I recently finished Gabriel Kolko’s Triumph of Conservatism and Charles Kesler’s I Am the Change: Barack Obama and the Crisis of Liberalism. I’ll have more to say about those books later, but I wanted to comment on something that became very clear to me upon reading them.
By way of brief summary, Kolko’s thesis is that the Progressive movement, at least from 1900 to the beginning of World War I, was actually conservative in its economic policy. In the wake of the transportation and communication revolutions of the new century, large firms–in the steel, oil, cattle, and banking industries, to name just a few–were desperate for Washington to centralize power to itself in order to facilitate growth, eliminate small and mid-size competitors, escape local controls, and safeguard control over their respective markets. Despite repeated attempts in the private sphere, the large firms were unable to achieve monopolies and hegemony in the marketplace. Thus, they turned to the federal government. TR, for all his trustbusting notoriety, was all too happy to oblige, as were Taft and Wilson after him.
In addition to technological progress, Kolko claims that what facilitated this economic revolution was the lack of an alternative school of thought. Austrian economics, the basis of modern libertarian political theory, wouldn’t reach a critical mass until later in the century. As Kesler points out, by the time the political ideologies as we now know them would arrive, FDR had put economic protectionism on steroids, rebranded the conservative Progressive movement as modern “liberalism,” and forced proponents of liberty to qualify themselves as “classical” liberals.
Today, classical liberals are accused of trying to “return” us to a laissez faire economy of 100 years ago (which, as Kolko shows, did not exist), which left FDR with no choice but to centralize control in an all-powerful national government (a project that, as Kolko shows, had begun at least three decades earlier).
The reality is that free markets have never been attempted in the modern U.S. Instead, we have always fumbled with clumsy regulations written largely by the very industries they mean to regulate. TR, Taft, and Wilson each admitted they didn’t understand how banking worked, and their administrations let the banking industry write their own rules. But this has been tolerated because, for at least the last 100 years, stability has trumped liberty. Transparency, arms’ length dealings, fairness, these too are unimportant compared to economic stability.
What struck me is this: If the reason this economic “conservatism” exists is because there was no viable alternative when it was first rolled out, surely there is an alternative now. Hayek, Friedman, and Von Mises, and hordes of free market economists and political theorists, make a compelling case for a classical liberalism that has yet to be tried. It promises a liberty that none of us have seen in our lifetimes. Sure, it also entails some discomfort, some insecurity as the creative destruction process plays out. But it also promises an end to the political capitalism that the left and the right both abhor. It promises prosperity. And it promises fairness.
So what say you? Are you in favor of decentralization? Or are you conservative?