X hits on this document

PDF document

Amitai Etzioni - page 10 / 30

101 views

0 shares

0 downloads

0 comments

10 / 30

250

AMIT AI ETZI0 NI

Historical Illustration In nineteenth-century America, the national financial system developed with

great difficulty due to the low level of nation building. Without a nationwide, easily mobilized flow of capital, large-scale development is severely set back. Until savings were no longer dispersed in thousands of banks, inaccessible to

large borrowers, specialists such as J. Pierpont Morgan, Edward Harriman, and Jacob Schiff were required to improvise ad hoc the linkages to secure enough capital for large projects.

For twenty years prior to the Civil War, the paper currency consisted largely

of bank notes issued by local banks-in

1862, some 1,600 of them--operating

under diverse statelaws. After 1863, asthe nation soughtto resolve the divisions accompanying the war and the economic crises following it, a greaterdegree of uniformity and national collaboration gradually evolved. In 1913 Congress es- tablished the Federal Reserve System, which provided a basis for national coordination of banking activities.

Practically all economic historians of the United States stress the supportive

role of toward

government-in

the nineteenth century, primarily state governments-

business in

general and economic

development in particular.

Financial

aid, direct and indirect, was common. Governments invested in railroads other transportation facilities; they favored the banks, and the banks in

and turn

financed

railroads

and

industrial

enterprises.

Regulations

that

protected

young

industries were introduced. the construction of bridges,

Lotteries were conducted and their proceedsused for roads, and papermills. Government franchises were

used to against

spurthe building of bridges, aqueducts,and dams, andto protect builders damage claims resulting from consequentfloods or diversions of water.

While the majority of the financial/legal developments betweenthe 1860sand the 1920swere basically favorable to industrialization, not all pointed in this di- rection. Public opposition to "combinations of capital" was so strong that the Sherman Antitrust Act was passed unanimously by the House in 1890; in the Senate, there was only one dissenting vote. Many statespassed their own anti- trust laws. While those laws were ineffectually enforced, and most corporations worked their way around them, they had a nuisancevalue and illustrate populist misgivings about the new industrial world. They did not stop or significantly slow down industrialization, but they sniped at it.

II. THE SEVEN ELEMENTS: REVISITED

The accumulationof thesesevenelementsbetwee the 1820sandthe 1920s,at an acceleratedpace after the Civil War, providedthe foundationfor a strong economy.Partof its capacitywasidle duringthe Depression,andcommittedto thewar during the post-Depressioyears.Only in thelate 1950s,andespecially in the following decades,did massproductionof consumegoodsandservices

Document info
Document views101
Page views101
Page last viewedFri Dec 09 15:41:02 UTC 2016
Pages30
Paragraphs755
Words11416

Comments