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Procrastinating on January 12, 2017

The Story of American Economic History

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Let me start this course about American economic history with a story:

This is a story about a guy born in the late 19th century, in 1879, on the prairie: his family's homestead was 17 miles from the nearest post office. In historical terms, the horse-riding nomads who had dominated the prairie had only recently been driven off by the guns of government soldiers. Agricultural settlement in one of the richest soil regions of the world was well advanced, but frontier life was still raw and uncivilized.

The kid was smart. So at the age of nine his parents decided to send him to the big city for school. He thus grew up in the bustling cosmopolitan big port city, undergoing very rapid economic growth and industrialization, as it processed and transported the grain and other exports of one of the most fertile agricultural regions of the world.

But the city was Odessa, not Chicago. He was Russian, not American. His name was Lev Davidovitch Bronstein--Lev is either Hebrew for "heart" or Russian for "lion"; Davidovitch is "son of the beloved one"; Bronstein is German or Yiddish for "stone well".

He did, eventually, wind up in the United States. He came to the U.S. only after being arrested, jailed, and exiled four times; leading one unsuccessful revolution; and rising to the top of the Russian Social Democratic Labor Party. By then he was known as Leon Trotsky—a pseudonym he adopted in 1902 to try to throw the Czarist secret police—the Okhrana—off of his scent, supposedly the name of one of his Czarist jailers. By then he had lived in many places and seen a great deal of the world--Nikolayev, Kherson, Kiev, and Odessa in Ukraine; Moscow and St. Petersburg in European Russia; Alma-Ata in Kazakhstan; Ust-Kut in Siberia; Vienna, Geneva, and Paris; all before being deported from France to Spain and then Spain to New York, where he arrived on January 13, 1917.

But he did not stay in the United States for long.

When the Kerenskyites overthrew the Romanov Czar Nikolai II in February 1917 to try to establish a democratic republic in Russia, Trotsky immediately sailed back to his country, departing from New York on March 27, 1917. He then took his place at Vladimir Lenin's right hand in the October Revolution and the construction of the Soviet Union before being purged, exiled, and murdered—stabbed with an ice pick by an NKVD agent soon after moving out of artist Frida Kahlo's house in Mexico City—by Josef Stalin.

Russia was his country. Lenin was his friend, leader, and comrade. And Lenin's Majority—Bolshevik—faction of the Russian Social Democratic Labor Party was his cause.

However, later, in 1930 in his autobiography My Life, he would write that he left with regrets that his stay had been so short:

It would be a gross exaggeration to say that I learned much.... The Russian revolution came so soon that I only managed to catch the general life-rhythm of the monster known as New York. I was leaving for Europe, with the feeling of a man who has had only a peep into the foundry in which the fate of man is to be forged...

"The foundry where the fate of humanity is to be forged".

The then-38 year old Trotsky had seen more of the world and its history from more levels than all but a few, and had a brain and education that put him in the very select company of those who could try to grasp and understand it. And Trotsky's judgment was that he; in returning to St. Petersburg and Moscow was returning to a backwater: moving back to the past that was his country from where the future was being made every day.

And Trotsky was right. America has been--since 1776 and perhaps since 1630--the place where the future of humanity has been and is being hammered out. That is why its history--the study of what has happened here--is of general interest to humans wherever they live in the world, and will be of interest to humans long into the future.

Why did I start this lecture with this story?

Why didn't I just say: "America has been--since 1776 and perhaps since 1630--the place where the future of humanity has been and is being hammered out. That is why its history--the study of what has happened here--is of general interest to humans wherever they live in the world, and will be of interest to humans long into the future"; and omit the windup?

First, to stress that my judgment that the history of America is of general rather than parochial interest is shared by one of the smartest and most farsighted human beings of the twentieth century, and one whose politics and understanding of the world are very, very different from mine. My judgment is not mine alone--far from it.

Second, to try to keep you awake: We have here someone who should be sympathetic to you--a young, very smart, man on the make, upwardly mobile and trying to figure out what to do with his life. Plus we have travel, danger, imprisonment, revolution, and murder while reading in his study by a single blow in the back of his head from an ice pick wielded by the lover of his personal secretary and Russian NKVD agent Ramon Mercader.

Third, you won't remember "America has been--since 1776 and perhaps since 1630--the place where the future of humanity has been and is being hammered out. That is why its history--the study of what has happened here--is of general interest to humans wherever they live in the world, and will be of interest to humans long into the future". You will remember the story: You will remember that there was this interesting dude named Trotsky who had a very full life and to whom lots of things happened, and he thought the U.S. and its history was really important--so much so that he left New York to become Lenin's principal deputy and People's Commissar for Foreign Affairs in the Soviet government with some regret.

You see, we are narrative-loving animals. We like stories. It is how we think. We are jumped-up East African Plains Apes, only 3000 generations removed from those who first developed language, trying to understand the world as monkeys with, as Winnie-the-Pooh would say, "very little brain". We are lousy at remembering lists--that is why we need to write them down. We are not much good at retaining sets of information--unless we can, somehow, turn them into a journey or a memory palace. We are excellent, however, at remembering landscapes. And we are fabulous at stories: human characters with believable motivations; beginnings, middles, and endings; hubris and nemesis; cause and effect; villains and heroes.

To place ideas and lessons in the context of a story is a mighty aid to our thinking. And history and its narratives are how we do that.

That is the first BIG IDEA of this course: that you should study history because it is a mental force multiplier for your brain, and that disciplines that do not take a historical approach and ideas that do not admit of a narrative historical presentation are crippling themselves.

There are thirteen other BIG IDEAS to watch out for in this American economic history course. Yes, I know that is too many. Make a list and refer to it.

The BIG IDEAS are:

  1. We are animals that live by narrative—hence by history…
  2. There are three American nationalisms…
    • The City Upon a Hill: “Let it be as it was in New-England…”
    • A place where we can live freely…
    • “But here was Old Kentucky!”
  3. The American project has been astonishingly successful—in Trotsky’s words: “the furnace where the future is being forged…”
  4. But the American project has been much worse than shadowed by plantation slavery and its echoes down the centuries…
  5. One big contributor to the success of the American project has been immigration…
  6. American society has generated a large—in comparative context—but unevenly distributed quantum of liberty…
  7. American society used to deliver an unusually large quantum of opportunity—but not any more…
  8. American society has delivered an unprecedented and unequalled quantum of prosperity
  9. The story of industrialization requires focusing on growth-oriented industrial policy…
  10. The story of industrialization requires focusing on societal well being-oriented industrial policy…
  11. The story of opportunity and prosperity is the story of our two Gilded Ages: their rise, fall, and rise
  12. The apogee of American success is the mid twentieth century era of social democracy
  13. Society has moved from agriculture to industry to post-industrial services, and is now moving on to ?…
  14. Much of what has gone wrong with America can be traced to regional geography—and to the cultures that entrenched themselves in that geography…

Note: Want to learn more about Lev Bronstein--Leon Trotsky? IMHO, the best places to start are with two books: First, the relevant sections of Edmund Wilson (1940): To the Finland Station. Second, Leon Trotsky (1930): My Life.