Audience Member/Interjector (6:03)

Right.

Professor/Lecturer (6:04)

The autonomous individual will be released by the end of socialism and the establishment of socialism and the end of capitalism. We don't need any limitations. Everybody will be free to create themselves in the way that only a few people like myself, Oscar Wilde had be able to create themselves. Everybody will be turned into an artist and the self will be the subject and the object of that art. So heading into the 20th century you have sort of visions like that. And to one degree or another you can see that Marx's view of the dictatorship of the proletariat, but then eventually the state will wither away. But along the way, statism is sort of the unifying theme of Progressivism and in the progressives, development in their founding, sort of re founding of America and their sort of overcoming of the Constitution isn't a continuous and gradual process. It's really more of a quantum process, usually in response to some great crisis that you have these leaps forward in Progressivism, modern liberalism, be called by different names in the 20th century. Then there'll be something of a hiatus. Things will level off. Americans will sort of get tired of the intense reform movement until some other crisis comes along and goads it into the next step. Charles Kessler wrote a book called I Am the Change about Barack Obama and the fourth wave of Progressivism. The earlier waves of Progressivism being the period that we call the Progressive Era itself, from the 1890s to about World War I. The second being the New Deal, FDR and the New Deal, which I think is really the, in terms of constitutionalism, the real point of no return, and you could say 1937 in particular is the sort of the inflection point in terms of the Constitution. The third one would be Lyndon Johnson and the Great Society. Johnson's self conscious and articulated attempt to complete the New Deal, to get done what FDR wasn't able to do. Then there's a reaction, you know, in the 70s and the 80s and the Reagan years, even through the, through the 1990s and did Barack Obama represent the completion, you know, the culmination of this progressive arc in history? And you know, it looked like that might be the case. And then Trump happened and the jury's still out about this, whether we're sort of completing this or not. Another way of looking at this is an economic historian named Robert Higgs book called Crisis in Leviathan, published in the 1980s, where he says that in response to crises, right, ambitious politicians say never let a crisis go to waste, right. You'll have an advancement. People are willing to give the federal government more power than they did in the pre crisis situation, but then it'll abate. But he uses the metaphor of a ratchet, right? A ratchet which is sort of a wrench that only turns in one direction. So there's never any going back. There's no undoing what the previous period progressive reform had done. But things might be sort of slack for a while until the next crisis. So the crises are really the 1890s. What had been then, the Great Depression of the 1890s, the New Deal, of course, the economic depression of the New Deal and the war, World War II, just like World War I wars, the intense and all consuming wars of the 20th century did a lot to advance government power. War always does that, right? The ancient poet Heraclitus said war is the father of all things. War is more responsible for social, economic, cultural change than anything else in human history. So the fact that you look in the 19th century, civil war aside, the United States didn't have any wars that really required fundamental changes in the society and economic structure of the country. But in the 20th century you have big wars, almost constant wars going through the Cold War that do have this impact. So the Great Depression, the Depression sort of acts as a war. World War II is a real war Cold War that follows that the civil rights movement and the crisis over the Vietnam War sort of contribute to the modern liberal reforms of the 1960s. And you're old enough to remember the financial crisis of 2008 that led to the Affordable Care act and the Obama administration. So you have all that sort of this step by step incremental expansion of the state in the 20th century. You can say that progressivism really is fundamentally an attack upon the Founders political theory. All the things that I talked about this morning, right, they look at Jefferson's Declaration of Independence and say, really there are no self evident truths. We don't have pre existing natural rights that governments are formed to protect. Rather, government is the thing that defines what our rights are. And gives them to us. There are no principles of government like the separation of powers that are applicable in all times, all places, in all circumstances.

Audience Member/Interjector (10:50)

Right.

Professor/Lecturer (10:50)

Government constitutions need always to adapt themselves to rapidly changing situations such as we see in the late 19th century. And they look at the Founders Constitution and all of those things that are in it that are meant to prevent the kind of state that the Progressives believe is necessary. The Progressives have to find some way to overcome the constitutional limitations that are built into our not only of the founding document, but also the American tradition. The fact that by the time the Progressives come along, the Americans have come to venerate and worship their constitution. And many of the chief founders of Progressivism, the first generation of Progressive intellectuals and Woodrow Wilson sort of towers above them all. But there are others like Frank Goodnow and others, political scientists, social scientists of other kinds, the emerging law professor, who were frankly aware of this. And they said we have to find some way to sort of wean the American people away from their attachment to the Founders. There's almost sort of a religious conversion that needs to take place if we're going to build the kind of state that is necessary to deal with the problems of urbanization, industrialization, the trust, the railroads, mass immigration. The sort of human situation that again, the Founders could never have, can never have imagined. Another way of looking at this is if you look at some European intellectuals who looked at America in the 19th century and remarked how exceptional America was, that America wasn't developing the kind of centralized, bureaucratic state that was advanced in Prussia and France especially. The British are somewhat behind here, but they're catching up. They're ahead of the Americans, at least. Why don't Americans have the kind sort of normal state development that political scientists talk about today? Why is America retarded in its political development compared to other advanced industrial states? Again, it's called American exceptionalism. If you look at thinkers like Alexis de Tocqueville, a lot of what he explains in Democracy in America is how democracy works without a strong central state. De Tocqueville says America has an incomplete central state, or as he famously put it, it's a central government with decentralized administration. And de Tocqueville described the way that civil society, voluntary associations, especially religious ones, are the way in which Americans deal with their problems. Another important intellectual at the time, George Will GWF Hegel, right, also looked at America and said America is behind the norm again. The Prussian state is sort of the way in which history with a capital H is Advancing and soon, Hegel says, America will get into get with the program of centralized state development. People were aware of American exceptionalism in the 19th century. What happens in the 20th century is more and more American leaders say, stop being proud of the way in which America is unlike the old world and say we need to catch up with old World developments. We need to make America more like France or Prussia, Western Europe in general. And this is a result of the sort of predominant intellectual trends of the 19th century, especially of Darwinian evolution. Woodrow Wilson was the one who was most clear in expressing this. His point was that the American founders reflected the intellectual basis of their society, which was still Newtonian. Physics was still the area of science that dominated all the other ways of thinking about things like politics. And Wilson said that was fine. The founders were sort of scientists in the best way that they could be in the late 18th century. But the fact is that science has evolved. And now we understand, he says, that government is not a machine. You don't build a government on Newtonian lines. Government is an organism that needs to follow the laws that Darwin has discovered. So things like checks and balances, which is a mechanical, physical kind of thing, right? As Wilson said, the founders built a government like you would build an orrery. An orrery is one of those models of the solar system. They had these when I was in school. I don't know if I'm old, you guys, where you would turn a crank and you would see the way that the moon revolves around the earth and the earth revolves around the sun and all that. It was a mechanical view that once you set the machine in motion, it will go without any outside interference. Sort of like the, you know, sort of the deist view of God, the eternal clockmaker. But now we understand that government is an organism. It's a body of organs that need to cooperate and work together, right? So the separation of powers. You can't have your liver and your heart and your pancreas, you know, checking and balancing one another. They all need to work together. So what we need to do, Wilson says, is get our political science up to date with the larger science of the day. We need to follow a Darwinian rather than a Newtonian model to one degree or another. The intellectual trends of the 19th century are in this sense Darwinian. It's known by various other kinds of names, things like historicism, the idea that all ideas, all institutions are historically contingent. As I said, there are no self evident truths that are applicable in all times, places and circumstances. They always depend upon the Historical context, utilitarianism in the legal field, the field that I'm most familiar with, things like sociological jurisprudence that we need to bring to the law, not just the law. Lawyers need to study more than the law and the precedents and the institutions and the founding documents. They need to bring in modern social science, modern sociology. A guy named Roscoe Pound, who's the dean of the Harvard Law School and Harvard was sort of making over all the law schools in the United States in its image. Those ideas begin to get into the law schools, another one known as legal realism, which said the judges simply reflect the prejudices of the class that they come from, or their own social and economic upbringing. And we need to enlighten them. The whole point of legal education is we need to bring progressive and modern ideas and get them into the minds of judges. So to one degree or another, they all share this idea that everything is evolutionary, everything is contingent, everything is relative. In a nutshell, the phrase the living Constitution reflects this right that constitutionalism and government is organic. It's biological. It needs to evolve and change according to the circumstances in which we are rapidly changing in the late 19th century. And the problem is that the American Constitution and our institutions are behind, behind the times. So how do we see this in operation? Where progressivism begins, progressive ideas begin to be instantiated in American institutions. It's quite appropriate that the first of these is the regulation of the railroads in the Interstate Commerce act of 1887. So now we're getting to the point where ideas are beginning to be institutionalized and made into policy. And the railroads, it's not surprising that this should happen because they were the leading industry of the 19th century, the industrial Revolution, they are literally driving the entire American economy. The steel industry is mostly in the service of the railroad industry. American middle class, the professional middle, white collar class in America managing the railroads, complicated nationwide industrial organizations. The railroads affected every aspect of American life, and the sense that they had become more powerful than the government itself meant that they were going to be the first institution to have national regulation. It also needs to be emphasized that railroads are also clearly enterprises that were engaged in interstate commerce. One of the chief limitations on Congress power in the 19th century was in order for Congress to regulate something, it had to be genuinely interstate and it had to be genuinely commerce. So for instance, the, the Sherman antitrust Act. In 1890, the court said, you can't apply that to an industry like the sugar refining industry. Even though the Sugar Trust controlled 98% of sugar refining in the United States. Refining sugar is not commerce. It's production. And it's all taking place within this state of Pennsylvania. So the Sherman act doesn't apply. Railroads, that's different. That's clearly commerce among the states. So it's not surprising that the first opening for economic regulation and all other kinds of regulation should start with the railroads. So the Interstate Commerce act of 1887 is the first progressive step forward. And it's a combination of factors that you'll see in every later major regulatory effort by Congress. There are lots of difficult and technical questions that Congress had to face if you wanted to regulate the railroads.

Audience Member/Interjector (19:44)

Right.

Professor/Lecturer (19:45)

Things about, you know, railroad rates in long hauls versus short hauls, rebates, and things like that. And there were a lot of different interests and constituencies that Congress had to choose from in making railroad policy. So Congress, for the most part, decided not to do that. They decided to create the first independent regulatory commission, the Interstate Commerce Commission, in 1887, and tell them that they should make the policy questions right. In other words, Congress delegated a lot of important legislative questions to the icc. All the law said was the ICC had to make sure that there were just and reasonable rates charged by railroads. Well, what is a just and reasonable rate? Congress doesn't say. Leaves it for the agency to determine. You're going to see that pattern over and over again later on. The Federal Trade act, which creates the Federal Trade Commission, says unfair methods of competition are outlawed by this act. What are those? Nobody knows. Our civil rights laws in the 1960s. The Civil Rights act of 1964 says it's illegal to discriminate on the basis of race. Well, what does that mean? Does that mean you can't take race into account or that you must take race into account?

Audience Member/Interjector (20:58)

Right.

Professor/Lecturer (20:59)

Those are fundamental policy questions that the Civil Rights act doesn't say. And ultimately, it is the agencies, in this case, the Equal Employment Opportunity Commission, that does that. The National Labor Relations act did the same thing. The Environmental Protection act did the same thing. The basis of the administrative state of the progressive state is the delegation of legislative power to an independent agency, the Independent Regulatory Commission. And that commission has the power to both make the rules and then to enforce the rules and then to adjudicate cases where they claim that somebody is violating those rules. These agencies are far from the separation of powers. They are a combination of. Of legislative, executive, and judicial powers. And when the bill was being debated in Congress in the 1880s, there were members of Congress who were aware of this and said that the act is unconstitutional because this is creating a fourth branch of government that violates the basic principles of the three branch structure of the Constitution. And the ICC was the first one of these to do that. The officers of the ICC were appointed by the President and they're confirmed by the Senate, as the Constitution provides for. But they had tenure of office. They served for a term. I think it was originally five or seven years. And they couldn't be removed by the President except for cause malfeasance, neglect of duty, and something like that.

Audience Member/Interjector (22:22)

Right.

Professor/Lecturer (22:22)

And there's a long debate about whether you could, whether Congress could limit the president's power to remove executive officers. Again, President Trump, right now, the Schedule F issue, right. This question of how much protection you can give to employees of the federal government faces. It really wasn't technically the first. There were a couple of attempts before this where Congress tried to limit the President's removal power. There was a big debate in the first Congress and the consensus there seemed to be no, the president's power of removal is unlimited. It is a plenary, inherently executive power. But then Congress tried to limit Andrew Johnson's power to remove officers to try to protect reconstruction.

Audience Member/Interjector (23:02)

Right.

Professor/Lecturer (23:03)

That's technically what Johnson was impeached for violation, violating the Tenure of Office Act. The act itself was probably unconstitutional. Grover Cleveland got Congress to repeal it. But it comes back with the Interstate Commerce Commission and a lot of later commissions. And this is part of the progressive idea that these administrators need to be outside of politics. Another basis of the administrative state is it's sometimes referred to by the political scientists as the politics administration dichotomy. Woodrow Wilson wrote a famous essay in 1887, the same year that the Interstate Commerce act was passed in one of the first issues of the American Political Science Review. And again, you'll find this in the back list of readings for the Constitution course that we teach at Hillsdale College called the Study of Administration. And again, coincidental with the passage of the Interstate Commerce act, on the centennial of the Constitution, no less, Wilson says, in America, we don't have any science of administration, what we would call today public administration as an academic discipline, something that's taught in schools and in universities. At the very moment when the modern American university is beginning to take shape like we have today at the Kennedy School of Government, where we use the universities as a way of training the civil service administrators, the bureaucrats who are going to run this new state. Wilson says, we're behind the curve. We need to catch up with this. We need to develop an American science of administration and the Fundamental basis for public administration is going to be that politics and administration are two separate things. Politics is an expression of the legislature and the president or whoever. Again, that could be the governor at the state level. It's an expression of the will of the people. What is the end that they want to establish? Right again. Clean air, non discrimination, fair railroad rates.

Audience Member/Interjector (24:57)

Right.

Professor/Lecturer (24:57)

After having done that, though, we leave the details, the technicalities of administration to people who are not elected, people who are highly trained, highly educated scientists and experts in their fields who are going to be insulated from politics because they're not making political decisions. They're making scientific, technical, engineering decisions. Right again, claims of people like Anthony Fauci during the COVID epidemic at the time in the 1880s. Look, railroads are really complicated to operate. Most people don't know how to run a railroad. We need to put it in the hands of experts who do. Or later on questions of, like the Pure Food and Drugs act of 1905.

Audience Member/Interjector (25:40)

Right.

Professor/Lecturer (25:41)

We need people who are PhDs in chemistry. You need people with scientific expertise who can understand these problems. And these are not political questions. Like the old saying, there's no Democratic or Republican way to pave a road.

Audience Member/Interjector (25:54)

Right.

Professor/Lecturer (25:54)

These are questions of technique only. They're not questions that can be influenced by politics. Thus we need to insulate these administrators, give them tenure of office, give them high salaries and make them not responsible or accountable to political actors. They can't be making their scientific decisions worrying about what the results of the next election are going to be.

Audience Member/Interjector (26:17)

Right.

Professor/Lecturer (26:17)

So Wilson says, you don't have to worry about this new class of administrators because they're going to be apolitical. We're going to hive them off and keep them insulated from politics. That was the founding myth, you could say, of the American administrative state. It's a good question whether the people who articulating this, like Wilson in the 1880s, really believed it themselves. But getting into the 20th century, more and more political scientists began to say, yeah, as a matter of fact, you, you can't separate politics and administration. And politics always intervenes in what appear to be non political questions. And I think we've seen that a great deal in recent years.

Audience Member/Interjector (26:52)

Right.

Professor/Lecturer (26:52)

But that was one of the foundations of getting the American people to accept the new administrative state was this guarantee that politics and administration are two separate things. And again, for the Interstate Commerce Commission, what happened to the ICC was for one thing, the courts kept it on a very short leash. And that's because the courts very rightly saw these new agencies as a threat to their business. Again, they're engaged in judicial activity. In fact, a lot of what the administrative state and progressives want to do is take the business of the federal courts, which tended to be conservative and old fashioned and concerned about property rights in particular, and give those duties over to the new administrators. This is especially the case with regard to labor and labor unions.

Audience Member/Interjector (27:38)

Right.

Professor/Lecturer (27:39)

They usually came out on the losing end when cases got into federal courts about strikes and lockouts and picketing and things like that. That's why we have the National Labor Relations Board that take labor relations questions out of the courts, which are hostile to unions, and give them over to a new body that's going to be friendly to them. With the railroads, though, it didn't work out that way because the courts kept the ICC on a very short leash and also because the railroads largely captured the Interstate Commerce Commission. And that term regulatory capture is another one that political scientists began to realize in the 20th century, showed some of the shortcomings of the administrative state, that who are the experts who really know about the railroad industry in the late 19th century? Mostly it's going to be railroad people and they're going to be the ones who are administering the Interstate Commerce Commission in a way that is friendly to railroads. So one of the problems is agencies that are created in order to control some industry end up being dominated by that industry. We saw this with the Dodd Frank legislation especially. Who writes all those complicated rules about bank regulation? Bankers do that.

Audience Member/Interjector (28:44)

Right.

Professor/Lecturer (28:44)

And mostly lawyers do that. One of the chief things about the administrative state is most of the people who make the important decisions in it are not experts.

Audience Member/Interjector (28:53)

Right.

Professor/Lecturer (28:53)

They're lawyers. They're really not much different from the members of Congress who created the agencies in the first place. Which is why very often members of Congress, if their party is voted out of office, end up becoming lawyers and lobbyists who engage in work for these agencies that they help create and write the rules for.

Audience Member/Interjector (29:11)

Right.

Professor/Lecturer (29:11)

That happened in a big way at the end of the New Deal. After World War II, when the Republicans took over the government, A lot of the people who went from Congress or had created these agencies established very lucrative law firms in Washington, D.C. they become the K Street lobbyists and all this. So these are some of the sort of historical ways in which the administrative state has developed. And you can see some of it in the Interstate Commerce act and its successors. Another major change that comes about in the 20th century especially is the reorientation of the American presidency from what the Founders had envisioned. And you can say the first progressive president is Theodore Roosevelt. He wasn't a theorist in the way that Woodrow Wilson was. Woodrow Wilson had his ideas as an academic going back to the 1880s. Wilson was president of Princeton University from 1902 until 1910, when he briefly and only recently got into politics. One term as governor of New Jersey, and then he's president of the United States.

Audience Member/Interjector (30:11)

Right.

Professor/Lecturer (30:12)

But Theodore Roosevelt was there earlier as the one who does the most to change sort of the image and the public image or the public perception, especially of the American presidency. Another part of progressive theory was that the legislatures are too much under the control of political parties and the corporations that corrupt those political parties. So we need a strong, independent executive who's going to sort of lead the people in a much more active way than the American people had been used to. I often ask my students, can you name any president between, let's say, Ulysses Grant and Theodore Roosevelt?

Audience Member/Interjector (30:50)

Right.

Professor/Lecturer (30:51)

And even at Hillsdale, a lot of them can't. And I say in a way that's not unexpected and in a way, it's a good thing.

Audience Member/Interjector (30:56)

Right.

Professor/Lecturer (30:57)

Because after the Civil War was over, the American presidency reverted to its limited role. That, I think, was what the founders had in mind when they created the American presidency. It would be strong and things that had to do, especially foreign affairs or with crises like those of the Civil War. But in normal, peaceful times, the president's only job was to execute the limited number of laws that Congress enacted. If you could pick somebody in there that period, it would have been Grover Cleveland, who was an active president. But most of what he did was vetoing acts that were passed by Republican Congresses. And the Democratic party did have a vision of a stronger executive that went back at least to Andrew Jackson. But the Republican party was the dominant party in the period from the Civil War to the New Deal. And those presidents were pretty contained until Theodore Roosevelt bursts upon the scene. A lot of this just has to do with personality. I mean, he was a very sort of vigorous theory of, you need more energy in the executive, the American people. He thought Roosevelt was first of all and above all else, an imperialist. He thought that, you know, the American people are losing the martial virtues that a Republican people need were becoming soft, and the term at the time would have been effeminate because of the luxury that's come upon us by the industrial and the urban revolutions. We need more of these sort of martial spirit of sacrifice that war brings about.

Audience Member/Interjector (32:18)

Right.

Professor/Lecturer (32:19)

So there's some of that sort of energetic, militaristic view that that's some of the martial virtues that the American people need. He also had the advantage of what was at the time, cutting edge media developments. The ability of the President to be recorded by sound. I think William McKinley was the first president to be recorded on sound. And the beginning of images of motion pictures in the early 20th century. Later on, this is going to be radio, then it's going to be television, then it's going to be Twitter or stuff that's beyond my bandwidth. But Roosevelt certainly took advantage of media developments of his day. And the media loved him, right? He was good copy. He was colorful. He was easy to caricature. He was willing to go out and speak and intervene in Congress in ways that previous American presidents had. So he took a hand in legislation, getting things like a strengthening of the railroad regulation, things like the Pure Food and Drugs act and things like that. Knew the next sort of step in the development of the American administrative state comes from Theodore Roosevelt. And so he fundamentally transforms the American presidency. And Roosevelt's theory of the presidency, it was known as the stewardship theory, and it was essentially that the President of the United States can do whatever the American people need done unless he is forbidden to do so by the Constitution or the laws. So the default position is the President has the power unless there's some formal institutional constitutional limitation to it. Almost nobody had gone this far in the view of presidential power. If you compare him with Abraham Lincoln in the crisis of the Civil War, I think you'll see that Lincoln has a much more limited understanding of what the president's powers are, as close as any of the founders. You could say this is Alexander Hamilton's view of the presidency, and it's one that was very controversial in the Federalist period. So Roosevelt intervenes and does all kinds of things that previous presidents wouldn't do. One illustration of this is the 1902 anthracite coal strike. American economy, American heating depended upon hard coal from Pennsylvania. And there's a strike in 1902. And Roosevelt was the first president, too, who sort of intervened in a way that tried to be a neutral arbiter between the unions and the owners. Most presidents did what Grover Cleveland did in the Pullman strike is break the strike, right? So this idea that the president should be an arbiter of industrial disputes like this, but the two sides can't come to terms about this. The owners are very recalcitrant. And Roosevelt says, I'm just going to send in the army, take over the mines and operate them, because this is a national Emergency.

Audience Member/Interjector (34:49)

Right.

Professor/Lecturer (34:50)

And a member of Congress says, oh, it's a very interesting idea, Mr. President, but you have no constitutional power to do that. And Roosevelt says, well, to hell with the Constitution when the people want coal, right? Now, whether he said that or not, it's probably apocryphal, but it's like Andrew Jackson's kind of thing that he was apt to say. But it is a good indication of this idea that if there's some crisis that comes along, and Roosevelt was very explicit in saying this is a crisis that's as serious as that of the Civil War. And so the president has extraordinary powers in situations like that, that the series of crises that we get in the 20th century is always going to be the occasion or the pretext, if you're critical of it, of an extraordinary exercise of power and especially executive power. If you look at Roosevelt's foreign policy as well, if we're actually going to take the Panama Canal back, remember, it was Theodore Roosevelt who got it for us in the first place by means that are debatable to say the least. Again, if you look in the index of documents here, the speech that I was giving you from Woodrow Wilson, where he talks about the Darwinian Constitution, that was Wilson's new freedom speech in the 1912 campaign where he's running against Theodore Roosevelt, primarily the Republican party itself split in 1912. It's principally a contest between Wilson and Roosevelt. Roosevelt's speech was the new nationalism speech, where he gives his expression of how the United States needs a stronger state that looks a lot like the kind that Bismarck had developed in Prussia. And Roosevelt here is very explicit saying, I know this is acquiring that the federal government have much more power than the American people have been willing to give it. But I think that current circumstances require us to do so.

Audience Member/Interjector (36:31)

Right.

Professor/Lecturer (36:31)

We can no longer have federalism, that principle of federalism stopping the federal government from dealing with what are national problems. Obviously, the states cannot deal with these problems. We've outgrown them.

Audience Member/Interjector (36:41)

Right.

Professor/Lecturer (36:41)

The separation of powers can't be an excuse for a weakened president who's not willing to exercise the kind of stewardship that modern conditions require. So in the new nationalism speech in 1912, Roosevelt gives his argument for expanded national and especially presidential power. Now, Wilson wins that election, Roosevelt loses. But Wilson ended up adopting many of the kind of policies that Roosevelt had been calling for in 1912, although they differed upon the means.

Audience Member/Interjector (37:11)

Right.

Professor/Lecturer (37:12)

The big question was, what are we going to do about the trusts?

Audience Member/Interjector (37:14)

Right.

Professor/Lecturer (37:15)

Big business. And Roosevelt said, look, let's just face the fact that big business is here to stay. Most business is big because it's efficient and beneficial to the American consum. We don't want to just break them up just because they're big. Wilson, on the other hand, said no, we just need stronger antitrust laws and we've got to break up the trust and restore the kind of small scale American economy that we had before the trusts. And Wilson loses the election, but he ends up adopting essentially a Rooseveltian trust policy. Congress did pass a new antitrust act in 1914, but it didn't do anything, didn't change anything. But the creation of the Federal Trade Commission in 1914 was supposed to be Wilson's answer to the trust question. It was supposed to do for the rest of the economy what the Interstate Commerce Commission was supposed to do for the railroads. As I've already told you, the act said that from now on, unfair methods of competition are against the law.

Audience Member/Interjector (38:08)

Right.

Professor/Lecturer (38:09)

But Dodds, Congress doesn't define what those are. It created a new commission just like the icc, right, with staggered terms and a tenure and things like that, to deal with America's new industrial problems and sort of sets them the task for doing that. And the FTC ended up going much the way that the ICC did in its early years. The courts were still not willing to give these new fourth branch of government agencies the kind of powers that Congress appeared to have delegated to it. Who's going to define things like unfair competition? The court said we will, not you.

Audience Member/Interjector (38:42)

Right.

Professor/Lecturer (38:42)

And so the FTC to this day has never really made much of a difference in the American economy. In fact, all of these attempts to deal with what appear to be the natural tendencies of industry throughout the industrialized world, where you're just not going to have a large number of small producers of steel. Everywhere in the world you have a small number of large producers of steel or railroads or banks or things like that. So none of these sort of change much of the American industrial structure, as they call it. Wilson also presided over the creation of the Fed, the Federal Reserve Board. And this is probably the most powerful of all of the independent regulatory agencies where these expert bankers are essentially given Congress's power to coin money and regulate the value thereof.

Audience Member/Interjector (39:29)

Right.

Professor/Lecturer (39:29)

The monetary policy Congress has delegated to an independent regulatory commission. They serve very long terms.

Audience Member/Interjector (39:35)

Right.

Professor/Lecturer (39:37)

President Trump, and this was in his first term, actually sort of took on the Fed and was trying to sort of reassert the idea that it's the elected branches, the politically accountable branches of government that should be setting Things like monetary terms. And most of the establishment was aghast at that idea that the Fed shouldn't be completely independent. But that just shows you the degree to which in the 20th century, we had gotten into the habit of creating these independent regulatory agencies. Another really important change that came about in the Wilson administration, although Wilson himself didn't have much to do with this, was the income tax. It's a long story, but because the Supreme Court effectively said the income tax was unconstitutional in the 1890s, you had to amend the Constitution to give Congress the power to collect, to tax incomes without apportionment according to population. So we have. The 16th amendment was ratified just a couple days before or after Wilson was inaugurated. And that was really important because that provides the revenue by which the large state of the 20th century is going to be. Is going to require.

Audience Member/Interjector (40:40)

Right.

Professor/Lecturer (40:41)

It's also going to enable you to reduce the tariff, which is something that Wilson and the Democrats had always been committed to. And in the course of the 20th century, the United States went from a highly protectionist country to be more of a free trade country. Until a couple of days ago.

Audience Member/Interjector (40:55)

Right.

Professor/Lecturer (40:56)

Trump changes everything. So that's the important change in sort of the fiscal, sort of revenue basis of the American government is right there at Wilson's disposal. And so you had that helping. I mentioned this talking with some of you after the first talk. The 17th Amendment's ratification also at exactly this time, made one of the most important structural changes in all of American history. The idea of the Senate representing the states as states, because the Senators were chosen by the state legislatures, not by the people directly. And the 17th amendment made direct election of senators nationwide. Very Interestingly, before the 17th Amendment, the Senate tended to be the more conservative of the two branches of government, which is really exactly what the founders would have anticipated. And after it, they become the more liberal one. So that's, again, a really important structural change in the United States. And perhaps the most important thing of all that helps Wilson advance progressivism is the Great war, World War I, the first really, again, Civil War aside. And even if you look at the Civil War, the most impressive thing about the Civil War is even though it was a huge war that, you know, 700,000Americans are killed in the Civil War, millions of Americans on both sides serve in the armed forces. The ways in which it really didn't fundamentally and especially did not permanently change American institutions.

Audience Member/Interjector (42:21)

Right.

Professor/Lecturer (42:22)

You created the grand army of the Republic, and then when the war was over, you just disbanded it.

Audience Member/Interjector (42:26)

Right.

Professor/Lecturer (42:27)

The intervention in the south during Reconstruction was limited. And if you say Reconstruction failed, it was largely because the American people were not willing to impose the kinds of permanent changes in the sort of a bureaucratic establishment that institutions like the Freedmen's Bureau would have required. There was an income tax during the Civil War and it was repealed. It expired in 1872. A lot of the Civil War taxes turned out to be temporary. In the 20th century, though, that doesn't happen. The changes that are made during the war tend to become permanent. And people are, especially after World War I, waiting for another crisis to become the occasion to resurrect many of the wartime innovations. Progressives realized In World War I that war makes people willing to empower the government, especially the central government and especially the president, with powers that they never would in peacetime. The philosopher William James wrote a famous essay called the Moral Equivalent of War, where he said, wouldn't it be great if we could find something that would make people make the kind of heroic sacrifices that they make in war without all the destruction and blood and guts that war entails?

Audience Member/Interjector (43:34)

Right.

Professor/Lecturer (43:35)

So in the 20th century, you're looking for something to be the moral equivalent of war. It's going to end up being the Great Depression. It's going to end up being the COVID or something like that. Something that can do for the government what war does for government. And what does war do for government? World War I, the first significant conscription in American history. There was a little bit of a draft in Civil War, but it was limited. It was mostly done through the states. And I think only about one in eight soldiers in the Civil War serve because of conscription. Each war in the 20th century becomes more and more a draft based war. Conscription had never been challenged before World War I. And the Supreme Court finally came around and said, yes, Congress does have the power to compel people to serve in the armed forces. And of course, once you do that, then everything else becomes up for grabs. Once you say the government can compel people to risk their lives and limbs for the cause, Any kind of property or liberty that you're complaining about being infringed, people are not going to be willing to listen to that for very long. If your husbands or your sons are out there risking their lives for this cause, you're complaining about high taxes, right. Or limitations on speech or whatever, People are going to be much less willing to tolerate those kinds of protections of liberty in wartime. So During World War II, you got very high taxes. The, the original income tax in 1913, the top rate was something like 7%, and almost nobody paid it because it was meant to be a tax that only the wealthy paid. And In World War I, the top rate went up to 77%, and a lot more people paid it. In World War II, the income tax became genuinely a mass tax that almost everybody paid. And that's when it became the real sort of engine of sort of the fiscal basis of the United States. So a lot higher taxes during the war. Conscription, government propaganda efforts during World War I, again using new media like film censorship, and of course, the Sedition act, where people were criminalized for the first time since 1798, people were prosecuted for saying things that were harmful to the war effort. And the acts were upheld by the Supreme Court shortly after the war. But you had the full panoply of economic and other kinds of controls. Now, the European countries had been through this long before we were, but the United States got around to it only in 1917 and 1918. So the other big one was prohibition before the 18th amendment was ratified and before this became required by law. Congress outlawed the manufacture of alcoholic beverages during World War I, the idea being that soldiers need bread, not whiskey.

Audience Member/Interjector (46:09)

Right.

Professor/Lecturer (46:10)

So you had Prohibition before Prohibition during World War I. So it was remarkable to progressives how much people were willing to let the government do during the war. The problem was World War I didn't last that long. We weren't involved in it very long.

Audience Member/Interjector (46:24)

Right.

Professor/Lecturer (46:25)

And with the disillusionment of the peace settlement after the war, the 1920s was one of these periods of hiatus because the American people were kind of tired of the great flurry and frenzy of reform efforts during World War I. But it's notable, as I mentioned, the ratchet effect.

Audience Member/Interjector (46:41)

Right.

Professor/Lecturer (46:42)

You didn't abolish any of these Wilson agencies.

Audience Member/Interjector (46:45)

Right.

Professor/Lecturer (46:45)

You may restaff them. The Republicans would put their people on the FTC rather than Democrats.

Audience Member/Interjector (46:50)

Right.

Professor/Lecturer (46:51)

You didn't abolish the income tax. You lowered the rates under Andrew Mellon.

Audience Member/Interjector (46:55)

Right.

Professor/Lecturer (46:55)

But nevertheless, the income tax is still there. The Fed is still there. All those institutions are still there. There wasn't much addition, although there was some, to the progressive state state during the 1920s. But you had a period of sort of leveling off in what's known as the ratchet. And that's the pattern for the rest of the 20th century. You're going to have the Great Depression, of course, is the next occasion, the next opportunity, the next moral equivalent of war. And many people, it's remarkable how many people in the Roosevelt administration cut their teeth in the government in the Wilson administration. Roosevelt himself was Assistant Secretary of the Navy under Wilson. Roosevelt had been Assistant Secretary of the Navy too. Watch out for Assistant Secretaries of the Navy. There's something about that job that apparently gives people ambitions.

Audience Member/Interjector (47:39)

Right?

Professor/Lecturer (47:40)

People like Felix Frankfurter and a lot of Roosevelt's academic advisors had been part of the Wilson administration. Friends of Wilson. And almost all of the policies, things like the National Industrial Recovery act or the Reconstruction Finance Corporation were actually left over from World War I. Acts that Congress had not repealed, but that had been inactive, that were now sort of dusted off and re energized during the Great Depression. In fact, some of the New Dealers said actually there was nothing really innovative, nothing that was altogether new in the New Deal agencies. They were all ones that were sort of test driven in World War I and some even that the Hoover administration had begun to implement.

Audience Member/Interjector (48:21)

Right.

Professor/Lecturer (48:22)

So it was a sort of a revival of wartime experiments. And then of course, World War II after, especially Wilson, sorry, the Roosevelt administration began to sort of lose steam in 1937, 1938. The war provided an opportunity to extend government power. World War II, even more than World War I, because it lasted much longer. You had things that even didn't happen in World War I, like rationing and price controls you got in World War II. And then things level off again. So that's the pattern of the 20th century is these recurrent crises that bring about occasions for building the new kind of state that we have in the 20th century. The one last thing I would say about the New Deal though, as a turning point, something that was innovative was Roosevelt gave an articulation of what the purpose of government was that Woodrow Wilson never did again. If you look at the back, sort of the index of the documents here, you can see the Commonwealth Club address that Roosevelt gave when he was a candidate in 1932 and the so called Second Bill of Rights speech that he gives in 1944 when the war was at its end, where he talks about, you know, we used to understand the Bill of Rights as protecting individual rights and liberties and property and things like that. Now we understand that the times call for an economic Bill of Rights or a second Bill of Rights, which is really about government providing people with all the things that the New Deal started to provide them with. Subsidies for farmers, collective bargaining for workers.

Audience Member/Interjector (49:50)

Right.

Professor/Lecturer (49:51)

Social Security and its many expansions over the course of the 20th centuries. What the political scientists refer to as entitlements. I think this went further than Woodrow Wilson. If you look at the Wilson agencies, they were dealing with questions and problems that were pretty familiar to people and they weren't really. There was some of this in the Wilson administration guaranteeing benefits for particular interest groups. You really begin to see that in the New Deal. And that's another trend that continues throughout the 20th century. And another difference is Wilson and the earlier progressives were, as I said, Frank in their saying we've outgrown the Constitution, we need to get over the framers Constitution. Roosevelt I think was aware that that's not a good thing to try to sell to the American people. And so when Roosevelt talked about what we needed to do, he used the vocabulary and the language of the Founders as a way of claiming that the New Deal was continuous rather than a departure from the Founders Constitution. That's why in his speeches he talks about self evident truths and he talks about things like an economic Bill of Rights.

Audience Member/Interjector (50:52)

Right.

Professor/Lecturer (50:53)

I don't know whether Roosevelt was consciously being deceptive in this way or tried to cover up what he's actually doing, the substantive changes with the rhetoric and the language of the Founders, but I've often seen, suspected that he did. But that's another thing I think that makes the New Deal period the real, as I said, the inflection point in all this. The other important thing too is that the Supreme Court gets out of the way. In 1937, Roosevelt asked Congress for the power to pack the court with an additional six Justices. People were talking about this when liberals were unhappy about the Trump appointees to the Court and the Roberts Court. He lost that battle. And he wasn't able to expand the size of the court, but he was able to pack the Court the old fashioned way. And by the end of his administration, all of us, all the justices were New Dealers and they had stopped standing in the way. And so you no longer had the Court as an obstacle to progressive reform. You do again today. And the Court, as I said, has taken on some of these fundamental issues like the non delegation doctrine, the nature of these administrative agencies, the unitary executive. And so a lot of these 20th century issues are sort of back in, in the foreground today. But a minute or two for some questions, sir. Oh, wait for the mic.

Audience Member/Interjector (52:10)

Yeah.

Audience Questioner (52:12)

In talking about the New Deal.

Professor/Lecturer (52:16)

Is.

Audience Questioner (52:16)

It fair, is it fair to say that that. Actually, I don't know, there's some that say that the government policy that came after the stock market crash and into the New Deal is actually what caused the Great Depression.

Professor/Lecturer (52:28)

I mean, yeah, that is more of a question for economic historians, but I'm familiar enough with the literature to say that a lot of them have said yes indeed that another key point about this is that the crisis will the claim will be that the crisis is due to market failure. We need government intervention because voluntary association and sort of businessmen can't can't deal with this.

Audience Member/Interjector (52:50)

Right.

Professor/Lecturer (52:50)

So government intervenes. Then they exacerbate the problem, they make it worse and then that becomes the excuse for giving the agency more power. Exhibit A would be the Fed. And the economists say that the Fed was responsible for making the Great Depression as long and as severe as it was. And what happened to the Fed as a result of that? They got more power by the New Deal. The same thing happened in 2008. Bad regulation needs leads to more power for the regulators in Washington, D.C. nothing succeeds like failure. And that's the way the ratchet works.

Podcast Network Staff/Promoter (53:27)

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