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Government was much smaller at the time of the Industrial Revolution. Is this true? Is it really such an open-and-shut case? In some senses it is obviously tr

Government was much smaller at the time of the Industrial Revolution. Is this true? Is it really such an open-and-shut case? In some senses it is obviously true: There were a lot fewer people, a lot fewer filing cabinets and a lot fewer regulations. A lot of the tools needed for our big modern system -- hygiene, communications, literacy -- just weren't there yet. There were essentially no worker protections in the early stages of the Industrial Revolution; there were few environmental regulations. And travel and communications were harder, which made it easier to evade certain regulations -- they say that, as late as the 20th century, movie companies relocated to Hollywood in large part because it was the US city farthest from Thomas Edison's patent lawyers. But government-sanctioned monopolies are not a new invention. (That's what the British East India Company was all about.) Enormous tariffs levied on mass-produced goods are not a new invention. Taxes are not a new invention. Gangs of Luddites (not metaphorical Luddites -- the real thing) who break your equipment and sabotage your business model are not a new invention. Wine monopolies? Here's a book that deals, in part, with how the English ban on French wine imports boosted the English brewing industry in the 17th century: http://www.amazon.com/War-Wine-Taxes-Political-Anglo-French/dp/0691129177/reasonmagazineA/ http://www.amazon.com/War-Wine-Taxes-Political-Anglo-French/... And here's a Wikipedia article on mercantilism, the dominant theory of international trade for over 250 years, starting in 1500: http://en.wikipedia.org/wiki/Mercantilism http://en.wikipedia.org/wiki/Mercantilism Mercantilism was all about big-government management of the economy through tariffs and subsidies. But, of course, that was arguably a big improvement over the medieval model: Small-government "management" of the "economy" by private armies who threatened to burn your crops and besiege your house unless you paid tribute.

davidw 18y ago
> Is it really such an open-and-shut case? No, but a reasonable percentage of those convinced that "it's all the government's fault" are going to continue to see it that way no matter what (and get offended when that gets pointed out, apparently). Just like other people think that more government/laws/rules is always the answer. For that matter, I'm pretty convinced of my "radically moderate" views which are somewhere around The Economist's. Which is why these sorts of discussions rarely go anywhere, even over a beer, to say nothing of short, sharp answers on internet forums.
- jodrellblank 18y ago
  For that matter, I'm pretty convinced of my "radically moderate" views Of course you are. If you thought they were wrong, you wouldn't hold them as your views, would you?
  - davidw 18y ago
    I'm fairly willing to be convinced that, on some point or another, the best course of action lies close to what I held to be true, but differs by a few degrees. I also try and think about the holes in my argument and to consider the fact that I am not actually omniscient, and may very well be wrong about things (it is rare, but does happen:-). I was thinking about this, and part of the problem is that these threads often feel like someone selling me something, rather than trying to figure out how things really work. They'd be much more interesting if people "let down their guard" a bit, upped the reasoning, and lowered the propagandizing. I guess it may not feel like propaganda to those involved, but I really like reading comments like mechanical_fish's, which cast a wide eye on things, considering all points of view, rather than people pulling out all the stops to fit the facts to their point of view.
    - nazgulnarsil 18y ago
      "moderate" is a cop-out. If you're a moderate now you would presumably have been a moderate 50 years ago. And the moderate of 50 years ago would be fringe today. The moderate of 100 years ago would be a radical today. Don't surrender your reason to social contructivism.
      - davidw 18y ago
        That's not a bad point, especially where it comes to how we treat other people. Indeed, I am not a moderate in everything, clinging to the center. However, in terms of government intervention in the economy, I am, and I also think it's far too large and interesting, and nuanced of a subject to adequately cover it in these sorts of forum. It's best left to be talked about over a bottle of good wine.
tokenadult 18y ago
You ask a very astute question that is too rarely asked. The way this plays out in the United States is that many entrepreneurs complain about the growing role of the federal government in regulation of business over the last two centuries, which plainly is a correct description of the historical trend. But only legal historians, with their specialized knowledge, notice that many state laws have become much less restrictive of business activity over time. It's actually rather difficult to figure out what the overall historical trend is at all levels of government in the United States. Some businesses may be easier than ever to form, while others are harder than ever to form.
ellyagg 18y ago
Yes, government was much smaller at the time of the Industrial Revolution, at least in the US. The federal budget, as a share of the GDP, was 3% right before FDR. Now it's some giant, horrible amount I don't even want to say out loud. Given this, the idea that there could be less (or about the same) regulatory interference of business today is, frankly, ludicrous. For one thing, simply reducing business budgets (taxes) at the rate the government does is an onerous burden all by itself. Arguments can certainly be made that it's a net gain for society, but please do not be disingenuous in stipulating the facts.
- mechanical_fish 18y ago
  the idea that there could be less (or about the same) regulatory interference of business today is, frankly, ludicrous. That depends crucially on which business you're talking about. Exceptions abound. Consider that example of the mail-order wine business. Do you know how hard it was to start such a business in the days before FDR? There was a lot of "regulatory interference", personified by guys like "Eliot Ness". You couldn't start a wine business in the USA, full stop -- unless you kept it underground. That era also had a devastating effect on our brewing industry that took a generation to recover from. One could also ask some of the people who run porn sites about the complex history of "regulatory interference" in their business. And, as we now know all too well, there have been times when regulation of the financial industry was much more strict than it is today. That's not a simple history, either: Corporations and stock exchanges have existed since the 17th century, but their degree of regulation has changed in complicated ways over time. And a relentless focus on taxes obscures other forms of interference that were more important at certain times, for certain industries. However onerous it is to start a telecom-based company today, it was probably harder back in those days before FDR, when AT&T held a government-sanctioned monopoly over all of US telephony: http://en.wikipedia.org/wiki/Ma_Bell http://en.wikipedia.org/wiki/Ma_Bell In 1934, the government set AT&T up as a regulated monopoly under the jurisdiction of the Federal Communications Commission, in the Communications Act of 1934... by 1940 the Bell System effectively owned most telephone service in the United States, from local and long-distance service to the telephones themselves. This allowed Bell to prohibit their customers from connecting phones not made or sold by Bell to the system without paying fees. For example, if a customer desired a type of phone not leased by the local Bell monopoly, he or she had to purchase the phone at cost, give it to the phone company, then pay a 're-wiring' charge and a monthly lease fee in order to use it. That the Internet managed to come into existence at all is the result of a complex interplay of antitrust law, the rise of government-funded research under guys like Vannevar Bush, and the Cold War (DARPA, which funded the Internet, was born in the days after Sputnik). Today, our cable and phone companies also wield virtual monopolies with the help of the FCC. The situation is pretty bad in the USA. But I'm not sure it's significantly worse than it was back in 1940.

davidw 18y ago

> Is it really such an open-and-shut case? No, but a reasonable percentage of those convinced that "it's all the government's fault" are going to continue to see it that way no matter what (and get offended when that gets pointed out, apparently). Just like other people think that more government/laws/rules is always the answer. For that matter, I'm pretty convinced of my "radically moderate" views which are somewhere around The Economist's. Which is why these sorts of discussions rarely go anywhere, even over a beer, to say nothing of short, sharp answers on internet forums.

jodrellblank 18y ago
For that matter, I'm pretty convinced of my "radically moderate" views Of course you are. If you thought they were wrong, you wouldn't hold them as your views, would you?
- davidw 18y ago
  I'm fairly willing to be convinced that, on some point or another, the best course of action lies close to what I held to be true, but differs by a few degrees. I also try and think about the holes in my argument and to consider the fact that I am not actually omniscient, and may very well be wrong about things (it is rare, but does happen:-). I was thinking about this, and part of the problem is that these threads often feel like someone selling me something, rather than trying to figure out how things really work. They'd be much more interesting if people "let down their guard" a bit, upped the reasoning, and lowered the propagandizing. I guess it may not feel like propaganda to those involved, but I really like reading comments like mechanical_fish's, which cast a wide eye on things, considering all points of view, rather than people pulling out all the stops to fit the facts to their point of view.
  - nazgulnarsil 18y ago
    "moderate" is a cop-out. If you're a moderate now you would presumably have been a moderate 50 years ago. And the moderate of 50 years ago would be fringe today. The moderate of 100 years ago would be a radical today. Don't surrender your reason to social contructivism.
    - davidw 18y ago
      That's not a bad point, especially where it comes to how we treat other people. Indeed, I am not a moderate in everything, clinging to the center. However, in terms of government intervention in the economy, I am, and I also think it's far too large and interesting, and nuanced of a subject to adequately cover it in these sorts of forum. It's best left to be talked about over a bottle of good wine.

tokenadult 18y ago

You ask a very astute question that is too rarely asked. The way this plays out in the United States is that many entrepreneurs complain about the growing role of the federal government in regulation of business over the last two centuries, which plainly is a correct description of the historical trend. But only legal historians, with their specialized knowledge, notice that many state laws have become much less restrictive of business activity over time. It's actually rather difficult to figure out what the overall historical trend is at all levels of government in the United States. Some businesses may be easier than ever to form, while others are harder than ever to form.

ellyagg 18y ago

Yes, government was much smaller at the time of the Industrial Revolution, at least in the US. The federal budget, as a share of the GDP, was 3% right before FDR. Now it's some giant, horrible amount I don't even want to say out loud. Given this, the idea that there could be less (or about the same) regulatory interference of business today is, frankly, ludicrous. For one thing, simply reducing business budgets (taxes) at the rate the government does is an onerous burden all by itself. Arguments can certainly be made that it's a net gain for society, but please do not be disingenuous in stipulating the facts.

mechanical_fish 18y ago
the idea that there could be less (or about the same) regulatory interference of business today is, frankly, ludicrous. That depends crucially on which business you're talking about. Exceptions abound. Consider that example of the mail-order wine business. Do you know how hard it was to start such a business in the days before FDR? There was a lot of "regulatory interference", personified by guys like "Eliot Ness". You couldn't start a wine business in the USA, full stop -- unless you kept it underground. That era also had a devastating effect on our brewing industry that took a generation to recover from. One could also ask some of the people who run porn sites about the complex history of "regulatory interference" in their business. And, as we now know all too well, there have been times when regulation of the financial industry was much more strict than it is today. That's not a simple history, either: Corporations and stock exchanges have existed since the 17th century, but their degree of regulation has changed in complicated ways over time. And a relentless focus on taxes obscures other forms of interference that were more important at certain times, for certain industries. However onerous it is to start a telecom-based company today, it was probably harder back in those days before FDR, when AT&T held a government-sanctioned monopoly over all of US telephony: http://en.wikipedia.org/wiki/Ma_Bell http://en.wikipedia.org/wiki/Ma_Bell In 1934, the government set AT&T up as a regulated monopoly under the jurisdiction of the Federal Communications Commission, in the Communications Act of 1934... by 1940 the Bell System effectively owned most telephone service in the United States, from local and long-distance service to the telephones themselves. This allowed Bell to prohibit their customers from connecting phones not made or sold by Bell to the system without paying fees. For example, if a customer desired a type of phone not leased by the local Bell monopoly, he or she had to purchase the phone at cost, give it to the phone company, then pay a 're-wiring' charge and a monthly lease fee in order to use it. That the Internet managed to come into existence at all is the result of a complex interplay of antitrust law, the rise of government-funded research under guys like Vannevar Bush, and the Cold War (DARPA, which funded the Internet, was born in the days after Sputnik). Today, our cable and phone companies also wield virtual monopolies with the help of the FCC. The situation is pretty bad in the USA. But I'm not sure it's significantly worse than it was back in 1940.