Is American Liberty in Decline?

Max J. Skidmore
Political Science
University of Missouri-Kansas City

It was with mixed emotions that I saw in The Montana Professor an article, "American Liberty in Decline, 1865-2000: The Progressive Substitution of State Coercion for Individual Cooperation," by one James Rolph Edwards, who teaches economics at Montana State University-Northern./1/ It is always interesting, of course, for an author to see that someone has taken his work sufficiently seriously to go to the trouble to prepare a reply, and the article at issue purported to be a response to one that I had published previously, also in this journal./2/ I say "purported," because when I read the article, I discovered it to be hardly more than a diatribe that was founded upon little more than the author's need to expound his own fervently held views.

Foremost among those views is that programs of income transfer, such as social security, and all other government actions--except those Mr. Edwards describes as "negative"--destroy human liberty. Only during the time in which he assumes America had an entirely "negative" government does he think its citizens were free. It is difficult to believe that anyone familiar with American history could argue that factory workers of the late nineteenth or early twentieth centuries had more liberty than their counterparts today, and only the most tormented reasoning could lead one to conclude, for example, that a pregnant rape victim at the end of the twentieth century who wished not to give birth to the rapist's child had less freedom at the century's end than she would have had at its beginning.

"American Liberty" describes any governmental action its author favors (police protection, copyright protection, national defense, money[!], etc.) as "negative." Any action he abhors (unemployment compensation, health and safety regulation, Social Security, and the like) he considers to be inappropriately "positive" government. Things become muddled, however, and in some instances it is impossible to tell whether the author's reasoning is muddled or devious. He decries coercion, for example, but then tries to support his argument by referring only to "physical" coercion; similarly, he criticizes government land grants, but then tries to support his argument by referring only to "federal" grants. Let us be charitable and assume that what we examine must be muddled thinking.

A court ruling (even by notoriously anti-Clinton U. S. District Judge Royce Lamberth) holding President Clinton guilty of a misdemeanor is proof positive that Clinton tried to "intimidate and abuse" his opponents; a court ruling that Microsoft acted illegally, on the other hand, is clearly an outrageous abuse of government power that came about only as a result of unjustified complaints from "less efficient" competitors./3/ In the Clinton case, the author was unable to resist providing a gratuitous footnote (note 45) that had nothing to do with his argument. In it, he sniffed about Clinton's inappropriate personal conduct (though conceding, grudgingly, that numerous charges of sexual abuse and rape "have yet" to be proved) but raged that Clinton had been proven to "intimidate and abuse" his opponents systematically. That proof? Clinton attempted to protect himself by releasing exculpatory letters to him from a woman who alleged that he made advances toward her. One might have expected a laissez-faire ideologue to be outraged at the decision--the letters were Clinton's "property" after all, he had been acting as a private citizen, and surely the accused has the right of self-defense. But no, it was appropriate in this instance for the government to exercise its power and levy a fine because--as the footnote puts it--the letters were "embarrassing to her." Indeed they must have been.

Here we have an instance of what must literally be compassionate conservatism. One doubts, though, that our conservative's compassion extended to Anita Hill, who no doubt also was "embarrassed"--even though the author of the most brutal attack upon her now has recanted and has conceded that his charges against her were false. There may have been abuse of government power in the Willey situation, but they were not Clinton's futile attempts at self-defense.

Another example of the positive/negative muddle is the author's attitude toward schooling. He harbors enormous antipathy to public schools ("government K-12 schools nearly everyone's children must attend," he calls them on page 19), which is to be expected in view of his general attitude toward governmental services. Public schools must therefore be a reflection of "positive" government. At the very end of his article, though, he lavishes praise upon school vouchers. By causing "competition between public and private schools," they would "remove the statist liberal capacity to indoctrinate the young," that he so fears.

Vouchers, therefore, in his view must be a reflection of "negative" government, since only "negative" government is acceptable. Yet vouchers as obviously involve transfers of income as does any social welfare program. Moreover, he approves them even though they would be subsidies to private schools, despite his belief that subsidies--as well as income transfers in general--are inappropriate. Clearly, then, his definition of "negative" and "positive" as applied to a program reflects nothing other than his negative or positive attitude toward that program. Perhaps this explains how he could justify continuing to work in a "government" university.

My mixed emotions to "American Liberty in Decline" emerged as soon as I discovered that it really contained no reasoned response to my article; instead, it attributed to me positions that I did not take and used those fancied positions as an excuse to unleash a torrent of invective. I had become that dreaded creature, a "statist liberal," by which it meant one who thinks the state has some utility beyond that of the most negative. I plead guilty to harboring such a belief. Mea culpa.

I do not plead guilty, however, to the charge that motivates the venom directed my way from northern Montana. That is the nonsensical statement that I argued that individualism precludes cooperative action. Of course it does not, and of course I would never write that it does. The author worked himself virtually into an intellectual frenzy: "I utterly defy Skidmore to document this claim," he thundered--stinging me not only with defiance, but with utter defiance! Take that! "Who, among the intellectual advocates or practitioners [whatever he means by that] of individualism," he asks, "ever gave it this interpretation? Was it Locke, Turgot, Mill, Spencer, Sumner, Mises, Rand,...or Nozick? Did the ordinary people who thought of themselves as rugged individualists believe that, as such, they also had to be hermits, or at least eschew cooperative social interaction?"/4/

Well, I would assume they did not make such an assumption and would point out that nowhere did I say--or imply--that they did. If one reads either article carefully, it becomes clear that such a claim only appears in the fevered mind of "American Liberty's" author. Even he implicitly concedes that actually I made no such argument. According to him, my "worst fallacy" was my "apparent claim"--not what I wrote--"that individualism precludes cooperative action" [emphasis mine]./5/ The claim may have been "apparent" to Mr. Edwards, but it was not one that I made. It nevertheless occasioned his entire article. Certainly, individualism does not preclude cooperative action. Neither, however, does it preclude cooperative action through the mechanism of a democratically chosen government. It is this position that--although it would seem to be hardly open to question--he cannot accept.

My point was not that individualism is "bad," as should have been clear. If doubt remains, witness for example, my earlier essay, "Ideologies, Ideologues, and Academic Freedom," in this same journal./6/ It was, rather, that a spirit of individualism must be complemented by a recognition of the value of both private and public cooperation, and that some recent political rhetoric denies this (see "American Liberty" for a prime example).

I pondered whether it would be worthwhile to respond. After all, the chances of success in encouraging an ideologue to re-examine a position are indeed slim if they exist at all. I decided that I should do so because of the possibility that some naive reader might conclude that "American Liberty in Decline" presented in any way a plausible case. The outrage on the 11th of September makes it all the more necessary that Americans work together to ensure the best government possible and not give in to the simplistic plea to have the smallest government possible. So, accepting the risk that our naive reader might consider it impolite to do so, I point out that Mr. Edwards has written nonsense.

Consider, for example, his article's undocumented assertions (rather than "defying" the author to document them, utterly or not, I shall leave it up to the reader to draw his or her own conclusions):

A longer (and more questionable) list of undocumented assertions would be hard to find in any article of comparable length.

Mr. Edwards concedes that in preparing his paper, he received help from a historian, Gary Knarr, whom he thanks for his "valuable assistance." It is unfortunate that he did not receive greater assistance. His paper, in common with those of many modern economists, reflects a lack of historical awareness and a sufficient understanding of politics and sociological forces--especially of power. He quoted Douglas North, who "has done the math" and shown that "government infrastructure investments were not a quantitatively major factor in U.S. 19th century economic growth."/28/ North is also notorious for minimizing the importance of American railroads in that century! Such a position simply demonstrates that historical awareness is necessary for sound conclusions in all the social sciences; without sufficient knowledge--or under the sway of ideology--it is possible to "prove" a number of points by using sophisticated mathematical models, even when they contradict reality. North did, indeed, win the Nobel Prize, but one should be aware that the prize in economics is far different from the other Nobels. A separate fund finances it, a separate board awards it, and vastly more than the others, it reflects an ideological stance, the stance that Mr. Edwards approves.

American corporations are far from the mere "voluntary associations" that "American Liberty" assumes. The author implicitly concedes this without recognizing it, when he asserts that "the proper role of government...if it wishes to protect individual citizens from predatory corporations, is to simply avoid creating and protecting such predatory monopolies and cartels" [author's emphasis]./29/ Precisely so. As William Roy notes,

The corporation is explicitly a government creation. The modern industrial corporation, to a greater extent than other forms of ownership, is a creature of the law. The law defines the rights, entitlements, and responsibilities of all forms of property, but it has little jurisdiction over the very existence of entrepreneurships and partnerships. Individuals and partners can form simple companies on their own, but a corporation does not exist unless the state says so./30/

The corporation, therefore, is a "legal fiction," that "has no existence without a charter from the state." As a structure, it is neither good nor bad; it may be used well, or used poorly. Moreover, it has "rights and entitlements not available to individuals or individually owned businesses" [emphasis mine]./31/ Such enhanced powers, rather than inherent efficiency, could well explain why the corporate form came to dominate.

For example, the law in general gives the corporation the rights of an individual, but courts long tended to hold that under common law, corporations could not own stock in other corporations, unless specifically authorized by statute. Advocates favoring the legalization of intercorporate stock ownership successfully argued that insofar as corporations legally were individuals, they should have the same right to own both real and negotiable property as natural individuals. However, since this right was not available to an unincorporated business firm--a partnership could not own another partnership--the laws permitting intercorporate stock ownership created a power not available to entrepreneurships and partnerships./32/

It should be obvious to any social scientist that the notion that property somehow exists in a vacuum, unrelated to society, is too simplistic to be credible. Property "is a social relationship enforced by the state." Consider its nature. It "gives some people the right to use objects or to enter into contracts with others concerning the use of those objects or to decide how anything produced in the use of those objects will be disposed of. It also creates obligations and liabilities concerning the use of those objects if debts are incurred or people are injured by those objects. The exact nature of the rights, entitlements, obligations, and liabilities involved in property relations are defined and enforced by the state." Even "markets, no less than state ownership are created and sustained by states."/33/

Moreover, the view that the corporation is a mere "voluntary cooperation among individuals" should evaporate when one recognizes that corporations in America began as explicitly public enterprises. Rather than being private, early American corporations "were originally chartered by governments to accomplish public tasks, to build roads, construct canals, explore and settle new lands, conduct banking, and other tasks governments felt could not or should not be conducted privately. Contrary to the notion that corporations autonomously developed because they competed more efficiently or effectively in the market, governments created the corporate form to do things that rational businessmen would not do because they were too risky, too expensive, too unprofitable, or too public." They emerged to perform tasks that the market would or could not perform./34/

It thus is absurd to argue that railroads received no public subsidy until the Civil War, and that only with federal land grants did corruption and inefficiency begin. Take the assertion regarding James Hill, for example. He was an efficient manager, and he operated the Great Northern well. To say that his Great Northern was successful because he operated without government support not only reflects a logical leap regarding cause and effect, but in fact reflects ignorance of what actually happened. Regardless of what one can say about the Great Northern and receipt of federal land grants, Hill and his railroad empire did profit immeasurably from federal lands--which means from federal land grants.

As early as 1857, Minnesota had chartered a railroad in the Red River Valley and had given it a substantial amount of land. The railroad never materialized, and Hill later bought its charter--and therefore was in a position to profit from a government land grant. Whether it went to him directly is irrelevant. In the meantime, the General Land Office, assuming the land was in the public domain, deeded it to numerous farmers. Hill asserted that it belonged to his Great Northern. The U. S. Supreme Court in 1891 upheld his claim, and "the Great Northern thereupon issued an order compelling farmers to vacate all lands in the odd-numbered sections within the twenty-mile limits of the grant. Many of these farmers had been living on the lands in question for a decade; several had been there for twenty years."/35/

The distraught settlers then "appealed to Congress, which passed an act permitting the railroad company to select an equal area of federal lands in lieu of those in the Red River Valley. Hill already knew what lands to select. He had seen them himself. The Great Northern was happy to settle for some of the finest timber on the face of the earth, situated in Montana, Idaho, and Washington."/36/

One of Hill's admiring biographers wrote that the Red River grant situation "had a happy ending after all. The farmers retained their lands." Moreover, "the railroad received lands of far greater value to it than even the rich acres of the Red River Valley." Hill then persuaded Frederic Weyerhaeuser, one of the most prominent timber barons, to accompany him to inspect the lands, and Weyerhaeuser bought from him "great stands of fir and pine."/37/ This is good business to be sure, but it hardly presents the picture of a giant of individualism who eschewed government support and who operated without benefit from governmental land grants or other assistance.

"American Liberty in Decline" is at its most unrealistic and reflects its author's greatest lack of understanding when it attempts to deny the existence of corporate power over individuals. All corporations do with regard to individuals, it asserts, is to provide "products, jobs, and ownership shares. Transactions in any and all of these things are matters of voluntary and uncoerced which either party is free to accept or reject the terms of contract offered by the other, and accepts those terms only if they value what they are getting in exchange more than what they are giving in exchange." Inserting a straw man, the author adds that "no physical coercion or compulsion is involved in any of these transactions."/38/ Note the argument that without physical coercion or compulsion, there is no exercise of power. It is at this point that he--presumably sensing a need to avoid inconsistency--makes the absurd statement noted above that all government acts "are acts of physical coercion" [emphasis in original]. I suppose this would include publication of the Congressional Record, or paying faculty members at Montana State University-Northern.

No one with the slightest understanding of power, let alone of power theory, would assert that power exists only in instances of physical compulsion. Weber's classic discussion of power speaks of imposition of one's will upon another regardless of resistance,/39/ and even though this does not presuppose physical coercion, other definitions correctly go considerably further. Roy, for example (along with numerous others), broadens it to include "the extent to which the behavior of one person is explained in terms of the behavior of another." An instance is what he calls "structural power;" that occurs when the ability exists "to determine the context within which decisions are made by affecting the consequences of one alternative over another. For example, an employer that hires sociology majors rather than economics majors structures the consequences of choosing a major and is exercising power over students deciding on a major."/40/ It thus is simplistic to consider only whether a relationship is "voluntary."

To return to the railroads, as Roy notes conventional accounts do take into account the asymmetrical relationships they generated. "Railroads had much greater influence on farmers, merchants, small towns, and consumers than vice versa. But this," he says, "is rarely theorized in terms of power for at least three reasons." First, the emphasis is economic or organizational, not "dominance oriented," but regardless of motivation or economic rationality, managers still can exercise power. He points out perceptively that "just as benign motivation versus power is a false dichotomy, so is freedom versus power. The fact that people are making choices without overt constraint does not necessarily mean that no power is exercised." Certainly, he points out, town leaders were free by conventional definitions. They could invest or not invest in a railroad, "but if the consequence of not investing was that the station was located elsewhere, power was certainly being exercised."/41/

Corporations did, and do, exercise power over individuals. There are some instances, in fact, of corporations exercising police--i.e., physically coercive--powers. Examples from the early days of industrialism are well known, but some corporations today, such as some that operate nuclear generating plants, and the operators of privatized prisons do so even today (as do bail bondsmen, whether or not they are incorporated).

Governments, too, exercise such power. In their case, they always have the option of exercising physical power under prescribed circumstances. One common definition of government, in fact, is the agency that has a legal monopoly upon the exercise of force. As the examples indicate, this is not entirely accurate because governments, rightly or wrongly, have sometimes seen fit to delegate such authority.

In any case, uncontrolled power, governmental or corporate, is a threat to liberty. Moreover, the people--regardless of any mathematical model that suggests otherwise--potentially have greater control over government than over corporations. This is not to condemn the existence of corporate power, but to point out that it is dangerous to deny its existence.

Is there any real danger to liberty from government today? Of course there is. Rather than coming from programs of income transfer, however, dangers tend to result from government efforts to control social behavior. The abuse of grand juries against war protestors during the Nixon Administration, the violations of civil liberties in the name of the "war on drugs" by the administrations of Presidents Reagan, both Bushes, and Clinton--including, but not limited to, asset forfeiture--are glaring instances. The draconian provisions to safeguard "intellectual property" on the Internet are also disturbing instances of government abuse of the individual, and these result solely from "protection of property"--in this case, intellectual property--and certainly not from social welfare programs.

In fact, today in the aftermath of September 11th it is the very "negative" functions that Mr. Edwards deems the only appropriate governmental activities that are the source of the greatest threat. The public, at least for the time being, appears likely to acquiesce to increasingly restrictive measures under the control of an authoritarian U. S. attorney general in an attempt to achieve security. For such a loss of personal freedom to be blamed on--of all things--social security and public schools is the height of Orwellian doublespeak--a true theater of the absurd.

As the historian Arthur Schlesinger, Jr, noted, it is not the welfare state that is the danger. Herbert Hoover had argued that it was a "disguise for the totalitarian state by the route of spending." In 1944, Friedrich A. von Hayek electrified laissez-faire advocates with his Road to Serfdom expanding the Hoover thesis that governments use the pretext of doing good for their citizens to seize totalitarian power. Schlesinger pointed out that Hoover-Hayek thesis is, and was, historical nonsense. In 1949, in response to the enthusiasm for Hayek, he wrote to his friend the conservative writer John Chamberlain that "there is no example on record of progressive social legislation leading to totalitarianism."/42/ More than half a century later, there still is not. Doctrinaire laissez-faire advocates tend to be interested more in their doctrine, however, and in their mathematical models than in the historical record.

Contrary to the doctrinaire advocates of laissez faire, it is possible to be concerned for individual freedom and to oppose coercion in general, yet still to conclude that there are circumstances in which government should do more. The recent terrible acts in our own United States should cause us as a society to examine whether private enterprise has been efficient enough to meet America's needs.

For example, the automobile and the airlines have emerged, for better or worse, as our sole significant forms of personal transportation. Automobiles are flexible, but inefficient. They result in congestion and tremendous consumption of natural resources, including those from foreign sources, thus compromising national security. They also are slow for long-distance travel. The airline industry as a whole was barely surviving even before the tragedy. The profit margins were so slim that that many lines were barely keeping from bankruptcy. They were abusing passengers with inadequate space and service to preserve what profits they had, they had used up available landing space causing congestion similar to that created by the automobile, and they provided security that obviously was woefully inadequate.

Suddenly, Americans have become familiar with pressure for more government; for government itself to provide security measures, because private corporations have not been able to do it efficiently. Some beneficial pressure may also develop for more than security measures, for a re-structuring of our systems of transportation in general. The systems that we have developed have left us vulnerable. In most industrial countries the government does more regarding transportation, not less, and their patterns tend to be more favorable than those in the United States.

More government action may be essential here as well, along with a recognition that the enemy is not collective action; it is fundamentalism. We have seen troubles around the world, and now even within our borders, resulting from religious fundamentalism. Such fundamentalism can come from many religions, including Hindu, Sikh, Jewish, Christian, and Islamic. Fundamentalism, however, is not limited to the religious; there is also a related phenomenon, political fundamentalism, that itself is dangerous to public policy.

Fundamentalisms substitute rigid ideology for thoughtful consideration. An example is "American Liberty in Decline," with its author's unreasoning commitment to laissez faire and to what George Kateb criticized as the "night-watchman state." Kateb, a quarter century ago, pointed out--as Schlesinger had earlier--that it simply is false to equate property transfer from the wealthy to the poor as the cause of the growth in state power. Such growth, instead, has resulted from corporate industrialism (that which Mr. Edwards sees as the model of individualism) and from its huge expenditures on armaments. A minimalist state that existed primarily to protect property, a "night-watchman state," could develop a huge coercive apparatus if property protection required suppression of a mass of the discontented who considered themselves exploited. So a police state could result from the limited "negative" state, regardless of the utopian hopes of the fundamentalists./43/

So, I remain disappointed not to have seen a reasoned rejoinder to my article, "America's Twentieth Century." I also was startled that Mr. Edwards did not take me to task for a truly egregious error that did appear in my article. I had intended to end it by writing: "freedom, including intellectual freedom, can certainly suffer from intrusive government, but not only then. Freedom suffers equally when government becomes ineffective--as many citizens in Somalia, Rwanda, or the former Yugoslavia surely would be only too happy to verify."

I certainly stand by that statement, but by some embarrassing slip of the keyboard, I wrote "Botswana," instead of Somalia. I did not detect the error until I saw the printed text. This was inexcusable. Botswana presents a different situation entirely, as anyone familiar with news headlines over the last few years knows. A reasoned critique of my paper would have condemned this error, rather than manufacturing fancied ones.


  1. James Rolph Edwards, "American Liberty in Decline, 1965-2000: The Progressive Substitution of State Coercion for Individual Cooperation," The Montana Professor 11.1 (Winter 2001): 15-24.[Back]

  2. Max J. Skidmore, "America's Twentieth Century: Individualism, Freedom, and Community from Theodore Roosevelt to Bill Clinton," The Montana Professor 10.2 (Spring 2000): 8-12.[Back]

  3. See Edwards, 18.[Back]

  4. Ibid., 16.[Back]

  5. Ibid.[Back]

  6. Max J. Skidmore, "Ideologies, Ideologues, and Academic Freedom," The Montana Professor 7.2 (Spring 1997): 26-30.[Back]

  7. Edwards, 15.[Back]

  8. Max J. Skidmore, Legacy to the World: A Study of America's Political Ideas (New York: Peter Lang, 1998).[Back]

  9. Edwards, 15, col. 2.[Back]

  10. Ibid.[Back]

  11. Ibid., 16.[Back]

  12. Ibid., 17.[Back]

  13. Ibid., 17, col. 2.[Back]

  14. Ibid., 18.[Back]

  15. Ibid., 19.[Back]

  16. Ibid.[Back]

  17. Ibid., 21.[Back]

  18. Ibid.[Back]

  19. Ibid., 22.[Back]

  20. Ibid.[Back]

  21. Ibid.[Back]

  22. Ibid., col. 2.[Back]

  23. Ibid.[Back]

  24. Ibid.[Back]

  25. Ibid., 22.[Back]

  26. Max J. Skidmore, Social Security and Its Enemies (Boulder, Colo: Westview Press, 1999).[Back]

  27. Robert Eisner, Social Security: More Not Less (New York: Century Foundation Press, 1998); Dean Baker and Mark Weisbrot, Social Security: The Phony Crisis (Chicago: University of Chicago Press, 1999).[Back]

  28. Edwards, 15.[Back]

  29. Ibid., 17.[Back]

  30. William G. Roy, Socializing Capital: The Rise of the Large Industrial Corporation in America (Princeton: Princeton University Press, 1997), 145.[Back]

  31. Ibid.[Back]

  32. Ibid., 149.[Back]

  33. Ibid., 145.[Back]

  34. Ibid., 41.[Back]

  35. Stewart H. Holbrook, James J. Hill (New York: Alfred A. Knopf, 1955), 145.[Back]

  36. Ibid., 145-146.[Back]

  37. Ibid., 146.[Back]

  38. Edwards, 16.[Back]

  39. See Max Weber, Economy and Society (Berkeley: University of California Press, 1978).[Back]

  40. Roy, 13.[Back]

  41. Ibid., 111.[Back]

  42. Arthur Schlesinger, Jr., A Life in the 20th Century (New York: Houghton Mifflin, 2000), 485.[Back]

  43. See George Kateb, "The Night Watchman State," The American Scholar 45.1 (Winter 1975-1976): 816-826; see also Douglas Rae's critical review of Nozick in the American Political Science Review 70 (December 1976): 1289-1291.[Back]

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