White House

Democracy or Liberty?

President-elect Joe Biden is sworn in as the 46th President of the United States at the U.S. Capitol in Washington, D.C., January 20, 2021. (Saul Loeb/Pool via Reuters)
Words from Joe Biden’s inauguration may mislead us about the nature of the American founding.

Today’s headlines in the New York Times and Financial Times screamed with President Biden’s words from Inauguration Day: “Democracy has prevailed.” For those with a sense of America’s history, those words raise questions.

Most people, including most Americans, would be surprised to learn that the word “democracy” does not appear in the Declaration of Independence (1776) or the Constitution of the United States of America (1789). They would also be shocked to learn the reason for this absence in the Founding documents of the U.S.A. Contrary to what propaganda has led the public to believe, America’s Founding Fathers were skeptical and anxious about democracy. They were aware of the evils that accompany a tyranny of the majority. The Framers of the Constitution went to great lengths to ensure that the federal government was not based on the mere will of the majority and that it, therefore, was not democratic.

The Constitution divided the federal government into legislative, executive, and judicial branches. Each branch was designed to check the power of the other branches. The Founders did not want to rely only on voters to check government power. As a result, citizens were given very little power to select federal officials. Neither the president, members of the judiciary, nor senators were elected by direct popular vote. Only the members of the House of Representatives were directly elected by popular vote.

If the Framers of the Constitution did not embrace democracy, what did they adhere to? To a man, the Framers agreed that the purpose of government was to secure citizens in John Locke’s trilogy of the rights to life, liberty, and property. The Framers wrote extensively and eloquently on this. On property, for example, John Adams wrote that “the moment the idea is admitted into society, that property is not as sacred as the laws of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence.”

The Founders’ actions often spoke even louder than their words. Alexander Hamilton, a distinguished lawyer, took on many famous cases out of principle. After the Revolutionary War began, the state of New York enacted harsh measures against Loyalists and British subjects. These included the Confiscation Act (1779), the Citation Act (1782), and the Trespass Act (1783). All involved the taking of property. In Hamilton’s view, these acts illustrated the inherent difference between democracy and the law. Even though the acts were widely popular, they flouted fundamental principles of property law. Hamilton carried his views into action and successfully defended — in the face of enormous public hostility — those who had property taken under those three New York State statutes.

The Constitution was designed to further the cause of liberty, not of democracy. To do that, the Constitution protected individuals’ rights from the government, as well as from their fellow citizens. To that end, the Constitution laid down clear, unequivocal, and enforceable rules to protect individuals’ rights, which strictly limited government’s scope and scale. Economic liberty, which is a precondition for growth and prosperity, was enshrined in the Constitution.

The conflagration of World War I marked a violent break with the letter and spirit of the Constitution. Property rights were suspended on a large scale. There were wide‐​scale nationalizations of industry in rail, telephone, telegraph, and, to a lesser degree, ocean shipping. Over 100 manufacturing plants were nationalized. The government became involved in labor‐​management relations under the Adamson Act in 1916. Conscription was instituted. The Espionage Act was passed in 1917. The Sedition Act of 1918 imposed penalties for anti‐​government expression, thereby subverting the Bill of Rights. The novelist Upton Sinclair was actually arrested for reading the Bill of Rights. Roger Baldwin, one of the founders of the American Civil Liberties Union, was arrested for reading the Constitution. All of this was accomplished under the emergency powers granted to President Wilson by Congress in 1916.

Much of this anti‐​constitutional apparatus was scrapped after World War I. However, residues remained and eventually resurfaced. All it took were other national emergencies — the Great Depression, World War II, the Vietnam War, the War on Terror, and, most recently, the COVID-19 pandemic. With each, laws were enacted, bureaus created, and budgets enlarged. In many cases, these changes turned out to be permanent. The result is that crises acted as a ratchet, shifting the trend line of government size and scope up to a higher level.

It comes as no surprise that governments spend more money and regulate more actively during crises — wars and economic bailouts are expensive and complicated. But a more active government also attracts opportunists, who perceive that a national emergency can serve as a useful pretext for achieving their own objectives.

What lessons can we learn? First, “democracy” and “liberty” are not interchangeable words. Second, only the first century of the American experience represents one in which freedom and liberty was the standard. Invoking the word “democracy” requires great caution. It can easily result in elected tyranny. Liberty is what the Founders were after.

Steve H. Hanke is a professor of applied economics at the Johns Hopkins University in Baltimore. He is a senior fellow and the director of the Troubled Currencies Project at the Cato Institute in Washington, D.C.

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