The American Dream is not dead, but it is certainly on life support. As fewer and fewer people own capital and the State takes over more and more of the economy, Americans become permanent children, expecting to be taken care of from cradle to grave, and turning over all responsibility for their lives, fortunes and sacred honor to a faceless and impersonal government.
This situation did not occur overnight. It has been building up since the founding of the Republic. From the very first a serious flaw, an “original sin,” we might say, was built into the system: slavery. To protect the interests of people who owned other human beings and to hold the new country together, the importance of private property had to be downplayed. To justify these moves, the whole concept of “States’ Rights” was invented, individual sovereignty guaranteed by the 9th and 10th Amendments to the Constitution were effectively nullified, and judicial review expanded far beyond what the framers of the Constitution intended.
This was fatal. Private property in human beings is wrong, but private property in capital is essential to the survival of individuals, families and nations. As Daniel Webster observed in the Massachusetts Constitutional Convention of 1820, “Power naturally and necessarily follows property.” Without ownership of capital, people become wage and welfare slaves, dependent on a private employer or the State for their subsistence.
Giving private property a bad name by going to such great lengths to protect the hideous injustice of chattel slavery made it seem as if private property could not be all that important, or was wrong in and of itself. After all, defense of the “peculiar institution” was the primary cause of the Civil War. This belief was so pervasive following the Civil War that Nathan C. Kouns, a former Confederate Major, who had fought for four years to defend private property in human beings, decided that if owning people was wrong, then owning anything was equally wrong, and socialism was demanded by God. The two novels in which Kouns presented his case, “Dorcas, the Daughter of Faustina,” and “Arius the Libyan” sold well into the 1920s.
The Homestead Act of 1862 made it possible for many people to own landed capital, but did nothing to open up participation in the phenomenal expansion of industrial and commercial capital that was going on in the latter half of the 19th century. The fact that the rich could finance industrial and commercial development by drawing bills of exchange to use as money while farmers and small businessmen had only what they could save out of consumption made the situation even worse, especially when the government began deflating the currency to restore parity with gold following the Civil War.
It was not until the U.S. Supreme Court redefined both private property and personality in its decision in the Slaughterhouse Cases of 1873 that matters came to a head. The decision effectively nullified the new 14th Amendment, and reaffirmed the Court’s decision in the Dred Scott case, even though the clear intent of the 14th Amendment was in part to overturn the Dred Scott decision. By giving the Court the power to decide what a person is and that the source of rights is not human nature but whatever the Court says, the groundwork was laid for the complete redefinition of private property that came in with the New Deal, and forced many of the remaining small owners and farmers into wage slavery.
Only a program that limits the economic role of the State, restores free and open markets and the rights of private property and provides an effective mechanism by means of which ordinary people can acquire and possess private property in industrial, commercial and landed capital can restore the American Dream to what it was. One such proposal is the “Capital Homestead Act” that should be considered by all candidates for public office.