While researching the history of fixing U.S. elections, I recently came across an interesting book by historian Gabriel Kolko.
Wikipedia states Mr. Kolko is liberal, but a review of his book The triumph of conservatism: a re-interpretation of American history, 1900-1916 on Amazon.com states:
No book details the historical relationship between big business and the Federal government better than this one. Though confined merely to the so-called Progressive Era in American history (1901-1914), Kolko manages to overturn all the misconceptions about the formation of government regulation in America. Instead of accepting the standard view that federal regulation of business was inspired by the Progressive intellectuals and activist political leaders eager to put a check on the rising power of big business, Kolko shows that it was really inspired by the drive of businessman to limit competition and bring “stability” into the market. The result is what Kolko calls, appropriately enough, “political capitalism.” Some earlier reviews have attempted to draw an ideological lesson from this book. This is a mistake. If there is a lesson to be drawn from Kolko’s work, it is the failure of all ideologies (whether from the right, left, or center) to adequately explain the rise of political capitalism in America. Both the right and the left share the common assumption that government regulation hurts big business. Kolko proves that this isn’t the case, that Big Business is in favor of regulation and the throttling of competition. Kolko’s book is a must read for anyone who wants to understand what capitalism and politics is really all about.
What’s quite fascinating is in The triumph of conservatism Mr. Kolko identifies John D. Rockefeller as being directly responsible for the creation of US incorporation law :
Page 63
The Sherman Act was not, with rare exceptions, enforced throughout the 1890’s. By the end of the century the issue could no longer be ignored, if only because it was becoming politically inexpedient to continue to do so in the face of mounting concern over the growth of big business. In June, 1898, Congress created the U.S. Industrial Commission to study the entire economic structure and to take testimony from those interested in the problem. Composed of House and Senate members, but primarily of the representatives of a variety of economic organizations, the commission functioned for three years, and its nineteen volumes of testimony and reports are a goldmine of information on every aspect of the American economy at the beginning of the century.
The Industrial Commission accepted the necessity and inevitability of industrial combinations, urging that “Their power for evil should be destroyed and their means for good preserved.” More significantly, the commission’s hearings provided a forum for key businessmen on the question of federal regulation. Of some type in some specific area, and no interest was as strong in this demand as Standard Oil. John D. Rockefeller, John D. Archibold, and H. H. Rogers of Standard called for a national incorporation law and the federal regulation of accounts and financial publicity. Inconsistent state regulation, the Standard spokesmen claimed, was vexatious. There should be, Rockefeller suggested, “First. Federal legislation under which corporations may be created and regulated, if that be possible. Second. In lieu thereof, State legislation as nearly uniform as possible encouraging combinations of persons and capital for the purpose of carrying on industries, but permitting State supervision. . . .” They were joined by Elbert H. Gary, of Morgan’s Federal Steel, who called for full publicity of financial data, and by John W. Gates and Max Pam of American Steel and Wire, who wanted strict federal incorporation laws and a national manufacturing commission to supervise incorporation, and by James B. Dill, the promotion lawyer, who also favored federal incorporation. There was of course, significant opposition to federal incorporation from John R. Dos Passos, the promoter, and Francis Lynde Stetson, but it is clear that important, if not dominant, big business sentiment was very much in favor of federal regulation.
This brings about a paradox in the right and the left. Glenn Beck is often critical of liberals for criticizing corporations, yet it was federal interference on behalf of big business which created our modern day incorporation laws to shield against liability. On the left there is a demand to regulate industry without acknowledging the dangerous fact big business is the main driver behind regulation. In most cases big business actually writes the laws to regulate themselves.
More Information:
The triumph of conservatism: a re-interpretation of American history, 1900-1916
By Gabriel Kolko Google Books excerpt.
The triumph of conservatism: a re-interpretation of American history, 1900-1916 on Amazon.com
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