Economic Law and Economic Growth: Antitrust, Regulation, and the American Growth System

By George E. Garvey; Gerald J. Garvey | Go to book overview
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Broad framework setting no longer sufficed. Additional measures were needed to contain the newly released forces within the economy. The government empowered itself to prosecute monopolists under the antitrust laws or to institute detailed price regulation within specified (but obviously, no longer free) highly concentrated markets.

Antitrust enforcement and administrative rate setting injected public officials into a complicated system of economic relationships. Shibboleths about competitive markets could hardly begin to describe the intricacies of the wage- price-profit equipoise. Nor could devil theories of monopoly suggest how necessary it would be to keep tolerable wage-price-profit balances in order to maintain the growth system. Benighted interference in a complex economic mechanism might throw the whole system into disarray.

The main fallacy of the populist-progressive thinkers lay in their failure to reflect the broader outlook that the growth system required--to see exactly how the price mechanism fit into the larger system of balances. The contemporary crisis in antitrust and regulation is a long-delayed result of that late-nineteenthcentury failure to understand the full context and real functions of economic law.


NOTES
1.
The vignette comes from David Potter, People of Plenty: Economic Abundance and the American Character ( Chicago: University of Chicago Press, 1954), 80.
2.
See ibid.
3.
James Willard Hurst, Law and the Conditions of Freedom in the Nineteenth- Century United States ( Madison: University of Wisconsin Press, 1956), 7.
4.
Alexis de Democracy in America Tocqueville, abridged version, ed. Richard Heffner , ( New York: New American Library, 1956), 125.
5.
Joseph Dorfman, Economic Mind in American Civilization, 1606-1933, 4 vols. ( New York: Macmillan, 1946).
6.
Ibid., vol. 2, esp. pp. 512-65, 771-88, 929ff. It is clear, incidentally, that material growth has been accepted by many contemporary professional economists as a central--probably the central--driving impulse of U.S. history. See, for example, the work by twelve leading economists, Lance Davis et al., American Economic Growth: An Economist's History of the United States ( New York: Harper & Row, 1972), part 1, esp. p. 83.
7.
See Leo Marx, The Machine in the Garden: Technology and the Pastoral Ideal in America ( New York: Oxford University Press, 1964), chap. 4, and esp. pp. 197ff. The antebellum years themselves, moreover, engaged Americans in lively debates over the proper strategy for economic development, debates that perhaps have not since been matched either in seriousness or in the level of heat that they generated.
8.
Ralph Waldo Emerson, "Wealth", in "The Conduct of Life" ( 1860), ed. Donald McQuade , Selected Writings of Emerson ( New York: Modern Library, 1981), 707.
9.
Actually, it might be preferable in this listing to refer to some of the leading Jacksonians (such as William Leggett or, of course, Jackson himself) rather than to those two leaders of the American Whig party and proponents of the so-called American

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