In light of our recent discussions of the history of “capitalism”, check out Chris Wright’s succinct 2018 summary of Gabriel Kolko‘s trailblazing work on the Progressive Era. Kolko has been taken to task by many, but even those who disagree with aspects of his work, such as my pals, Rob Bradley, and recent JARS contributor, Roger Donway, have readily acknowledged that Kolko blew “to smithereens the smug narrative about Progressivist regulation,” “disproving the old stereotypes of Gilded Age businessmen as uncompromising pro-capitalists and Progressive reformers as do-gooders. He showed that industrialists had not been as laissez-faire or reformers as high-minded as Progressivism alleged.”
The Facebook discussion that followed from my cross-posting of this led me to reproduce in whole a note from my Journal of Ayn Rand Studies-published review (vol. 20, no. 2, December 2020, pp. 340-71): “Free Market Revolution: Partial or Complete?” (references therein):
For my own comparison of the parallels between Rand’s critique of the neofascist mixed economy and that offered by Kolko, see Sciabarra [1995] 2013, 311–12. The debate over Kolko’s historiography—particularly in light of the fiftieth anniversary of his profoundly influential Triumph of Conservatism—has spiked in recent years. Bradley and Donway (2013) devote an article to a reassessment of Kolko’s revisionist perspective on the Progressive era, including his study of Railroads and Regulation (Kolko 1965). They argue correctly that industries, such as railroads, were essentially “feudal” from their inception (Bradley and Donway 2013, 564). They take issue with the neo-Marxist premises in Kolko’s conceptual framework and Kolko’s questionable interpretations of some of the data. Still, as critical as they are, they conclude: “Ourreinterpretation of Kolko in light of libertarian thought should not take away from Kolko’s success in amending the simplistic Progressivist interpretation of American history. The present review merely points out that a libertarian, anti-Progressivist interpretation of Progressive legislation should be freed from Kolko’s leftist framework and supported by better evidence” (575). They repeat that point in a later essay (Bradley and Donway 2015): “Unquestionably, Kolko did valuable work in disproving the old stereotypes of Gilded Age businessmen as uncompromising pro-capitalists and Progressive reformers as do-gooders. He showed that industrialists had not been as laissez-faire or reformers as high-minded as Progressivism alleged.” The authors also issued a correction with regard to their criticism that Kolko had doctored a quote by railroad magnate James J. Hill (see Bradley and Donway n.d.). But even in a forthcoming reply to Stromberg’s defense (2019, 43) of Kolko’s admirable avoidance of historical “reductionism” (on display in the work of many pre-revisionist left-wing historians), they credit Kolko for having blown “to smithereens the smug narrative about Progressivist regulation, spread by Arthur Schlesinger Jr. and his ilk, which dominated American historiography during the Forties, Fifties, and early Sixties” (Bradley and Donway forthcoming; see also Bradley 2014). Ironically, Kolko provided a back cover blurb for Bradley 2009, praising it as “[f]ascinating, comprehensive . . . far surpassing my own history of political capitalism in the 1960s.”
Bradley and Donway’s criticisms notwithstanding, Kolko is certainly not the only revisionist historian who has written on the corporatist nature of the Progressive political agenda. For example, see essays by William Appleman Williams, Martin J. Sklar, Murray Rothbard, Ronald Radosh, David Eakins, James Gilbert, and Leonard Liggio in Radosh and Rothbard 1972. Also see Weinstein and Eakins 1970; Green and Nader 1973; Liggio and Martin 1976; Sklar 1988; Horwitz 1992; Lindsey and Teles 2017; Rothbard 2017; Holcombe 2018; Newman 2019a.
Newman (2019b) places special emphasis on the principle that “personnel is policy,” that is, those who are appointed to regulatory agencies will often dictate the trajectory of the policies in question. He argues convincingly that, like all legislative processes, the establishment of regulatory agencies, such as the Federal Trade Commission, emerged out of the push-and-pull of conflicting interests, some inimical to business, others fully in favor of using political means for business consolidation. Newman shows “that regulatory capture is a dynamic process that does not follow a deterministic path because control of an agency depends on the commissioners appointed who are continually changing over time” (1038).
“Rent-seeking”—as outlined by public choice theorists such as Gordon Tullock, James Buchanan, and George Joseph Stigler—is made all the more complicated with the “division of power among regulatory agencies that have overlapping jurisdictions, [requiring] special interests . . . to make sure that they have control of multiple commissions in order to accomplish their objectives” (1040).
It should also be noted that Arthur Ekirch, whose work Rand praised, was equally impressed by the theses of revisionist historians on the left. Ekirch remarks that way back in 1944, Friedrich Hayek’s book The Road to Serfdom had warned that the rise of state capitalism, “[t]he progressive abandonment of freedom in economic affairs[,] . . . was leading to a similar destruction of political and personal freedom” (Ekirch [1955] 1967, 310). He highlights the complementary contributions of both Robert Wiebe (1962) and Gabriel Kolko (1963; 1965) toward our understanding of the emergence of a form of “state socialism” or “state capitalism” in which business has been among the chief designers and beneficiaries of the regulatory apparatus from its inception (Ekirch 1974, 143–44).
Gordon Adams (1981) provides another provocative perspective on regulation. Though Adams focuses on “the politics of defense contracting,” his insights are equally applicable to the give-and-take that takes place across all regulatory agencies. The “Iron Triangle,” as Adams famously characterized it, constitutes the relationship between congressional committees, regulatory bureaucracies, and the industries being regulated—that is, the dynamic and systemic interrelationships between congressional committees that create bureaucratic regulatory agencies, which are designed to serve their “constituencies.” But the constituencies of each regulatory agency are not “the people.” Indeed, Adams argues that the constituencies in question are the actual industries being regulated. And so, the entire regulatory state has emerged in a way such that industries push for regulations, which enable them to block entry into markets, using money to buy various forms of “pork barrel” legislation, while lobbying and courting members of Congress and gaining key personnel appointments to the very regulatory agencies that were ostensibly created to “protect” the public from corporate “excess.” See also Higgs 2006. Regulation also helps to socialize risk for a whole panoply of industries—from health care insurance companies to the most blatant of industrial polluters. See Sciabarra 2020 and LaCalle 2019, respectively.
— from my review of the Yaron Brook-Don Watkins book, Free Market Revolution, published in JARS’s December 2021 issue (pp. 362-63, n. 12)
