Jackson and Jefferson

Major Leggett dropped by in the comments below to direct our attention to this article.  It's really about Jackson and his claim to prominence for the TEA Party movement, but there are strong lessons from Jefferson as well.

In his first message to Congress, Jefferson vowed to abolish all internal federal taxes and reduce federal expenditures and personnel. He attacked a system in which, "after leaving to labor the smallest portion of  its earnings on which it can subsist, government…consume[s] the residue of what it was instituted to guard." Hamilton was aghast. He said this attack on Federalism should "alarm all who are anxious for the safety of our government…" But John Quincy Adams, whose father had just lost the presidency, understood the force of Jefferson's proposals. They are, he lamented, "all popular in all parts of the nation." 

Jefferson governed as he had promised. He eliminated internal taxes, cut the size of government, reduced the national debt. He brushed aside Hamilton's concept of selling federal lands at robust prices in order to fill government coffers for federal infrastructure projects. Jefferson sold the lands to ordinary Americans at modest prices based on his vision that the West would fill up with independentminded farmers reveling in their land ownership and opportunity for self-betterment. He was confident that these yeoman folk would build up the nation from below, thus obviating the need for elites to build it up from above.

Now that's right in line with my own ideas even today:  a government that is structured to help individuals achieve the individual ownership of their own means of production (to put the matter in Marxist terms, in a way that would choke a Marxist).

Jackson inherited the populist wing of Jefferson's party, and led a revolution particularly directed against the Second Bank of the United States -- an organization devoted to 'stability in the currency,' which was the supposed intent of the Federal Reserve system we use today:  it was established during a series of panics around the turn of the last century.  The panics were real enough, but the system instituted to provide stability turned into a system for bankers to provoke, and profit from, boom-bust cycles.  Something similar was going on in Jackson's time.

State banks in the Northeast, where the war [of 1812] was unpopular, were protesting the war by hoarding the country's meager reserves of specie (gold and silver), forcing banks in other regions to rely on printed money. That unleashed a menacing wave of inflation and considerable economic dislocation. 

Thus, the Second Bank was established in 1816 in the country's financial center of Philadelphia. Immediately it slipped into corruption as its first president promiscuously violated terms of the charter, speculated in the bank's stock, and exploited the venal practices of the bank's branch members. Jones was forced out, and his successor sought to clean up the mess by calling in unsound loans, foreclosing on overdue mortgages, and redeeming overextended notes from state banks. The result was the Panic of 1819 as local banks slipped into bankruptcy, prices collapsed, unemployment soared, and a general economic malaise gripped the country. (Sound familiar?)

Unhappily, there is no Andrew Jackson on the ballot for next year.  We may, though, find useful principles in his example.  Those who form our political class today may need to be led to those principles by the nose, rather than leading from the front; but if we are to save the Republic, which to me seems less sure than once, it must be done.