Brexit Through The Eyes of Jefferson and Hamilton

I’m working my way through the excellent John Ferling book “Jefferson and Hamilton: The Rivalry That Forged a Nation” which devotes tens of pages of ink to Alexander Hamilton and Thomas Jefferson’s differences on the economic relationship between the working man and his government.

Hamilton loved the rise of American cities which could harness efficiency through large markets. Want to become a dentist? Do it in a city with 100,000 rather than 1,000 because there are a million more cavities for you to fill. Want to build up factory resources? Same premise, do it where adding 200 workers only requires you to find .2% rather than 20% of the population. Ease of scalability is the proven formula for improving living standards dramatically within a generation.

Meanwhile, Jefferson had his mind on the yeomen farmers that would be displaced by the rise of centralized industrialization. The consolidation of power and resources was fine and dandy if you had the skill and ambition to access a piece of the pie, but was quicksand otherwise. If you were cemented in your community, and decades settled into your skills, you would sit idly by as the rest of your countrymen got richer. It didn’t help when the ones that were passing you by were younger and adopting a smug sense of elitist superiority over you, as if being in the right place and bringing the right natural talent into the universe were a meritorious accomplishment.

People act like the Brexit debate is something new. It’s not. It’s the age old question: Do you pursue any strategy that maximizes societal wealth–naked utilitarianism–without any concern for the tradeoffs? And if not, which trade-offs are acceptable? Why should someone in the English countryside have the ability to stifle, in any way, the ambitions of a London businessman that is trying to get car parts from Germany at a good price? Is maximum wealth as good as it sounds when the grievance process involves reaching out to far-away bureaucrats that only have the interests of the collective in mind when making decisions? What remedies should be pursued when the workers’ displacement rate gets too high?

Consider this lengthy quote from Ferling’s work:

In manufacturing societies, only those at the top of the economic structure were truly independent and more or less in control of their destiny. The political system likely to evolve in such societies would be little different from those in monarchical kingdoms. In both, a “heavy-handed” executive would manage affairs on behalf of the oligarchy. The ruling elite would harbor an “unfeeling” fear and scorn for the great mass of the citizenry, “rendered desperate by poverty and wretchedness.”

But a rural society in which the freeman were property-owning farmers stood in stark contrast to the “degeneracy” and “canker” of a manufacturing society. Whereas freedom could not long exist in a manufacturing world, not only did liberty survive among yeomen, but farming in fact kept “alive that sacred fire” of individualism, personal independence, and liberty.

For Jefferson, the American Revolution had been about resisting the expansive, exploitative encroachments of a degenerate monarchical and oligarchical Great Britain, and erecting in independent American a republican system that safeguarded against those things that led to “corruption and tyranny.” He was convinced that the best means of preserving republicanism- of “keeping the wolf out of the fold”- was through nearly universal property ownership within an agrarian state.

There can be little doubt that the English fiscal structure provided the model for Hamilton’s economic plans. Several things in his experience and way of thinking drew him to the English example, but his views on human nature were crucial. His conviction that humankind was driven by ambition, cupidity, and an insatiable lust for preeminence led him to wish to equip America not just with the means of surviving in a heartless world but also with the capability of cutting a figure in that world. For this, Hamilton understood perfectly the need for ready wealth.

Moreover, his conviction that people were driven primarily by their self-centered pursuit of private interests led him to seek the means of controlling humankind’s selfish propensities, lest society unravel in the face of self-absorbed avarice. He was convinced that social stability required the presence of a strong central government dominated by those at the top of a hierarchical society.

Hamilton’s view was also shaped by the fact that his world was the commercial world… He saw that as commerce flourished, opportunities arose for others, so that in time they and their descendants could rise socially and economically. And he believed that it was not just the wealth generated by trade that made a commercial society commendable… Hamilton was persuaded that commercial societies produced a philanthropic, sociable, knowledgeable, enterprising people habituated to a useful work ethic.

An urbanite to the core, Hamilton saw that commerce nourished cities, and cities in turn brought people together where they intermingle in productive ways. Cities were incubators of consumerism, the arts, education, inventiveness, and enlightened thinking… Unlike Jefferson, Hamilton was not one to see cities as blights on humanity or to eulogize yeomen.


Originally posted 2016-06-25 23:59:47.

Like this general content? Join The Conservative Income Investor on Patreon for discussion of specific stocks!