America was never guaranteed to survive this long. Indeed, many of the founders wondered if this nation would survive its infancy. There were so many deep disagreements, especially between North and South, that people wondered whether the nation could hold itself together after the immediate concern of defeating the British had passed. But America did endure, and not only that, Americans have thrived. But why did America thrive? Given the considerable debate currently about economic theories and which way to go from here, The Dispatch takes a moment to consider why America has flourished.
With a few exceptions in history, whether the government or even the theory behind a form of government actually considered the economic well-being of the ordinary person depended greatly on the magnanimity of the person or persons vested with political power. Often, rulers intentionally limited the economic prospects of average members of society, forcing dependence so as to maintain their hold on arbitrary political power. Kings, emperors, potentates, feudal lords—when those who have amassed incredible power actually care about the plight of those less fortunate than themselves, it not only represents rare charity in the all-powerful but reflects an instinct that pushes against the very basis of their power.
It is a well-documented fact that the rise of free-market economics led to the "hockey stick of growth" that is so often discussed among economists, such as professor Don Boudreaux of George Mason University. But rarely do people take the time to consider the underlying political realities that allowed free-market economics to come into being. What political systems jive well with free markets? What are the core aspects of these political systems? Are there any specific political features of such systems that lead directly to open and free market realities?
The answers to such questions begin all the way back with Aristotle. Now, Aristotle did not necessarily care directly for the plight of the less fortunate, at least not in his writings on government. But he did consider greatly how certain forms of government led to economic disparity and, therefore, political upheaval. For example, in his Politics, he observed that aristocracies tended to serve only the interests of the wealthy, eventually leading to populist revolt, and that democracy tended to become a lever utilized by the underprivileged classes to redistribute wealth from the rich, eventually leading to either chaos, tyranny, or elitist coup. Aristotle's solution to this, among many other concerns, was a form of government he called a polity, a contractual form of mixed government that sought to establish the strengths of different models (monarchy, aristocracy, democracy, etc.) while avoiding their weaknesses. One might call this the theoretical birth of constitutionalism.
Fast-forward to the British Isles in the 17th and 18th centuries, the cradle of free-market economics, and what emerges? A form of constitutionalism that, whether by Lockean reason or Burkean prescription (perhaps a fair amount of both), looks stunningly similar to Aristotle's polity: a mixed system of competing yet complementary parliamentary sovereignty and royal prerogative that identified and respected fundamental rights of ordinary people. English subjects, especially after the Glorious Revolution, understood themselves as belonging to a contractual form of social and political organization. They had rights; the levers of power were divided and leveraged; and the growing British Empire benefited from the positive aspects of monarchy, aristocracy, and democracy while only occasionally being beset by their negative aspects. It was amid this fertile ground of English constitutionalism that early notions of free-market principles began to grow and eventually came to blossom.
But it was America that took the next step toward unleashing the potential of the free market, as spontaneous and free economic forces were given full rein by the policy of salutary neglect. England's colonial settlers in the New World maintained a strong sense of England's unwritten constitutionalism, but they went even further, establishing a new tradition of written constitutionalism. From the 17th-century examples of the Mayflower Compact, the Fundamental Orders of Connecticut, and the Rhode Island Charter to the prerevolutionary Albany Plan of Union and Articles of Association, to those made amid revolution such as the Declaration of Independence, the Articles of Confederation, early state constitutions, and then to the crowning jewel of the U.S. Constitution itself, written agreements, contracts, compacts, and constitutions developed into the bedrock norm for social and political organization in England's 13 American colonies and then the first 13 states.
A major consequence of the American Revolution was the preservation of the free-market realities engendered by the long tradition of salutary neglect, threatened by the remnants of England’s monarchical leviathan. The American colonists proved to be an exception to English constitutionalism, having no direct representation in Parliament and being at the whim of royal prerogative as a colonial venture under the executive authority of foreign policy. The colonies ended up being outside English polity and thus subject to the whims of mercantilism rather than allowed to continue prospering under the spontaneous capitalism of the mother country. And so, the people revolted.
And not only did the American patriots revolt, but when their attempt to reestablish the conditions of prewar colonial America through the Articles of Confederation failed, they responded by furthering the development of constitutional governance. American constitutionalism improved on English constitutionalism by stripping away the royal prerogative and dismissing parliamentary sovereignty, instead establishing the basis of government strictly on the sovereignty of the people. It delegated authority and power vertically by dividing power between the states and the federal government, as well as horizontally between different branches of government. This established a new form of mixed government that brought out the benefits of monarchy, aristocracy, and democracy even more while further subduing their disadvantages.
And what was the economic result? A flowering of economic prosperity unrivaled in human history.
This story was produced by The Dispatch and reviewed and distributed by Stacker.
