Those who are interested in American history can find some incredibly fascinating historical roots embedded in both the “bailout” (or so called “recovery” or “rescue”) package now evolving and bumping through Congress — and in Americans’ reactions to it.
No, this is not about the financial or economic aspects of the legislation; that has been discussed in great detail. Rather, it is about the deep emotional, traditional and uniquely American facets of the plan and people’s reactions to it.
On one hand we have the powerful concept of Americans’ feelings about “self-reliance.” Ever since Ralph Waldo Emerson wrote his famous thesis by the same name, Americans have thought of themselves as having that independent quality. Thus, conservative Republicans oppose the bailout on these grounds, along with their corollary of a free-market system that tells us “leave the market alone, and it will right itself.” In short, stay out of our business.
Values shaped in the West
Extending this idea are the many historians who have written extensively about the settling of the West in America, and the strong strain of “individualism” it engendered. In addition, Americans have a deep distrust of government in general, likely going back to colonial times. It’s part of a constellation of admired values that include self-reliance, rugged lifestyle, self-protection, laissez faire and “stay out of our business.”
These concepts/values have been strong influences in American history (but conveniently ignore the fact that a lot of the West was settled by the Federal Homestead Act, which gave the settlers land for pennies on the acre; that the government defended them with federal troops when needed — and later built federal dams and reclamation to help them manage). Nevertheless, the tradition has raised its head again in the bailout negotiations: Stay out of our business; stay out of our lives.
Concern for the victims
Liberals, on the other hand, have historical references to point to in support of their position to add more benefits to the “victims” (my term) of the financial fiasco as opposed to the corporations. In regard to property rights versus individual rights, certainly Thomas Jefferson would be their leading advocate. Among Jefferson’s more famous quotes on the subject was this:
“Societies that gave undue emphasis to protection of property could infringe on the people’s rights of life, liberty, and happiness.” According to Jefferson: “Whenever there is, in any country, uncultivated lands and unemployed poor, it is clear that the laws of property have been so extended as to violate.”
And Benjamin Franklin noted: “Hence, the public has the rights of regulating Descents, and all other Conveyances of Property, and even of limiting the quantity and uses of it. All the property that is necessary to a man is his natural Right, which none may justly deprive him of, but all Property superfluous to such Purposes is the property of the Public who, by their Laws have created it and who may, by other Laws dispose of it.”
Thus, the Democrats, who have less compunction in allowing government to regulate commerce, seem to allow themselves to support a plan that rewards corporate America, so long as it benefits the “people” as well. A much easier philosophical leap for them (as evidenced by their proportionate votes).
Suspicion toward East Coast financiers
Another historical force involved in the bailout package is the traditional American suspicion of East Coast financiers. Again, going to the settling of the West, as Americans developed new lands, they became increasingly suspicious — indeed hostile — to those East coast elite who benefited richly from financial manipulations. And while some of this resentment was geographical (again West vs. East), some was based on the increasing maldistribution of wealth in the country — ending with the super-rich financial barons of the late 19th and early 20th centuries.
This resentment was not hard to fire up — it actually had roots in the “moneychangers” in the Bible. So we see it again today in the language of the bailout with constant references to “greedy Wall Street executives.” Ironically, they are “greedy” because unfettered capitalism historically has had a bad habit of making the rich (much) richer — a trend that has continued for enough years now to have made it apparent before a crisis made us revisit the issue.
An ebb and flow over our history
Embedded in the bailout discussions is the ebb and flow of American’s concept of capitalism, which has vacillated so frequently over our history. The free rein of the robber barons was a mantra of our capitalistic society, until Teddy Roosevelt stopped its abuse. Laissez faire economics came back in vogue during the Reagan years, with Milton Friedman’s Chicago School of Economics: i.e. only in a totally free market can capitalism reach it proper potential. American capitalism (as opposed to more regulated European capitalistic systems) resents oversight because oversight goes against the deep traditions of our early years of individualism and keeping government out of our lives, as previously noted.
Now that precise debate has again bubbled up to the top of our national dialog. Having said that, there is an old maxim that corporations are capitalists in good times and socialists when they are in trouble. How perceptive. That maxim has come home to roost at this time and this place!
So, while this current drama appears to be about economics, in reality it has its basis in deeply rooted philosophical and social aspects of American history. It is less about money, golden parachutes, mortgages and bailouts than it is a debate on American historical perspectives. And that is what makes it so interesting, as well as crucial — it is a mosaic of history, ideology, traditions and long-held American values.
Myles Spicer of Minnetonka is a businessman and writer who owned several successful ad agencies over the past 45 years.
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