The Transformation of America from the Revolution to the Present, Part I

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Robert Wright’s review of my book captures the essence of my journey in America. 

“There is a right way and a wrong way, always choose the right way.”  Abraham Sabrin (1914-2001)

The following is the first part of a revised version of a presentation I gave on June 27^th at the independent living campus where we live in Naples, FL.  We moved to Fort Myers in 2021 after living in New Jersey since 1977 and then we moved to Naples last October.

I would like to thank Resident Services for arranging this morning’s presentation. I’m grateful for the opportunity to present an overview of the material I covered in my financial history of the United States course at Ramapo College, where I taught for 35 years.  The material I will present ranges from conventional history we were all taught in K-12 and in undergraduate courses plus the literature I have been studying for the past fifty years, which had a substantial impact on my intellectual journey I cover in my memoir, From Immigrant to Public Intellectual:  An American Story.   

My citizenship document photo, including the seal of the Department of Justice

I chose today for this presentation on the transformation of America, because 64 years ago my parents took me and my older brother to the Manhattan federal courthouse where we both raised our rights hands and swore to uphold the US Constitution.  In addition, next week is July 4^th, when we celebrate our independence from Great Britain.   America has not been the free and independent nation for quite some time since the Declaration of Independence was written in 1776 and our rights have been chipped away continuously since the Bill of Rights added to the Constitution in 1791.

The Declaration provides a blueprint, a roadmap if you will, about the relationship between government and the people.  “We hold these truths to be self-evident, that all men are created, equal, that they are endowed by their Creator, with certain unalienable rights, that among these are life, liberty, and the pursuit of happiness…”

This philosophical “GPS” has substantial implications for the nature of government and the power it should exercise over the people.  For me, that would be “thou shalt not steal and thou shalt not steal.”  In other words, if an individual would be branded a criminal if he steals or commits aggression, then government officials should be prevented from committing such acts as well. 

In looking back on the past 64 years, I can say with great certainty that I have been faithful to my oath to uphold the Constitution as a citizen and a US Senate and gubernatorial candidate in New Jersey pledging to align our laws with Article I, Section 8, which outlines the authorized activities of the federal government. 

If members of Congress and presidents from both major political parties, and justices of the Supreme Court had upheld their fidelity to the Constitution, we would not have a $32 trillion national debt, a nearly $7 trillion budget with endless deficits, an institution—the Federal Reserve--that creates money out of thin air, ongoing attacks on our civil liberties, and endless undeclared wars since the end of World War II.  US policymakers have turned their backs on our limited government philosophical heritage.  I will explain how that happened shortly.

As two-time Medal of Honor recipient General Smedley Butler wrote in War is a Racket, “There are only two things we should we fight for.  One is the defense of our homes and the other is the Bill of Rights.  War for any other reason is a racket.” 

Another principle of the American Revolution that some (many?) historians have misinterpreted is that the prosperity, wealth, and “legitimate” income is the result of free enterprise.  As Albert Jay Nock wrote in the 20^thcentury: “There are two methods, or means, and only two, whereby man’s needs and desires can be satisfied. One is the production and exchange of wealth; this is the economic means. The other is the uncompensated appropriation of wealth produced by others; this is the political means.”

The Founders—not all of them to be sure—must have had in mind the experience of the Pilgrims when they arrived at Plymouth Rock 150 years earlier.  When the Plymouth colony was established to create a “New Jerusalem” in America, they formed a collectivized society.  The result: mass starvation, because some colonists did not work the collective land and the food output was dismal.  Governor Bradford realized the survival of the colony was at stake and he “desocialized” the land and abundance followed.  That’s why we celebrate Thanksgiving.    

The French writer, philosopher, and legislator Frederic Bastiat observed in The Law during the middle of the 19^th century in response to the call for socialism in many countries: “Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we have checked with things being done by government, the socialist conclude that with we object to its being done at all.”

Although the Founders were aware of the Pilgrims’ plight, some of them nevertheless advocated a form of socialism called crony capitalism. 

Foremost among of the early republic’s advocates of crony capitalism was Alexander Hamilton.  Economist and historian Tom DiLorenzo in Hamilton’s Curse:  How Jefferson’s arch enemy betrayed the American revolution – and what it means for Americans today provides the details of the Hamilton-Jefferson rivalry. 

DiLorenzo reveals that Hamilton wanted a powerful central government in the fledgling republic, the “British system” without the British.  Hamilton wanted a permanent president, government planning of the economy, business subsidies, a public debt, protectionist tariffs and a politically controlled central bank.  Hamilton also believed the Constitution granted the federal government “implied powers” which would in effect mean no check virtually on unlimited government spending, taxation, borrowing and money printing.   

Jefferson, on the other hand, wanted a decentralized government like the discarded Articles of Confederation, a strict interpretation of the new Constitution, no government debt and the application of the Tenth Amendment.  “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

Jefferson’s insight about government in general and the new federal government can be summed up in two assertions which resonate with many Americans today regarding the national debt and government spending.

“To compel a man to furnish funds for the propagation of ideas he disbelieves and abhors is sinful and tyrannical.”  Thus, Jefferson’s prescient statement is a reminder why tax and spend policies are inherently polarizing.  The freedom of conscience should be a guiding principle in spending the people’s money. 

In addition, regarding the national debt Jefferson pointed out: “The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.”

As we shall see as the 19^th and 20^th centuries unfolded the Hamiltonian view of governing became entrenched slowly and then accelerated during the past 100 plus years.  The welfare-warfare and is now cemented in America’s political culture and both political parties are responsible for the unsustainable tax and spend policies, unlimited money printing, and endless wars.   

(Some of the specific details in Part 2 about how America became a welfare-warfare state.)

My latest piece on the economy was published in Fortune, https://fortune.com/2023/03/27/recession-2023-layoffs-tech-finance-unemployment-outlook-fed-rates-murray-sabrin/  This is an update of my 2021 forecast, https://fortune.com/2021/12/09/next-recession-heres-everything-bubble-markets-2021-2022-covid-murray-sabrin/ 

Murray Sabrin, PhD, is emeritus professor of finance, Ramapo College of New Jersey. Dr. Sabrin is considered a “public intellectual” for writing about the economy in scholarly and popular publications. His new book, The Finance of Health Care: Wellness and Innovative Approaches to Employee Medical Insurance (Business Expert Press, Oct. 24, 2022), and his other BEP publication, Navigating the Boom/Bust Cycle: An Entrepreneur’s Survival Guide (October 2021), provides decision makers with tools needed to help manage their businesses during the business cycle.  Sabrin's autobiography, From Immigrant to Public Intellectual: An American Story, was published in November, 2022.