The entire history of the United States of America — from 1776 to Ronald Reagan — demonstrates the struggle of the politicians and citizens of this nation against the hyper-concentration of private power.
For two centuries now, this country has perfectly integrated this problem and has been the pioneer in dismantling monopolies. The American Revolution itself was based on the questioning of economic control, such as that of the East India Company. It was precisely the Founding Fathers’ determined struggle that made defining the philosophy of U.S. economic policy possible. They understood early on that human freedom cannot thrive in the soil of economic servitude.
The extraordinary (for the time) Declaration of Independence goes beyond the point of liberating a people from the yoke of its occupier to guaranteeing perfect equality. Having the courage to free man from the grip of his fellow men, the Founding Fathers thus developed refined and sophisticated institutions and laws that aimed to protect each citizen from the excesses generated by private powers. Unfortunately, Black people, ethnic minorities and women were not protected by these new civic privileges at the time, but the fact remains that the Revolutionaries and their immediate successors were driven by a genuine philanthropic will and an admirable organizational capacity.
The cornerstone of all this construction was the U.S. Constitution, which made it possible to distribute land equitably to families who immediately benefited from the protection of the public authorities against private monopolies. It would be a mistake to consider that this document only defined the balance of power in the United States; the other priority of the American Constitution was to complicate the task of the finance and industry lords of the time in their natural temptation to concentrate too much power in their hands.
It was James Madison who wrote, “The accumulation of all powers, legislative, executive, and judiciary, in the same hands, whether of one, a few, or many, and whether hereditary, self-appointed, or elective, may justly be pronounced the very definition of tyranny.” This explains the laws adopted in 1789 by the first Congress under the presidency of George Washington, which aimed to instill democratic reflexes in the colonists by outlawing land speculators, by requiring parents to distribute their property equitably among their children of all sexes, and by penalizing excessive landholdings. The ultimate goal of the American Founding Fathers was to build a healthy society through fair rules and public education. Much later, emblematic laws such as the Interstate Commerce Act of 1887 and the Sherman Antitrust Act of 1890 were passed with the aim of breaking the monopolies of rail and finance. Without, however, avoiding at the dawn of the 20th century the emergence of a small oligarchy around the banker J.P. Morgan, who succeeded in dominating — and leeching off — various parts of the American economy.
It took all the determination of Woodrow Wilson, elected president in 1912, and his talent as a reformer to create a central bank, the Federal Reserve, to control the flow of credit and regulate or even break up Wall Street; to implement a progressive income tax to avoid the concentration of big fortunes; and to dismantle AT&T, the giant of the time. Wilson’s legislative successes thus paved the way for a true second American Revolution that he himself called “New Freedom,” which paved the way for Roosevelt’s “New Deal” 20 years later. The latter perpetuated the work of his predecessor by continuing his action against financial monopolies and industrial and commercial conglomerates.
Under his impetus, the number of lawyers specializing in the application of antitrust laws within the Ministry of Justice jumped from 60 to more than 600! Economic and financial predators were thus gagged or even eliminated altogether, wages were raised, union membership rose sharply, private enterprise prospered. All of these were decisive factors that unleashed the energies and presided over the richest period of innovation in history.