Passed by a House of Representatives gridlocked by its most extremist members, only 27 bills became law in 2023, marking a nearly 90% drop from the previous year. Those who oppose entrenched government as a hazard to freedom interpret this lapse as a “victory.”
Nevertheless, the notion of limited government is a fallacy conflicting with American chronicles. In our recent publication, “How Government Built America,” we delve into the degree to which the U.S. government has interfered in markets since the Colonial era. As it turns out, the nation has consistently embraced substantial government.
Expansive Government, 18th-Century Variation
Defenders of limited-government theory argue that the concept of restrained government is fundamental to the United States. Nevertheless, the Founding Fathers – including those portrayed on the modern US$1 and $10 bills – advocated for the new government to interfere in markets.
Envisage the scenario towards the end of the 18th century. Post the U.S. gaining independence from Great Britain, two political factions – the Federalists and the Anti-Federalists – wrangled over apportioning power between the federal and state governments.
Whilst the Federalists endorsed a potent national government – a stance opposed by the Anti-Federalists – both factions concurred that the government should play a prominent role in the fledgling nation. The Anti-Federalists didn’t object to a robust government but preferred to maintain it at the local level.
The Federalists, counting Alexander Hamilton, George Washington, and John Adams, prevailed. They spearheaded the federal government’s endeavors to regulate the economy and invest in infrastructure, such as constructing canals, bridges, and roads. Even today, the federal government continues to make analogous investments to foster prosperity.
Thomas Jefferson and other Anti-Federalists opined that a robust centralized federal government was more prone to corruption compared to a locally maintained government. In his inaugural address, Jefferson advocated for “a judicious and economical Government, which shall prevent men from harming one another, shall enable them to self-regulate their own vocations of industry and progress.”
However, Jefferson didn’t protest against the broad regulatory undertakings transpiring at the state level. At that time, nearly every facet of the nascent American economy and society, from Sabbath observance to tavern operations, was supervised by the states, and previously, the colonies. This constituted “extensive” government.
Jefferson, akin to other founding figures, adhered to a political doctrine, republicanism – not to be confused with the modern-day Republican Party – which underscores the advancement of the public welfare as a primary objective of sound governance. These lowercase republicans entrusted the government with organizing economic and social activities.
Jefferson acknowledged that a portion of that government had to operate at a national level. During his presidency, he championed crucial components of the national government established by the Federalists, including the national bank.
Three Centuries of Extensive Government
A parallel narrative has unfolded throughout American history. Markets catalyzed an Industrial Revolution in the 1800s, yet they concurrently introduced unsafe workplaces, merchandise, slums, and impoverishment, constraining individual prospects and imperiling lives. The federal government, for the first time, assumed responsibility from the states for regulating consumer markets, encompassing railroad oversight, antitrust prosecution, and food and drug safety.
And when unbridled market forces triggered the Great Depression of 1929-1939, it was the government that reinstated economic prospects and facilitated individuals in their sustenance and employment in the interim.
More recently, following the 2008 subprime mortgage crisis caused by Wall Street’s meltdown, the government was compelled to intervene anew to revive markets. When the COVID-19 pandemic struck, the government expedited vaccine development, thereby reinstating individuals’ freedom to engage in life and labor.
A Perspectival Issue
We contend that the notion of miniscule government not only contradicts the verities of American history but also imperils the nation’s fundamental political principles. A blend of both markets and government has been requisite to construct a nation that embodies American values of freedom, parity, impartiality, and the collective welfare.
Take liberty, for instance. Markets are extolled for fostering individual liberty when individuals buy a vehicle, establish a business, and make myriad other market choices. According to this interpretation, market participants enjoy the autonomy to make their own decisions, and in doing so, markets engender affluence and success for the nation.
The remarkable transformation brought by the internet exemplifies this well. Users are presented with a myriad of options when it comes to content, applications, podcasts, and various social networking platforms as business owners vie for their attention and patronage.
However, just as history has demonstrated, markets can also restrict the freedom of consumers and employees, thereby compromising the collective welfare. Reflect on how the internet can jeopardize the safety and welfare of minors.
In the case of the U.S. downsizing its governing bodies, as urged by its most resolute political adversaries, it is evident from history that the perils posed by markets will not vanish. For instance, the global community is currently confronted by the “existential threat” of climate change – a crisis that cannot be effectively addressed solely through unregulated markets.
The precise balance between governmental intervention and market forces has been a subject of debate throughout the annals of American history, with the notion of advocating for a “lean” government being a recurring theme in political campaigns. However, endorsing the belief that an uncontrolled “big” market is superior to an oversight from a “big” government, as advocated by ultra-conservative House members, disregards the rich tapestry of American historical experience.
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