This is the first video in a series on how 20th Century corporatism is the result of progressive values. The series will range from turn-of-the-century anti-trust suits that allowed companies with government connections to punish competitors, to ways in which the New Deal solidified the type of corporatism we still experience today.
Video Script:
In the mid 1800s, progressivism began as a two-pronged movement toward direct democracy and efficiency. It was the second prong that led progressives to focus on the mergers of big business. But they weren't against the big business merger; early progressives were for it.
Efficiency meant consolidation, cooperatives, and a spirit of working together. And there was another aspect of consolidation that appealed to progressives. It eliminated competition, something they began to see as a problem.
One of the first expressions of the just-emerging progressive movement was published in Blackwoods in 1864: "We are at the outset of a new era in social progress, and one which is probably the highest to which material civilisation can attain. It is the era of cooperation. Hitherto competition has been regarded as the most efficient agent of social progress. But the principle of competition is one of rivalry and struggle. It is a system of beggar my neighbour, most useful in the earlier stages of civilisation, but one most unworthy of civilisation at its maturity. It is costly, for it requires many companies and establishments to do the work which would be more economically performed by one."
Progressives wanted competing businesses to consolidate or combine or merge into something larger that would accommodate everyone. Those words, consolidation, combination, and merger appear often in the early progressive era. But the word that best described the social progress value of reducing conflict was integration.
Mary Parker Follett, an early progressive and feminist, a management theorist, and adviser to President Theodore Roosevelt, believed conflict could be resolved by integrating competing interests. Follett wrote, "There are three ways of dealing with difference: domination, compromise, and integration. By domination only one side gets what it wants; by compromise neither side gets what it wants; by integration we find a way by which both sides may get what they wish."
According to Gabriel Kolko, a leftist historian, even the well-known muckraker Ray Stannard Baker considered monopolies a progressive idea. In 1901, Baker wrote a piece for McClure's magazine praising U.S. Steel as a federation of combined companies, similar in structure to the United States, itself.
"It is a general though erroneous impression that when the Steel Corporation was organized all of the 10 absorbed companies lost their identity, being merged in a single huge concern managed from New York City. But the United States Steel Corporation is rather a federation of independent companies, a combination of combinations... Mr. Carnegie encouraged friendly rivalries between his plants, spurring them on with rewards, and by firing the pride of accomplishment he succeeded surprisingly in adding to the efficiency of his force."
It was efficiency progressives wanted, not trust busting. In her book, The New State, progressive Mary Parker Follett wrote, "What American politics need today is positive principles. We do not want to "regulate" our trusts, to "restrain" our bosses. The measure of our progress is never what we give up, but what we add."
Understanding this more accurate definition of progressivism, it no longer seems odd to hear J.P. Morgan described as he was in 1911: "Mr. Morgan has stood in a unique way for the principle that capital must always organise and do away with internal friction, war, waste, among its factors and segments. He has been the great Progressive among capitalists."
So how did progressivism move from supporting business mergers to fighting monopolies? The answer is, it never really did.
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