --> 00:13:46.680 They had learned just enough about them to fire their imagination and their avarice to 127 00:13:46.680 --> 00:13:48.580 a white heat. 128 00:13:48.580 --> 00:13:53.140 The seaboard had been pretty well taken up, the free-holding farmer had been pushed back 129 00:13:53.140 --> 00:13:59.760 farther and farther, population was coming in steadily, the maritime towns were growing. 130 00:13:59.760 --> 00:14:04.760 Under these conditions, Western lands had become a center of attraction. 131 00:14:04.760 --> 00:14:07.120 Rental values depended on population. 132 00:14:07.120 --> 00:14:12.180 The population was bound to expand, and the one general direction in which it could expand 133 00:14:12.180 --> 00:14:19.180 was westward, where lay an immense and incalculably rich domain waiting for preemption. 134 00:14:20.240 --> 00:14:25.480 What could be more natural than that the colonists should itch to get their hands on this territory 135 00:14:25.480 --> 00:14:29.240 and exploit it for themselves alone and on their own terms 136 00:14:29.240 --> 00:14:33.560 without risk of arbitrary interference by the British state. 137 00:14:33.560 --> 00:14:38.160 And this of necessity meant political independence. 138 00:14:38.160 --> 00:14:41.480 It takes no great stress of imagination to see that 139 00:14:41.480 --> 00:14:45.200 anyone in those circumstances would have felt that way 140 00:14:45.200 --> 00:14:49.320 and that colonial resentment against the arbitrary limitation which the Edict of 141 00:14:49.320 --> 00:14:50.960 1763 142 00:14:50.960 --> 00:14:56.160 put upon the political means must therefore have been great. 143 00:14:56.160 --> 00:15:00.040 The actual state of land speculation during the colonial period will give a 144 00:15:00.040 --> 00:15:03.760 fair idea of the probabilities in the case. 145 00:15:03.760 --> 00:15:08.240 Most of it was done on the company system. A number of adventurers would 146 00:15:08.240 --> 00:15:11.480 unite, secure a grant of land, survey it, 147 00:15:11.480 --> 00:15:14.520 and then sell it off as speedily as they could. 148 00:15:14.520 --> 00:15:20.000 Their aim was a quick turnover. They did not, as a rule, contemplate holding land, 149 00:15:20.000 --> 00:15:27.000 – much less settling it. In short, their ventures were a pure gamble in rental values. 150 00:15:27.000 --> 00:15:32.680 Among these pre-revolutionary enterprises was the Ohio Company, formed in 1748 with 151 00:15:32.680 --> 00:15:38.800 a grant of half a million acres, the Loyal Company, which like the Ohio Company was composed 152 00:15:38.800 --> 00:15:48.080 of Virginians, the Transylvania, the Vandalia, Schiotto, Indiana, Wabash, Illinois, Susquehanna, 153 00:15:48.080 --> 00:15:52.380 and others whose holdings were smaller. 154 00:15:52.380 --> 00:15:57.340 It is interesting to observe the names of persons concerned in these undertakings. 155 00:15:57.340 --> 00:16:01.820 One cannot escape the significance of this connection in view of their attitude towards 156 00:16:01.820 --> 00:16:07.600 the revolution and their subsequent career as statesmen and patriots. 157 00:16:07.600 --> 00:16:12.680 For example, aside from his individual ventures, General Washington was a member of the Ohio 158 00:16:12.680 --> 00:16:17.800 Company and a prime mover in organizing the Mississippi Company. 159 00:16:17.800 --> 00:16:22.680 He also conceived the scheme of the Potomac Company, which was designed to raise the rental 160 00:16:22.680 --> 00:16:28.120 value of Western holdings by affording an outlet for their produce by canal and portage 161 00:16:28.120 --> 00:16:34.840 to the Potomac River, and thence to the seaboard. This enterprise determined the establishment 162 00:16:34.840 --> 00:16:40.360 of the national capital in its present most ineligible situation, for the proposed terminus 163 00:16:40.360 --> 00:16:46.220 of the canal was at that point. Washington picked up some lots in the city that bears 164 00:16:46.220 --> 00:16:51.140 has his name, but in common with other early speculators, he did not make much money out 165 00:16:51.140 --> 00:16:58.140 of them. They were appraised at about $20,000 when he died. 166 00:16:58.140 --> 00:17:03.140 Patrick Henry was an inveterate and voracious engrosser of land lying beyond the deadline 167 00:17:03.140 --> 00:17:09.620 set by the British state. Later he was heavily involved in the affairs of one of the notorious 168 00:17:09.620 --> 00:17:16.620 Henry bought up all these certificates that he could get his hands on, at ten cents on the dollar, and made a great profit on them by their rise in value when Hamilton put through his measure for having the central government assume the debts they represent. 169 00:17:39.620 --> 00:17:52.620 Undoubtedly, it was this trait of unrestrained avarice which earned him the dislike of Mr. Jefferson, who said, rather contemptuously, that he was insatiable in money. 170 00:17:52.620 --> 00:18:05.620 Benjamin Franklin's thrifty mind turned cordially to the project of the Vandalia Company, and he acted successfully as promoter for it in England in 1766. 171 00:18:05.620 --> 00:18:11.860 in 1796. Timothy Pickering, who was Secretary of State under Washington and John Adams went 172 00:18:11.860 --> 00:18:22.060 on to record in 1796 that all I am now worth was gained in speculations in land. Silas 173 00:18:22.060 --> 00:18:27.520 Deane, emissary of the Continental Congress in France was interested in the Illinois and 174 00:18:27.520 --> 00:18:33.840 Wabash companies, as was Robert Morris, who managed the revolution's finances, as was 175 00:18:33.840 --> 00:18:38.600 There was also James Wilson, who became a justice of the Supreme Court and a mighty 176 00:18:38.600 --> 00:18:42.280 man in post-revolutionary land grabbing. 177 00:18:42.280 --> 00:18:47.800 Wolcott of Connecticut and Stiles, president of Yale College, held stock in the Susquehanna 178 00:18:47.800 --> 00:18:49.400 Company. 179 00:18:49.400 --> 00:18:56.240 So did Pelletier-Webster, Ethan Allen and Jonathan Trumbull, the brother Jonathan, whose 180 00:18:56.240 --> 00:19:03.560 His name was a long sobriquet for the typical American, and is still sometimes so used. 181 00:19:03.560 --> 00:19:08.480 James Duane, the first mayor of New York, carried out some quite considerable speculative 182 00:19:08.480 --> 00:19:15.080 undertakings, and however indisposed one may feel towards entertaining the effect, so did 183 00:19:15.080 --> 00:19:20.120 the father of the revolution himself, Samuel Adams. 184 00:19:20.120 --> 00:19:26.000 A mere common-sense view of the situation would indicate that the British state's interference 185 00:19:26.000 --> 00:19:32.320 with the free exercise of the political means was at least as great an incitement to revolution 186 00:19:32.320 --> 00:19:37.360 as its interference through the Navigation Acts and the Trade Acts with the free exercise 187 00:19:37.360 --> 00:19:43.720 of the economic means. In the nature of things it would be a greater incitement, both because 188 00:19:43.720 --> 00:19:49.440 it affected a more numerous class of persons and because speculation in land values represented 189 00:19:49.440 --> 00:19:55.680 much easier money. Aligned with this is the second matter which seems to me deserving 190 00:19:55.680 --> 00:20:18.680 It would seem the most natural thing in the world for the colonists to perceive that independence would not only give freer access to this one mode of the political means, but that it would also open access to other modes which the colonial status made unavailable. 191 00:20:18.680 --> 00:20:25.680 The merchant state existed in the royal provinces completely in structure, but not in function. 192 00:20:25.680 --> 00:20:30.680 It did not give access to all the modes of economic exploitation. 193 00:20:30.680 --> 00:20:37.680 The advantages of a state which should be wholly autonomous in this respect must have been clear to the colonists, 194 00:20:37.680 --> 00:20:43.680 and must have moved them strongly towards the project of establishing one. 195 00:20:43.680 --> 00:20:50.680 Again, it is purely a common sense view of the circumstances that leads to this conclusion. 196 00:20:51.200 --> 00:20:55.720 The merchant state in England had emerged triumphant from conflict, and the colonists 197 00:20:55.720 --> 00:20:59.840 had plenty of chance to see what it could do in the way of distributing the various 198 00:20:59.840 --> 00:21:06.440 means of economic exploitation and its methods of doing it. For instance, certain English 199 00:21:06.440 --> 00:21:11.960 concerns were in the carrying trade between America and England, for which other English 200 00:21:11.960 --> 00:21:14.960 English Concerns Built Ships 201 00:21:14.960 --> 00:21:18.560 Americans could compete in both these lines of business. 202 00:21:18.560 --> 00:21:24.120 If they did so, the carrying charges would be regulated by the terms of this competition. 203 00:21:24.120 --> 00:21:29.520 If not, they would be regulated by monopoly, or, in our historic phrase, they could be 204 00:21:29.520 --> 00:21:33.380 set as high as the traffic would bear. 205 00:21:33.380 --> 00:21:37.880 English carriers and shipbuilders made common cause, approached the state and asked it to 206 00:21:37.880 --> 00:21:43.400 to intervene, which it did by forbidding the colonists to ship goods on any but English-built 207 00:21:43.400 --> 00:21:49.680 and English-operated ships. Since freight charges are a factor in prices, the effect 208 00:21:49.680 --> 00:21:54.240 of this intervention was to enable British shipowners to pocket the difference between 209 00:21:54.240 --> 00:22:00.660 monopoly rates and competitive rates. To enable them, that is, to exploit the consumer by 210 00:22:00.660 --> 00:22:07.660 employing the political means. Similar interventions were made at the instance of cutlers, nail 211 00:22:07.660 --> 00:22:13.020 Steelmakers, hatters, steelmakers, etc. 212 00:22:13.020 --> 00:22:16.940 These interventions took the form of simple prohibition. 213 00:22:16.940 --> 00:22:21.540 Another mode of intervention appeared in the customs duties laid by the British state on 214 00:22:21.540 --> 00:22:24.400 foreign sugar and molasses. 215 00:22:24.400 --> 00:22:29.140 We all now know pretty well, probably, that the primary reason for a tariff is that it 216 00:22:29.140 --> 00:22:35.060 enables the exploitation of the domestic consumer by a process indistinguishable from sheer 217 00:22:35.060 --> 00:22:36.940 robbery. 218 00:22:36.940 --> 00:22:43.100 All the reasons regularly assigned are debatable, this one is not, hence propagandists and lobbyists 219 00:22:43.100 --> 00:22:49.220 never mention it. The colonists were well aware of this reason, and the best evidence 220 00:22:49.220 --> 00:22:55.720 that they were aware of it is that long before the union was established, the merchant enterprises 221 00:22:55.720 --> 00:23:00.540 and industrialists were ready and waiting to set upon the new formed administration 222 00:23:00.540 --> 00:23:04.900 with an organized demand for a tariff. 223 00:23:04.900 --> 00:23:09.540 It is clear that while in the nature of things the British state's interventions upon the 224 00:23:09.540 --> 00:23:15.460 economic means would stir up great resentment among the interests directly concerned, they 225 00:23:15.460 --> 00:23:21.180 would have another effect fully as significant, if not more so, in causing those interests 226 00:23:21.180 --> 00:23:25.700 to look favorably on the idea of political independence. 227 00:23:25.700 --> 00:23:30.460 They could hardly have helped seeing the positive as well as the negative advantages that would 228 00:23:30.460 --> 00:23:37.460 would accrue from setting up a state of their own, which they might bend to their own purposes. 229 00:23:37.500 --> 00:23:42.380 It takes no great amount of imagination to reconstruct the vision that appeared before 230 00:23:42.380 --> 00:23:47.420 them of a merchant state clothed with the full powers of intervention and discrimination, 231 00:23:47.420 --> 00:23:53.420 a state which should first and last help business, and which should be administered by persons 232 00:23:53.420 --> 00:24:00.420 of actual interest like their own. It is hardly presumable that the colonists generally were 233 00:24:00.460 --> 00:24:05.560 are not intelligent enough to see this vision, or that they were not resolute enough to risk 234 00:24:05.560 --> 00:24:11.980 the chance of realizing it when the time could be made right. As it was, the time was ripened 235 00:24:11.980 --> 00:24:17.900 almost before it was ready. We can discern a distinct line of common purpose uniting the 236 00:24:17.900 --> 00:24:24.500 interests of the actual or potential speculator in rental values, uniting the Hancock, Gores, 237 00:24:24.500 --> 00:24:29.940 Otis's with the Henry's, Lee's, Walcott's, Trumbull's, and leading directly towards the 238 00:24:29.940 --> 00:24:33.940 The goal of political independence. 239 00:24:33.940 --> 00:24:39.480 The main conclusion, however, towards which these observations tend, is that one general 240 00:24:39.480 --> 00:24:44.120 frame of mind existed among the colonists with reference to the nature and primary function 241 00:24:44.120 --> 00:24:45.980 of the state. 242 00:24:45.980 --> 00:24:48.700 This frame of mind was not peculiar to them. 243 00:24:48.700 --> 00:24:52.820 They shared it with the beneficiaries of the merchant state in England, and with those 244 00:24:52.820 --> 00:24:58.860 of the feudal state as far back as the state's history can be traced, Voltaire surveying 245 00:24:58.860 --> 00:25:04.860 According to a study of the Federal Reserve, the state is a device for taking money out 246 00:25:04.860 --> 00:25:11.020 of one set of pockets and putting it in another. The beneficiaries of the feudal state had 247 00:25:11.020 --> 00:25:15.860 precisely this view, and they bequeathed it unchanged and unmodified to the actual 248 00:25:15.860 --> 00:25:21.940 and potential beneficiaries of the merchant state. The colonists regarded the state primarily 249 00:25:21.940 --> 00:25:27.860 as an instrument whereby one might help oneself and hurt others. That is to say, first and 250 00:25:27.860 --> 00:25:32.820 and foremost they regarded it as the organization of the political means. 251 00:25:32.820 --> 00:25:37.900 No other view of the state was ever held in colonial America. 252 00:25:37.900 --> 00:25:42.100 Romance and poetry were brought to bear on the subject in the customary way. 253 00:25:42.100 --> 00:25:47.620 Glamorous myths about it were propagated with the customary intent, but when it all came 254 00:25:47.620 --> 00:25:54.300 to all, nowhere in colonial America were actual practical relations with the state ever determined 255 00:25:54.300 --> 00:26:24.300 3. The Charter of the American Revolution was the Declaration of Independence, which took its stand on the double theses of unalienable natural rights and popular sovereignty. We have seen that these doctrines were theoretically, or as politicians say, in principle, congenial to the spirit of the English merchant-enterpreiser, and we may see that in the nature of things 256 00:26:24.300 --> 00:26:54.300 A thin and scattered population with a whole world before it, with a vast territory full of rich resources which anyone might take a hand at pre-empting and exploiting, would be strongly on the side of natural rights, as the colonists were from the beginning, and political independence would confirm it in that position. These circumstances would stiffen the American merchant-enterprises in the country. 257 00:26:54.300 --> 00:27:24.300 So also was the sister doctrine of popular sovereignty. The colonists had been through a long and vexatious experience of state interventions which limited their use of both the political and economic means. They had also been given plenty of opportunity to see how the interventions had been managed, and how they could be used in the right way. 258 00:27:24.300 --> 00:27:31.300 This is how the interested English economic groups, which did the managing, had profited at their expense. 259 00:27:31.300 --> 00:27:40.300 Hence, there was no place in their minds for any political theory that disallowed the right of individual self-expression in politics, 260 00:27:40.300 --> 00:27:50.300 as their situation tended to make them natural-born economic individualists, so it also tended to make them natural-born Republicans. 261 00:27:50.300 --> 00:27:55.860 Thus, the preamble of the Declaration hit the mark of accordial unanimity. 262 00:27:55.860 --> 00:28:01.100 Its two leading doctrines could easily be interpreted as justifying an unlimited economic 263 00:28:01.100 --> 00:28:06.900 pseudo-individualism on the part of the State's beneficiaries and a judicially managed exercise 264 00:28:06.900 --> 00:28:11.020 of political self-expression by the electorate. 265 00:28:11.020 --> 00:28:15.540 Whether or not this were a more free and easy interpretation than a strict construction 266 00:28:15.540 --> 00:28:22.540 The preamble, nevertheless, did reflect a general state of mind, however incompetent the understanding of its doctrines may have been, and however interested the motives which prompted that understanding. 267 00:28:45.540 --> 00:29:15.540 There was complete unanimity also in the nature of the new and independent political institution which the Declaration contemplated as within the right of the people to set up. There was a great and memorable dissension about its form, but none about its nature. It should be in essence a mere continuator of the merchant state already existing. 268 00:29:15.540 --> 00:29:45.540 There was no idea of setting up government, the purely social institution which should have no other object than, as the Declaration put it, to secure the natural rights of the individual, or as Paine put it, which should contemplate nothing beyond the maintenance of freedom and security, the institution which should make no positive interventions of any kind upon the individual, but should confine itself exclusively to such negative interventions as the maintenance of freedom might indicate. 269 00:29:45.540 --> 00:29:58.540 The idea was to perpetuate an institution of another character entirely, the state, the organization of the political means, and this was accordingly done. 270 00:29:58.540 --> 00:30:06.540 There is no disparagement implied in this observation, for, all questions of motive aside, nothing else was to be expected. 271 00:30:06.540 --> 00:30:10.540 No one knew any other kind of political organization. 272 00:30:10.540 --> 00:30:22.540 The causes of American complaints were conceived of as due only to interested and culpable maladministration, not to the necessarily anti-social nature of the institution administered. 273 00:30:22.540 --> 00:30:29.540 Dissatisfaction was directed against administrators, not against the institution itself. 274 00:30:29.540 --> 00:30:38.540 Violent dislike of the form of the institution, the monarchical form, was engendered, but no distrust or suspicion of its nature. 275 00:30:38.540 --> 00:30:48.540 The character of the state had never been subjected to scrutiny, the cooperation of the zeitgeist was needed for that, and it was not yet to be had. 276 00:30:48.540 --> 00:30:59.540 One may see here a parallel with the revolutionary movements against the Church in the 16th century, and indeed with revolutionary movements in general. 277 00:30:59.540 --> 00:31:06.520 They are incited by abuses and misfeasances, more or less specific and always secondary, 278 00:31:06.520 --> 00:31:11.820 and are carried on with no idea beyond getting them rectified or avenged, usually by the 279 00:31:11.820 --> 00:31:15.700 sacrifice of conspicuous scapegoats. 280 00:31:15.700 --> 00:31:22.140 The philosophy of the institution that gives play to these malfeasances is never examined, 281 00:31:22.140 --> 00:31:27.440 and hence they recur promptly under another form or other auspices, or else their place 282 00:31:27.440 --> 00:31:33.160 This case is taken by others which are in character precisely like them. Thus the notorious 283 00:31:33.160 --> 00:31:38.920 failure of reforming and revolutionary movements in the long run may as a rule be found due 284 00:31:38.920 --> 00:31:45.920 to their incorrigible superficiality. One mind indeed came within reaching distance 285 00:31:46.480 --> 00:31:52.900 of the fundamentals of the matter not by employing the historical method but by a homespun kind 286 00:31:52.900 --> 00:31:57.620 of Reasoning, aided by a sound and sensitive instinct. 287 00:31:57.620 --> 00:32:03.100 The common view of Mr. Jefferson as a doctrinaire believer in the stark principle of states' 288 00:32:03.100 --> 00:32:10.060 rights is most incompetent and misleading. He believed in states' rights assuredly, 289 00:32:10.060 --> 00:32:15.220 but he went much further. States' rights were only an incident of his general system 290 00:32:15.220 --> 00:32:21.240 of political organization. He believed that the ultimate political unit, the repository 291 00:32:21.240 --> 00:32:26.320 The theory and source of political authority and initiative should be the smallest unit, 292 00:32:26.320 --> 00:32:32.120 not the federal unit, state unit or county unit, but the township, or as he called it, 293 00:32:32.120 --> 00:32:38.640 the ward. The township and the township only should determine the delegation of power upwards 294 00:32:38.640 --> 00:32:44.760 to the county, the state and the federal units. This system of extreme decentralization is 295 00:32:44.760 --> 00:32:51.160 interesting and perhaps worth a moment's examination, because if the idea of the state is ever displaced 296 00:32:51.160 --> 00:32:56.720 by the idea of government, it seems probable that the practical expression of this idea 297 00:32:56.720 --> 00:33:03.720 would come out very nearly in that form. There is probably no need to say that the consideration 298 00:33:05.120 --> 00:33:10.920 of such a displacement involves a long look ahead and over a field of view that is cluttered 299 00:33:10.920 --> 00:33:17.920 with the debris of a most discouraging number, not of nations alone but of whole civilizations. 300 00:33:17.920 --> 00:33:34.920 Nevertheless, it is interesting to remind ourselves that more than 150 years ago, one American succeeded in getting below the surface of things, and that he probably to some degree anticipated the judgment of an immeasurably distant future. 301 00:33:34.920 --> 00:33:46.520 In February 1816, Mr. Jefferson wrote a letter to Joseph C. Cabell, in which he expounded the philosophy behind his system of political organization. 302 00:33:46.520 --> 00:34:06.520 What is it, he asks, that has destroyed liberty and the rights of man in every government which has ever existed under the sun, the generalizing and concentrating all powers into one body, no matter whether of the autocrats of Russia or France, or of the aristocrats of the Venetian Senate? 303 00:34:06.520 --> 00:34:32.020 The secret of freedom will be found in the individual, making himself the depository of the powers, respecting himself so far as he is competent to them, and delegating only what is beyond his competence by a synthetical process to higher and higher orders of functionaries, so as to trust fewer and fewer powers in proportion as the trustees become more and more oligarchical. 304 00:34:32.020 --> 00:34:44.020 This idea rests on accurate observation, for we are all aware that not only the wisdom of the ordinary man, but also his interest and sentiment have a very short radius of operation. 305 00:34:44.020 --> 00:35:03.420 They cannot be stretched over an area of much more than a township size, and it is the acme of absurdity to suppose that any man or any body of men can arbitrarily exercise their wisdom, interest and sentiment over a statewide or nationwide area with any kind of success. 306 00:35:03.420 --> 00:35:12.220 Therefore the principle must hold that the larger the area of exercise, the fewer and more clearly defined should be the functions exercised. 307 00:35:12.220 --> 00:35:19.540 Moreover, by placing under everybody what his own eye may superintend, there is erected 308 00:35:19.540 --> 00:35:26.120 the surest safeguard against usurpation of freedom. Where every man is a sharer in the 309 00:35:26.120 --> 00:35:31.560 direction of his ward republic or of some of the higher ones, and feels that he is a 310 00:35:31.560 --> 00:35:37.040 participator in the government of affairs, not merely at an election one day in the year, 311 00:35:37.040 --> 00:35:42.720 But every day, he will let the heart be torn out of his body sooner than his power rested 312 00:35:42.720 --> 00:35:48.520 from him by a Caesar or a Bonaparte. 313 00:35:48.520 --> 00:35:53.380 No such idea of popular sovereignty, however, appeared in the political organization that 314 00:35:53.380 --> 00:35:57.720 was set up in 1789, far from it. 315 00:35:57.720 --> 00:36:02.760 In devising their structure, the American architects followed certain specifications 316 00:36:02.760 --> 00:36:11.760 by Harrington, Locke and Adam Smith, which might be regarded as a sort of official digest of politics under the merchant state. 317 00:36:11.760 --> 00:36:24.760 Indeed, if one wished to be perhaps a little inerbane in describing them, though not actually unjust, one might say that they are the merchant state's defense mechanism. 318 00:36:24.760 --> 00:36:33.760 Harrington laid down the all-important principle that the basis of politics is economic, that power follows property. 319 00:36:33.760 --> 00:36:39.760 Since he was arguing against the feudal concept, he laid stress specifically on landed property. 320 00:36:39.760 --> 00:36:46.760 He was, of course, too early to perceive the bearings of the state system of land tenure upon industrial exploitation, 321 00:36:46.760 --> 00:36:54.760 and neither he nor Locke perceived any natural distinction to be drawn between law-made property and labor-made property. 322 00:36:54.760 --> 00:37:01.760 Nor yet does Smith perceive this clearly, though he seems to have had occasional indistinct glimpses of it. 323 00:37:01.760 --> 00:37:09.760 According to Harrington's theory of economic determinism, the realization of popular sovereignty is a simple matter. 324 00:37:09.760 --> 00:37:39.760 Since political power proceeds from landownership, a simple diffusion of landownership is all that is needed to ensure a satisfactory distribution of power. If everybody owns, then everybody rules. If the people hold three parts in four of the territory, Harrington says, it is plain that there can be neither any single person nor nobility able to dispute the government with them. In this case, therefore, 325 00:37:39.760 --> 00:37:44.000 For except force be interposed, they govern themselves. 326 00:37:44.000 --> 00:37:51.000 Locke, writing half a century later, when the revolution of 1688 was over, concerned 327 00:37:51.000 --> 00:37:55.960 himself more particularly with the state's positive confiscatory interventions upon other 328 00:37:55.960 --> 00:38:01.920 modes of property ownership. These had long been frequent and vexatious, and under the 329 00:38:01.920 --> 00:38:08.160 Stuarts they had amounted to unconscionable high-womenry. Locke's idea, therefore, was 330 00:38:08.160 --> 00:38:14.160 to copper rivets such a doctrine of the sacredness of property as would forever put a stop to 331 00:38:14.160 --> 00:38:19.280 this sort of thing. Hence he laid it down that the first business of the state is to 332 00:38:19.280 --> 00:38:25.520 maintain the absolute inviolability of general property rights. The state itself might not 333 00:38:25.520 --> 00:38:31.520 violate them, because in doing so it would act against its own primary function. Thus 334 00:38:31.520 --> 00:38:37.720 in Locke's view, the rights of property took precedence over those of life and liberty, 335 00:38:37.720 --> 00:38:43.720 And if it ever came to the pinch, the state must make its choice accordingly. 336 00:38:43.720 --> 00:38:49.820 Thus, while the American architects assented in principle to the philosophy of natural 337 00:38:49.820 --> 00:38:55.280 rights and popular sovereignty and found it in a general way highly congenial as a sort 338 00:38:55.280 --> 00:39:02.280 of voucher for their self-esteem, their practical interpretation of it left it pretty well hamstrung. 339 00:39:02.280 --> 00:39:26.280 They were not especially concerned with consistency. Their practical interest in this philosophy stopped short at the point, which we have already noted, of its presumptive justification of a ruthless economic pseudo-individualism and an exercise of political self-expression by the general electorate which should be so managed as to be, in all essential respects, futile. 340 00:39:26.280 --> 00:39:33.280 In this, they took precise pattern by the English Whig, exponents and practitioners of this philosophy. 341 00:39:33.280 --> 00:39:40.280 Locke himself, whom we have seen putting the natural rights of property so high above those of life and liberty, 342 00:39:40.280 --> 00:39:44.280 was equally discriminating in his view of popular sovereignty. 343 00:39:44.280 --> 00:39:49.280 He was no believer in what he called a numerous democracy, 344 00:39:49.280 --> 00:39:55.280 and did not contemplate a political organization that should countenance anything of the kind. 345 00:39:55.280 --> 00:40:10.280 The sort of organization he had in mind is reflected in the extraordinary constitution he devised for the Royal Province of Carolina, which established a basic order of politically inarticulate serfdom. 346 00:40:10.280 --> 00:40:22.280 Such an organization as this represented was about the best in a practical way that the British merchant state was ever able to do for the doctrine of popular sovereignty. 347 00:40:22.280 --> 00:40:28.280 It was also about the best that the American counterpart of the British merchant state could do. 348 00:40:28.280 --> 00:40:37.280 The sum of the matter is that while the philosophy of natural rights and popular sovereignty afforded a set of principles upon which all interests could unite, 349 00:40:37.280 --> 00:40:42.280 and practically all did unite, with the aim of securing political independence, 350 00:40:42.280 --> 00:40:49.280 it did not afford a satisfactory set of principles on which to found the new American state. 351 00:40:49.280 --> 00:40:55.220 When political independence was secured, the stark doctrine of the Declaration went into 352 00:40:55.220 --> 00:41:02.120 abeyance, with only a distorted simulacrum of its principles surviving. The rights of 353 00:41:02.120 --> 00:41:08.920 life and liberty were recognized by a mere constitutional formality left open to eviscerating 354 00:41:08.920 --> 00:41:15.440 interpretations or, where there were for any reason deemed superfluous, to simple executive 355 00:41:15.440 --> 00:41:31.440 and all consideration of the rights attending the Pursuit of Happiness was narrowed down to a plenary acceptance of Locke's doctrine of the preeminent rights of property, with law-made property on an equal footing with labour-made property. 356 00:41:31.440 --> 00:41:40.440 As for popular sovereignty, the new state had to be republican in form, for no other would suit the general temper of the people, 357 00:41:40.440 --> 00:41:46.200 People, and hence its peculiar task was to preserve the appearance of actual republicanism 358 00:41:46.200 --> 00:41:52.360 without the reality. To do this, it took over the apparatus by which we have seen the English 359 00:41:52.360 --> 00:41:59.060 merchant state adopting when confronted with a like task, the apparatus of a representative 360 00:41:59.060 --> 00:42:05.280 or parliamentary system. Moreover, it improved upon the British model of this apparatus by 361 00:42:05.280 --> 00:42:10.580 by adding three auxiliary devices which time has proved most effective. 362 00:42:10.580 --> 00:42:15.680 These were, first, the device of the fixed term, which regulates the administration of 363 00:42:15.680 --> 00:42:21.000 our system by astronomical rather than political considerations, by the motion of the earth 364 00:42:21.000 --> 00:42:25.120 around the sun rather than by political exigency. 365 00:42:25.120 --> 00:42:31.880 Second, the device of judicial review and interpretation which, as we have already observed, 366 00:42:31.880 --> 00:42:36.880 is a process whereby anything may be made to mean anything. 367 00:42:36.880 --> 00:42:42.380 Third, the device of requiring legislators to reside in the district they represent, 368 00:42:42.380 --> 00:42:48.000 which puts the highest conceivable premium upon pliancy and venality, and it therefore 369 00:42:48.000 --> 00:42:53.840 the best mechanism for rapidly building up an immense body of patronage. 370 00:42:53.840 --> 00:42:58.800 It may be perceived at once that all these devices tend of themselves to work smoothly 371 00:42:58.800 --> 00:43:05.800 as well as one can put a date to such an event, the surrender at Yorktown marks the sudden and complete disappearance of the Declaration's doctrine from the political consciousness of America. Mr. Jefferson resided in Paris as Minister for Foreign Affairs. 372 00:43:28.800 --> 00:43:37.680 to France from 1784 to 1789. As the time for his return to America drew near, he wrote 373 00:43:37.680 --> 00:43:43.920 Colonel Humphreys that he hoped soon to possess myself anew by conversation with my countrymen 374 00:43:43.920 --> 00:43:51.080 of their spirit and ideas. I know only the Americans of the year 1784. They tell me this 375 00:43:51.080 --> 00:43:58.580 is to be much stranger to those of 1789. So indeed he found it. On arriving in New 376 00:43:58.580 --> 00:44:02.980 In New York and resuming his place in the social life of the country, he was greatly 377 00:44:02.980 --> 00:44:08.100 depressed by the discovery that the principles of the Declaration had gone wholly by the 378 00:44:08.100 --> 00:44:14.980 board. No one spoke of natural rights and popular sovereignty. It would seem actually 379 00:44:14.980 --> 00:44:20.420 that no one had ever heard of them. On the contrary, everyone was talking about the pressing 380 00:44:20.420 --> 00:44:26.820 need of a strong central coercive authority able to check the incursions which the democratic 381 00:44:26.820 --> 00:44:38.820 Mr. Jefferson wrote despondently of the contrast of all this with the sort of thing he had been hearing in the France which he had just left in the first year of her resolution, in the fervour of natural rights and zeal for reformation. 382 00:44:38.820 --> 00:44:44.820 In the process of possessing himself anew of the spirit and ideas of his countrymen, he said, 383 00:44:44.820 --> 00:44:49.820 in the fervour of natural rights and zeal for reformation. 384 00:44:49.820 --> 00:44:55.820 In the process of possessing himself anew of the spirit and ideas of his countrymen, he said, 385 00:44:55.820 --> 00:45:02.820 I cannot describe the wonder and mortification with which the table conversations filled me. 386 00:45:02.820 --> 00:45:08.820 Clearly, though the Declaration might have been the Charter for American Independence, 387 00:45:08.820 --> 00:45:12.820 It was in no sense the charter for the new American state.