Here’s your chance to grab your FREE subscription to Whiskey & Gunpowder, the world wide web’s only e-newsletter that covers resources, oil, geopolitics, military history, geology and personal freedom. The main editors are Dan Denning, from Strategic Investment, Byron King, our geology and oil specialist, and Jim Amhrhein, who details personal liberties.And – as you’ll see – Justice Litle and Kevin Kerr will pop up with some Whiskey shots from time to time, offering their keen insights on the natural resource markets and macro-economic factors that drive those markets. Each and every issue will bring you a different perspective on the markets or geopolitical news.  Make sure you know what the future holds — get a FREE subscription today! See two sample issues below:

End of the Line for the Disruptive Technology of Its Day: the Railroad

Dear Reader,

In 1934, the railway unions were in trouble. As William E. Leuchtenburg writes in The Supreme Court Reborn: The Constitutional Revolution in the Age of Roosevelt,

"The onset of the Great Depression, though, dealt savagely with the railroad industry. Even before 1929, competition from trucks, intercity buses, pipelines, even the first sign of commercial air travel, was already threatening the supremacy of the railways, and each year at the start of the Depression -- 1930, 1931, 1932 -- operating revenues of railroads fell another billion dollars, so that by 1932, income had dropped to under half that of 1929."

Sounds a bit like the current state of the North American auto industry, doesn't it? Leuchtenburg continues:

"From 1929 to 1933, railroads fired more than two out of every five railway workers, and total compensation in 1933 was less than half of what it had been four years earlier. Railroad employment, which had peaked at above 2 million in 1920, fell to under a million. By the late summer of 1932, more than 760,000 railroad workers had lost their jobs, a decline since 1929 of 54%, and thousands of those still employed drew only part-time pay."

Sounds even more like the current state of the North American manufacturing industry. But in 1934, no public pension system existed that could absorb such high levels of unemployment. I will submit that none such exist today, either. But more of that in a future Whiskey.

With the help of allies in Congress, the railroad unions helped draft the Railroad Retirement Act of 1934. According to Leuchtenburg:

"It required carriers to contribute 4% of their payrolls to a common pension pool for more than 2 million railway workers, past and present, and assessed employees 2% of their wages...Workers would be eligible for pensions on reaching the age of 65, or upon completing 30 years of service on the roads, or if they became disabled.

"It was the first compulsory plan ever imposed by the federal government on private industry. The carriers protested that in the first year, the law would double the $35 million the railroads were currently laying out under private pension programs and that by 1953, that sum would nearly quadruple."

On May 6, 1935, the Supreme Court ruled the act unconstitutional. Writing for the majority, Owen Roberts laid out the basis of the court's disagreement with the act:

"The federal government is one of enumerated powers; those not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states or to the people. The Constitution is not a statute, but the supreme law of the land to which all statutes must conform, and the powers conferred upon the federal government are to be reasonably and fairly construed, with a view to effectuating their purposes. But recognition of this principle cannot justify attempted exercise of a power clearly beyond the true purpose of the grant."

Roberts cited due process and the 10th Amendment as reasons for the ruling. He wrote:

"It results from what has now been said that the act is invalid because several of its inseparable provisions contravene the due process of law clause of the Fifth Amendment. We are of opinion that it is also bad for another reason, which goes to the heart of the law, even if it could survive the loss of the unconstitutional features which we have discussed. The act is not in purpose or effect a regulation of interstate commerce within the meaning of the Constitution."

Roberts saw that the real goal of the act was not to regulate interstate commerce, but to create a government role in the pension system. He objected to this at the time and wrote as much:

"We feel bound to hold that a pension plan thus imposed is in no proper sense a regulation of the activity of interstate transportation. It is an attempt for social ends to impose by sheer fiat noncontractual incidents upon the relation of employer and employee, not as a rule or regulation of commerce and transportation between the states, but as a means of assuring a particular class of employees against old-age dependency. This is neither a necessary nor an appropriate rule or regulation affecting the due fulfillment of the railroads' duty to serve the public in interstate transportation."

Roosevelt was appalled at the ruling, and the Railroad Retirment Act wasn't even his legislation. But the Social Security Act was. And he reliazed that if the court struck down the Railroad Retirement Act, Social Security didn't stand a chance.

Congress passed the Social Security Act on Aug. 14, 1935. But it had yet to be challenged -- and upheld -- by the Supreme Court. Based on the court's ruling on the Railroad Retriment Act, the prospects for Social Security and other pieces of Roosevelt's socialist agenda did not look good. Indeed, the court rapidly struck down other New Deal initiatives.

In May, the court threw out the National Industrial Recovery Act, the centerpiece of the New Deal. It was a huge blow to Roosevelt's interventionist ambitions. Section 3 of the act allowed the president to "implement industrial codes to regulate weekly employment hours, wages and minimum ages of employees."

In Schechter Poultry Corp. v. the United States, the court held that Congress had unconstitutionally delegated legislative power to the president. It gave the president the power to simply make up rules.

In writing for the majority, Chief Justice Charles Evans Hughes wrote:

"Extraordinary conditions do not create or enlarge constitutional power. The Constitution established a national government with powers deemed to be adequate, as they have proved to be both in war and peace, but these powers of the national government are limited by the constitutional grants. Those who act under these grants are not at liberty to transcend the imposed limits because they believe that more or different power is necessary. Such assertions of extraconstitutional authority were anticipated and precluded by the explicit terms of the 10th Amendment."

There were more detailed arguments in the decision pertaining to specific aspects of the act. But the general dismissal of the act was grounded in the argument above. Namely, extraordinary circumstances don't allow the Congress or the president to exceed the limits of Constitution.

It's not as if the court routinely rejected acts of Congress before Roosevelt. In fact, you can find a listing of acts of Congress that the court has held unconstitutional at http://www.gpoaccess.gov/constitution/pdf/con039.pdf. Up through the late 1990s, only 127 acts have been overturned as unconstitutional. Roosevelt, though, was pushing the envelope. The court pushed back.

In January 1936, the court threw out the Agricultural Adjustment Act. The majority concluded that the "Agricultural Adjustment Act providing for processing taxes on agricultural commodities and benefit payments therefore to farmers" was "not within the taxing power under Article I, Section 8, Clause 1." But far from reaching arid, legal conclusions, the court's 5-4 majority thoroughly rejected the idea that a tax could be constitutionally levied in the manner the act conceived.

Writing for the majority, Justice Owen Roberts wrote:

"A tax, in the general understanding of the term, and as used in the Constitution, signifies an exaction for the support of the government. The word has never been thought to connote the expropriation of money from one group for the benefit of another. We may concede that the latter sort of imposition is constitutional when imposed to effectuate regulation of a matter in which both groups are interested and in respect of which there is a power of legislative regulation. But manifestly no justification for it can be found unless as an integral part of such regulation. The exaction cannot be wrested out of its setting, denominated an excise for raising revenue and legalized by ignoring its purpose as a mere instrumentality for bringing about a desired end. To do this would be to shut our eyes to what all others than we can see and understand."

Roberts waxed philosophic about the role of the judiciary in public life -- and of the proper scope and power of the federal government. He wrote:

"The question is not what power the federal government ought to have, but what powers in fact have been given by the people. It hardly seems necessary to reiterate that ours is a dual form of government; that in every state there are two governments; the state and the United States. Each state has all governmental powers save such as the people, by their Constitution, have conferred upon the United States, denied to the states, or reserved to themselves. The federal union is a government of delegated powers. It has only such as are expressly conferred upon it and such as are reasonably to be implied from those granted. In this respect we differ radically from nations where all legislative power, without restriction or limitation, is vested in a parliament or other legislative body subject to no restrictions except the discretion of its members."

What was Roberts getting at? He was trying to show that any laws that expand the scope of federal power -- for whatever benignly stated purposes -- violate the letter of the Constitution. It was especially important with respect to taxes, as the Agricultural Act sought to ground the power to levy taxes in the general welfare language in Article I, Section 8, Clause 1 of the Constitution, which states:

"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States."

Justice Roberts rejected the government's reasoning. Roberts wrote (emphasis mine):

"The clause thought to authorize the legislation, the first, confers upon the Congress power 'To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States.' It is not contended that this provision grants power to regulate agricultural production upon the theory that such legislation would promote the general Welfare. The government concedes that the phrase 'to provide for the general welfare' qualifies the power 'to lay and collect taxes.' The view that the clause grants power to provide for the general welfare, independently of the taxing power, has never been authoritatively accepted. Mr. Justice Story points out that, if it were adopted, It is obvious that under color of the generality of the words, to 'provide for the common Defence and general Welfare,' the government of the United States is, in reality, a government of general and unlimited powers, notwithstanding the subsequent enumeration of specific powers.' The true construction undoubtedly is that the only thing granted is the power to tax for the purpose of providing funds for payment of the nation's debts and making provision for the general welfare."

What goes "general welfare" mean, then? I suppose that depends on whom you ask. For example, if you asked Alexander Hamilton, you'd get one answer. James Madison would give you an entirely different one. Roberts opines:

"Since the foundation of the nation, sharp differences of opinion have persisted as to the true interpretation of the phrase. Madison asserted it amounted to no more than a reference to the other powers enumerated in the subsequent clauses of the same section; that, as the United States is a government of limited and enumerated powers, the grant of power to tax and spend for the general national welfare must be confined to the enumerated legislative fields committed to the Congress. In this view the phrase is mere tautology, for taxation and appropriation are or may be necessary incidents of the exercise of any of the enumerated legislative powers. Hamilton, on the other hand, maintained the clause confers a power separate and distinct from those later enumerated is not restricted in meaning by the grant of them, and Congress consequently has a substantive power to tax and to appropriate, limited only by the requirement that it shall be exercised to provide for the general welfare of the United States."
 
You can see why the older argument between Hamilton and Madison mattered very much to Roosevelt. To redress the social evils of the Depression, Roosevelt needed the court to sign off on the idea that the general welfare of the nation permitted Congress and the president to levy new taxes and impose new regulations that were not specifically enumerated in the Constitution.

But Roberts utterly rebuffed Roosevelt at every turn. If you're still with me at this point, then you're interested in the argument. So I'll quote one last big chunk of Owens' decision. In this conclusion, Owens shows that giving the federal government the power to levy specific taxes or lay specific regulations in order to redress some general social evil and promote the general welfare essentially destroys the federal character of the Constitution and imposes no limits on Congress except what it chooses to impose on itself (emphasis mine):

"Suppose that there are too many garment workers in the large cities; that this results in dislocation of the economic balance. Upon the principle contended for, an excise might be laid on the manufacture of all garments manufactured and the proceeds paid to those manufacturers who agree to remove their plants to cities having not more than a hundred thousand population. Thus, through the asserted power of taxation, the federal government, against the will of individual states, might completely redistribute the industrial population.

"A possible result of sustaining the claimed federal power would be that every business group which thought itself underprivileged might demand that a tax be laid on its vendors or vendees, the proceeds to be appropriated to the redress of its deficiency of income. These illustrations are given, not to suggest that any of the purposes mentioned are unworthy, but to demonstrate the scope of the principle for which the government contends; to test the principle by its applications; to point out that, by the exercise of the asserted power, Congress would, in effect, under the pretext of exercising the taxing power, in reality accomplish prohibited ends. It cannot be said that they envisage improbable legislation. The supposed cases are no more improbable than would the present act have been deemed a few years ago.

"Until recently no suggestion of the existence of any such power in the federal government has been advanced. The expressions of the framers of the Constitution, the decisions of this court interpreting that instrument and the writings of great commentators will be searched in vain for any suggestion that there exists in the clause under discussion or elsewhere in the Constitution, the authority whereby every provision and every fair implication from that instrument may be subverted, the independence of the individual states obliterated, and the United States converted into a central government exercising uncontrolled police power in every state of the Union, superseding all local control or regulation of the affairs or concerns of the states.

"Hamilton himself, the leading advocate of broad interpretation of the power to tax and to appropriate for the general welfare, never suggested that any power granted by the Constitution could be used for the destruction of local self-government in the states. Story countenances no such doctrine. It seems never to have occurred to them, or to those who have agreed with them, that the general welfare of the United States (which has aptly been termed 'an indestructible Union, composed of indestructible States') might be served by obliterating the constituent members of the Union. But to this fatal conclusion the doctrine contended for would inevitably lead. And its sole premise is that, though the makers of the Constitution, in erecting the federal government, intended sedulously to limit and define its powers, so as to reserve to the states and the people sovereign power, to be wielded by the states and their citizens and not to be invaded by the United States, they nevertheless by a single clause gave power to the Congress to tear down the barriers, to invade the states' jurisdiction, and to become a parliament of the whole people, subject to no restrictions save such as are self-imposed. The argument, when seen in its true character and in the light of its inevitable results, must be rejected."

On March 9, 1937, Roosevelt introduced the nation to the idea of packing the court in one of his famous fireside chats. To read the whole thing, or better yet, listen to it as an MP3 file, go to

http://millercenter.virginia.edu/scripps/diglibrary/prezspeeches/roosevelt/fdr_1937_0309.html.

And by the way, isn't it amazing the lack of condescension in public dialogue back then? Roosevelt expected the public would listen to a long speech and handle complicated ideas. Contrast that with today's approach, which seems to suggest that the affairs of state are too complicated for average Americans to worry their little old heads over.

In his folksy and charming way, Roosevelt makes the cases for a strong "national power." He says:

"I hope that you have reread the Constitution of the United States in these past few weeks. Like the Bible, it ought to be read again and again.

"It is an easy document to understand when you remember that it was called into being because the Articles of Confederation, under which the original 13 states tried to operate after the Revolution, showed the need of a national government with power enough to handle national problems. In its preamble, the Constitution states that it was intended to form a more perfect union and promote the general welfare; and the powers given to the Congress to carry out those purposes can be best described by saying that they were all the powers needed to meet each and every problem which then had a national character and which could not be met by merely local action.

"But the framers went further. Having in mind that in succeeding generations many other problems then undreamed of would become national problems, they gave to the Congress the ample broad powers 'to levy taxes...and provide for the common defense and general welfare of the United States.'

"That, my friends, is what I honestly believe to have been the clear and underlying purpose of the patriots who wrote a federal Constitution to create a national government with national power, intended, as they said, 'to form a more perfect union...for ourselves and our posterity.'"

Let us give the man at least some credit. He says the Constitution and the Bible should be read "again and again." I wonder how many modern-era Democrats would agree. He suggests we should "reread" the Constitution, assuming most Americans have already read it at least once. I wonder how true that is today.

But then, he grounds the power to deal with national problems in the ability of Congress to levy taxes. Is there any clearer expression of the idea that all problems are political problems and can be solved if only the right government program is properly funded with taxpayer dollars? Roosevelt practically advocates a kind of national socialism.

Roosevelt did not succeed in packing the courts. There's a whole other story there. But he didn't entirely fail in influencing the direction of the courts' opinions.

In three crucial opinions delivered in 1937, the Supreme Court -- with Roberts voting with a new majority -- upheld the major tenants of the Social Security Act. What's more, Benjamin Cardozo, writing for the majority, captured the suddenly new spirit suffusing the Constitution. I'll quote it at length and emphasize what I think are the crucial passages.

By the way, the passages are crucial because they establish the foundation for defending a changing interpretation of the Constitution, a sort of unholy trinity of ideas that still find purchase today. One, taxes can be levied to promote the general welfare, as determined by Congress. Two, the general welfare changes with the times. Three, what is critical or urgent changes with the times. And if you wanted to throw in a fourth, it would this: When Congress has one idea of the general welfare and the states another, "the locality must yield," according to Justice Cardozo, who continues:

"The scheme of benefits created by the provisions of Title II is not in contravention of the limitations of the 10th Amendment.

"Congress may spend money in aid of the 'general welfare.' Constitution, Article I, Section 8; United States v. Butler, 297 U. S. 1, 65; Steward Machine Co. v. Davis, supra. There have been great statesmen in our history who have stood for other views. We will not resurrect the contest. It is now settled by decision. United States v. Butler, supra. The conception of the spending power advocated by Hamilton and strongly reinforced by Story has prevailed over that of Madison, which has not been lacking in adherents. Yet difficulties are left when the power is conceded. The line must still be drawn between one welfare and another, between particular and general. Where this shall be placed cannot be known through a formula in advance of the event. There is a middle ground or certainly a penumbra in which discretion is at large. The discretion, however, is not confided to the courts. The discretion belongs to Congress, unless the choice is clearly wrong, a display of arbitrary power is not an exercise of judgment. This is now familiar law...Nor is the concept of the general welfare static. Needs that were narrow or parochial a century ago may be interwoven in our day with the well-being of the nation. What is critical or urgent changes with the times.

"The purge of nationwide calamity that began in 1929 has taught us many lessons. Not the least is the solidarity of interests that may once have seemed to be divided. Unemployment spreads from state to state, the hinterland now settled that in pioneer days gave an avenue of escape. Spreading from state to state, unemployment is an ill not particular but general, which may be checked, if Congress so determines, by the resources of the nation. If this can have been doubtful until now, our ruling today in the case of the Steward Machine Co. supra, has set the doubt at rest. But the ill is all one or at least not greatly different whether men are thrown out of work because there is no longer work to do or because the disabilities of age make them incapable of doing it. Rescue becomes necessary irrespective of the cause. The hope behind this statute is to save men and women from the rigors of the poor house as well as from the haunting fear that such a lot awaits them when journey's end is near.

"Whether wisdom or unwisdom resides in the scheme of benefits set forth in Title II, it is not for us to say. The answer to such inquiries must come from Congress, not the courts. Our concern here as often is with power, not with wisdom. Counsel for respondent has recalled to us the virtues of self-reliance and frugality. There is a possibility, he says, that aid from a paternal government may sap those sturdy virtues and breed a race of weaklings. If Massachusetts so believes and shapes her laws in that conviction must her breed of sons be changed, he asks, because some other philosophy of government finds favor in the halls of Congress? But the answer is not doubtful. One might ask with equal reason whether the system of protective tariffs is to be set aside at will in one state or another whenever local policy prefers the rule of laissez faire. The issue is a closed one. It was fought out long ago. When money is spent to promote the general welfare, the concept of welfare or the opposite is shaped by Congress, not the states. So the concept be not arbitrary, the locality must yield."

From there on out, it was mostly smooth sailing for FDR, at least when it came to the court. In fact, in the decision I quoted from above -- Helvering v. Davis -- the vote was 7-2 to, de facto, uphold the Social Security Act. The dissent, from what I can gather, was terse:

"Mr. Justice McReynolds and Mr. Justice Butler are of opinion that the provisions of the act here challenged are repugnant to the 10th Amendment, and that the decree of the Circuit Court of Appeals should be affirmed."

The battle over the constitutionality of Social Security was over, at least the legal battle. With the litany of other entitlement programs that have sprung up under the logic of the court's rulings in 1937, we now have a government that's promised more that it can deliver.

Who will pay for it? Foreign bondholders? New workers paying higher taxes? The Easter Bunny?

The financial consequences of a taxpayer-funded national retirement system will come into full maturity in the next 20 years. What is obvious in logic -- that the system cannot support itself without the kind of high taxes that actually reduce economic growth -- will become obvious in reality.

The promise of the New Deal and the Great Society, that the state could provide for your retirement by levying a tax on your wages, has proven to be a big, fat, empty lie. Unfortunately, by the time many Americans find that out, they will need a financial helping hand just as badly as Americans did in 1933.

Who will be there to give it?

Regards,
Dan Denning

 Don’t think for a minute that Washington is you your side!

Every day the government steals more of your freedom. Special interests from both sides of the aisle are in charge… each one scheming to create new taxes… new laws … and new assaults on your privacy. And the sad truth is that most of what they do is never reported — until now!

Introducing Whiskey & Gunpowder — a FREE e-letter that explores the government’s intrusions into every day life… and offers strategies to protect yourself as the Constitution is erased one line at a time. Each and every issue will bring you a different perspective on the day’s news, offering a glimpse of Washington’s true motives. Make sure you know what the future holds — sign up for a FREE subscription today!

There Was Never a Good War, Or a Bad Peace

Greg's Note: Former Librarian of Congress  Daniel Boorstin once said that trying to plan for the future without knowing the past is like trying to plant cut flowers. Who are we to disagree? But does history make its own actors? Or do the world's actors make their own history? It is probably some of both. You cannot look at an individual outside of the context of his time. But there is no doubting that, at times, it all boils down to just one or a few singular individuals who make big things happen.

In this two-part mailing of Whiskey & Gunpowder, we mount our trusty steeds as our intrepid correspondent Byron King takes us on another ride through military and diplomatic history. But this time, however, the object of our inquiry is a single, very famous phrase, penned by a remarkable man who has been called, with good reason, "The First American." Byron sees Dr. Benjamin Franklin, and his famous phrase, as a lens through which to examine the past and shed light on the present. We give you... 

There Was Never a Good War, or a Bad Peace
by Byron W. King
April 20, 2005
Pittsburgh, PA

 "He was genial and homespun, a mixture of a man of the frontier and of the not entirely unsophisticated Eastern cities, at root a master of the oblique approach. Franklin's world in his dealings with the French was one of practiced nuance, and etched in every conceivable shade of gray."

 WHENCE COMES THE title of this article? So wrote Benjamin Franklin (1706-1790) to an acquaintance named  Sir Joseph Banks, president of the Royal Society in London, in correspondence dated July 27, 1783, and posted from Franklin's diplomatic residence in Passy, France. And thus was created another of the many aphorisms for which the illustrious Dr. Franklin is so famous, and rightly and highly esteemed.

 But a wise man once remarked that there are few things in life more dangerous than blind adherence to maxims. This is particularly the case when dealing with issues so profound as to encompass war, let alone peace.

That "there was never a good War, or a bad Peace" is no simple personal statement by Dr. Franklin's alter ego Poor Richard, along the lines that "Early to bed and early to rise makes a man healthy, wealthy, and wise." War and peace take in the most grand vistas and schemes of human endeavor, and Benjamin Franklin knew this. So even Dr. Franklin cannot get off easy on this one. Somewhere between war and peace, and somewhere between the ears of our old friend Dr. Franklin, lies the topic of this discussion.

First, let us set the world stage for Franklin's comment, and consider the context of his oft-quoted words. As of the date of the letter, July 27, 1783, Dr. Franklin, lately the American ambassador in France, was commenting upon the impending end of the American Revolutionary War with the British. The peace treaty was in preparation, and due to be signed within two months. It was Dr. Franklin's job to see that nothing interfered with the process.

 As with so many other aspects of his life, Benjamin Franklin -- the most distinguished scientific and literary American of his age -- was also the very first American diplomat. He was not the second or the third, but the first -- the pathfinder of American diplomacy, as of so much else. (This assessment comes from none other than the official history of American diplomacy  published by the U.S. State Department.) And as was Franklin's wont, in his letter to Banks, he was waxing philosophical, if not hopeful, and -- being Ben Franklin -- in 1783, he had much upon which to look back and reflect.

Near the beginning of his famous letter, Franklin said, "I hope soon to have more Leisure, and to spend a part of it in those Studies, that are much more agreeable to me than political Operations." Dr. Franklin had been a busy man, having spent most of the past seven years in France, arranging for French support of the American revolutionary cause against Great Britain.

 And Dr. Franklin was writing to the president of the Royal Society, Joseph Banks, himself one of the best-known scientists in the world, fresh back from a long  exploration of the South Seas  with none other than  Capt. James Cook . President Banks was, among other accomplishments, one of the first white men ever to set foot upon  New Zealand. So Franklin's letter began with reference to his longing to pursue studies "that are more agreeable to me than political Operations." More agreeable, indeed. Dr. Franklin was playing to his gallery, and knew well the mind of his correspondent. But this gets ahead of the story.

 And then, in his letter to Banks, Dr. Franklin goes on: "I join with you most cordially in rejoicing at the return of Peace." It had not "returned" quite yet, but that is beside the point. Franklin was looking forward to concluding what would be called the  Treaty of Paris, eventually signed on Sept. 3, 1783, which formally ended the American Revolutionary War between the Kingdom of Great Britain and her North American Colonies.

Franklin writes of peace: "I hope it will be lasting, and that Mankind will at length, as they call themselves reasonable Creatures, have Reason and Sense enough to settle their Differences without cutting Throats; for, in my opinion, there was never a good War, or a bad Peace."

And there it is, that famous line, penned by the one man, out of an entire nation, who had done so much to assist in purchasing, procuring, and perpetuating a revolution and war in North America, not to mention negotiating the peace that brought the war to an end. We will discuss this more, but for now let us read what else Mr. Franklin had to say to Banks:

"What vast additions to the Conveniences and Comforts of Living might Mankind have acquired, if the Money spent in Wars had been employed in Works of public utility! What an extension of Agriculture, even to the Tops of our Mountains: what Rivers rendered navigable, or joined by Canals: what Bridges, Aqueducts, new Roads, and other public Works, Edifices, and Improvements, rendering England a compleat Paradise, might have been obtained by spending those Millions in doing good, which in the last War have been spent in doing Mischief; in bringing Misery into thousands of Families, and destroying the Lives of so many thousands of working people, who might have performed the useful labour!"

From the context of his letter, Dr. Franklin apparently had in mind that "peace" was a spur to extending agriculture, building canals, constructing bridges and public works and the like. Perhaps it is, but is that the best that one can say on the subject? Franklin may as well have just said that "Little strokes fell great oaks." Oh, wait a minute. He did say that, in Poor Richard's Almanack of 1757.  (cont'd below...)

As to the misery of war, Franklin apparently was viewing it mainly as a loss of the potential "useful labour" of the otherwise "working people." Again, this is not an erroneous statement, but where is the typically pithy Franklin commentary applied to the sense of serious purpose that characteristically leads a nation to war?

Sun Tzu , the ancient Chinese scholar of war, had written a classic treatise on the subject 600 years before the birth of Christ. In ancient literature and mythology, war and peace were the playthings of gods.  Thomas Aquinas  (1225-1274) had written of the  theory of "just war" in the 13th century. Europe of the 17th and 18th centuries was a tangled skein of animosities, and had rent itself asunder with vicious and brutal wars from Scandinavia to Sicily, Tangiers to Turkey. Franklin knew this.  

In his own experience, by the summer of 1783, Franklin had lived through and witnessed firsthand many of the episodes of the front-line combat of the French and Indian War and had played a key role in obtaining French support of the more recent American Revolution. Could he not have come up with something better than that, in essence, war is a waste of human labor that could otherwise be used to build canals? Are we not entitled to expect more from Mr. Franklin than this?

Is Franklin, in his letter, merely passing judgment upon war and peace with the same process of intellectual distillation as that which inspired such other famous Franklin sayings as "Plow deep while sluggards sleep"? If I may say so, respectfully, how pedestrian of him.

Where is the depth of analysis that one would otherwise expect from so perceptive an observer and so great a thinker? We can forgive Benjamin Franklin for not being a scholar of war in the nature of the Prussian military thinker  Carl von Clausewitz (1780-1831), whose firsthand knowledge of the subject would come from fighting both with and against the likes of Napoleon. But is this really the best that Franklin could do? Aqueducts? Canals? Dr. Franklin, of course, knew how to count his pennies (he once said, famously, "A penny saved is a penny earned"), but did he not also know how to take the measure of man?

Let us expand the context of Mr. Franklin's letter some more. In the summer of 1776, Benjamin Franklin had signed the Declaration of Independence in Philadelphia. A few months later, on a cold day in December 1776, a small boat landed his 70-year-old frame upon the shores of France. Franklin's mission was, in essence, to convince the absolute monarch of France to underwrite a revolution against a fellow regent, albeit a British king. Franklin would spend the next two years, 1776-1778, on a three-man commission to France charged with the critical strategic task of obtaining French support for American independence.

To accomplish this extraordinary undertaking, Franklin's government had overlooked his age -- certainly advanced and indeed remarkable for that time. And his government had, apparently, not been concerned that Franklin lacked any formal diplomatic training, or that he possessed only the most rudimentary knowledge of the French language. After all, why would an emissary to France, whose mission was to gain diplomatic and economic support for a revolution, need to know anything about diplomacy, or to speak French? (Not to neglect an important point, Franklin had also spent several years in London as a representative of the Colonies to the British government.)

When Franklin's feet first pressed down into the soil of France, he must have understood that he was embarking on the greatest gamble of his career. Franklin was an expert in the politics of the frontier Colonies and had treated on many occasions with certain of the Indian tribes of North America. He had served in London and observed British politics up close. But now he had to learn the European style of diplomacy, not to mention the French language, literally on the run. To make a hard task even more difficult, Franklin had to outmaneuver British spies and French deceivers at almost every step, as well as overcome jealous and hostile colleagues.

In many respects, Franklin's fame from his publishing and speaking efforts in North America, as well as his stint in London, had preceded him to the continent. As time passed, both French aristocrats and intellectuals alike welcomed Franklin into their homes, and embraced him as the personification of the Enlightenment.

For more than 200 years, French Jesuit missionaries in the New World had been sending back home lengthy and detailed monographs about the North American continent, its native inhabitants, and its flora and fauna. There was a cottage industry within French intellectualism that concerned itself with distributing this knowledge, and teaching and learning about this strange new land across the sea. Franklin, with his extensive experience in both the English Colonies and at the edges of the frontier with the Indians and French settlements, was a natural magnet for further inquiry along these lines.

In a manner reminiscent of a modern rock star, the likeness of Franklin's face appeared on medallions , rings, watches, and snuffboxes. Even fashionable ladies adopted the coiffure a la Franklin, in imitation of the  fur cap he wore instead of a wig.

In his first two years in France, Franklin became famous even among those who had not known of him before. He was charismatic, and ingenious in every way. Thus, Franklin's personal popularity and diplomatic skill were exactly where they were most needed when opportunity arose. He was well positioned to follow up with his inimitable style of diplomacy after news of the first American battlefield success in the  Saratoga Campaign, in September and October of 1777, reached Paris.

The remarkable success of American arms against the British, coupled with the able assistance of Dr. Franklin's ministry, convinced the French government to recognize American independence, to conclude an alliance with the 13 states in 1778, and actively enter the war against Britain. Considering that a mere 15 years previous, in another Treaty of Paris, in 1763, the French had conceded defeat after the French and Indian War, this turnaround was a strategic maneuver of immense significance and truly a tale to astonish.

In 1779, after obtaining diplomatic recognition of his country by France, Franklin was formally appointed as the American minister to France. Franklin presented his credentials to the French court, becoming the first American minister -- the 18th-century American equivalent of ambassador -- ever to be received by a foreign government. Franklin's home in Passy, just outside Paris, became the center of American diplomacy in Europe.

In the context of the glitter and gossip of the French court, Franklin plied his trade with his own style of efficiency -- sometimes workmanlike, and at other times completely at the mercies of his own whims, appetites and caprices. Still, he convinced the French government, ruled by an absolute monarch, to underwrite America's experiment in democracy.

"Who is wise?" Franklin once asked rhetorically. "He that learns from everyone," he answered, no doubt with himself in mind. "Who is powerful?" was his next question? "He that governs his passions," was the reply to his own query, probably with a twinge of regret, knowing Franklin. And "Who is rich?" he asked, following a trail of reasoning that was purely out of the Franklin school of hard work and thrift. "He who is content," was the answer. And "Who is that?" he queried. "Nobody," he concluded.

Wise, powerful, but not rich and certainly far from content, thus was Franklin, the American moral philosopher, in France, at the right place, at the right time. He was genial and homespun, a mixture of a man of the frontier and of the not entirely unsophisticated Eastern cities, at root a master of the oblique approach. Franklin's world in his dealings with the French was one of practiced nuance, and etched in every conceivable shade of gray.

As the U.S. minister to France in 1779, Benjamin Franklin lacked extensive instruction or guidance from his home government due to the obvious constraints of time and distance in those days, when continents were truly isolated by raging seas. And even had the lines of communication been more open, to what end would his government -- fighting for its life against a mighty British army -- have instructed him? Thus, Franklin often operated in a vacuum. When in doubt, Franklin did what one would expect of him -- he improvised and made decisions far outside of his scope of authority.

Here was a man who once had said, "Beware of little expenses. A small leak will sink a great ship." Now, Franklin was acting as the de facto, yet unappointed, American national banker to the French court. The American cause against Great Britain was threatened with financial insolvency, but Franklin was able to obtain loans and credits. Wearing another of his many hats, Franklin became America's on-site expert in procuring French naval equipment on credit and urging French ministers to advance funds to support the revolution and to buy the provisions that the fighting forces required.

Franklin was, in his own way, fiercely determined to perform his mission. Upon his arrival in France, Franklin had set up a  printing press near his quarters. From this press, he issued hundreds of pamphlets in support of the American cause and saw that they were distributed throughout the corridors of power within the French government and even further afield to anyone else who could possibly be of assistance. In support of his own cause, Franklin was a propagandist of the first order.

It is not overstating the case to say that Franklin's overt pamphleteering, as well as his backroom  dealings at Versailles , was indispensable in propelling George Washington from near defeat at  Valley Forge  to victory at  Yorktown. And when the British surrendered at Yorktown, they gave quarter to forces that were almost equal parts French and American, virtually all having been fed, clothed, and equipped courtesy of French funding, with a supporting French fleet sailing conveniently offshore. It was, to be sure, a Hollywood ending.

Having assisted in bringing to bear the resources necessary for military victory, Franklin also was instrumental in negotiating the peace treaty of 1783. This treaty led not only to American Colonial independence from Great Britain, but also to a bond between France and America that arguably lasted through World War II, if not beyond. For all of this, the American historical memory can look back with thanks to Benjamin Franklin, a Founding Father in more ways than one.

When Thomas Jefferson succeeded Franklin as U.S. ambassador in 1785, the French foreign minister,  Charles Gravier, comte de Vergennes. Vergennes asked: "It is you who replace Dr. Franklin?" Jefferson replied, "No one can replace him, sir; I am only his successor."

In 1785, Franklin returned to Philadelphia. He had helped to midwife a new nation into existence. But despite his years in France, engaging in the highest level of strategic diplomacy in support of the war against Great Britain, Franklin was more than sanguine about the prospects for the fledgling United States.

Along with a weak central government, the Confederation of 13 former Colonies had a monetary system that was essentially useless. The monetary affairs of the new nation fell everywhere along a disordered financial spectrum. Many East Coast merchants used British, Dutch, and Spanish coins. Elsewhere, people had little choice but to use the despised Revolutionary War-era  Continentals, which were all but worthless. In some states and regions, commerce was conducted using state-issued and privately issued paper scrip, but this was of little value for conducting trade over any great distance. And further inland, barter was used extensively in the economies of the Western frontier, where the average person would see no more than a few small metal coins in the course of a year.

Franklin took it all in and had his doubts about the nation as it was evolving under the Articles of Confederation. In his own, inimitable way, he summed up his thoughts:

"I think that a young state, like a young virgin, should modestly stay at home," he wrote, "and wait the application of suitors for an alliance with her; and not run about offering her amity to all the world; and hazarding their refusal. Our virgin is a jolly one; and though at present not very rich, will in time be a great fortune, and where she has a favorable predisposition, it seems to me well worth cultivating."

Having been instrumental in creating a new nation, financially distressed as it was, here was Benjamin Franklin at his best. In a few short sentences, he combined his views towards saving and investment with his extensive knowledge of women.

But who better than the sage Franklin to urge upon his national creation the civic virtues of modesty, prudence, and thrift? Here, writ on a larger tapestry of advice on the subject of the supreme national interest of a new nation, was the echo of some of Poor Richard's old adages.

By advising the young nation to "stay at home" and to "wait for the application of suitors for an alliance," Franklin was restating a comment of Poor Richard's from several decades before: "He that blows the coals in quarrels that he has nothing to do with, has no right to complain if the sparks fly in his face." Sadly, this Franklinesque comment appears nowhere in the current edition of The National Security Strategy of the United States of America. ( http://www.whitehouse.gov/nsc/nss.html)

When Franklin cautions the young nation against run[ning] about "offering her amity to all the world; and hazarding their refusal," he is presaging George Washington's advice to avoid "foreign entanglements" and restating another of his old chestnuts, to "Beware the hobby that eats." Perhaps Woodrow Wilson should have read up on his Franklin before setting this nation on what became a century-long path of worldwide military expedition to make the world safe for democracy. But this takes us too far away from the chosen topic just now.

To amplify the foregoing comments by Franklin, it was central to his thinking that "Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." So after all, Franklin did, when he needed to, come up with his measure of man. Fifty years later, the French traveler  Alexis de Tocqueville would say something eerily similar, that "America is great because America is good. If America ever ceases to be good, she will also cease from being great."  ( cont'd below...)

A few years after returning to America from France, Franklin was invited to attend the  Constitutional Convention. Before it began, on June 2, 1787, Franklin wrote the following:

"As all history informs us, there has been in every State & Kingdom a constant kind of warfare between the Governing & Governed: the one striving to obtain more for its support, and the other to pay less." Franklin's thinking had to be, in this case, colored by his intimate understanding of the consequences of Britain's misrule of its American Colonies, leading to revolution and war, as well as his close observation of everyday life during his long residency in France.

Franklin continued: "And this has alone occasioned great convulsions, actual civil wars, ending either in dethroning of the Princes, or enslaving of the people" -- describing his own nation's revolution and, in not so many words, prophesying the French Revolution, which was about to explode in Europe.

Franklin concluded: "Generally indeed the ruling power carries its point, the revenues of princes constantly increasing, and we see that they are never satisfied, but always in want of more. The more the people are discontented with the oppression of taxes; the greater need the prince has of money to distribute among his partisans and pay the troops that are to suppress all resistance, and enable him to plunder at pleasure. There is scarce a king in a hundred who would not, if he could, follow the example of Pharaoh, get first all the peoples' money, then all their lands, and then make them and their children servants forever."

Here is a continuing theme of Franklin's life philosophy, of thrift and saving, investment and the creation and growth of capital, and the betterment of the world from the ground up. He was an Austrian economist before there were Austrian economists!

The life of all civilizations, said Franklin, was a contest between the citizens of a nation and their rulers and, by extension, their tax collectors. Had Franklin expanded on this theme just a bit more, he could have done no better that to restate another of Poor Richard's comments, "Ere you consult your fancy, consult your purse." But Franklin had his own way of making his point, by taking the humble theme of a piece of Poor Richard's advice and blowing it up and applying it as a general rule to central government.

Franklin well understood the tendency of government to impose, and then to increase, levels of taxation, all in order to magnify its own power by, in essence, paying the troops." Had Franklin known of the modern tendency of government to expand in size and to regulate and control everything under the sun of its jurisdiction, he would probably have expanded on his comment. He might not have limited his criticism of government taxation in order to support the troops, strictly speaking, but also included in his critique the need for government to raise taxes to pay for the armies of bureaucrats and political appointees that staff its mighty ranks.

And at the consummation of the Constitutional Convention, as if to add a bookend to his cautionary comment near the beginning on the generally taxing nature of government, Franklin stated some words equally profound. One of the Maryland delegates overheard a woman ask Franklin, as he was exiting Independence Hall, "Well, Doctor, what have we got -- a republic or a monarchy?" Franklin's reply was serious and focused, "A republic, if you can keep it."

A republic, if we can keep it. Well put, Dr. Franklin. Have we kept it?

We started this discussion with citation to Franklin's letter to Joseph Banks, that "there was never a good War, or a bad Peace." Franklin characterized the American Revolutionary War as a waste of "Millions,...which in the last War have been spent in doing Mischief; in bringing Misery into thousands of Families."

Note that Joseph Banks had become president of the Royal Society in 1778. Thereafter, he promoted science and encouraged exchanges with scientists abroad. He was, at that time, among the most influential figures in all of British science, and in consequence, he certainly played an influential role in British politics.

Franklin's letter to Banks referred directly to the use of British funds to conduct a war against America, at the cost of agriculture that could have been extended, rivers that could have been made navigable, public works that could have been constructed. Looked at narrowly, Franklin's letter was addressed to only one man, but that man was very important in making decisions concerning British national policy. Thus, I believe that we can say that the audience for Franklin's words was intended to be larger than that single correspondent.

Knowing what we know about Benjamin Franklin's efforts in France during the war, we can now say that perhaps, in his letter to Joseph Banks, Franklin was talking about the waste of British millions, and certainly not of French millions. And we can say that perhaps Franklin was limiting his scope and targeting his point, meaning there could not be a good British war with America, or a bad American peace with Britain. And we can say that perhaps Benjamin Franklin penned his famous words while still practicing his role as his nation's first diplomat, promoting the future peace treaty between two warring peoples.

There are just wars and unjust wars, necessary wars and unnecessary wars, limited wars and total wars. But are there no good wars? A true examination of the nature of war and peace can be left to those who study Sun Tzu and Aquinas and Clausewitz. For our purposes, Franklin's short statement on the matter was a product of its own unique circumstances, a comment to an influential member of the intellectual leadership of the opposing nation, and thus can only be understood in that context.

We can sum up by saying that Benjamin Franklin was his own man, a man who made history, and a man who made his own indelible mark on this world. And always, never ceasing, he pursued the interests of the land that he loved and cherished. Franklin did this in his own unique way, striving to influence others, to make friends, and to sway their opinions to the favor of the United States of America.

Until we meet again... 

Byron W. King

P.S. From Greg: Byron used a lot of quotations from Benjamin Franklin in his articles. My favorite from Franklin is, "Beer is living proof that God loves us and wants us to be happy."

 And we at Agora Publishing and Whiskey & Gunpowder want to be sure that our readers are happy. Please feel free to e-mail me at greg@whiskeyandgunpowder.com and tell us what you think about what we are sending to you. Your comments, letters to the editor, and even guest essays are welcome. We reserve the right to exercise our editorial discretion, but that is part of the fun, isn't it?

The following is the complete text of the Franklin letter to Joseph Banks:

July 27, 1783.

Dear Sir;

I received your very kind letter by Dr. Blagden, and esteem myself much honoured by your friendly Remembrance. I have been too much and too closely engaged in public Affairs, since his being here, to enjoy all the Benefit of his Conversation you were so good as to intend me. I hope soon to have more Leisure, and to spend a part of it in those Studies, that are much more agreable to me than political Operations.

I join with you most cordially in rejoicing at the return of Peace. I hope it will be lasting, and that Mankind will at length, as they call themselves reasonable Creatures, have Reason and Sense enough to settle their Differences without cutting Throats; for, in my opinion, there never was a good War, or a bad Peace. What vast additions to the Conveniences and Comforts of Living might Mankind have acquired, if the Money spent in Wars had been employed in Works of public utility! What an extension of Agriculture, even to the Tops of our Mountains: what Rivers rendered navigable, or joined by Canals: what Bridges, Aqueducts, new Roads, and other public Works, Edifices, and Improvements, rendering England a compleat Paradise, might have been obtained by spending those Millions in doing good, which in the last War have been spent in doing Mischief; in bringing Misery into thousands of Families, and destroying the Lives of so many thousands of working people, who might have performed the useful labour!

I am pleased with the late astronomical Discoveries made by our Society. Furnished as all Europe now is with Academies of Science, with nice Instruments and the Spirit of Experiment, the progress of human knowledge will be rapid, and discoveries made, of which we have at present no Conception. I begin to be almost sorry I was born so soon, since I cannot have the happiness of knowing what will be known 100 years hence.

I wish continued success to the Labours of the Royal Society, and that you may long adorn their Chair; being, with the highest esteem, dear Sir, &c.

B. Franklin

P.S. Dr. Blagden will acquaint you with the experiment of a vast Globe sent up into the Air, much talked of here, and which, if prosecuted, may furnish means of new knowledge.

 For a Free Subscription to Whiskey & Gunpowder 
Enter Your e-Mail Address in the Above Sign Up Box!

COPYRIGHT AND DISCLAIMER © 2005 | Whiskey and Gunpowder | 808 St. Paul Street | Baltimore, MD, 21201