Book Reviews

A REVIEWER'S NOTEBOOK JOHN CHAMBERLAIN The Businessmanin AmericanLiterature WE do make some progress. Just when TV is being charged with per petuating the ancient stereotype of the businessman as Con Man and Scrooge, Emily Stipes Watts, a pro fessor of English at the University of Illinois, has discovered a new at titude toward business among American novelists. Her evidence, presented in considerable detail in her The Businessman in American Literature (Athens, GA, The Uni versity of Georgia Press, 183 pp., $16.00), depends on a corporal's guard of novelists-Stanley Elkin, James Dickey, Ken Kesey-who are hardly household names; and "cor porate capitalism," as something distinct from small business, gets few plus marks even from a new breed of writer that has turned against the socialists. But the air, in Emily Watts' pages, is cleared of a lot of cant as she moves toward her con clusion that "private capitalism pro vides the framework for a pluralistic society in which the individual and the civitas are suspended in a para doxical but healthy relationship."

To be sure, American writers for' long periods of time have not been concerned with business as such. Herman Melville's Moby Dick de scribes the whaling ship as a factory for killing and processing whales, and greed is undeniably a motive in fi nancing the whale-catching voyage ofthe Pequod. But Melville was only incidentally concerned with the utilitarian worries of whale ship proprietors. What really interested him was the metaphysical mono mania of his Captain Ahab. Mel ville, along with Thoreau and Emer son and the Transcendentalists of the pre-Civil War Golden Day, was troubled with larger questions of Good and Evil in a world in which Sam Slick, Johnson Hooper's ras cally character, could anticipate pragmatism with his "It's good to be shifty in a new country." Authorship, in pre-industrial times, had been bound up with aris tocratic patronage, and the writer in America was faced with a make-do situation -simply because there were no noble lords in a new society to 185 186 , THE FREEMAN March pay a scribbler's way. Mark Twain, Henry James and William Dean Howells, the Big Three of post-Civil War times, did the best they could in an insensitive world. Twain was a tramp printer; Howells got his wri ting start by producing a hack campaign biography for Abraham Lincoln, which led to a political ap pointment as consul. Twain had his fun with business {villains in The Gilded Age, but he was personally entranced with inventors and with the Yankee ingenuity of his Con necticut mechanic who visited the court of King Arthur.

Henry James, the novelist who wrote like a philosopher while his brother William, the philosopher, was writing like a novelist, did not hate business as such. He merely deplored the fact that in its native form it left Christopher Newman of The American (1877) very little time for culture. As for Howells, his ethical preoc cupation led to an early dalliance with Edward Bellamy-style social ism. What bothered Howells about his entrepreneurial Silas Laphams and Jacob Dryfooses, millionaires, was the atrophy of their generous instincts in pursuit of success. What escaped Howells was the fact that Silas Lapham's paint had both util itarian and esthetic uses that justi fied the business that produced it, and what escaped James was the circumstance that Christopher Newman had first to earn the money that enabled him to take his cul tural Wanderjahr in Europe. Signs of Envy The American fiction writer was anti-bourgeois before he was pro-so cialist. Writers belonged to Grub Street, and if they could not catch on in journalism their natural habi tat was the garret where idealism had to struggle to repress envy. Nat urally they saw business largely from the outside. Dreiser could be both fascinated and repelled by the amoral energies of Frank Cowperwood, his fictional traction magnate of The Titan, but he missed the point that it was a truly responsible man, Thomas Edison, who had brought electricity to the cities and made the five-cent fare possible even in spite of monopolistic financiers.

The anti-bourgeois writer easily went over to socialism. Upton Sin clair saw only a vicious spirit of competition in the Chicago packers who disassembled hogs without hearing "the hog-squeal of the uni verse." Sinclair changed the law as it affected sanitary conditions in Packingtown, but he was not satis fied with that. Frank Norris, in de picting the Southern Pacific Rail road as an "octopus," tried to take solace in the fact that the wheat of the San Joaquin valley got to mar ket despite the railroad robber bar ons. But he was troubled by the 1983 THE BUSINESSMAN IN AMERICAN LITERATURE 187 gambling element involved in mar keting the wheat once it was out of the grain elevators and off the trains. With Sinclair Lewis, who had gone to college in the muckrake era, the derogation of the businessman took on a Menckenian finesse. Babbitt believeq in go-getting, and he skirted the edge of sharp practice. But he had his pathetic side. He was not the heartless capitalist of the proletar ian novels, and he was aware of the shallowness of his life. He could re turn from his fishing trips in the Maine woods with new resolutions which he quickly forgot.

GertrudeStein'sInfluence Emily Watts, with an ear for nu ance, credits Gertrude Stein, Ernest Hemingway's mentor, with a most influential defense of private capi talism in the mid-Thirties. Writing in the Saturday Evening Post, Miss Stein asked a simple question, "Is Money Money or Isn't Money Money?" "When you earn money and spend money," she said, "anybody can know the difference between a mil lion and three. But when you vote money away there isn't any differ ence between a million and three." That put Gertrude Stein in the anti-Keynesian, anti-Marxian camp, and it seemed to pull other ex-radi cal writers (E. E. Cummings, John Dos Passos) with her. The fictional .businessman Merton was provided with some quite convincing lines by John Chamberlain's book re views have been a regular fea ture of The Freeman since 1950. We are doubly grateful to John and to Henry Regnery for now making available John's autobi ography, A Life with the Printed Word. Copies of this remarkable accountof a man and his times our times-are available at $12.95 from The Foundation for Economic Education, Irvington on-Hudson, New York 10533.

Edna St. Vincent Millay in her long poem, "Conversation at Midnight." With Gertrude Stein pointing the way, the "lost generation" managed by degrees to find themselves on the side of common sense. The business man in fiction became as other peo ple, a human being to be judged in terms of his own sensibilities, which might be those of any professional faced with the necessity of both making a living and discharging his duties as a citizen. Emily Watts is a deft researcher and excellent summarizer, but she has overlooked some points. She sets Willa Cather down as antibusiness on the basis of Cather short stories, but it was a businessman, Fred Ot tenburg, who pushed the operatic career of Thea Kronborg in Cather's The Song of the Lark. And one looks 188 THE FREEMAN March in vain in Emily Watts' book for the name of Garet Garrett, who, in ad dition to his purely economic writ ing, gave us some remarkable nov els about business. Garrett's The Driver, a novel based on the life of E. H. Harriman of the Union Pacific, was surely worth a glance. And ditto for Booth Tarkington's The Plutocrat.

THE CASE FOR GOLD: A MINORITY REPORT OF THE U.S. GOLD COMMISSION by Ron Paul and Lewis Lehrman (CATO Institute,224 Second Street, S.E., Washington,D.C. 20003), 1982 226 pages - $8.95 paper Reviewed by Tommy W Rogers The Case for Gold is more signifi cant in analysis and insight than its title might imply. It is a record of the political economy and banking of the United States as they have evolved in history. It is an impor tant reinterpretation of American history with respect to the uses of the public treasury by financial in terests, and of the accompanying struggles, manipulations, and polit ical developments. The book traces the recent economic decline, details the process by which the dollar has lost public trust and has suffered de creased purchasing power, and pro poses specific reforms predicated on a monetary standard. It is a specific defense of the political, economic, and moral desirability of an honest money standard.

This book is anything but a com pilation of esoteric statistical data; it is both original and restorative. It contains just about everything one would ask about the history, signif icance, and importance of the gold standard, past, present, and future, if one knew enough to ask the right questions. The implications of the topic dealt with are enormous; the penalty for public failure to come to grips with the truths presented here would be severe. This is not to say that The Case for Gold is a sensationalist work, for it is not. It is not written with excla mation marks! Honest money (re deemable specie measured by a known standard of value) versus the continuation of politically manipul able fiat paper money which is un defined by, is not redeemable in, and is not backed by specie of specific value, poses questions of such in tense reverberation that realism speaks in unfettered terms of the cataclysmic consequences of contin uing failure to respect and abide by fundamental economic law.

The question of fiat political money versus honest money poses some of the most dramatic and consequen tial political and economic issues of the day. The question of honest money, of necessity, goes to the es sence of freedom, liberty, limi ted 1983 OTHER BOOKS 189 government, the role of law, and prospects for economic growth and business predictably. The impor tance of public understanding and willingness to take appropriate cu rative steps can scarcely be overem phasized or exaggerated. Paul and Lehrman make an ex plicit case for the desirability of an honest money ,standard (a require ment gold suitably meets) with re spect to its political, moral and eco nomic parameters. It was not until August 15, 1971, that the United States severed the last link between the dollar and gold. This act ushered in a new era of inflationary psychol ogy and lack of trust. Gold has value of itself; paper does not. As Thomas Jefferson stated in debate over the money issue in 1784: "If we deter mine that a dollar shall be our unit, we must then say with precision what a dollar is." From 1792 until August 15, 1971, the dollar was defined as a precise weight of either gold or sil ver. For the last decade, the dollar has been undefined and unbacked. It is sustained only by popular faith, and that faith has declined steadily.

The dollar, in consequence, is worth only about one-third of what it was worth in 1971, as measured by its command over goods and services. The loss of definition of the mone tary unit is directly related to the financial and economic problems of today. The institutionalization of moneycreating powers in the Federal Re serve has not and cannot perform the economic miracle of turning stones into bread. Paul and Lehrman argue that the entire process-the crea tion of the Federal Reserve in 1913, President Roosevelt's confiscation of privately owned gold and devalua tion of the dollar in 1934, with drawal of silver certificates from cir culation and the debasement of coinage and its replacement by cop per sandwiches for coins in the 1960s, terminating with the ending of the international convertibility of the dollar into gold in 1971-"is a cata logue of broken promises and out right theft on the part of the federal government as it sought to substi tute a managed, irredeemable paper money for a gold standard."

Elimination of honest money, that is, of money as a commodity defined precisely by weight-is a threat to freedom itself. John Locke argued that the right of the individual to own gold was a civil liberty equal in importance to the liberty to speak, write, or practice one's own religion. When the Founding Fathers wrote the U.S. Constitution in the summer of 1787, the debacle of the paper money issued by the Continental Congress was fresh in their minds. The framers of the American Con stitution, men who were greatly in fluenced by both English Common Law and biblical law, regarded money as "a weight ofprecious metal, 190 THE FREEMAN March not a weightless piece of paper with green ink printed on it." The au thors contend that today's paper money system, issued by a coercive banking monopoly, has no basis in the Constitution. It is, they state, "a form of taxation without represen tation, and a denial of the hard fought and won principle of consent before payment of taxes," and is a blatant contradiction of the Consti tutional provision restricting legal tender to gold and silver.

Chapter one of The Case for Gold reviews the problem of persistent inflation and general economic havoc which have become accentuated by the last .decade of paper money. Chapters two and three review the history of money· and banking in the United States and the process by which we arrived at our present state of economic disorganization through paper currency. Chapter four sets forth arguments for monetary free dom based on historical experience with the free market and an absence of legal tender laws. Chapter five makes the case for the gold standard. The authors dispose of the common objections, and set forth the benefits derived from sound money. These include low interest rates (anticipated to stablize at three to four per cent), accelerated real economic growth, increased savings, renewal of longterm financing, checking of government spending, and a growing economy with increasing de mands for employment.

Chapter six outlines specific re forms that are needed to correct the blunders of the past. These include repeal of the legal tender laws, de finition of the dollar in terms of a specific metallic unit, gold coinage by government and private mints, removal of monopoly privileges over money by the Federal Reserve, con tinuing audits of America's gold re serves, and deregulation of banking. Paul and Lehrman point out that there is no free entry into the bank ing business, which is largely cen tralized by the Federal Reserve and other federal and state regulatory agencies. Deregulation of _banking, incl uding free entry by simply filing the legal documents with the appro priate government clerk, is a must for monetary freedom. The last chapter of The Case for Gold presents two contrasting sce narios for the next decade. One per spective, based on a gold standard and monetary freedom, moves to ward longterm stability of prices and business growth with prosperity made possible by maintenance of a sound currency. The alternative is to continue the present course with irredeemable paper accompanied by accelerating rates of inflation and unemployment, the punishment of thrift, and the eventual spectre of whirlwind inflation and social chaos.

Americans must choose. , 1983 OTHER BOOKS 191 INTRODUCTIONTO THE STUDY OF THE LAW OF THE CONSTITUTION by A. V. Dicey (Liberty Classics, 7440 North Shadeland, Indianapolis, Ind. 46250) 435 pages - $15.00 cloth; $7.00 paperback Reviewed by Tommy W Rogers DICEY (1835-1922) held a professor ship at Oxford for twenty-seven years. He was heir to the first aca demic post created specifically for the study of English law, the Vinerian Professorship at Oxford, established in 1758, and of which Sir William Blackstone was the first incumbent. The fruitfulness and productivity of Dicey's tenure in this chair was such as to make it known as the second founding. Dicey, said a subsequent incumbent, is entitled to a similar place in the legal literature of the nineteenth century as Blackstone holds in the history of legal litera ture in the eighteenth century. Law of the Constitution-pub lished in 1885, revised edition, 1915-was based on Dicey's profes soriallectures. The "rule of law" idea is one of the organizing principles of the book. While Dicey did not create the phrase, he did bring the concept into currency and was responsible for the elaboration of its principles. The rule of law means one law for all men alike. It means that "no man can be made to suffer punishment or to pay damages for any conduct not definitely forbidden by law; every man's legal rights or liabilities are almost invariably determined by the ordinary Courts of the realm, and each man's individual rights are far less the result of our constitution than the basis on which that consti tution is founded."

Dicey noted the emergence of ad ministrative law between 1885 and 1914 with a corresponding decline in the ancient veneration for the rule of law in England; there was, he said "a marked tendency towards the use of lawless methods for the attain ment of social or political ends." Di cey was referring to legislative acts which gave judicial or quasi-judicial authority to "officials who stand more or less in connection with, and therefore may be influenced by, the government of the day, and hence have in some cases excluded, and in others indirectly diminished, the authority of the law Courts." Dicey contrasts the rule of law with administrative law which, he writes, was "unknown to English judges and counsel ... In England, and in coun tries which, like the United States, derive their civilisation from En glish sources, the system of admin istrative law and the very principles on which it rests are in truth unknown."

Dicey, with his opposition to "law" propelled by administrative agen192 THE FREEMAN cies as a contravention of the rule of law, would be astonished by the amount of discretionary authority which has come to be vested in reg ulatory agencies and tribunals of administrative law judges in our country today, which makes this classic study more pertinent than ever. i THE PORTABLE CONSERVATIVE READER edited by Russell Kirk (Viking/Penguin, Inc., 299 Murray Hill Pkwy., E. Rutherford, NJ 07073), 1982 723 pages - $6.95 paperback HERE, in one handy sized volume, is a little library of distinguished writ ing-prose, poetry, fiction, fable and myth. The anthology opens with Burke, as is fitting; forty-five pages of selections from four of his works. Then there is Adams, Hamilton, Calhoun and Cooper; Tocqueville, Disraeli, Newman and Bagehot. From the modern period there is Santayana, More, Babbitt, C. S.

Lewis, T. S. Eliot, and a score of oth ers. It all adds up to hours of reading pleasure. Where else will you conveniently find Macaulay's letters to Randall, Hawthorne's fantasy called "Earth's Holocaust," Kipling's fable of "The Mother Hive," Conrad's "The In former," or "The Liberal Death Wish" by Muggeridge? The imagination kindles while the intellect gets a workout. These selections reflect Dr. Kirk's far ranging mind in the area of man as a social being seeking freedom and order in the company of his fellows. His Introduction sets forth the es sential features of the Conservative outlook and disposition, and the au thors he has chosen reveal the depth and several dimensions of this philosophy. Russell Kirk burst upon the world about twenty books ago with his Conservative Mind (1953). Four years later he launched a quarterly re view, Modern Age, which has just published its Silver Jubilee Issue 248 pages of the best articles which have appeared during its first twenty-five years. There are appre ciations of Mises, Hayek, Weaver, Strauss, Vivas and others. The Aus trian School is surveyed by Albert Zlabinger. Several scholars assay Conservative thought during the past generation, and others explore its principal fountainhead, the philoso phy of Edmund Burke.

Intellectual history has been made in our time, and Modern Age has played a significant role. (Copies of this Summer/Fall 1982 issue are available @ $2.50 by writing to Modern Age at 14 South Bryn Mawr Avenue, Bryn Mawr, PA 19010.) , -Edmund A. Opitz Book ReviewEditor the Freeman VOL. 33, NO.4 • APRIL 1983 Free Trade and Foreign Wars Sam H. Husbands, Jr. 195 Trade barriers between nations lead toward friction and war. Free Riders Face a Rocky Road Melvin D. Barger 205 Those who "go along" with pressure-group demands are also re sponsible for the consequences. The Crisis of the Welfare State Clarence B. Carson 213 Policing the market against violence is a political, not an economic, process. The Virtues of the Free Economy Bill Anderson 225 The market promotes cooperation instead of conflict-peace instead of war. Workers and Robots Hans F: Sennholz 236 The impact of new technology on the job market and on workers.