“Progressive” is often a word
we hear bandied about to describe very destructive things.
It’s
“progressive,” for example, to believe taking responsibility for your
individual thoughts, words and actions is a fool’s errand. When taken to its
extreme, as it often is, many self-described progressives believe you are
responsible for the actions, past and present, of your “group” — and such
group, whether you like it or not, is decided for you without your input.
And
based on what group you are in, you are more responsible for some things and
less responsible for others.
So,
says the uber-progressive, your individual actions don’t matter. The core of
your being is morally relative. You are defined not by your peers, principles
and actions — but by the things you can’t possibly choose. You are judged,
rather, by those things outside of your control and those judgments are based
on the whims of trendsetters, glitterati and pseudo-experts.
Filmmaker Neel Kolhatkar did a
brilliant video about this strange paradigm called Modern Educayshun. Check it out if you haven’t
seen it.
It’s
also “progressive” to believe only elite academics or politicians — those
people, as it happens, with the least skin in the game —
are capable of saving the environment, the poor, the abused and the downtrodden
from themselves.
If only they had more money. If
only they could go deeper and deeper and deeper into debt. If only the masses
would just get on their knees like good little docile sheep and wisely accept
their theories as unvarnished truth. If only they would get “educated.”
(Another word that’s been corrupted beyond belief.)
If only. Then, we could make
real progress.
Which
is why, naturally, the progressive movement is responsible for not just the
centralized power structures we behold today — but also for the biggest
“vampire squid” (hat tip to Matt Taibbi) of them all… the Federal Reserve.
To
explain, we pull a chapter from Murray Rothbard’s enlightening book, The Origins of the Federal
Reserve.
Read
on.
The Progressive Movement
Murray Rothbard, The Origins of
the Federal Reserve
The Federal Reserve Act of
December 23, 1913, was part and parcel of the wave of Progressive legislation,
on local, state, and federal levels of government, that began about 1900.
Progressivism was a bipartisan movement which, in the course of the fi rst two
decades of the twentieth century, transformed the American economy and society
from one of roughly laissez-faire to one of centralized statism.
Until
the 1960s, historians had established the myth that Progressivism was a virtual
uprising of workers and farmers who, guided by a new generation of altruistic
experts and intellectuals, surmounted fierce big business opposition in order
to curb, regulate, and control what had been a system of accelerating monopoly
in the late nineteenth century. A generation of research and scholarship,
however, has now exploded that myth for all parts of the American polity, and
it has become all too clear that the truth is the reverse of this well-worn
fable.
In contrast, what actually
happened was that business became increasingly competitive during the late
nineteenth century, and that various big-business interests, led by the
powerful financial house of J.P. Morgan and Company, had tried desperately to
establish successful cartels on the free market.
The
first wave of such cartels was in the first large-scale business, railroads,
and in every case, the attempt to increase profits, by cutting sales with a
quota system and thereby to raise prices or rates, collapsed quickly from
internal competition within the cartel and from external competition by new
competitors eager to undercut the cartel.
During
the 1890s, in the new field of large-scale industrial corporations,
big-business interests tried to establish high prices and reduced production
via mergers, and again, in every case, the mergers collapsed from the winds of
new competition.
In both
sets of cartel attempts, J.P. Morgan and Company had taken the lead, and in
both sets of cases, the market, hampered though it was by high protective
tariff walls, managed to nullify these attempts at voluntary cartelization. It
then became clear to these big-business interests that the only way to
establish a cartelized economy, an economy that would ensure their continued
economic dominance and high profits, would be to use the powers of government to
establish and maintain cartels by coercion. In other words, to transform the
economy from roughly laissez-faire to centralized and coordinated statism.
But how could the American
people, steeped in a long tradition of fierce opposition to government imposed
monopoly, go along with this program? How could the public’s consent to the New
Order be engineered?
Fortunately
for the cartelists, a solution to this vexing problem lay at hand. Monopoly
could be put over in the name of opposition to monopoly! In that way, using the
rhetoric beloved by Americans, the form of the political economy could be
maintained, while the content could be totally reversed.
Monopoly
had always been defined, in the popular parlance and among economists, as
“grants of exclusive privilege” by the government. It was now simply redefined
as “big business” or business competitive practices, such as price-cutting, so
that regulatory commissions, from the Interstate Commerce Commission to the
Federal Trade Commission to state insurance commissions, were lobbied for and
staffed by big-business men from the regulated industry, all done in the name
of curbing “big business monopoly” on the free market.
In that
way, the regulatory commissions could subsidize, restrict, and cartelize in the
name of “opposing monopoly,” as well as promoting the general welfare and
national security. Once again, it was railroad monopoly that paved the way.
For
this intellectual shell game, the cartelists needed the support of the nation’s
intellectuals, the class of professional opinion molders in society. The
Morgans needed a smoke screen of ideology, setting forth the rationale and the
apologetics for the New Order. Again, fortunately for them, the intellectuals
were ready and eager for the new alliance.
The enormous growth of
intellectuals, academics, social scientists, technocrats, engineers, social
workers, physicians, and occupational “guilds” of all types in the late
nineteenth century led most of these groups to organize for a far greater share
of the pie than they could possibly achieve on the free market.
These
intellectuals needed the State to license, restrict, and cartelize their
occupations, so as to raise the incomes for the fortunate people already in
these fields. In return for their serving as apologists for the new statism,
the State was prepared to offer not only cartelized occupations, but also ever
increasing and cushier jobs in the bureaucracy to plan and propagandize for the
newly statized society.
And the
intellectuals were ready for it, having learned in graduate schools in Germany
the glories of statism and organicist socialism, of a harmonious “middle way”
between dog-eat-dog laissez-faire on the one hand and proletarian Marxism on
the other.
Instead, big government,
staffed by intellectuals and technocrats, steered by big business and aided by
unions organizing a subservient labor force, would impose a cooperative
commonwealth for the alleged benefit of all.
