Anti-Capitalist Origins
06/02/2010 21:51
Michael Merrill
“The Anti-Capitalist Origins of the United States”
1990
Adam Smith, Merrill says, was an anti-capitalist who “sharply condemned the ‘mean rapacity, the monopolizing spirit of merchants and manufacturers, who neither are, nor should be, the rulers of mankind.’” (465) The point, of course, is that this argument (and the whole question of the “capitalist transition”) revolves around how you define “capitalism.”
Merrill says the word was not used much in the 18th century, and when it was used he says it carried connotations of “court capitalism,” the process by which political hangers-on enriched themselves at the expense of the rest of society. “Capitalism,” for Merrill, means a political-economic organization of society by and for the benefit of “capitalists.” In this sense, he says, “the American Revolution did more to retard than to hasten capitalism’s triumph in the New World [by] bringing to power a self-conscious class of small property holders who would resist dispossession and proletarianization for more than a century.” (466)
Historians, Merrill says, “universally equate ‘capitalism’ with what eighteenth-century political economists called ‘commercial society,’ and take for granted that the expansion of the latter automatically entailed the triumph of the former.” (468) “This shift in emphasis is not inconsequential,” Merrill says. (471) The real question might be, was it self-conscious and deliberate? Because, as he points out in 1995, equating a market economy with capitalism means that being anti-capitalist is the same as being against commerce -- which everyone realizes is absurd.
But back to the market revolution. Merrill says “if the Wealth of Nations had a single theme, it was that the monied interest was not the same as the public interest.” (475) The cast of characters remains the same, but Merrill sees their motivations slightly differently. “Many of the former colonists,” he says, “were set to sweep away the monopolies, duties, prohibitions, and restraints that both the Declaration of Independence and The Wealth of Nations had complained of so bitterly.” (480) Hamilton tried to build a “capitalist” economy that emulated Great Britain “not so much because he admired its economic and political institutions but because he feared its political might.” (486) This is an interesting point, because it provides Hamilton with a patriotic benefit-of-the-doubt, where other historians have been quick to condemn him.
In his letters to Robert Morris, Hamilton complained “as early as the winter of 1779-1780 [before Jefferson published his Notes on the State of Virginia] that ‘a great part of our internal commerce is carried on by barter,’ which he thought ‘inconvenient, partial, confined, [and] destructive of both commerce and industry.’ Most awkwardly, it also interfered with the ability of the government to raise an adequate revenue,” which is the main point. “The farmers have the game in their hands,” Hamilton warned. (487) “Hamilton’s funding system created an artificial interest--a class of monied men whose wealth and income was due to public largess and not to their own industry,” Merrill says, noting that this group “would ever more work to secure legislation that benefited themselves at the expense of the public.” (490) This is true, and tragic. But, following the logic of Merrill’s story, this is not why Hamilton did it. He did it to locate economic power in a group that was dependent on government, in the hopes that he and his successors would be able to control the economy through them. No one could imagine, of course, how large the economy (and thus the power of this dependent group) would grow in the nineteenth century.
The Democratic-Republican agrarian alternative, which favored discriminating between the holders of the debt (to avoid enriching speculators by assumption), retiring it quickly, reducing taxes, and limiting banking and joint-stock corporations, seems very reasonable in retrospect. Extensive, rather than intensive, development became more feasible after the 1803 Louisiana Purchase. The question is, did the Jeffersonians have a viable economic plan before the “revolution of 1800,” or were they arguing in a more “moral economy” direction? And how did this effect our subsequent understanding of what happened in both political and economic history?
“The Anti-Capitalist Origins of the United States”
1990
Adam Smith, Merrill says, was an anti-capitalist who “sharply condemned the ‘mean rapacity, the monopolizing spirit of merchants and manufacturers, who neither are, nor should be, the rulers of mankind.’” (465) The point, of course, is that this argument (and the whole question of the “capitalist transition”) revolves around how you define “capitalism.”
Merrill says the word was not used much in the 18th century, and when it was used he says it carried connotations of “court capitalism,” the process by which political hangers-on enriched themselves at the expense of the rest of society. “Capitalism,” for Merrill, means a political-economic organization of society by and for the benefit of “capitalists.” In this sense, he says, “the American Revolution did more to retard than to hasten capitalism’s triumph in the New World [by] bringing to power a self-conscious class of small property holders who would resist dispossession and proletarianization for more than a century.” (466)
Historians, Merrill says, “universally equate ‘capitalism’ with what eighteenth-century political economists called ‘commercial society,’ and take for granted that the expansion of the latter automatically entailed the triumph of the former.” (468) “This shift in emphasis is not inconsequential,” Merrill says. (471) The real question might be, was it self-conscious and deliberate? Because, as he points out in 1995, equating a market economy with capitalism means that being anti-capitalist is the same as being against commerce -- which everyone realizes is absurd.
But back to the market revolution. Merrill says “if the Wealth of Nations had a single theme, it was that the monied interest was not the same as the public interest.” (475) The cast of characters remains the same, but Merrill sees their motivations slightly differently. “Many of the former colonists,” he says, “were set to sweep away the monopolies, duties, prohibitions, and restraints that both the Declaration of Independence and The Wealth of Nations had complained of so bitterly.” (480) Hamilton tried to build a “capitalist” economy that emulated Great Britain “not so much because he admired its economic and political institutions but because he feared its political might.” (486) This is an interesting point, because it provides Hamilton with a patriotic benefit-of-the-doubt, where other historians have been quick to condemn him.
In his letters to Robert Morris, Hamilton complained “as early as the winter of 1779-1780 [before Jefferson published his Notes on the State of Virginia] that ‘a great part of our internal commerce is carried on by barter,’ which he thought ‘inconvenient, partial, confined, [and] destructive of both commerce and industry.’ Most awkwardly, it also interfered with the ability of the government to raise an adequate revenue,” which is the main point. “The farmers have the game in their hands,” Hamilton warned. (487) “Hamilton’s funding system created an artificial interest--a class of monied men whose wealth and income was due to public largess and not to their own industry,” Merrill says, noting that this group “would ever more work to secure legislation that benefited themselves at the expense of the public.” (490) This is true, and tragic. But, following the logic of Merrill’s story, this is not why Hamilton did it. He did it to locate economic power in a group that was dependent on government, in the hopes that he and his successors would be able to control the economy through them. No one could imagine, of course, how large the economy (and thus the power of this dependent group) would grow in the nineteenth century.
The Democratic-Republican agrarian alternative, which favored discriminating between the holders of the debt (to avoid enriching speculators by assumption), retiring it quickly, reducing taxes, and limiting banking and joint-stock corporations, seems very reasonable in retrospect. Extensive, rather than intensive, development became more feasible after the 1803 Louisiana Purchase. The question is, did the Jeffersonians have a viable economic plan before the “revolution of 1800,” or were they arguing in a more “moral economy” direction? And how did this effect our subsequent understanding of what happened in both political and economic history?
