The Place of Markets Then and Their Place Now

I have previously observed that there are multiple "capitalisms." Like folks at the Acton Institute, I believe that markets (and liberty generally) exist for a purpose or goal. In other words, combining a robust covenantal anthropology and a biblical eschatology entails a purposeful freedom, one that is oriented toward shalom. In yet other words, I am not a libertarian. Sure, you may say, but if so I'm un-American.

Some contemporary popularizers of American economic history, who tend toward a libertarian understanding (of the place of the markets, anyway), postulate an Edenic American Founding in which all economic activity was free from government control. Ever since, at least since the beginning of the twentieth century, it has been downhill as America has become more and more statist.

For such I recommend a short dose of actual history that can be got on the cheap by downloading Pre-Liberal Autonomy and Post-Liberal Finance by Robert Hockett. Quoting from his abstract, it seems the truth is that Jefferson and even Hamilton believed that markets existed for an end:

Even American Founders whose views diverged as dramatically as those of Jefferson and Hamilton shared a view of finance and of enterprise that one might call “productive republican.” Pursuant to this vision, financial and other forms of market activity are instrumentally rather than intrinsically good — and for that very reason are of interest to the public qua public rather than to the public qua aggregate of “private” individuals. Citizens are best left free to engage in financial and other market activities, per this understanding, only insofar as these are consistent with sustainable collective republic-making. And the republic — the res publica or “thing of the public” — for its part devotes many of its energies to the task of fostering and maintaining a materially independent republican citizenry. State and citizen are thus mutually constituting and mutually supporting, per this vision, and finance is important primarily in its capacity to nurture that symbiosis.

State and citizen in symbiosis! The res publica is more than the sum of individual bona! Who'd a thunk it? But there's more:

The productive republican view of finance can be illuminatingly contrasted with another view of more recent vintage, which one might call “liberal.” The liberal view takes market activity to be an intrinsic good, if not indeed a matter of inherent political-cum-moral right. Markets on this view are as it were natural social outgrowths of and aggregated counterparts to inherently “free” individual choices — choices that all of us, in both our individual and our collective capacities, are ethically bound to respect insofar as they don’t impose illegitimate costs upon others. So-called “public” interventions in “private” markets are accordingly fit subjects of suspicion and scrutiny per the liberal view.

All in all, an insightful analysis of the link between liberty and virtue early American thought.