Abstract
Tocqueville is not considered a pioneer of political economy, though economic themes are prevalent throughout his work. However, through an analysis of his comments on the debate over whether or not to recharter the Second Bank of the United States, I argue Tocqueville demonstrates that governmental centralization is essential for a healthy liberal political economy. Governmental centralization is key because it allows for the implementation of the entrepreneurial spirit and provides a basic structure of rules and laws that facilitate commerce and are the basis for national bonds and distinctly American mores. For Tocqueville, the political economy of America is defined by both a spirit of commerce and a need for institutions that foster this spirit and prevent it from being overcome by problematic democratic passions.
I would like to thank the editors of this volume, Peter Boettke and Adam Martin, for their helpful insights on this chapter. I would also like to thank Thomas Bunting, Connor Ewing, and Katelyn Jones for their comments on earlier versions of the chapter that greatly improved the argument. The ideas for this paper were also enhanced through many conversations with my student, Katherine Fossaceca, about her senior thesis on the connections between Tocqueville and the American committees of correspondence during the Revolutionary War. To the other participants in the volume, thank you for your feedback at the abstract stage of the development of the argument. All remaining errors are my own.
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Notes
- 1.
Tocqueville explains his fears that equality of conditions will lead citizens to desire a strong central government: “I have pointed out how fear of disorder and love of well-being unconsciously lead democracies to increase the functions of the central government, the only power which they think strong, intelligent, and stable enough to protect them from anarchy” (Tocqueville 1969: 677). Hereafter, all citations will be parenthetical as (DA, page). He also explains how the central government could turn despotic if citizens lose their desire to participate in government: “I am trying to imagine under what novel features despotism may appear in the world. In the first place, I see an innumerable multitude of men, alike and equal, constantly circling around in pursuit of the petty and banal pleasures with which they glut their souls. Each one of them, withdrawn into himself, is almost unaware of the fate of the rest…Over this kind of men stands an immense, protective power…it daily makes the exercise of free choice less useful and rarer, restricts the activity of free will within a narrower compass, and little by little robs each citizen of the proper use of his own faculties. Equality has prepared men for all this, predisposing them to endure it and often even to regard it as beneficial” (DA, 692).
- 2.
In a notable exception, Swedberg argues that just as Tocqueville separates governmental and administrative centralization, he also separates economic governmental centralization from economic administrative centralization. However, Swedberg states that Tocqueville thinks the federal government should only have the power of taxation and suggests that most other economic affairs should be handled locally because local governments know their own economic affairs best (Swedberg 2009, 28–31).
- 3.
For more on Hayek’s federalism see Galeotti (1987).
- 4.
Hamilton (1904), 408–9.
- 5.
Hamilton, Opinion on the Constitutionality of the Bank, 1791. https://teachingamericanhistory.org/library/document/opinion-on-the-constitutionality-of-the-bank-of-the-united-states/. Accessed May 1, 2019.
- 6.
Jefferson, Opinion on the Constitutionality of the Bill for Establishing a National Bank, 1791. https://teachingamericanhistory.org/library/document/opinion-on-the-constitutionality-of-a-national-bank/. Accessed May 1, 2019.
- 7.
“You tell me I am quoted by those who wish to continue our dependence on England for manufactures. There was a time when I might have been so quoted with more candor, but within the thirty years which have since elapsed, how are circumstances changed! ...Shall we make our own comforts, or go without them, at the will of a foreign nation? He, therefore, who is now against domestic manufacture, must be for reducing us either to dependence on that foreign nation, or to be clothed in skins, and to live like wild beasts in dens and caverns. I am not one of these; experience has taught me that manufactures are now as necessary to our independence as to our comfort.” Thomas Jefferson, Letter to Benjamin Austin, January 9, 1816.
- 8.
See Lomazoff (2018).
- 9.
Jackson, Veto Message of the Bill on the Bank of the United States, 1832 in Burkett (2015).
- 10.
Clay, Speech on President Jackson’s Veto of the Bank Bill in Senate, 1832. https://teachingamericanhistory.org/library/document/speech-on-president-jacksons-veto-of-the-bank-bill-in-senate/. Accessed May 1, 2019.
- 11.
Webster, Speech on the Presidential Veto of the Bank Bill, 1832. https://teachingamericanhistory.org/library/document/speech-on-the-presidential-veto-of-the-bank-bill/. Accessed May 1, 2019.
- 12.
Tocqueville’s example of geographical connection is the Alleghenies stretching through multiple states rather than acting as a barrier between states (DA, 371).
- 13.
- 14.
- 15.
Tocqueville’s argument here is a precursor to the argument Friedrich Hayek will make against central economic planning. In “The Use of Knowledge in Society,” for example, Hayek argues “to assume all the knowledge to be given to a single mind in the same manner in which we assume it to be given to us as the explaining economists is to assume the problem away and to disregard everything that is important and significant in the world.” Hayek (1945: 530).
- 16.
For more on Tocqueville’s theory of political and economic liberty throughout his work see Swedberg (2009).
- 17.
Tocqueville (1971: 87). Hereafter, all citations will be parenthetical as (JA, page).
- 18.
- 19.
Of course, this process can work in reverse as well. If citizens are only motivated by well-being, they might retreat into their private lives and ignore public affairs altogether. For more on the commercial spirit see Henderson (2005).
- 20.
For more on the relationship between governmental centralization, liberalism, and republicanism in Tocqueville’s theory see Engster (1998).
- 21.
Smith explains how regulations on trade limit its possibilities: “No regulation of commerce can increase the quantity of industry in any society beyond what its capital can maintain. It can only divert a part of it into a direction into which it might not otherwise have gone; and it is by no means certain that this artificial direction is likely to be more advantageous to the society than that into which it would have gone of its own accord” Smith (1981 [1776]), WN IV.ii.3, 453.
- 22.
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Wolf, B. (2020). “The Monetary Link”: Tocqueville on the Second Bank of the United States and Liberal Political Economy. In: Boettke, P., Martin, A. (eds) Exploring the Social and Political Economy of Alexis de Tocqueville. Mercatus Studies in Political and Social Economy. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-34937-0_3
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