Showing posts with label Lincoln. Show all posts
Showing posts with label Lincoln. Show all posts
Monday, April 11, 2011
The Nineteenth-Century Eclipse of Democratic Governance by Capitalism. Part II: Wartime Exploitation of Government by Lincoln and the Railroads
0 comments Posted by Find Insurance Online at 12:28 AMBy the time of Lincoln, the capitalists had amassed sufficient capital that they could literally write federal laws concerning them and exploit the government beyond their own statues for additional profits. In 1869, the first transcontinental railroad was completed. Brands notes that “the capitalists commanding the road recruited the institutions of government to share the risk and costs of construction.” (1) In other words, the capitalist investors (not the workers) get the rewards while the taxpayers take on the risk. Capitalism might thus be called convenience by another name. To be sure, a political ideology came into play that was highly conducive to this arrangement.
By the Civil War, “(a)mong the Republicans, support for a Pacific railroad fitted a general belief that government could benefit the American people by helping American business.” (2) This was an early version of what is good for GM is good for America. The fallacy in this assertion is that what is good to a part is necessarily good for the whole. For example, a part benefits from exclusion (e.g., not paying for externalities), which is not in the interest of the whole.
In any case, the fashioning of the first transcontinental railroad during the Civil War involved Lincoln, Stanford (the Governor of California and a partner of the Central Pacific Railroad),
and the two railroads in some shady dealing and related conflicts of interest. Generally speaking, the capitalist capture of democratic government can be expected to spin off various unethical twisters.
Funding by the U.S. Government for the railroad would entice California, which might have adopted a pro-Confederate independence otherwise, to remain in the union. (3) It was also not lost on Lincoln that the western republic had gold. Accordingly, the new party adopted into its platform the plank of government financial assistance in the undertaking. Brands reports that “Californians’ brave talk of self-sufficiency suddenly ceased when they heard the Republican offer.” (4) For the plank to be converted into legislation favorable to California, as well as to the railroads, the remnants of democracy had to be overcome in the Congress. This required “the concerted efforts of small armies of lobbyists.” (5) This experience gave capitalists a “way in” to the halls of the national government, which they could exploit in the future. In other words, the Republican policy involved a shift in government with respect to the influence of capitalists. American government would never be the same.
Specifically, Durant’s Union Pacific Railroad bribed members of Congress. Not to be outdone, Theodore Judah brought shares of the Central Pacific Railroad to Congress to disperse as he saw fit. (6) The result was the Pacific Railway Act of 1862, which was essentially written by the railroads even though they had vested interests in the project. (7) The federal government would offer the railroads loans financed by 30 year bonds held by the taxpayers and grants of land. If the project failed, the certificates would be worthless.
To be sure, private capital markets could not attract investors willing to risk large sums on such a long-term (and risky) payoff. (8) The interest of the U.S. Government in integrating the union such that new western states would not follow the example of the Confederacy made it worthwhile to make up for the shortfall in those markets. The problem is that the precedent risked giving capitalists access to the Treasury—a new source of food for the new feeding machines. It is not as though the cats would have one taste of the tuna only to never come back for more. Once on the scent of the government money, the capitalists would surely follow up in the halls of Congress. The case was the same in California.
Leland Stanford (the namesake of Stanford University) was elected governor of California without having to reduce his participation in the Central Pacific. His brother Philip distributed gold coins to voters. As if there were no conflict of interest between his office and his business interests, he got the California legislature to contribute $15 million to get the transcontinental railroad started on the California end. (9) In general, the capitalist capture of democratic government makes use of the public’s proclivity to ignore conflicts of interest. This continued to be the case for Governor Stanford.
In July 1864, the Pacific Railway Act of 1862 was amended so the U.S. Government would bear most of the risk (giving up first lein) and the railroads would get even more from the government. Even though the railroads had written the original act, only with the amended act did the capitalists find the railroad to be “a most attractive investment.” (10) It was no concern to them that in 1864 the U.S. Government was nearly bankrupt on account of the war. Nor did the sacrifices being made on the battlefields in the wilderness intimate to the capitalists that they too should sacrifice so the U.S. Government could add more resources to the war effort. The matter was one solely of risk and profit calculations—the railroads leveraging the government until the investment was sufficiently sweetened for enough potential investors to come on board. Duty, or ethics more generally, does not compute in business terms. Business ethicists would be wise to remember this.
In any case, the U.S. Government would pay the railroads $48,000 per mile in the mountains and $32,000 per mile on the flat land away in the desert. The self-written terms not be enough for the Central Pacific railroad, Governor Stanford used California’s geologists to claim flat land as mountainous. With a difficult election approaching, Lincoln overruled his own secretary of the Interior in favor of his railroad allies in California. (11) Lincoln himself had been a railroad lawyer. The preserver of the union was inadvertently making the task more difficult for the U.S. Government by bowing to the new capitalist might at the expense of his own government. In other words, he was willing to acquiesce in the defrauding of his own government even when it was fighting a rebellion. Such is the allure of capitalists at the expense of public governance in the name of democracy.
Lest this information on Lincoln be deemed as counter-productive by Lincoln fans, pointing out the president’s faults makes him “all the more beloved because they discourage us from turning him into a plaster saint. His greatness, without the flaws, would make him unapproachable and remote — a canonization made even more probable by his martyrdom.” (12) Made human, all too human in fact, Lincoln can stand for us as a marker on the trajectory of capitalism over democracy that occurred during the nineteenth century.
Speaking on the capitalist inroads in democratic government already by the end of the Civil War, Rep. Elihu Washburne, interestingly a Republican lawyer from Illinois and the chairman of the U.S. House Commerce Committee, said, “I have no faith in the noisy patriotism of shoddy contractors and none in the men who in these times of trial and tribulation through which the country is passing are scheming and plotting to fill their own pockets while the nation is verging toward bankruptcy. The sublime and unselfish patriotism of our people, . . . a people suffering, bleeding, dying for their country, is in magnificent contrast to the flaunting counterfeit everywhere to be seen.” (13) Worse still were those contractors who had paid gold coins to gain public office only to engage their government in the service of their capitalist ventures. Of the “flaunting counterfeits” who would avoid government office, the richest would become the robber barons of the Gilded Age. Government would be theirs for the taking, such that holding office would no longer be necessary.
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1. Henry W. Brands, American Colossus: The Triumph of Capitalism 1865-1900 (New York: Doubleday, 2010), p. 40.
2. Ibid., p. 42.
3. Ibid.
4. Ibid.
5. Ibid.
6. Ibid., p. 44.
7. Ibid., 48.
8. Ibid., p. 45.
9. Ibid., p. 47.
10. Ibid., p. 49.
11. Ibid., p. 49.
12. Ross Baker, “Lincoln—Like All of Us—Had his Flaws,” USA Today, April 10, 2011 (on-line).
13. Congressional Globe, 38th Congress, 1st session. June 21, 1864, 3150-152. Quoted by Brands, American Collosus, p. 48.
Monday, April 4, 2011
Exfoliating a Hero: On Lincoln's Unconstitutional Overreaching
0 comments Posted by Find Insurance Online at 1:01 PMLest we get carried away and inadvertantly enshrine our leaders with mythic laurals, it is worthwhile to peel back our societal "remembering" of past figures, such as Abraham Lincoln, who have become larger than life.
Lincoln was a moderate, promising merely not to spread slavery. In his address after being sworn in, he promised not to go after slavery where it existed. Accordingly, radical abolitionists complained. Even so, the 1860 campaign had been viewed, at least in the south, as a referendum on the southern way of life. Lincoln received only 40% of the vote; he was not even on the ballot in ten states. There were just 33 states in the union at the time. Lincoln's victory suffered from a deficit of legitimacy in some quarters. In fact,he was burned in effigy at a state capitol in the south. With free Kansas becoming a state, the slave states felt that their respective abilities to defend their way of life in the general councils of the union would become even more truncated or dilute. Berift of a sense of influence on general matters that concerned themselves, the confederating republics felt they had no alternative other than secession.
Lincoln was a moderate, promising merely not to spread slavery. In his address after being sworn in, he promised not to go after slavery where it existed. Accordingly, radical abolitionists complained. Even so, the 1860 campaign had been viewed, at least in the south, as a referendum on the southern way of life. Lincoln received only 40% of the vote; he was not even on the ballot in ten states. There were just 33 states in the union at the time. Lincoln's victory suffered from a deficit of legitimacy in some quarters. In fact,he was burned in effigy at a state capitol in the south. With free Kansas becoming a state, the slave states felt that their respective abilities to defend their way of life in the general councils of the union would become even more truncated or dilute. Berift of a sense of influence on general matters that concerned themselves, the confederating republics felt they had no alternative other than secession.
On Feb 18, 1861, Jefferson Davis became President of the Confederate States of America. At his swearing in, Dixie, which had been composed by a northerner, was played. The two sides in the continental dispute were closer than they perhaps realized. Both Lincoln and Davis, for example, were from Kentucky originally. According to the Confederate constitution, Davis had a line item veto and would have had a six year term had the confederacy lasted that long. Astonishingly, international slave trading was outlawed. Even so, there were fundamental differences involved in the dispute. Ironically, had the southern states freed the slaves before firing on Fort Sumpter--depriving Lincoln of his motivational tactic midway through the way--perhaps something resembling the southern way of life in a loose confederacy would have prevailed. The United States would have been left to consolidate to its heart's content.
On the way to his inauguration, Lincoln declared that he would rather be assassinated than to see even one star removed from the flag. Such a stance reflects the "all or none" mentality that accompanies political consolidation. In spite of Lincoln's line in the sand, the War between the Confederated States and the United States began at 4:30am on April 12, 1861. Technically, it was a war between a federated alliance and a federal government. The opening act was bloodless, even as the war to come was the bloodiest in American history. Siloh alone matched the casualties at Waterloo, and there would be 27 more to come. 51,000 men lost their lives in the three days at Gettysburg alone. The contest between the old and new federal forms exacted a heavy toll in human loss and suffering. Who would have thought that contending distinctions in political theory could be so bloody. Of course, might does not in itself make right, although the passion of the unjustly oppressed can bring about victories disproportionate to the relative lack in number. Furthermore, in this particular case, the respective populations in the federations and the industrialization of several of the union's states gave the forces of modern federalism an advantage not necessarily sourced in the nature of the type.
At the time, the union states had a combined population of 21 million while the confederacy had only 9 million, 4 million of which were slaves and thus not in the fight. In spite of the fact that so many southerners volunteered to enlist that a third of them had to be sent back home, the confederacy was perhaps destined to lose the bellum given the tremendous disadvantage in terms of population. That the conflict lasted until 1865 may point to the extent of resentment that had been allowed to build up throughout the slave states against what was viewed there as an “intrusive” federal government. For example, the devisive tarriff that had nearly caused South Carolina to secede in 1832 was reimposed by the U.S. Government in 1858. As in 1832, the tax was to finance northern industrialization. The states producing cotton and/or rice were left not being able to defend their interests in Washington. Accordingly, that distant government was viewed as encroaching and increasingly foreign. The root of the festering dispute went far beyond the issue of slavery.
To the confederate citizens, the cause involved the rights of their republics as well as their property rights. Slaves, being viewed as property by their "masters"--a decadent conception of slavery unknown to ancient understandings--were thus in play as part of the wider and deeper southern concern with self-determination, which the southerners identified with their respective countries and associated ways of life. Even Lincoln's Emancipation Proclamation, which took effect on January 1, 1863 (almost two years into the war), applied only to slaves in the states that had already left the union (rather than to the five slave states that had remained).
The confederate states were not subject to U.S. law as long as they were part of the confederacy rather than the union. Lincoln's proclamation was thus extra-constitutional, and thus without immediate effect other than to motivate an increasingly weary northern citizenry and armed forces. To be sure, Sherman freed slaves as he blazed a trail to the sea. However, even without the proclamation, he would have deprived the confederates of their "property" along with their other means until they surrendered. Slavery was not outlawed in the United States until 1865, when the thirteenth amendment was ratified by the states (the former confederate states excluded even though they had been re-afixed to the union). There was some duplicity involved in, "Welcome back to the union! But unfortunately your vote doesn't count yet because you don't agree."
Fundamentally, the "north" and "south" interpreted the United States differently. This is what the war was really about, and the issue went all the way back to the contentious debates in the constitutional convention in 1787. The delegates had hotly debated whether the proposed General Government would consolidate power via "general welfare" spending and the potentially unlimited taxation, irrespective of the question of slavery. The people who wanted to secede viewed the U.S. as more like a confederation than a modern federal government. That is, confederates viewed their states as countries and the U.S. more as an alliance having only strictly defined enumerated powers that a national government. Robert E. Lee, for example, was offered command of the union army. He refused and went with Virginia. He could not draw his sword, he said, against his native country. Virginia had to come first; there was never any question about that. Such a view of Virginia and the other republics was to fade even as they still retained residual sovereignty at least into the twenty-first century.
At the time, the union states had a combined population of 21 million while the confederacy had only 9 million, 4 million of which were slaves and thus not in the fight. In spite of the fact that so many southerners volunteered to enlist that a third of them had to be sent back home, the confederacy was perhaps destined to lose the bellum given the tremendous disadvantage in terms of population. That the conflict lasted until 1865 may point to the extent of resentment that had been allowed to build up throughout the slave states against what was viewed there as an “intrusive” federal government. For example, the devisive tarriff that had nearly caused South Carolina to secede in 1832 was reimposed by the U.S. Government in 1858. As in 1832, the tax was to finance northern industrialization. The states producing cotton and/or rice were left not being able to defend their interests in Washington. Accordingly, that distant government was viewed as encroaching and increasingly foreign. The root of the festering dispute went far beyond the issue of slavery.
To the confederate citizens, the cause involved the rights of their republics as well as their property rights. Slaves, being viewed as property by their "masters"--a decadent conception of slavery unknown to ancient understandings--were thus in play as part of the wider and deeper southern concern with self-determination, which the southerners identified with their respective countries and associated ways of life. Even Lincoln's Emancipation Proclamation, which took effect on January 1, 1863 (almost two years into the war), applied only to slaves in the states that had already left the union (rather than to the five slave states that had remained).
The confederate states were not subject to U.S. law as long as they were part of the confederacy rather than the union. Lincoln's proclamation was thus extra-constitutional, and thus without immediate effect other than to motivate an increasingly weary northern citizenry and armed forces. To be sure, Sherman freed slaves as he blazed a trail to the sea. However, even without the proclamation, he would have deprived the confederates of their "property" along with their other means until they surrendered. Slavery was not outlawed in the United States until 1865, when the thirteenth amendment was ratified by the states (the former confederate states excluded even though they had been re-afixed to the union). There was some duplicity involved in, "Welcome back to the union! But unfortunately your vote doesn't count yet because you don't agree."
Fundamentally, the "north" and "south" interpreted the United States differently. This is what the war was really about, and the issue went all the way back to the contentious debates in the constitutional convention in 1787. The delegates had hotly debated whether the proposed General Government would consolidate power via "general welfare" spending and the potentially unlimited taxation, irrespective of the question of slavery. The people who wanted to secede viewed the U.S. as more like a confederation than a modern federal government. That is, confederates viewed their states as countries and the U.S. more as an alliance having only strictly defined enumerated powers that a national government. Robert E. Lee, for example, was offered command of the union army. He refused and went with Virginia. He could not draw his sword, he said, against his native country. Virginia had to come first; there was never any question about that. Such a view of Virginia and the other republics was to fade even as they still retained residual sovereignty at least into the twenty-first century.
In general, the southerners feared that the federal government would usurp more and more power from their countries; as things turned out, the fear was not without foundation. Even then, Lincoln declared war against the confederated states even though the U.S. constitution clearly stipulates that Congress is the governmental body in the U.S. Government that declares war. As the president is the commander in chief, there is a conflict of interest in that office also declaring war. So technically speaking, the war was not constitutional, and thus legal. Lincoln also suspended habeus corpus, though the constitution allows for this in time of rebellion. To keep the Maryland from seceding, he locked up thirteen of the state's legislators without trial.
Chief Justice Taney, who had four years earlier concurred with the Dred Scott decision, said that Lincoln had gone too far beyond the constitution in the powers he was exercising. Taney was on firm ground on the declaration of war. Even so, astonishingly, the president simply ignored the chief justice. From the standpoint of an independent judiciary with teeth, Lincoln was laying a precedent very dangerous to the republic.
Because the judiciary has no means of enforcing its decisions by force, the branch depends on the other branches, and, indeed, the people, resisting the temptation to contravene a judicial decision. The basis of the resisted temptation rests on the court's legitimacy, for the judiciary has no troops of its own. In fact, Bickel refers to the court as the “least dangerous branch” for this reason. Lincoln’s precedent in simply ignoring the court put at risk the system of checks and balances that resides in the separation of powers in the federal government. Fortunately for us, Lincoln’s treatment of the Chief Justice's effort to hold the executive branch within its proper constitutional sphere, as though Taney were a mere bystander, has largely been forgotten. Yet the expediency of an imperial presidency has indeed been on display since Lincoln as Congress has gradually lost power to the commander in chief. The danger is real, and Lincoln's precedent could yet be used by an ambitious commander in chief who has his or her eye on another country to invade.
Ironically, Lincoln’s unconstitutional actions at the beginning of the war ironically to save the union could be viewed as confirming the charges made by the confederates against the encroaching nature of the federal government. Lest we miss the lesson as we remember the bloody war 150 years later in 2011-2015 from the standpoint of the victors, we might take note of the susceptibility of power itself to consolidate, ultimately in one person—indeed, even in a hero. The consolidating proclivity is as much a danger in the modern American empire today as it was in ancient Rome.
Ironically, Lincoln’s unconstitutional actions at the beginning of the war ironically to save the union could be viewed as confirming the charges made by the confederates against the encroaching nature of the federal government. Lest we miss the lesson as we remember the bloody war 150 years later in 2011-2015 from the standpoint of the victors, we might take note of the susceptibility of power itself to consolidate, ultimately in one person—indeed, even in a hero. The consolidating proclivity is as much a danger in the modern American empire today as it was in ancient Rome.
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Source: Ken Burns’ The Civil War (PBS)
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