Theodore Roosevelt and the Crisis

The failure of the progressive movement of the late nineteenth and early twentieth centuries to address the issue of widespread ownership of capital resulted in a quarrel between Roosevelt and one of his “trust busters,” Judge Peter S. Grosscup.  As a result, the ownership issue was sidelined during Roosevelt’s administration.  It never became a part of the progressive platform, despite ongoing efforts by Grosscup to focus people’s attention on the critical need to spread out ownership of America’s productive capacity.

Archbishop John Ireland

The fact was, what with the rise of capitalism and socialism, combined with revolution in politics, organized religion, and even Academia, the United States and the rest of the world were in very serious trouble.  Unfortunately, very few voices were raised expressing concern about the need to address the problem of concentrating capital ownership and the effect this change was having in all aspects of life, even to the invention of a new religion under the name of Christianity.  Grosscup, Archbishop John Ireland, G.K. Chesterton, and a few others made the growing propertylessness of ordinary people a focus of their efforts but were not taken seriously by the very people they were trying to help.

Consequently, while Roosevelt made strenuous efforts to implement the progressive program during his tenure as president, progressivism was ultimately built on an unstable foundation and inadequate assumptions. Without widespread capital ownership, ordinary people would continue to lose power, while State bureaucrats and the wealthy would continue to gain power at the expense of the people.

Gilbert Keith Chesterton

The spirit and direction of the country seemed different. As G.K. Chesterton observed at this time,

In the case of America, indeed, a warning to this effect is instant and essential. America, of course, like every other human thing, can in spiritual sense live or die as much as it chooses. But at the present moment the matter which America has very seriously to consider is not how near it is to its birth and beginning, but how near it may be to its end. It is only a verbal question whether the American civilization is young; it may become a very practical and urgent question whether it is dying. (G.K. Chesterton, Heretics. Hollywood, Florida: Simon and Brown, Publishers, 2011, 177.)

There will always be an ongoing temptation in every time and place to replace the true power with which private property naturally vests an owner, with the ephemeral pseudo power that comes from State protection of the propertyless. The only choice facing the American Republic, therefore, seemed to be between capitalism, with its concentration of ownership in the hands of a private sector elite, and socialism, with its concentration of ownership or control in the hands of the State. The only question was whether the vested interests of the private sector control the government that controlled the economy, or would the people control the government?

In neither case was the possibility of power subsisting directly in the people through broad-based capital ownership addressed. The obvious threat of uncontrolled growth of State power, or that of a private sector elite, made for an extremely unstable social situation. As Herbert Knox Smith (1869-1931), Roosevelt’s Commissioner of Corporations, described it,

Herbert Knox Smith

In 1900 the surface of American life was, as it were, hardening, was growing less plastic. Dangerous division lines were opening from the pressures beneath, splitting the unity of the nation. The great trust movement was in full force, sweeping into a few hands special industrial privileges, the control of natural resources, and decisive advantages in transportation. Individual opportunity and the open highways of commerce were narrowing. Great corporations were considering themselves above the law, with the cynical but increasing concurrence of the public. A sinister atmosphere was gathering, menacing to American initiative and American ideals.

These recognized inequalities, with the twisted standards which they implied, were moving strongly toward national disunity — that profound disunity which in a democratic people must result from confessed differences in privilege and opportunity. (Herbert Knox Smith, “The Great Progressive,” Foreword to Social Justice and Popular Rule. New York: Charles Scribner’s Sons, 1926, xi.)

In short, the divide between the propertied and the propertyless was growing. If something were not done, the stage would be set for much greater problems in the future. A decision had to be made.

Unfortunately, Roosevelt made the wrong decision, at least in part. He may have been stymied (as he evidently believed) by the presumed necessity of past savings to finance new capital formation, a monopoly by definition controlled by the rich, and thus the presumed inevitability of concentrated ownership. Roosevelt may also have been somewhat diverted by his seeming exclusive focus on breaking up monopolies by direct legal action by the State, rather than by indirect financial and economic action by the people.

Whatever the reason, Roosevelt believed that economic democracy could best be attained and sustained by reining in the vested interests and returning control of the government to the man in the street, before the man in the street had the economic power to attain and sustain that political power. This was where Grosscup’s input might have influenced Roosevelt’s program, at least had the two men been on speaking terms at the time. Grosscup’s insights on the necessity of widespread capital ownership would have been invaluable while Roosevelt was president and had the power to do something.

Theodore Roosevelt, Jr.

The forces against which Roosevelt struggled, of course, were locked into the same economic paradigm, and were prepared to meet him on his own ground.

Whether they could beat him on it was another matter. As H.K. Smith put it,

The great interests were already familiar with Colonel Roosevelt’s powers and purposes when he was President and earnestly feared and hated them. He told them plainly: “Our intention is to extend the genuine principles of democracy into our industrial and economic, as into our political life.” They also saw, just as he did, that the old conflict was moving to a new battle-ground — the political arena. They prepared for that struggle with the intensity and short-sightedness of those who hope actually to hand down unfair advantage to their children, not foreseeing the harvest those children would reap. The original question, “Shall the Government control business?” gave place to the ultimate question: “Shall the citizen control his Government?” (Ibid., xiii.)

But is the ultimate question “Shall the citizen control his Government?” . . . or “How shall the citizen control his Government?” By putting the cart before the horse, that is, putting the demand that the citizen control his government before he can control his government through widespread capital ownership, Roosevelt virtually ensured that the progressive cause would come to nothing.

Does that mean, however, that what Roosevelt did was completely useless? That would be as great a mistake as to assume that the specifics Roosevelt proposed constituted a complete solution to the problems facing the country.

The fact is, what Roosevelt proposed was the right thing to do. It just was not sufficient. There were just too many assumptions implicit in the progressive program. Should government restrict itself to providing a level playing field and equality of opportunity, enforcing contracts, and policing abuses, and serving as the succor of the individual citizen when all other recourse has been exhausted?

Of course it should. That is what governments were instituted to do, and what progressives demanded. It is just not enough when the country is in a state of crisis, and most people are cut off from private property, the chief means by which they participate in the common good.

The only thing worse is to assume that the State can fill all needs and directly make up what is lacking when the institutions of society are flawed and prove inadequate.  As Pope Pius XI would point out in the next generation,

Pope Pius XI

When we speak of the reform of institutions, the State comes chiefly to mind, not as if universal well-being were to be expected from its activity, but because things have come to such a pass through the evil of what we have termed “individualism” that, following upon the overthrow and near extinction of that rich social life which was once highly developed through associations of various kinds, there remain virtually only individuals and the State. This is to the great harm of the State itself; for, with a structure of social governance lost, and with the taking over of all the burdens which the wrecked associations once bore, the State has been overwhelmed and crushed by almost infinite tasks and duties. (Quadragesimo Anno, § 78.)

Unfortunately, the populist orientation had come around to the belief that the State should have the ultimate responsibility to take care of people directly. By this time, the populist position differed from that of the socialists only in degree.

Not to keep making this point, but most people then and now could not see much or even any difference between the respective positions of the progressives and the populists. This meant that the decision would be made not on the issues, but on personalities, and which side could muster the most effective rhetoric.

And that was a problem.

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