THE REVIVAL OF DISSENT
On the morning of March 4, 1901, when Mr. McKinley took the oath of
office to succeed himself as President, it appeared to the superficial
observer that the Populist movement had spent its strength and
disappeared. Such was the common remark of the time. To discredit a new
proposition it was only necessary to observe that it was as dead as
Populism. Twice had the country repudiated Mr. Bryan and his works, the
second time even more emphatically than the first; and the radical ideas
which had been associated with his name, often quite erroneously, seemed
to be permanently laid to rest. The country was prosperous; it
congratulated itself on the successful outcome of the war with Spain and
accepted the imperialist policies which followed with evident
satisfaction. Industries under the protection of the Dingley Act and
undisturbed by threats of legislative interference went forward with
renewed vigor. Capital began to reach out for foreign markets and
investments as never before. Statesmen of Mr. Hanna's school looked upon
their work and pronounced it good.
But Populism was not dead. Defeated in the field of national politics,
it began to work from the ground upward, attacking one piece of
political machinery after another and pressing upon unwilling state
legislatures new forms of agrarian legislation. The People's party, at
its convention in 1896, had declared in favor of "a system of direct
legislation through the initiative and referendum, under proper
constitutional safeguards"; and Mr. Bryan two years later announced his
belief in the system, saying: "The principle of the initiative and
referendum is democratic. It will not be opposed by any Democrat who
indorses the declaration of Jefferson that the people are capable of
self-government; nor will it be opposed by any Republican who holds to
Lincoln's idea that this should be a government of the people, by the
people, and for the people."[70]
The first victory of "direct democracy" came in the very year of Mr.
Bryan's memorable defeat. In 1896, the legislature of South Dakota was
captured by a Democratic-Populist majority, and at the session beginning
in the following January, it passed an amendment to the state
constitution, establishing a system of initiative and referendum. Some
leaders of the old Knights of Labor and the president of the Farmers'
Alliance were prominently identified with the campaign for this
innovation. The resolution was "passed by a strict party vote, and to
the Populists is due the credit of passing it," reported "The Direct
Legislation Record" in June, 1897. In the contest over ratification at
the polls a party division ensued. The Democratic state convention in
1898 adopted a plank favoring direct legislation, on "the principle that
the people should rule"; and the Republicans contented themselves with
urging party members "to study the legislative initiative and
referendum." At the ensuing election the amendment was carried by a vote
of 23,876 to 16,483; but ten years elapsed before any use was made of
the new device.[71]
A cloud no bigger than a man's hand had appeared on the horizon of
representative government. East, West, North, and South, advocates of
direct government were busy with their propaganda, Populists and
Democrats taking the lead, with Republican politicians not far in the
rear. The year following the adoption of the South Dakota amendment a
combination of Democrats and Populists carried a similar provision
through the state legislature of Utah and obtained its ratification in
1900. This victory was a short-lived triumph, for the Republicans soon
regained their ascendancy and stopped the progress of direct legislation
by refusing to enact the enabling law putting the amendment into force.
But this check in Utah did not dampen the ardor of reformers in other
commonwealths. In 1902, Oregon adopted the new system; four years later
Montana followed; in 1907, Oklahoma came into the Union with the device
embodied in the Constitution; and then the progress of the movement
became remarkably rapid. It was adopted by Missouri and Maine in 1908,
Arkansas and Colorado in 1910, Arizona and California in 1911,
Washington, Nebraska, Idaho, and Ohio in 1912. By this time Populists
and Democrats had ceased to monopolize the agitation for direct
government; it had become respectable, even in somewhat conservative
Republican circles.
It should be pointed out, however, that there is a conservative and a
radical system of initiative and referendum: one which fixes the
percentage necessary to initiate and adopt a measure at a point so high
as to prevent its actual operation, and another which places it so low
as to make its frequent use feasible. The older and more radical group
of propagandists, finding their general scheme so widely taken up in
practical politics, soon began to devote their attention rather to
attacking the stricter safeguards thrown up by those who gave their
support to direct government in theory only.
In its simple form of initiation by five per cent of the voters and
adoption by a majority of those voting on the measure submitted, this
new device was undoubtedly a revolutionary change from the American
system of government as conceived by the framers of the Constitution of
the United States--with its checks and balances, indirect elections, and
judicial control over legislation. The more radical of the advocates of
direct government frankly admitted that this was true, and they sought
to strengthen this very feature of their system by the addition of
another device, known as the recall, which, when applied to judges as
well as other elective officers, reduced judicial control over
legislation to a practical nullity. Where judges are elected for short
terms by popular vote and made subject to the recall, and where laws
are made by popular vote of the same electors who choose the judges, it
is obvious that the very foundations of judicial supremacy are
undermined.
The recall, like direct democracy, was not new to American politics.
Both were understood, at least in principle, by the framers of the
Federal Constitution and rejected decisively. The recall seems to have
made its appearance first in local form,--in the charter of Los Angeles,
adopted in 1903. From there it went to the Seattle charter of 1906, and
two years later it was adopted as a state-wide system applicable to all
elective officers by Oregon. Its progress was swiftest in municipal
affairs, for it quite generally accompanied "the commission form" of
city government as a check on the commissioners in their exercise of
enlarged powers.
The state-wide recall, however, received a remarkable impetus in 1911
from the controversy over the admission of Arizona, which attracted the
attention of the nation. That territory had framed a constitution
containing a radical form of the recall based on the Oregon plan, and in
August, 1911, Congress passed a resolution admitting the applicant, on
condition that the provision relating to the recall should be
specifically submitted to the voters for their approval or rejection.
President Taft was at once stirred to action, and on August 15 he sent
Congress a ringing message, displaying unwonted vigor and determination,
vetoing the resolution and denouncing the recall of judges in unmeasured
terms. "Constitutions," he said, "are checks upon the hasty action of
the majority. They are the self-imposed restraints of a whole people
upon a majority of them to secure sober action and a respect for the
rights of the minority.... In order to maintain the rights of the
minority and the individual and to preserve our constitutional balance
we must have judges with courage to decide against the majority when
justice and law require.... As the possibilities of such a system [as
the recall] pass in review, is it too much to characterize it as one
which will destroy the judiciary, its standing, and its usefulness?"
Acting upon the recommendation of President Taft, Congress passed a
substitute resolution for admitting Arizona only on condition that the
obnoxious recall of judges be stricken from the constitution of the
state.[72] The debates in Congress over the admission of Arizona covered
the whole subject of direct government in all its aspects, and these,
coupled with the President's veto message, brought the issue prominently
to the front throughout the country. Voters to whom it had previously
been an obscure western device now began to take a deep interest in it;
the press took it up; and one more test for "progressive" and
"reactionary" was put in the popular program.
* * * * *
The movement for direct popular participation in state and local
government was inevitably accompanied by a demand for more direct
government within the political party; in other words, by a demand for
the abandonment of the representative convention in favor of the
selection of candidates by direct primary. During the decade of the
great Populist upheaval, legislation relative to political parties was
largely confined to the introduction of the Australian ballot and the
establishment of safeguards around the primaries at which delegates to
party conventions were chosen. The direct primary, like the initiative
and referendum, grew out of a discontent with social and economic
conditions, which led to an attack on the political machinery that was
alleged to be responsible for them. Like the initiative and referendum,
also, it was not an altogether new device, for it had been used for a
long time in some of the states as a local institution established by
party custom; but when it was taken up by the state legislatures, it
made a far more rapid advance.
It was not, however, until the opening of the new century that primary
legislation began to engross a large share of legislative activities. In
1903, "the first state-wide primary law with fairly complete provisions
for legal supervision was enacted by the state of Wisconsin"; Oregon,
making use of the new initiative system, enacted a thoroughgoing primary
law in 1904; and the following year Illinois adopted a state-wide
measure. Other states, hesitating at such an extensive application of
the principle, contented themselves at first with laws instituting local
primaries, such, for example, as the Nebraska law of 1905 covering
cities of over 125,000, or the earlier law of Minnesota covering only
Hennepin county. "So rapid was the progress of public opinion and
legislation," says Mr. Merriam, "that in many instances a compromise law
of one session of the legislature was followed by a thoroughgoing law
in the next. For example, the North Dakota law of 1905 authorized direct
primaries for all district nominations, but did not include state
offices; but in 1907, a sweeping act was passed covering practically all
offices."
The vogue of the direct primary was confined largely to the West at
first, but it steadily gained in favor in the East. Governor Hughes, of
New York, in his contest with the old organization of the Republican
party, became a stanch advocate of the system, recommended it to the
legislature in his messages, campaigned through the state to create
public sentiment in favor of the reform, and labored unsuccessfully to
secure the passage of a primary law, until he closed his term to accept
an appointment to the Supreme Court of the United States. In 1911, the
Democratic party, which had carried New York state at the preceding
election, enacted a primary law applicable to local, but not to state,
offices. About the same time Massachusetts, Maine, and New Jersey joined
the long list of direct primary states. Within almost ten years the
principle in its state-wide form had been accepted in two thirds of the
states, and in some local form in nearly all of the other commonwealths.
* * * * *
Meanwhile, the theory and practice of direct government made their way
upward into the Federal government. As early as 1826, Mr. Storrs, a
representative from New York, introduced in the House a constitutional
amendment providing for the popular election of United States Senators,
and from time to time thereafter the proposal was urged upon Congress.
President Johnson, who had long been an advocate of this change in the
Federal government, made it the subject of a special message to Congress
in 1868; but in his contest with that body the proposed measure was lost
to sight. Not long afterward it appeared again in the House and the
Senate, and at length the lower house in 1893 passed an amendment
providing for popular election by the requisite two-thirds vote, but the
Senate refused to act. Again in 1894, in 1898 (by a vote of 185 to 11),
in 1900 (240 to 15), and in 1902 by practically a unanimous vote, there
being no division, the House passed the amendment; still the Senate
resisted the change.
In the Senate itself were found occasional champions of popular
election, principally from the West and South. Mitchell, of Oregon,
Turpie, of Indiana, Perkins, of California, Berry, of Arkansas, and
Bailey, of Texas, took the leadership in this contest for reform.
Chandler, of New Hampshire, Depew, of New York, Penrose, of
Pennsylvania, Hoar, of Massachusetts, Foraker, of Ohio, and Spooner, of
Wisconsin, leveled their batteries against it. State after state
legislature passed resolutions demanding the change, until at length
three fourths had signified their demand for popular election.
The Senate as a whole remained obdurate. When in the Fifty-third
Congress the resolution of the House came before that body, Mr. Hoar, of
Massachusetts, made, on April 6 and 7, 1893, one of his most eloquent
and impassioned pleas for resisting this new proposal to the uttermost.
He declared that it would transfer the seat of power to the "great
cities and masses of population," that it would create new temptations
to fraud and corrupt practices, that it implied that the Senate had been
untrue to its trust, that it would lead to the election of the President
and the judiciary by popular majorities, and that it would "result in
the overthrow of the whole scheme of the Senate and in the end of the
whole scheme of the national Constitution as designed and established by
the framers of the Constitution and the people who adopted it." With
impatience, he refused to listen to the general indictment which had
been brought against the Senate as then constituted. "The greatest
victories of constitutional liberty since the world began," he
concluded, "are those whose battle ground has been the American Senate,
and whose champions have been the Senators who for a hundred years,
while they have resisted the popular passions of the House, have led,
represented, guided, obeyed, and made effective the deliberate will of a
free people."
Having failed to make an impression on the Senate by a frontal attack,
the advocates of popular election set to work to capture that citadel by
a rear assault. They began to apply the principle of the direct primary
in the nomination of candidates for the Senate, and this development at
length culminated in the Oregon scheme for binding the legislature to
accept the "people's choice." This movement gained rapid headway in the
South, where the real contest was over nomination, not election, on
account of the absence of party divisions. As early as 1875, the
Nebraska constitution had provided for taking a popular preferential
vote on candidates for the Senate; but no considerable interest seems
to have been taken in it at the time. In 1899, Nevada passed a law
entitled "an act to secure the election of United States Senators in
accordance with the will of the people and the choice of the electors of
the state." Shortly afterward, Oregon enacted her famous statute which
attempted to compel the legislature to accept the popular nominee; and
from that time forward the new system spread rapidly. By 1910, at least
three fourths of the states nominated candidates for the Senate by some
kind of a popular primary.
It was not until 1911 that the Senate yielded to the overwhelming
popular demand for a change in the methods of election provided in the
Constitution. In December, 1909, Senator Bristow, of Kansas, introduced
a resolution designed to effect this reform, and after a hot debate it
was defeated on February 28, 1911, by a vote of 54 to 33, four short of
the requisite two thirds. In the next Congress, which convened on April
4, ten Senators who had voted against the amendment had been retired,
and the champions of the measure, taking it up again with renewed
energy, were able to force it through the upper house on June 12, 1911,
by a margin of five more than the two thirds. The resolution went to the
House and a deadlock arose between the two chambers for a time over
Federal control of elections, provided in the Senate resolution, which
was obnoxious to many southern representatives. At length, however, on
May 13, 1912, the opponents in the House gave way, and the resolution
passed by an overwhelming vote. Within a year, the resolution was
ratified by the requisite three fourths of the state legislatures, and
it was proclaimed on May 31, 1913.
* * * * *
The advance of direct democracy in the West was accompanied by a revival
of the question of woman suffrage. That subject had been earnestly
agitated about the time of the Civil War; and under the leadership of
Elizabeth Cady Stanton, Susan B. Anthony, and others it made
considerable headway among those sections of the population which had
favored the emancipation of the slaves. Indeed, it was inevitably linked
with the discussion of "natural rights," extensively carried on during
the days when attempts were being made to give political rights to the
newly emancipated bondmen. Woman suffrage was warmly urged before the
New York state constitutional convention in 1867 by Mr. George William
Curtis, in a speech which has become a classic among the arguments for
that cause. During the seventies suffrage petitions bearing the
signatures of thousands of men and women were laid before Congress, and
an attempt was made to secure from the Supreme Court an interpretation
of the Fourteenth Amendment which would force the states to grant the
ballot to women.
At length the movement began to subside, and writers who passed for keen
observers declared it to be at an end. The nineteenth century closed
with victories for the women in only four states, Wyoming, Colorado,
Utah, and Idaho. The first of these states had granted the vote to women
while yet a territory, and on its admission to the Union in 1890, it
became the first state with full political equality. Three years later,
Colorado enfranchised women, and in 1896 Utah and Idaho joined the equal
suffrage commonwealths. Meanwhile, a very large number of northern and
eastern states had given women the right to vote in local or school
elections, Minnesota and Michigan in 1875 and other states in quick
succession. Nevertheless, these gains were, relatively speaking, small,
and there seemed to be little widespread enthusiasm about the further
extension of the right.
Of course, the agitation continued, but in somewhat obscure circles,
under a running fire of ridicule whenever it appeared in public. At
length it broke out with unprecedented vigor, shortly after the tactics
adopted by militant English women startled the world. Within a short
time new and substantial victories gave the movement a standing which
could not be ignored either by its positive opponents or the indifferent
politicians. In 1910, the suffragists carried the state of Washington;
in 1911, they carried California; in 1912, they won in Arizona, Kansas,
and Oregon; but lost Ohio, Michigan, and Wisconsin. These victories gave
them nine states and of course a considerable influence in the House of
Representatives and the right to participate in the election of eighteen
out of ninety-six Senators. But the defeat in the three middle states
led the opponents of woman suffrage to believe that the movement could
be confined to the far West. This hope was, however, dashed in 1913 when
the legislature of Illinois gave women the right to vote for all
statutory officers, including electors for President of the United
States. Determined to make use of the political power thus obtained,
the suffragists, under the leadership of Alice Paul, renewed with great
vigor the agitation at Washington for a national amendment forbidding
states to disqualify women from voting merely on account of sex.
_The Rise and Growth of Socialism_
With the spread of direct elections and the initiative and referendum,
and the adoption of the two amendments to the Federal Constitution
authorizing an income tax[73] and the popular election of Senators, the
milder demands of Populism were secured. At the same time, the
prosperity of the farmers and the enormous rise in ground values which
accompanied the economic advance of the country removed some of the most
potent causes of the discontent on which Populism thrived. Organized
Populism died a natural death. Those Populists who advocated only
political reforms went over to the Republican and Democratic parties;
the advocates of radical economic changes, on the other hand, entered
the Socialist ranks.
Socialism, as an organized movement in the United States, runs back to
the foundation of the Social-Democratic Workingmen's party in New York
City, in 1874, which was changed into the Socialist Labor party three
years later,--a party that still survives. This group did not enter into
national politics until 1892, although its branches occasionally made
nominations for local offices or fused with other labor groups, as in
the New York mayoralty campaign of 1886. In its vigorous propaganda
against capitalism, this party soon came into collision with the
American Federation of Labor, established in 1886, and definitely broke
with it four years later when the latter withheld a charter from the New
York Central Federation for the alleged reason that the Socialist Labor
party of that city was an affiliated organization. After the break with
the American Federation, this Socialist group turned for a time to the
more radical Knights of Labor, but this new flirtation with labor was no
more successful than the first, and in time the Socialist Labor party
declared war on all the methods of American trades-unionism. Its gains
numerically were not very significant; it polled something over twenty
thousand votes in 1892 and over eighty thousand in 1896--the high-water
mark in its political career. Its history has been a stormy one, marked
by dissensions, personal controversies, and splits, but the party is
still maintained by a decreasing band of loyal adherents.
The growth of interest in socialism, however, was by no means confined
to the membership of the Socialist Labor party. External events were
stirring a consciousness that grave labor problems had arisen within the
American Commonwealth. The bloody strikes at Homestead, Coeur d'Alene,
Buffalo, and Pullman in the eighties and early nineties moved the
country as no preachments of abstract socialist philosophy could ever
have done. That such social conflicts were full of serious portent was
recognized even by such a remote and conservative thinker as President
Cleveland in his message of 1886 to Congress. In that very year, the
Society of Christian Socialists was formed, with Professor R. T. Ely and
Professor G. D. Herron among its members, and about the same time
"Nationalist" clubs were springing up all over the country as a result
of the propaganda created by Bellamy's _Looking Backward_, published in
1887. The decline of the Populist party, which had indorsed most of the
socialistic proposals that appealed to Americans tinged with radicalism,
the formation of local labor and socialist societies of one kind or
another, and the creation of dissatisfaction with the methods and
program of the Socialist Labor party finally led to the establishment of
a new national political organization.
This was effected in 1900 when a general fusion was attempted under the
name of the Social Democratic party, which nominated Mr. Eugene V. Debs
for President at a convention held in Indianapolis. The Socialist Labor
party, however, declined to join the organization and went on its own
way. The vote of the new party, ninety-six thousand, induced the leaders
in the movement to believe that they were on the right track, for this
was considerably larger than the rival group had ever secured. Steps
were immediately taken to put the party on a permanent basis; the name
Socialist party was assumed in 1901; local branches were established in
all sections of the country with astonishing rapidity; and a vigorous
propaganda was undertaken. In the national election of 1904 over four
hundred thousand votes were polled; in 1908, when Mr. Bryan and Mr.
Roosevelt gave a radical tinge to the older parties, a gain of only
about twenty-five thousand was made; but in 1912, despite Mr. Wilson's
flirtation with western democracy and the candidacy of Mr. Roosevelt on
a socialistic platform, the Socialist party more than doubled its vote.
During these years of growth the party began to pass from the stage of
propaganda to that of action. In 1910, the Socialists of Milwaukee
carried the city, secured twelve members of the lower house of the state
legislature, elected two state Senators, and returned Mr. Victor Berger
to Congress. This victory, which was hailed as a turning point in the
march of socialism, was largely due, however, to the divided condition
of the opposition, and thus the Socialists really went in as a
plurality, not a majority party. The closing of the Republican and
Democratic ranks in 1912 resulted in the ousting of the Socialist city
administration, although the party polled a vote considerably larger
than that cast two years previously. In other parts of the country
numerous municipal and local officers were elected by the Socialists,
and in 1912 they could boast of several hundred public offices.[74]
While there was no little difference of opinion among the Socialists as
to the precise character of their principles and tactics,--a condition
not peculiar to that party,--there were certain general ideas running
through their propaganda and platforms. Modern industry, they all held,
creates necessarily a division of society into a relatively few
capitalists, on the one hand, who own, control, and manipulate the
machinery of production and the natural resources of the country, and
on the other hand, a great mass of landless, toolless, and homeless
working people dependent upon the sale of their labor for a livelihood.
There is an inherent antagonism between these two classes, for each
seeks to secure all that it can from the annual output of wealth; this
antagonism is manifest in labor organizations, strikes, and industrial
disputes of every kind. Out of this contest, the former class gains
wealth, luxury, safety, and the latter, poverty, slums, and misery.
Finally, if the annual toll levied upon industry by the exploiters and
the frightful wastes due to competition and maladjustment were
eliminated, all who labor with hand or brain could enjoy reasonable
comfort and security, and also leisure for the cultivation of the nobler
arts of civilization.
At the present time, runs the Socialist platform of 1912, "the
capitalist class, though few in numbers, absolutely controls the
government--legislative, executive, and judicial. This class owns the
machinery of gathering and disseminating news through its organized
press. It subsidizes seats of learning,--the colleges and the
schools,--even religious and moral agencies. It has also the added
prestige which established customs give to any order of society, right
or wrong." But the working class is becoming more and more discontented
with its lot; it is becoming consolidated by cooperation, political and
economic, and in the future it will become the ruling class of the
country, taking possession, through the machinery of the government, of
the great instrumentalities of production and distribution. This final
achievement of socialism is being prepared by the swift and inevitable
consolidation of the great industries into corporations, managed by paid
agents for the owners of the stocks and bonds. The transition from the
present order will take the form of municipal, state, and national
assumption of the various instrumentalities of production and
distribution--with or without compensation to the present owners, as
circumstances may dictate.[75] Such are the general presuppositions of
socialism.
The Socialist party had scarcely got under way before it was attacked
from an unexpected quarter by revolutionary trade-unionists, known as
the Industrial Workers of the World, who revived in part the old
principle of class solidarity (as opposed to trade solidarity) which lay
at the basis of the Knights of Labor. The leaders of this new unionism,
among whom Mr. W. D. Haywood was prominent, did not repudiate altogether
the Socialist labors to secure control of the organs of government by
the ballot, but they minimized their importance and pressed to the front
the doctrine that by vigorous and uncompromising mass strikes a
revolutionary spirit might be roused in the working class and the actual
control of business wrested from the capitalists, perhaps without the
intervention of the government at all.
This new unionism was launched at a conference of radical labor leaders
in 1904, at which the following program was adopted: "The working class
and the employing class have nothing in common. Between these two
classes a struggle must go on until the workers of the world organize as
a class, take possession of the earth and machinery of production and
abolish the wage system. We find that the centering of the management of
industries into fewer and fewer hands makes the trade unions unable to
cope with the ever growing power of the employing class. The trade
unions foster a state of affairs which allows one set of workers to be
pitted against another set of workers in the same industry.... Moreover
the trade unions aid the employing class to mislead the workers into the
belief that the working class have interests in common with their
employers. These conditions can be changed and the interest of the
working class upheld only by an organization formed in such a way that
all its members in any one industry, or in all industries if necessary,
cease work whenever a strike or a lockout is on in any department
thereof.... We must inscribe on our banner the revolutionary watchword,
'Abolish the wage system.'"
This new society made a disturbance in labor circles entirely out of
proportion to its numerical strength. Its leaders managed strikes at
McKees Rocks, Pennsylvania, at Lawrence, Massachusetts, in 1912, and at
other points, laying emphasis on the united action of all the working
people of all the trades involved in the particular industry. The "new
unionism" appealed particularly to the great mass of foreign laborers
who had no vote and therefore perhaps turned with more zeal to "direct"
action. It appeared, however, that the membership of the Industrial
Workers was not over 70,000 in 1912, and that it had little of the
stability of the membership of the old unions.
What the effect of this new unionism will be on the Socialist party
remains to be seen. That party at its convention in 1912 went on record
against the violent tactics of revolutionary unionism, and by a party
vote "recalled" Mr. Haywood from his membership on the executive
committee. The appearance of this more menacing type of working-class
action and the refusal of the Socialist party to accept it with open
arms gave a new turn to the attitude of the conservative press toward
regular political socialism of the strict Marxian school.
_The Counter-Reformation_
Just as the Protestant Revolt during the sixteenth century was followed
by a counter-reformation in the Catholic Church which swept away many
abuses, while retaining and fortifying the essential principles of the
faith, so the widespread and radical discontent of the working classes
with the capitalist system hitherto obtaining produced a
counter-reformation on the part of those who wish to preserve its
essentials while curtailing some of its excesses. This counter-reformation
impress upon American political thinking and made a deep legislation at
the turning of the new century. More than once during his presidency Mr.
Roosevelt warned the capitalists that a reform of abuses was the price
which they would have to pay in order to save themselves from a socialist
revolution. Eminent economists turned aside from free trade and _laissez
faire_ to consider some of the grievances of the working class, and many
abandoned the time-honored discussions of "economic theories," in favor
of legislative programs embracing the principles of state socialism, to
which countries like Germany and Great Britain were already committed.
Charity workers whose function had been hitherto to gather up the wrecks
of civilization and smooth their dying days began to talk of "a war for
the prevention of poverty," and an examination of their concrete
legislation proposals revealed the acceptance of some of the principles
of state socialism. Unrestricted competition and private property had
produced a mass of poverty and wretchedness in the great cities which
constituted a growing menace to society, and furnished themes for
socialist orators. Social workers of every kind began the detailed
analysis of the causes of specific cases of poverty and arrived at the
conclusion that elaborate programs of "social legislation" were
necessary to the elimination of a vast mass of undeserved poverty.
Under the stimulus of these and other forces, state legislatures in the
more industrially advanced commonwealths began to pour out a stream of
laws dealing with social problems. These measures included employers'
liability and workmen's compensation laws, the prohibition of child
labor, minimum hours for dangerous trades like mining and railroading,
minimum wages for women and girls, employment bureaus, and pensions for
widows with children to support. While none of the states went so far
as to establish old-age pensions and general sickness and accident
insurance, it was apparent from an examination of the legislation of the
first decade of the twentieth century that they were well in the paths
of nations like Germany, England, and Australia.
_Criticism of the Federal System_
All this unsettlement in economics and politics could not fail to bring
about a reconsideration of the fundamentals in the American
constitutional system--particularly the distribution of powers between
the Federal and state governments, which is made by a constitution
drafted when economic conditions were totally different from what they
are to-day. In fact, during the closing years of the nineteenth century
there appeared, here and there in American political literature,
evidence of a discontent with the Federal system scarcely less keen and
critical than that which was manifested with the Articles of
Confederation during those years of our history which John Fiske has
denominated "The Critical Period."
Manufacturing interests which, at the time the Federal Constitution was
framed, were so local in character as to be excluded entirely from the
control of the Federal government had now become national or at all
events sectional, having absolutely no relation to state lines. As
Professor Leacock remarks, "The central fact of the situation is that
economically and industrially the United States is one country or at
best one country with four or five great subdivisions, while politically
it is broken into a division of jurisdictions holding sway to a great
extent over its economic life, but corresponding to no real division
either of race, of history, of unity, of settlement, or of commercial
interest."[76] For example, in 1900 the boot and shoe industry, instead
of being liberally distributed among the several states, was so
concentrated, that out of the total product 44.9 per cent was produced
by Massachusetts; nearly one half of the agricultural implements for
that year were made in Illinois; two thirds of the glass of the whole
country was made in Pennsylvania and Indiana; while Pennsylvania alone
produced 54 per cent of the iron and steel manufactured. The political
significance of this situation was simply this: the nation on which each
of these specialized industries depended for its existence had
practically no power through the national government to legislate
relative to them; but in each case a single legislature representing a
small fraction of the people connected with the industry in question
possesses the power of control.
The tendency of manufacturers to centralize was accompanied, as has been
pointed out above, by a similar centralization in railways. At the close
of the nineteenth century, the Vanderbilt system operated "some 20,000
miles reaching from New York City to Casper, Wyoming, and covering the
lake states and the area of the upper Mississippi; the Pennsylvania
system with 14,000 miles covers a portion of the same territory,
centering particularly in Ohio and Indiana; the Morgan system,
operating 12,000 miles, covers the Atlantic seaboard and the interior of
the Southern States from New York to New Orleans; the Morgan-Hill system
operates 20,000 miles from Chicago and St. Louis to the state of
Washington; the Harriman system with 19,000 miles runs from Chicago
southward to the Gulf and westward to San Francisco, including a
Southern route from New Orleans to Los Angeles; the Gould system with
14,000 miles operates chiefly in the center of the middle west extending
southward to the Gulf; in addition to these great systems are a group of
minor combinations such as the Atchinson with 7,500 or the Boston and
Maine with 3,300 miles of road."
Corresponding to this centralization in industries and railways there
was, as we have pointed out, a centralization in the control of capital,
particularly in two large groups, the Standard Oil and the Morgan
interests. As an expert financier, Mr. Moody wrote in 1904: "Viewed as a
whole, we find the dominating influences in the trusts to be made up of
an intricate network of large and small groups of capitalists, many
allied to one another by ties of more or less importance, but all being
appendages to, or parties of the greater groups which are themselves
dependent on and allied with the two mammoth or Rockefeller and Morgan
groups."
* * * * *
Facing this centralized national economy was a Federal system made for
wholly different conditions--a national system of manufacturing,
transportation, capital, and organized labor, with a national government
empowered, expressly, at least, to regulate only one of those
interests, transportation--the other fundamental national interests
being referred to the mercy of forty-six separate and independent state
legislatures. But it is to be noted, these several legislatures were by
no means free to work out their own program of legislation; all of them
were, at every point, subjected to Federal judicial control under the
general phrases of the Fourteenth Amendment relative to due process of
law and the equal protection of the laws.[77] To state it in another
way, the national government was powerless to act freely with regard to
nearly all of the great national interests, but it was all powerful
through its judiciary in striking down state legislation.
A few concrete illustrations[78] will show the lack of correspondence
between the political system and the economic system. Each state bids
against the others to increase the number of factories which adds to its
wealth and increases the value of property within its borders, although
it makes no difference to the total wealth of the nation and the
happiness of the whole people whether a particular concern is located in
New Jersey or in Pennsylvania. As the national government enjoys no
power to regulate industries--even those which are national in
character--the states use their respective powers under the pressure
which comes from those who are interested in increasing the industry of
the commonwealth. For example, it is stated "the glass workers of New
Jersey oppose any attempt to prohibit night work for boys under sixteen
years of age on the ground that such work is permitted in the
neighboring state of Pennsylvania." In 1907, in South Carolina, Georgia,
and Alabama, a ten year old child could, under the law, work for twelve
hours a day; North Carolina had sixty-six mills where twelve year old
children could do twelve hours' night work under the law. Although this
situation was somewhat remedied later, the advocates of reform were
resisted at every point by the interested parties who contended that in
competing with New England, the southern states had to take advantage of
every opportunity, even at the expense of the children.
The situation may be described in the language of the chief factory
inspector of Ohio: "Industrially as well as geographically we of the
Ohio Valley are one people and our laws should be uniform, not only that
they may be the easier enforced, but in justice to the manufacturers who
pursue the same industry in the several states and therefore come into
close competition with one another." Moreover, if a state enacts an
important industrial law, it may find its work in vain as the result of
a decision of the national Supreme Court, or of the state courts,
interpreting the Fourteenth Amendment.
Another example of a national interest which is wholly beyond the reach
of the Federal government, under a judicial decision reached in the case
of Paul _v._ Virginia in 1868, is that of insurance. Although Hamilton
and earlier writers on the Constitution believed that the insurance
business was a branch of interstate commerce whose regulation was vested
in Congress, the Supreme Court in this case dealing with fire insurance
declared that the act of issuing a policy of insurance was not a
transaction of commerce. "The policies," said the Court, "are simple
contracts of indemnity against loss by fire, entered into between the
corporations and the assured for a consideration paid by the latter.
These contracts are not articles of commerce in any proper meaning of
the word; they are not subjects of trade and barter offered in the
market as something having an existence and value independent of the
parties to them.... Such contracts are not interstate transactions,
though the parties may be domiciled in different states.... They are
then local transactions and are governed by the local laws. They do not
constitute a part of the commerce between the states any more than a
contract for the purchase and sale of goods in Virginia by a citizen of
New York whilst in Virginia would constitute a portion of such
commerce."
As a result of this narrow interpretation of the commerce clause, the
vast insurance business of the country, national in character, was put
beyond the reach of Congress, and at the mercy of the legislatures of
the several commonwealths. Under these circumstances, the insurance laws
of the United States were in splendid chaos. "If a compilation of these
laws were attempted," says Mr. Huebner, "a most curious spectacle would
result. It would be found that fifty-two states and territories are all
acting along independent lines and that each, as has been correctly
said, possessed its own schedule of taxations, fees, fines, penalties,
obligations and prohibitions, and a retaliatory or reciprocal provision
enabled it to meet the highest charges any other state may require of
the companies of any other states."
A still better example of confusion in our system is offered by the
corporation laws of the several states. Great industrial corporations
are formed under state laws. While many contend that Congress has the
power to compel the Federal incorporation of all concerns doing an
interstate business and thus to occupy the whole domain of corporation
law involving interstate commerce, this radical step has not yet been
taken. Congress has confined itself to the more or less fruitless task
of forbidding combinations in restraint of interstate trade.
Under these circumstances, there appeared the anomalous condition of
states actually advertising in the newspapers and bidding against each
other in offering the corporations special opportunities and low fees
for the privilege of incorporating. If the conscience of one state
became enlightened and a strict corporation law was enacted, the result
was simply to drive the irregular concerns into some other state which
was willing to sell its privileges for the small fee of incorporation,
and ask no questions. As might have been expected, every variety of
practice existed in the forty-eight jurisdictions in which corporations
might be located.
Not only was there the greatest diversity in these practices, but
special discriminations were often made in particular states against
concerns incorporated in other states; and on top of all this there was
a vast mass of anti-trust legislation, frequently drastic in character
or loose and futile. Often it was the product of a popular clamor
against large business undertakings, and often it was the result of the
effort of legislators to "strike" at corporations. Whatever the
underlying motive, it was generally characterized at the outset by lack
of uniformity and absence of any large view of public policy, and then
it was glossed over by judicial decisions, state and Federal, until it
was a fortunate corporation official, indeed, who knew either his rights
or his duties under the law. Moreover, it was a particularly obtuse
attorney who could not lead his client unscathed through this wonderland
of legal confusion.
The position of railway corporations, if possible, was more anomalous
still. Their interstate business was subject to the regulations of
Congress and their intra-state business to the control of the state
legislatures. Although there existed, in theory, a dividing line between
these two classes of business, there were always arising concrete cases
where it was difficult to say on which side of the line they would fall
in the opinion of the Supreme Court. States were constantly being
enjoined on the application of the railways for their "interference with
interstate commerce"; and when far-reaching legislation was proposed in
Congress, the cry went up that the rights of states were being trampled
upon. If X shipped a carload of goods to Y within the borders of his
state, he paid one rate; if he shipped it to Z, two miles farther on in
another state, he paid a different rate, perhaps less than in the first
instance. In a number of states companies owning parallel lines might
consolidate; in others, consolidation was forbidden. According to a
report of the Interstate Commerce Commission in 1902, the states were
equally divided on this proposition as to the consolidation of
competing lines. According to the same report, if a railway company was
guilty of unjust discrimination in one state, it paid a fine of $50, and
in other states it was mulcted to the tune of $25,000. At the same time,
whoever obstructed a railway track in Mississippi was liable to three
months in jail; for the same offense in New York he might get three
years; if, perchance, after serving three years and three months in
these two commonwealths, he tried the experiment again in Wyoming, he
might in the mercy of the court be sentenced to death.
A further element of confusion was added by the intervention of the
Federal judiciary in declaring state laws invalid, not merely when they
conflicted clearly with the execution of Federal law, but on
constitutional grounds which meant, for practical purposes, whenever the
said laws were not in harmony with the ideas of public policy
entertained by the courts at the time. The Federal judiciary in regard
to state legislation relative to corporations was, therefore, a
destructive, not a constructive, body. To use the language of the
street, state legislation was simply "shot to pieces" by judicial
decisions. That which was chaotic, disjointed, and founded upon no
uniformity of purpose or policy to begin with was riddled and torn by a
body which had no power for positive action.
As the Interstate Commerce Commission declared in 1903, "One of the
chief embarrassments in the exercise of adequate government control over
the organization, the construction, and the administration of railways
in the United States is found in the many sources of statutory
authority recognized by our form of government. The Federal Constitution
provides for uniformity in statutory control, so far as interstate
commerce is concerned, but it does not touch commerce within the states,
nor, as at present interpreted, does it cover the organization of
railroad corporations or the construction of railroad properties. These
matters, as well as the larger part of that class of activities included
under the police jurisdiction, are left to the states. Such being the
case, the development of an harmonious and uniform railroad system must
be attained, if at all, by one of two methods. The states must
relinquish to the Federal government their reserved rights over internal
commerce, or having first agreed upon fundamental principles, they must,
through comity and convention, work out an harmonious system of
statutory regulation."
* * * * *
This was the situation that called forth the demand for the national
regulation of large corporate enterprises, and brought about the demand
for a strengthening of the Federal government, either by a
constitutional amendment or judicial interpretation, which received the
name of "New Nationalism." Wide currency was given to this term by Mr.
Roosevelt, in his speech delivered at Ossawatomie on August 31, 1910.
After outlining a legislative policy which he deemed to be demanded by
the changed economic conditions of our time, Mr. Roosevelt attacked the
idea of "a neutral zone between the national and state legislatures,"
guarded only by the Federal judiciary; and pleaded for the
strengthening of the Federal government so as to make it competent for
every national purpose.
"There must remain no neutral ground," he said, "to serve as a refuge
for lawbreakers, and especially for lawbreakers of great wealth, who can
hire the vulpine legal cunning which will teach them how to avoid both
jurisdictions. It is a misfortune when the national legislature fails to
do its duty in providing a national remedy so that the only national
activity is the purely negative activity of the judiciary in forbidding
the state to exercise the power in the premises.
"I do not ask for overcentralization; but I do ask that we work in a
spirit of broad and far-reaching nationalism when we work for what
concerns our people as a whole. We are all Americans. Our common
interests are as broad as the continent. I speak to you here exactly as
I would speak in New York or Georgia, for the most vital problems are
those which affect us all alike. The national government belongs to the
whole American people, and where the whole American people are
interested, that interest can be guarded effectively only by the
national government. The betterment which we seek must be accomplished,
I believe, mainly through the national government.
"The American people are right in demanding that New Nationalism without
which we cannot hope to deal with new problems. The New Nationalism puts
the national need before sectional or personal advantages. It is
impatient of the utter confusion that results from local legislatures
attempting to treat national issues as local issues. It is still more
impatient of the impotence which springs from overdivision of
government powers, the impotence which makes it impossible for local
selfishness or for legal cunning, hired by wealthy special interests, to
bring national activities to a deadlock. This New Nationalism regards
the executive power as the steward of the public welfare. It demands of
the judiciary that it shall be interested primarily in human welfare
rather than in property, just as it demands that the representative body
shall represent all the people rather than any one class or section of
the people."
FOOTNOTES:
[70] The political history of the initiative and referendum
has never been written. Some valuable materials are to be
found in _Direct Legislation_, Senate Document No. 340, 55th
Cong., 2d Sess. (1898); and in "The Direct Legislation
Record," founded in May, 1894; and in the "Equity Series,"
now published at Philadelphia. See also Oberholtzer, _The
Initiative, Referendum, and Recall in America_, ed. 1911.
[71] _The Initiative, Referendum, and Recall_, Annals of the
American Academy of Political and Social Science, September,
1912, pp. 84 ff.
[72] Arizona was admitted without the judicial recall
provision, but immediately set to work and reinserted it in
the constitution, and devised a plan for the recall of
Federal district judges as well.
[73] See below, p. 325.
[74] See list in the _National Municipal Review_ for July,
1912.
[75] The Socialist party does not at present contemplate
public ownership of petty properties or of farm lands tilled
by their possessors. This is one part of its program not yet
definitely worked out.
[76] _Proceedings of the American Political Science
Association_, 1908, Vol. V, p. 42.
[77] See above, p. 54.
[78] Taken from Professor Leacock's paper in the _Proceedings
of the American Political Science Association_, 1908, pp. 37
ff.