Tuesday, July 8, 2014

What: Charles A. Beard, An Economic Interpretation of the Constitution of the United States (reprint, Free Press, 1986)

Why: A classic but controversial study emphasizing the role played by enlightened economic self-interest in the framing of the Constitution.

I write this in a nearly empty office on the day before Independence Day. Most of my colleagues (and clients) have already escaped their labors for at least a four-day weekend, ostensibly in celebration of our long-ago separation from the mother country and establishment as a new country founded on Enlightenment notions of “life, liberty and the pursuit of happiness.” (For another take on this historical event, see here.)

For most of us, the annual 4th of July celebration brings to mind the courageous, high-minded and selfless principles that guided our founding fathers in declaring American independence and thereafter shaping the mechanical structure of a working republican democracy.

I’m not here to say that this isn’t an accurate perception, but almost a century ago Charles A. Beard, a historian at Columbia University, presented a far more nuanced picture of the birth of our country in what was then a groundbreaking study (and which is now at best a golden oldie), An Economic Interpretation of the Constitution of the United States.

Don’t misunderstand me—this is not light beach reading. But for those with an entrepreneurial viewpoint, it is an eye-opening (albeit controversial) study in economic power and enlightened self-interest. I won’t spoil the details for you (it will take, shall we say, a fair amount of scholarly dedication and a couple of Red Bulls to plow through this book), but consider some of Beard’s conclusions:

The drive behind developing the Constitution was essentially economic: “Large and important groups of economic interests were adversely affected by the system of government under the Articles of Confederation, namely, those of public securities, shipping and manufacturing, money at interest; in short, capital as opposed to land.”

The Constitution was “an economic document drawn with superb skill by men whose property interests were immediately at stake; and as such it appealed directly and unerringly to identical interests in the country at large.”

At bottom, the Constitution is based “upon the concept that the fundamental private rights of property are anterior to government and morally beyond the reach of popular majorities.”

Some pretty heady stuff, most definitely.  

Whether or not you buy into Beard’s analysis completely, and there is much scholarship that does not (including Forrest McDonald’s equally groundbreaking We the People: The Economic Origins of the Constitution), no one will quibble with you if you come to see the Constitution as a masterpiece of enlightened self-interest—including economic self-interest—on the part of those who created the framework by which we are still governed a couple of hundred years and change later.

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