Introduction.
Our book presents a thesis of American history as a perpetual social class conflict caused by the conflict between Jefferson's promise of liberty for common citizens, and Madison's constitutional rules of civil procedure, which permanently elevated the financial interests of the natural aristocracy, over the economic interests of common citizens.
The conflict generally reveals itself in times of social or economic crisis when an observer comments that America is a great nation, but has never lived up to Jefferson's promise of equal liberty.
For example, Noah Feldman, in the conclusion of his recent book, The Broken Constitution, provides a version of the explanation that the nation never lived up to Jefferson’s promise because the constitution is a living, evolving document. (The Broken Constitution: Lincoln, Slavery, and the Refounding of America. Noah Feldman. Farrar, Straus & Giroux, 2021.).
Feldman writes,
“The reality is that the moral Constitution, like all constitutions, is not an end state but a promise of ongoing effort. Through the Constitution, we define our national project. But we never fully achieve it. Lincoln’s legacy, then, is not the accomplishment of a genuinely moral Constitution. It is the breaking of the compromise Constitution, and the hope and promise of a moral Constitution that will always be in the process of being redeemed.”
Feldman argues that there are two versions of the constitution, a “moral” constitution, created after the Civil War, and an immoral, “compromise” constitution, created by Madison, which protected slavery.
The conflict between Jefferson’s moral Declaration, and Madison’s immoral rules of civil procedure, is a metaphor for two conceptions of the "American Dream."
Jefferson’s ideology of liberty leads to the American Dream of upward occupational success through equal opportunity. Jefferson’s American Dream, today, is entrepreneurial capitalism in a commonwealth of politically equal independent producers, who voluntarily agree to obey the rule of law.
Madison feared the majority power of , “We, the people,” and his rules created a plutocracy for the benefit of the natural aristocracy, now known as the Ruling Class.
“We, the people,” was just a very clever rhetorical ruse to hide the fact that “We, the people,” was really just 39 self-selected elites, who met in secret to create the constitution.
Madison's rules perpetuated a political culture of ruling class shared plunder in government policies and speculation in the economy. Madison’s version of the American Dream is “Get-Rich-Quick.”
He used the British mixed government model of society, and recreated a version of the British social class society in America, where the American natural aristocracy had their own branch of government, and was insulated from the influence of common citizens.
Madison’s more perfect union was not a union of states, nor a union between common citizens and the new government. Madison’s more perfect union was a compact between the natural aristocracy and the agencies of government, held together by the cultural value of shared plunder.
Madison’s rules created the legal framework for elite rule, and Hamilton then added the financial system that benefitted the plutocracy.
The origin of the conflict between two versions of the American Dream lies in how the story of American history is told by scholars and academics, like Feldman, who combine and conflate two distinct, and separate historical events at the beginning of the American nation.
The two distinct and separate events are combined by academic historians into a historical myth of one consolidated event, called “the founding.”
The myth allows defenders of Madison’s constitution to use the Declaration’s principles of equality as evidence that Madison’s constitution is not immoral, it is simply evolving to become a “more perfect union.”
Feldman’s argument relies on slavery as the exclusive, single, immoral feature of Madison’s constitution.
We offer an alternative explanation of the immorality of Madison’s constitution that features the disenfranchisement of the consent of the governed of common citizens, in a transfer of sovereignty from citizens to a consolidated tyrannical central government.
In violation of both Locke’s and Jefferson’s image of citizens agreeing to a voluntary transfer of their rights to more fully secure their natural rights, when the citizens leave the state of nature, the common citizens lost natural rights without gaining any benefits in the exchange with Madison.
The citizens were never given a chance to vote to ratify the transfer of sovereignty and never agreed upon the establishment of Madison’s plutocracy.
In the only popular vote of citizens, for or against ratification, the 3,000 citizens in Rhode Island voted 99% to reject Madison’s constitution. There is considerable historical evidence that the overwhelming majority of common citizens, in other states, shared the views of the voters in Rhode Island.
The rest of the so-called ratification conventions secured ratification through force and fraud, including the use of police agents in Pennsylvania to hold convention delegates, against their will, to obtain an illegitimate quorum for the ratification vote.
We agree with the analysis of Feldman in his review of the debates between Lincoln and Douglas, where Douglas argued that the solution to the slave issue in the territories was to let citizens in each state to vote on slavery.
Feldman writes,
“Douglas was correct about popular sovereignty [states voting on slavery] because the people of the states never voted to ratify the compromise constitution.”
Our argument about the immoral constitution follows Feldman’s logic. The citizens in each state never voted to ratify Madison’s constitution, which would have been the correct moral founding of the U. S. Government.
To summarize, Madison’s constitution was immoral because it perpetuated slavery, because it disenfranchised the sovereignty of the consent of the governed of common citizens, and was implemented in a fraudulent ratification process.
The only shred of legitimacy of consent of the governed in Madison’s rules was the ability of the common citizens to vote, periodically, on the elites who would rule them.
And, that last shred of legitimacy was violated on November 3, 2020, when the Democrat Marxists overthrew the representative republic to install their version of a more perfect Marxist union.
The enactment of the 13th, 14th, and 15th Amendments changed nothing about the power of the Ruling Class to make economic and political decisions in the absence of the consent of the governed.
We argue that what Hamilton created, beginning in 1792, was an economy that ran on elite investment speculation, credit and debt, not on cash.
We explain that the cause of perpetual economic collapse, in Hamilton’s economic system, is the unbalanced centralized power of the early national banks, and the subsequent unchecked power of the Federal Reserve Bank, to manipulate the monetary system, to the benefit of New York bankers, and the American Ruling Class.
Madison's rules finally devolved into a centralized Marxist political tyranny, which functions with the collaboration of a global corporate state.
We use the analysis of W. J. Cash, in The Mind of the South, to explain that the history of American class conflicts can be interpreted as a three-stage chronology of economic collapse, common citizen rebellion, and restoration of the ruling class power. (The Mind Of The South, W.J. Cash. Vintage Books, 1941.).
Our reliance on the thesis of W. J. Cash provides a direct contrast with Feldman that there are two constitutions, a moral one, which replaced an immoral one. Feldman argues that American history can be seen as a clean break between the two constitutions.
Rather, we argue that the Civil War did not change the power of the Ruling Class to subjugate the common class of citizens. We argue, as does Cash, that there is on-going continuity of the Ruling Class power.
In fact, the aftermath of the Civil War resulted in a more powerful ruling class, commonly called the Plutocrats, during the so-called “Gilded Age.”
We agree with the analysis of Steven Hahn, that the Ruling Class became even more powerful after the Civil War.
Hahn writes,
“Especially important was the creation and dramatic empowerment of a new class of finance capitalists through the marketing of government securities and their close alliance with the national state mediated chiefly by the railroads…The alliance between new finance capital and the new nation-state proved of considerable developmental importance because it favored creditors over debtors…”
The elite rule, after the Civil War, created the economic instability that damaged the prospects of success for Black people, farmers, Indians, industrial workers, and West Coast Chinese immigrants, between 1865 and the election of McKinley, in 1896.
We argue that there is no logical or moral justification, for these people to have been mistreated by the Plutocrats. Under a different constitutional configuration, that promoted Jefferson’s concept of the American Dream, they would not have suffered.
The historical class conflict dynamic of Cash is explained by the ability of the financially wealthy families to transfer unelected, economic power to illegitimate political authority, under the guise of Madison’s constitution.
After the Civil War, the ruling class used their power to create an unstable economic and financial system that collapsed about every 10 years
We argue that there is no macro-economic marginal price theoretical reason for the economy to collapse every ten years. The economic instability is caused by Madison’s constitutional rules, not by a failure in the price system of the competitive free market.
We revive William Graham Sumner’s description of the American “Forgotten Man,” as a description of how Madison’s political rules, and Hamilton’s economic system, worked in tandem to deny common citizens an equal opportunity for financial success.
Sumner stated, in an 1883 lecture in Brooklyn, that the Forgotten Man would be compelled to pay to support the Ruling Class advantages.
Sumner wrote,
“A government produces nothing at all, they leave out of sight the first fact to be remembered in all social discussion—that the State cannot get a cent for any man without taking it from some other man, and this latter must be a man who has produced and saved it. This latter is the Forgotten Man. Hence the real sufferer by that kind of benevolence which consists in an expenditure of capital to protect the good-for-nothing (Ruling Class) is the industrious laborer.”
We revise Sumner’s phrase “the forgotten man” to mean, today, that the financial and economic interests of working and middle class citizens are not represented in the centralized, deep-state, Marxist tyranny.
Sumner explained that common citizens bore the brunt of taxes imposed by the ruling class. The burden of taxation caused two outcomes.
First, the taxes crushed the incomes and resources of common citizens because Hamilton’s system ran on credit and debt, not on currency, and common citizens never had the money to pay their taxes or debts.
When the common citizens failed to pay their taxes or debts in gold and silver, the legal rules allowed the elites to confiscate their farms and property.
Second, the government tax revenues were used by the elite to speculate on investment projects, and the speculation always ended in an economic collapse, generally leaving the elite financial interests unharmed.
The first event of economic collapse is caused by excessive money creation, which leads wealthy people to speculate. The speculation causes the economy to collapse, on a periodic basis, about every ten years. (see Exhibit 1. below).
The common citizens suffer job loss and lose their farms, during each economic collapse. The government agents then bail out the wealthy class to restore the status quo of elite rule. (see Exhibit 2. below).
The political model of Cash is easy to understand. In any small town, or larger political jurisdiction, a set of wealthy people control the political machinery to benefit themselves, to the disadvantage of common citizens.
In Aristotle’s description, America’s political system would be described as rule by the few. In the national government setting, Cash’s model is applied to the few who control the levers of power through the “spoils” system, and control the national laws on the financial and banking system.
There is no force in Madison’s framework to compel the elected representatives to represent the common good, or the public purpose. Once the elected representatives arrive in DC, they collaborate with the special financial interests to enrich themselves.
Cash applied his model to the historical era of reconstruction, when the ruling class in the South restored the image of the plantation in both society and industry, as a way of reasserting their political control over common citizens.
Cash wrote,
“The burning concern thus generated in the minds of the master class met with and married with that other concern which, as we have seen, was generated in them by their own economic difficulties...brought to a full conviction...that without ever abandoning cotton growing, the arm of the land must somehow be extended.”
The solution to the elite’s loss of political power, after the Civil War and Reconstruction, according to Cash, was pretty simple.
For them, the economic future of the South should look just like its past.
“Progress was being accomplished so completely within the framework of the past that the plantation remained the single great basic social and economic pattern of the South...that is exactly what the Southern factory almost invariably was: a plantation.”
We argue that the Cash’s metaphor of restoring the plantation fits as an explanation for every economic crisis in American history. After each economic collapse, the Ruling Class restores the image of the economic plantation.
In order to achieve their desired goal of restoring their power, the master class, after Reconstruction, needed to manipulate the White yeoman farmer’s prime value of economic opportunity to serve the needs of the elite.
The pathway of attack was along the farmer’s intersection of values of individualism and local allegiance to community and family.
In other words, the ruling class began substituting communal, or socialist values, for the former values of individualism and self-sufficiency of White yeoman farmers.
Bruce Palmer described how the Bourbon Democrats, beginning around 1895, began
“...an effort to reconcile individual material self interest with the welfare of the community, (which) led to the abandonment of the core of the (farmer’s) former idea - that society was held together and progressed because of the action of each person’s material self-interest - and moved toward a consideration of society as a group of people rather than a collection of individuals.” (Man Over Money: The Southern Populist Critique of American Capitalism, Bruce Palmer. UNC Press CH, 1980.).
According to Gavin Wright.
“Virtually every industrial beginning may be traced to someone’s attempt to make a capital gain on property in land, by selling the land for the industrial plant. (Old South, New South: Revolutions in the Southern Economy Since the Civil War. Gavin Wright. New York: Basic Books, 1986.).
Following Wright,
“there was a sense in which the beneficiaries really could be seen as ‘the community’ ...What was most misleading about the cotton mill rhetoric was the implication that non-property owning (white) laborers and concern for their welfare played a major role” in the booster’s motivations. The master class was using the appeal of “more and better jobs” for the ‘community’ in a way that appealed to the farmer’s need for upward mobility while at the same time, undermined the farmer’s traditional values of individual freedom.”
According to Cash,
“The southern textile industry stressed communal values. Its image for social relationships in mill villages was not the market but the paternalistic family.”
Under the jurisdiction of the plantation elite, the mill building movement used the values of the Agrarians, individual initiative, ambition and economic independence, which led to social relationships in mill towns that featured, according to Newby,
“a kind of social atomism, suspicion of strange people and new ideas, and resistance to social innovation of any sort,” including the political innovations promoted by the Agrarians. (Plain Folk in the New South: Social Change and Cultural Persistence, 1880-1915. I. A. Newby. Louisiana State University Press, 1989.).
According to Cash,
“...the cotton mill worker of the South would be stripped of his ancient autonomy and placed in every department of his life under the control of his employer…by 1910, the barons and the stockholders of the mills were exhibiting a tendency to turn a smaller proportion of the total profits back to building of more mills or the expansion of industry and business in general, and to take more for their own personal purposes.”
As noted by Cash, the Ruling Class economy ran on cheap labor.
“Whatever the intent of the original founders of progress, the plain truth is that everything here rested finally upon one fact alone: cheap labor...the wages were on average just about adequate to the support of a single individual - such wages as required that every member of a family moving from the land into Factory-town, who was not incapacitated by disease or age or infancy, should go into the mills in order that he too might eat.”
What Cash said about the historical era after 1877, applies equally well to our historical thesis of explaining American history as a series of economic collapse, followed by common citizen economic despair, followed by a restoration of elite rule.
The class conflict originates in the dynamic incompatibility of Jefferson’s promise of liberty and Madison’s framework of permanently empowering the natural aristocracy.
The political ideology of race hatred is a constant tool of the ruling class to restore elite rule. Throughout American history, it did not matter to the elite if the race hatred was Whites hating Blacks, or in the most recent era, of Blacks hating Whites.
We disagree both with the historical analysis of Democrat Marxists that America was founded upon the sin of slavery, in 1619, and their solution of a collectivist communist tyranny.
America was founded in 1775, under Jefferson’s promise of liberty.
In contrast, the United States Government was founded in 1787, under Madison’s constitution that empowered the elite over the common citizens.
The Democrat Marxists are correct that Madison’s constitution protected slavery, not because slavery was the essential value that held elites together, but because protecting slavery in the South was essential to maintaining elite rule in the North.
The 38 self-selected Federalist elites who walked out of Independence Hall, on the afternoon of September 17, 1787, knew that their rules would lead to a civil war, but their self interest in forming the plutocracy overrode their moral concern about slavery. (Note: Only 38 elites signed the document. One of the 39 elites signed the document twice, once for himself, and once for his buddy, who could not be there that day).
The two events, Jefferson’s Declaration, in1776, and Madison’s constitution, of 1787, do not constitute the “founding.”
Rather than interpreting the two events as a consolidated single “founding,” we agree with Michael Klarman, in his book. The Framers Coup, (Oxford University Press, NY. 2016.), that the 39 elites who met in secret, in Philadelphia, to hammer out Madison’s rules, constituted a Ruling Class coup over the Articles of Confederation, not a founding.
Klarman wrote,
“Madison objected to the injustice of state legislation on creating paper money and debtor relief laws … Madison viewed society as two classes: creditors or debtors, rich or poor… Madison declared that the Senate ought to come from and represent the wealth of the nation. The Senate should serve as a bastion of privilege. Dickinson wanted the Senate to bear the likeness of the British House of Lords. Pinckney argued that, “only the wealthy would be able to afford to serve.”…As Butler put it, “the great object of government was to protect property...the Senate would block any populist economic measures that might emanate from the House.”
Madison said that the Senate needed to be a “check on the democracy. It can not be made too strong.”
That “check on democracy” is now in the hands of Marxist Democrats, who staged America’s second coup, in November 2020, overthrowing Madison’s representative republic.
Our book explains that patriots today, who are trying to resurrect, or reconstruct Madison’s constitution, in order to defeat the Marxist Democrats are on a fool’s errand.
Madison and Hamilton created a ruling class plutocracy, and going back to their “founding” would not resolve the conflict in the two visions of the American dream.
The economic system of credit and debt created by Hamilton would continue to collapse about every 10 years, due to money growth and speculation by the Ruling Class.
And, restoring Madison’s centralized government would not eradicate the grip that the Democrat Marxists have on the deep state apparatus.
Our argument about the fallacy of going back to Madison’s constitution to eradicate Marxism echoes Lincoln’s argument about the Slaveocracy going back to Madison’s constitution, instead of seceding.
As noted by Feldman, Lincoln stated,
“The only solution Lincoln offered to the crisis was to “go back to [ the ] old policy.” He told the South , and his audience,“ If you would have the peace of the old times , readopt the precepts and policy of the old times.”
That advice to the Southern states was as false then for dealing with the issue of slavery, as the strategy of resurrecting Madison’s constitution today for dealing with the issue of Marxism.
It was the flaws in Madison’s rules for creating the British social class system in America that allowed the Marxists to gain their illegitimate power. In their ascendancy to illegitimate power, they are simply replacing the Ruling Class, to gain unchecked control over Madison’s Leviathan.
We offer a better strategy for common citizens to both eradicate the Marxist threat to liberty, and to eradicate the power of the global corporate state to undermine national sovereignty.
A better idea is to start over at the point of history of Jefferson’s Declaration, and reconstruct Jefferson’s American Dream of an entrepreneurial capitalist society.
Exhibit 1. The History of American Economic Collapse and Financial Panics. Data compiled from End the Fed, by Ron Paul and data sources in Wikipedia and other internet sources.
Panic of 1785.
The panic of 1785, which lasted until 1788, ended the business boom that followed the American Revolution. The causes of the crisis lay in the overexpansion and debts incurred after the victory at Yorktown, a postwar deflation, competition in the manufacturing sector from Britain, and lack of adequate credit and a sound currency. The panic among business and propertied groups led to the demand for a stronger federal government.
Copper Panic of 1789.
Loss of confidence in copper coins due to debasement and counterfeiting led to commercial freeze up that halted the economy of several northern States and was not alleviated until the introduction of new paper money to restore confidence.
Panic of 1796–97.
Just as a land speculation bubble was bursting, deflation from the Bank of England (which was facing insolvency because of the cost of Great Britain's involvement in the French Revolutionary Wars) crossed to North America and disrupted commercial and real estate markets in the United States and the Caribbean.
1802–1804 recession.
A boom of war-time activity led to a decline after the Peace of Amiens ended the war between the United Kingdom and France. Commodity prices fell dramatically. Trade was disrupted by pirates, leading to the First Barbary War.
Depression of 1807. The Embargo Act of 1807 was passed by the United States Congress under President Thomas Jefferson as tensions increased with the United Kingdom. Along with trade restrictions imposed by the British, shipping-related industries were hard hit. The Federalists fought the embargo and allowed smuggling to take place in New England.
1812 recession.
The United States entered a brief recession at the beginning of 1812. The decline was brief primarily because the United States soon increased production to fight the War of 1812, which began June 18, 1812.
1815–21 depression.
Shortly after the war ended on March 23, 1815, the United States entered a period of financial panic as bank notes rapidly depreciated because of inflation following the war. The 1815 panic was followed by several years of mild depression, and then a major financial crisis – the Panic of 1819, which featured widespread foreclosures, bank failures, unemployment, a collapse in real estate prices, and a slump in agriculture and manufacturing.
Panic of 1819.
The Panic of 1819 was the first major peacetime financial crisis in the United States. Public land debt ballooned from $3 million in 1815 to $17 million in 1818.
1822–1823 recession.
After only a mild recovery following the lengthy 1815–21 depression, commodity prices hit a peak in March 1822 and began to fall. Many businesses failed, unemployment rose and an increase in imports worsened the trade balance.
1825–1826 recession.
The Panic of 1825, started as a stock crash following a bubble of speculative investments in Latin America, which led to a decline in business activity in the United States and England.
1828–1829 recession.
In 1826, England forbade the United States to trade with English colonies, and in 1827, the United States adopted a counter-prohibition. Trade declined, just as credit became tight for manufacturers in New England.
1833–34 recession.
The United States' economy declined moderately in 1833–34. News accounts of the time confirm the slowdown. The subsequent expansion was driven by land speculation.
Panic of 1837.
The Panic of 1837 was a financial crisis in the United States that touched off a major recession ... The crisis followed a period of economic expansion from mid-1834 to mid-1836.
1836–1838 recession.
A sharp downturn in the American economy was caused by bank failures and lack of confidence in the paper currency. Speculation markets were greatly affected when American banks stopped payment in specie (gold and silver coinage). Over 600 banks failed in this period. In the South, the cotton market completely collapsed.
1839–late 1843 recession.
This was one of the longest and deepest depressions. It was a period of pronounced deflation and massive default on debt. The Cleveland Trust Company Index showed the economy spent 68 months below its trend and only 9 months above it. The Index declined 34.3% during this depression.
1845–late 1846.
This recession was mild enough that it may have only been a slowdown in the growth cycle. One theory holds that this would have been a recession, except the United States began to gear up for the Mexican–American War, which began April 25, 1846.
1847–48 recession.
The Cleveland Trust Company Index declined 19.7% during 1847 and 1848. It is associated with a financial crisis in Great Britain.
1853–54 recession.
Interest rates rose in this period, contributing to a decrease in railroad investment. Security prices fell during this period. Panic of 1857
June 1857–December 1858 recession.
Failure of the Ohio Life Insurance and Trust Company burst a European speculative bubble in United States' railroads and caused a loss of confidence in American banks. Over 5,000 businesses failed within the first year of the Panic, and unemployment was accompanied by protest meetings in urban areas. This is the earliest recession to which the NBER assigns specific months (rather than years) for the peak and trough
1860–61 recession.
There was a recession before the American Civil War, which began April 12, 1861. Zarnowitz says the data generally show a contraction occurred in this period, but it was quite mild. A financial panic was narrowly averted in 1860 by the first use of clearing house certificates between banks.
1865–67 recession.
The American Civil War ended in April 1865, and the country entered a lengthy period of general deflation that lasted until 1896.
1869–70 recession.
A few years after the Civil War, a short recession occurred. It was unusual since it came amid a period when railroad investment was greatly accelerating. Several months into the recession, there was a major financial panic.
Panic of 1873 and the Long Depression.
Economic problems in Europe prompted the failure of Jay Cooke & Company, the largest bank in the United States, which burst the post-Civil War speculative bubble. The Coinage Act of 1873 also contributed by immediately depressing the price of silver, which hurt North American mining interests. The deflation and wage cuts of the era led to labor turmoil, such as the Great Railroad Strike of 1877. In 1879, the United States returned to the gold standard with the Specie Payment Resumption Act. This is the longest period of economic contraction recognized by the NBER.
1882–85 recession.
Like the Long Depression that preceded it, the recession of 1882–85 was more of a price depression than a production depression. From 1879 to 1882, there had been a boom in railroad construction which came to an end, resulting in a decline in both railroad construction and in related industries, particularly iron and steel.
1887–88 recession.
Investments in railroads and buildings weakened during this period. This slowdown was so mild that it is not always considered a recession. Contemporary accounts apparently indicate it was considered a slight recession.
1890–91 recession.
Although shorter than the recession in 1887–88 and still modest, a slowdown in 1890–91 was somewhat more pronounced than the preceding recession. International monetary disturbances are blamed for this recession, such as the Panic of 1890 in the United Kingdom.
Panic of 1893.
Failure of the United States Reading Railroad and withdrawal of European investment led to a stock market and banking collapse. This Panic was also precipitated in part by a run on the gold supply. The Treasury had to issue bonds to purchase enough gold. Profits, investment and income all fell, leading to political instability, the height of the U.S. populist movement and the Free Silver movement.
Panic of 1896.
The period of 1893–97 is seen as a generally depressed cycle that had a short spurt of growth in the middle, following the Panic of 1893. Production shrank and deflation reigned.
1899–1900 recession.
Though not severe, this downturn lasted for nearly two years and saw a distinct decline in the national product. Industrial and commercial production both declined, albeit fairly modestly.The recession came about a year after a 1901 stock crash.
Panic of 1907.
A run on Knickerbocker Trust Company deposits on October 22, 1907, set events in motion that would lead to a severe monetary contraction. The fallout from the panic led to Congress creating the Federal Reserve System.
Panic of 1910–1911.
This was a mild but lengthy recession. The national product grew by less than 1%, and commercial activity and industrial activity declined. The period was also marked by deflation.
Recession of 1913–1914.
Production and real income declined during this period and were not offset until the start of World War I increased demand. Incidentally, the Federal Reserve Act was signed during this recession, creating the Federal Reserve System, the culmination of a sequence of events following the Panic of 1907.
1918 –1919. Post-World War I recession.
Severe hyperinflation in Europe took place over production in North America. This was a brief but very sharp recession and was caused by the end of wartime production, along with an influx of labor from returning troops. This, in turn, caused high unemployment.
Depression of 1920–21.
The 1921 recession began a mere 10 months after the post-World War I recession, as the economy continued working through the shift to a peacetime economy. The recession was short, but extremely painful. The year 1920 was the single most deflationary year in American history; production, however, did not fall as much as might be expected from the deflation. GNP may have declined between 2.5 and 7 percent, even as wholesale prices declined by 36.8.
1923–24 recession.
From the depression of 1920–21 until the Great Depression, an era dubbed the Roaring Twenties, the economy was generally expanding. Industrial production declined in 1923–24, but on the whole this was a mild recession.
1926–27 recession.
This was an unusual and mild recession, thought to be caused largely because Henry Ford closed production in his factories for six months to switch from production of the Model T to the Model A.
1929–March 1933. Great Depression.
A banking panic and a collapse in the money supply took place in the United States that was exacerbated by international commitment to the gold standard.Extensive new tariffs and other factors contributed to an extremely deep depression. GDP, industrial production, employment, and prices fell substantially. A small economic expansion within the depression began in 1933, with gold inflow expanding the money supply and improving expectations; the expansion would end in 1937. The ultimate recovery, which would occur with the start of World War II in 1940, was credited to monetary policy and monetary expansion.
Recession of 1937–1938.
The Recession of 1937 is only considered minor when compared to the Great Depression, but is otherwise among the worst recessions of the 20th century. Three explanations are offered as causes for the recession: the tight fiscal policy resulting from an attempt to balance the budget after New Deal spending; the tight monetary policy of the Federal Reserve; and the declining profits of businesses leading to a reduction in business investment.
Recession of 1945.
The decline in government spending at the end of World War II led to an enormous drop in gross domestic product, making this technically a recession. This was the result of demobilization and the shift from a wartime to peacetime economy.
Recession of 1949.
The 1948 recession was a brief economic downturn; The recession also followed a period of monetary tightening.
Recession of 1953.
In 1951, the Federal Reserve reasserted its independence from the U.S. Treasury and in 1952, the Federal Reserve changed monetary policy to be more restrictive because of fears of further inflation or of a bubble forming.
Recession of 1958.
Monetary policy was tightened during the two years preceding 1957, followed by an easing of policy at the end of 1957.
Recession of 1960–61.
Another primarily monetary recession occurred after the Federal Reserve began raising interest rates in 1959.
Recession of 1969–70.
The relatively mild 1969 recession followed a lengthy expansion. At the end of the expansion, inflation was rising, possibly a result of increased deficits.
1973–75 recession.
A quadrupling of oil prices by OPEC coupled with high government spending because of the Vietnam War led to stagflation in the United States. The period was also marked by the 1973 oil crisis and the 1973–1974 stock market crash. The period is remarkable for rising unemployment coinciding with rising inflation.
1980 recession.
The NBER considers a very short recession to have occurred in 1980, followed by a short period of growth and then a deep recession. Unemployment remained relatively elevated in between recessions. The recession began as the Federal Reserve, under Paul Volcker, raised interest rates dramatically to fight the inflation of the 1970s.
Early 1980s recession.
The Iranian Revolution sharply increased the price of oil around the world in 1979, causing the 1979 energy crisis. Tight monetary policy in the United States to control inflation led to another recession.
Early 1990s recession.
After the lengthy peacetime expansion of the 1980s, inflation began to increase and the Federal Reserve responded by raising interest rates from 1986 to 1989. This weakened but did not stop growth, but some combination of the subsequent 1990 oil price shock, the debt accumulation of the 1980s, and growing consumer pessimism combined with the weakened economy to produce a brief recession.
Early 2000s recession.
The collapse of the speculative dot-com bubble, a fall in business outlays and investments, and the September 11th attacks brought the decade of growth to an end.
2007 –2009. Great Recession
The subprime mortgage crisis led to the collapse of the United States housing bubble. Falling housing-related assets contributed to a global financial crisis, even as oil and food prices soared. The crisis led to the failure or collapse of many of the United States' largest financial institutions: Bear Stearns, Fannie Mae, Freddie Mac, Lehman Brothers, Citi Bank and AIG, as well as a crisis in the automobile industry. The government responded with an unprecedented $700 billion bank bailout and $787 billion fiscal stimulus package.
Exhibit 2. The Chronology of the Restoration of Elite Rule.
1775-1776. Jefferson’s Original Promise Documents.
1781. State Sovereignty Promise of Articles of Confederation.
1783. King George surrenders and transfers the Crown’s sovereignty to the sovereignty of 13 Independent States Britain acknowledges the United States (New Hampshire, Massachusetts Bay, Rhode Island and Providence Plantations, Connecticut, New York, New Jersey, Pennsylvania, Delaware, Maryland, Virginia, North Carolina, South Carolina, and Georgia) to be free, sovereign, and independent states, and that the British Crown and all heirs and successors relinquish claims to the Government, property, and territorial rights of the same, and every part thereof,
1787. Madison usurps the Articles of Confederation, First Restoration of elite rule. If you like your state, you can keep your state. 7 Grand compromises endorsing slavery.
1788-1789. Anti-Federalists betrayed by Federalists in sham ratification conventions.
1788. North Carolina holds out for Declaration of Rights and is oppressed by Congress for failure to ratify.
1791. Bill of Rights added.
1798. Federalists enact Alien and Sedition Acts to eliminate opposition.
1800. Jefferson’s Failed Counter Revolution to restore liberty.
1829. Jackson elected. Beginning of Democrat Party. Forced removal of Indians. First state’s rights nullification crisis.
1858. Extension of slavery into the territories. Lincoln quotes Jefferson as justification for the Civil War.
1866-1877. Failed Reconstruction. Natural aristocracy restores elite rule.
1880 – 1898. Failed Agrarian Revolt. Ruling Class restores elite rule.
1896. Beginning of American Apartheid and restoration of the rule by crony capitalism. McKinnley elected.
1929. Great Depression. First failed American experiment in socialism. Roosevelt tries out a version of Mussolini’s corporate fascism.
1958. Eisenhower warns of military industrial elite related to combined corporate government power.
1992. Corporate elites pass first acts of corporate crony globalism.
1999. Corporate elites admit China into WTO under status of a “developing nation.”
2008. Housing collapse and corporate bailouts. Fed restores elite rule.
2008. Obama elected
2016. Failed Trump presidency to avert a coup.
2020. Democrat Marxist coup. Coalition of Republican crony corporations and Democrat Marxists.
