Abstract: On or about the Ides of every month except March, the Adams Institute will send two letters to prominent Americans whose words or actions are relevant to the proposed amendment, and whose contributions to the idea of democratic-republican government merit all of our attention. These letters will also carbon-copy other distinguished individuals who were somehow involved in the recipient’s words or deeds, or in our analysis thereof.
Our initial letters, along with correspondence explaining to copied individuals why they were copied, will be published as an open diary of correspondence in the hopes of inspiring discussion of our proposed amendment and emulation of the recipients’ good examples. PDF files featuring scans of all this original correspondence will be available for download, and the substantive content of each primary letter will be pasted in blog-post format.
October 13, 2024
Dear Mr. Ballmer:
Three key points emerged from your lively discussion with Jon Stewart on September 10, 2024, where you discussed your work on your project USAFacts:
First, that the twin pillars of America are capitalism and democracy;
Second, that some form of government intervention is necessary to maintain a balanced and sustainable relationship between these two pillars; and
Third, that some combination of taxes and incentives are the appropriate form of intervention.
A fourth point not elaborated, but which Mr. Stewart has elsewhere addressed,[i] concerns the political consequences which arise when government fails to strike the proper balance between capitalism and democracy. These are the effects of extreme wealth concentration: pessimism, insecurity, addiction, polarization, faction, demagoguery, patronage, and authoritarian drift. What better describes today’s political reality than these?
Further to that conversation, we write you to introduce an incentive plan designed to maintain a proper balance between capitalism and democracy. A plan that would, to take your suggestion, “train this highly predictable tool [capitalism] to do what society wants it to do”. And we use the phrase “incentive plan” quite literally: Our plan literally scales up capitalism’s own device of the long-term incentive plan from the level of enterprise to nation. Its performance benchmark is the median household net worth, and its guiding philosophy is that the middle class should own at least half the wealth.
The enclosed summary of Operation Abigail outlines this incentive plan. We ask you to briefly review it, to give us feedback whether negative or positive, and if the latter, to endorse this plan. To better inform your consideration, the remainder of this letter furnishes an historical and philosophical defense for Operation Abigail.
Democratic and popular governments have existed for less than one-tenth of recorded history and seem to come and go in great waves.[ii] Having experienced political revolutions in rapid succession, the ancient Greeks early recognized that the stabilizing influence of the middle classes were indispensable to the preservation of popular government.[iii] All history since then confirms that an independent middle class is the condition precedent to democracy. The most fundamental law of political science, raised to its highest abstraction, is therefore this: the diffusion and reconcentration of wealth dictates the diffusion and reconcentration of political power.[iv] And so just as democracy rides in on the tide of a rising middle class, middling decline anticipates its self-destruction. This is in fact how mankind’s first great wave of popular government ended – Rome’s own historians blamed extreme wealth concentration for the death of that superpower republic[v] – and this is precisely the disease that today wracks ours.
The period spanning the Roman Republic to the birth of the United States saw few democratic experiments, and none on large scale. But the unique circumstances fostering the colonial yeomanry on the North American continent furnished conditions favoring the return of popular government. The principal fact of America’s founding, is that, despite slavery, it was born middle class.[vi] Our Founding Fathers recognized that it was this feature above all which allowed them to establish a new republic during an ancient age of monarchy and aristocracy.
Not only did they recognize that America was born middle class, they advocated government intervention as necessary to keep it that way:
John Adams: “Property monopolized, or in the Possession of a Few is a Curse to Mankind. We should preserve not an Absolute Equality – this is unnecessary, but preserve all from extreme Poverty, and all others from extravagant Riches.” [vii]
Thomas Jefferson: “Legislators cannot invent too many devices for subdividing property, only taking care to let their subdivisions go hand in hand with the natural affections of the human mind.” [viii]
James Madison: [advocating laws that would] “withhold unnecessary opportunities from a few, to increase the inequality of property, by an immoderate, and especially an unmerited, accumulation of riches,” and “reduce extreme wealth towards a state of mediocrity, and raise extreme indigence towards a state of comfort.” [ix]
Thus, while the Founders ordained a political constitution that guaranteed the legal form of a democratic republic[x] – and they accordingly endowed the federal government with only limited prerogatives – they weren’t the rabid anti-interventionists, anti-egalitarians, or Social Darwinists that libertarians and neoliberals often hold them out to be. Their words and laws, particularly on the state level, showed them more than willing to promulgate egalitarian interventions.[xi] The reason they didn’t require the federal government to guarantee the political substance of a democratic republic through an explicit constitutional mandate is not for lack of will or foresight, but for lack of need: There was always more land to the west.
A pre-industrial republic populated with citizen-soldier yeoman farmers demands few national organs besides a post office and judiciary. Yet though our federal government began small and weak, it grew to meet the changes brought on by industry and commerce. The development of steam power and electricity, communications and transportations networks like the telegraph and railroads, and ancillary industries like steel and oil, permanently transformed the nature of commercial relationships. These forces of industrialization and monopolization brought wealth concentration and worker misery to new extremes.
The excesses of the Gilded Age and hardships of the Great Depression were met with new laws and powers – the power to regulate trusts and securities, the power to tax incomes, and a broad reading of the Commerce Clause which sanctioned all manner of Congressional legislation. As genuine republicans like Theodore Roosevelt saw, the rapacious and parasitical pursuit of wealth by some must be bridled to preserve the honest pursuit of wealth by all others.[xii] And as ardent democrats like Franklin Roosevelt warned, if capitalism could not put food on the table, democracy would soon be traded for dictatorship.[xiii]
The dictatorship installed by one nation in response to these disorders instigated the greatest war in human history. And in the aftermath of the Second World War, America attained the same uncontested sovereignty which Rome achieved after the Third Punic War, succeeding republican Rome as earth’s only second superpower republic. Thanks to America’s spectacular post-war god fortune, the principal fact of America’s post-war life was that, despite segregation, America was re-born middle class: For the first two decades after the war the distribution of gains kept pace with overall productivity, but all that changed after 1975, with more than $50 trillion diverted to the top 10% relative to post-war rates.[xiv]
You already know where that brings us. The USAFacts team’s November 13, 2023 blog post stated: “the highest-earning Americans have increased their share of wealth over the past three decades, while the middle class has been losing its share.”[xv] Down at the bottom of that blog post is a 14-minute video of you discussing the American economy.
You obviously need no education on the numbers, but we still mention a few just to summarize the bottom line. The intuition and reason of mankind has held steady for 2,500 years that the middle class should own at least half.[xvi] According to that USAFacts post, the middling share is today 26%. So if that 50% target – and that 50% target unites the common sense of ordinary Americans with the learned conclusions of political philosophers – fairly states where we should be, then the middle class has a justifiable claim that it has been deprived of at least $33 trillion of its rightful share of our national wealth. The damages exceed the entire wealth of every other nation on earth, except China.
Many Americans – perhaps mainly White and older – still see the 1950s as the good old days. This is no surprise; the principal fact of America’s post-war life was that, despite segregation, it was re-born middle class. Yet despite our nostalgia for that golden age of middle-class primacy, or our characteristic American conviction that America’s best days are not behind but ahead, there’s really little cause for optimism on the question of political economy. For if the past 50 years of American history or the final 100 years of Roman republican history are inadequate to give us a reality check, perhaps the past 5,000 years of world history can: No political society, in all that time, has ever managed to serenely achieve structural wealth de-concentration.[xvii]
The political symptoms we now endure, including a drift toward mob-rule and authoritarianism, are caused by the underlying disease of wealth concentration at the expense of the middling share. Many societies, including our own, have deployed various palliatives and sedatives to ameliorate the effects of middling insecurity[xviii] but none have implemented a cure to the disease. If we do not timely act, this disease will prove as mortal to our experiment in republican government as it was to that one other superpower republic in history whose circumstances warrant the best comparison to the United States. Operation Abigail was conceived to be that cure, informed by the lessons of history.
In your interview with Mr. Stewart, you said: “I personally have no problem with government providing more direction to capitalism.” Would Operation Abigail not provide it?
Sincerely,
Tim Ferguson
A copy of Operation Abigail was enclosed behind this letter in the physical mailing to this recipient. Here is a link to the current version of Operation Abigail, which may have superseded the version that was submitted with this letter. Refer to the PDF scan of this letter for the version which was sent to this recipient.
[i] See, for example, The Daily Show, March 11, 2024, and The Weekly Show, June 6, 2024.
[ii] The first great wave broke on the Mediterranean basin in the 6th century BC, spawning over 300 democracies. The second commenced along the North Atlantic more than twenty centuries later, producing over 100 popular governments since our Revolutionary War.
[iii] On ancient Greek writings praising the middle class, see Euripides, Suppliants, Line 238 et seq., Plato, Laws 679b, and Aristotle, Pol., 1291b, 1295b.
[iv] See Noah Webster, An Examination into the Leading Principles of the Federal Constitution (1787): “On reviewing the English history, we observe a progress similar to that in Rome–an incessant struggle for liberty from the date of Magna Charta, in John’s reign, to the revolution. The struggle has been successful, by abridging the enormous power of the nobility. But we observe that the power of the people has increased in an exact proportion to their acquisitions of property.” See also a letter from John Adams to James Sullivan, 26 May 1776: “Harrington has Shewn that Power always follows Property. This I believe to be as infallible a Maxim, in Politicks, as, that Action and Re-action are equal, is in Mechanicks.”
[v] That extreme wealth concentration destroyed the Roman Republic, see Appian, The Civil Wars, I.1, Sallust, Conspiracy of Catiline, 10, 33. I; 37.3, 38, 53, The Jugurthine War, 4, Livy, History of Rome, Preface, Tacitus, Annals, 3.27, Florus, Epitome, I, XLVII, Lucan, Pharsalia, 1.63. Marcus Philippus said in 104BC that out of perhaps 400,000 citizens, only around 2,000 held any significant wealth.
[vi] See remarks from British Colonel Lord Adam Gordon in 1764: “The levelling principle here, everywhere operates strongly and takes the lead, and everybody has property here, and everybody knows it,” Benjamin Franklin, Observations Concerning the Increase of Mankind, 1751: “6. Land being thus plenty in America, and so cheap as that a labouring Man, that understands Husbandry, can in a short Time save Money enough to purchase a Piece of new Land sufficient for a Plantation, whereon he may subsist a Family; such are not afraid to marry; for if they even look far enough forward to consider how their Children when grown up are to be provided for, they see that more Land is to be had at Rates equally easy, all Circumstances considered. 7. Hence Marriages in America are more general, and more generally early, than in Europe,” Richard Price, Observations on Civil Liberty, 1776, stating that “The Colonies consist only of a body of Yeomanry supported by agriculture, and all independent, and nearly upon a level; in consequence of which, joined to a boundless extent of country, the means of subsistence are procured without difficulty,” Thomas Pownall, A memorial address to the sovereigns of America, 1783, stating that America was characterized by “a general equality, not only in the Persons, but in the power of the landed Property of the Inhabitants” and that America stands on a “natural equal level Basis,” Charles Pinckney, speech of 25 June 1787, stating: “The people of the U. S. are perhaps the most singular of any we are acquainted with.—Among them there are fewer distinctions of fortune & less of rank; than among the inhabitants of any other nation.—Every freeman has a right to the same protection & security and a very moderate share of property entitles them to the possession of all the honors & privileges the public can bestow.—Hence arises a greater equality, than is to be found among the people of any other country, and an equality which is more likely to continue. … there will be few poor & few dependent,” George Washington to Richard Henderson, 1788: “America … will be the most favorable Country of any in the world for persons … possessed of a moderate capital, to inhabit. … it will not be less advantageous to the happiness of the lowest class of people because of … the facility of procuring the means of subsistence.” For confirmation by contemporaneous observers, see Alexis de Tocqueville, Democracy in America, 1835: “Amongst the novel objects that attracted my attention during my stay in the United States, nothing struck me more forcibly than the general equality of conditions.” For confirmation by modern researchers, see Peter H. Lindert and Jeffrey G. Williamson, American Incomes 1774-1860, NBER Working Paper 18396, 2012, showing that in 1774, New England and the Middle Colonies were the most egalitarian place in the measurable world.
[vii] John Adams, Dissertation on the Canon and Feudal Law, 1765.
[viii] A letter from Thomas Jefferson to James Madison, 1785.
[ix] James Madison, Parties, 1792 (for the National Gazette).
[x] The Constitution is not a “democratic” instrument but contains “democratic” elements, balanced with explicitly non-democratic elements. Its tripartite structure descends from an anthropology of Greek political thought that passes through Lycurgus, Pindar, Herodotus, Thucydides, Plato, Aristotle, and possibly Panaetius, Dicaerchus, Isocrates, Protagoras, and Hecataeus, ultimately converging on Polybius, whose application of Greek ideas to his analysis of the Roman constitution circa the Second Punic War basically contain the final deliverables of classical political theory exerting significant influence on our Founders, particularly John Adams, whose 1780 Massachusetts constitution, and 1787 treatise Defence of the Constitutions, were both consulted at the 1787 Philadelphia convention. The Constitution nowhere references the notions of referendum, plebiscite, or even democracy. It does however require revenue bills to originate in the lower proportionally-elected, more democratic assembly, while it empowers Congress to declare war, and the President to wage war. The framers therefore accorded the Constitution’s democratic share this much: The people would directly choose those holding the power of the purse, and indirectly choose those holding the power of the sword. This was all the democracy the lessons of Classical Antiquity would countenance. Frequent elections and voting rights are delineated by Article I, Section 2, Article II, Section 1, and Amendments XIV, XV, XVII, XIX, XXIII, XXIV, and XXVI. The will of the people is nevertheless tempered by various non-democratic features such as the scheme of representation, separation of powers, checks and balances, bicameralism, equal numbers of Senators, and the Electoral College. It is worth noting in this regard that before Amendment XVII (1913), Senators were appointed by the State legislatures.
[xi] Thomas Jefferson’s actions are particularly instructive. See the first three drafts of Thomas Jefferson’s 1776 Virginia constitution, reviewed by James Madison, establishing a conditional 50-acre viritim (land grant) to every eligible adult male citizen. Read this measure especially in conjunction with his 1776 law to abolish entails and 1785 law to primogeniture in Virginia, by which, he announced to John Adams, he “laid the axe to the root of Pseudoaristocracy.” Thomas Jefferson to John Adams, 28 October 1813. Other states also abolished entails and primogeniture. See also Noah Webster, Miscellaneous Remarks, 1790: “The basis of a democratic and a republican form of government, is, a fundamental law, favoring … a general distribution of property.”
[xii] See Theodore Roosevelt, The Man with the Muck-rake, delivered 14 April 1906: “The men of wealth who today are trying to prevent the regulation and control of their business in the interest of the public by the proper government authorities will not succeed, in my judgment, in checking the progress of the movement. But if they did succeed they would find that they had sown the wind and would surely reap the whirlwind, for they would ultimately provoke the violent excesses which accompany a reform coming by convulsion instead of by steady and natural growth.”
[xiii] See Franklin Delano Roosevelt’s State of the Union Address, 11 January 1944, during the height of World War II: “We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. ‘Necessitous men are not free men.’ People who are hungry and out of a job are the stuff of which dictatorships are made.” See also Thomas Jefferson, Notes on the State of Virginia, 1784: “Dependence begets subservience and venality, suffocates the germ of virtue, and prepares fit tools for the designs of ambition.”
[xiv] See Carter C. Price and Kathryn A. Edwards, Trends in Income From 1975 to 2018. Santa Monica, CA: RAND Corporation, 2020, calculating the gains that would have but did not accrue to ordinary Americans since 1975 relative to post-World War II run rates. The abstract: “From 1975 to 2018, the difference between the aggregate taxable income for those below the 90th percentile and the equitable growth counterfactual totals $47 trillion.”
[xv] How has wealth distribution in the US changed over time? November 13, 2013, by the USAFacts team.
[xvi] The common intuition of mankind is that the middle class should own at least half. See Aristotle, Politics, 1295b, and James Harrington, Commonwealth of Oceana, Part I. The intuition of ordinary Americans agrees; see Michael I. Norton and Dan Ariely, Building a Better America – One Wealth Quintile at a Time, Perspectives on Psychological Science, Association for Psychological Science, 2011.
[xvii] See Walter Scheidel, The Great Leveler: Violence and the History of Inequality from the Stone Age to the Twenty-First Century, Princeton 2018. Shows that structural inequality has only been reduced by the shocks of plague, revolution, mass-mobilization warfare, or state collapse.
[xviii] Historical examples include the Lex Thoria, the Cura Annonae, the Zakat, pensions in the Han Dynasty, among other forms of poor relief. Modern examples include the social safety net, welfare benefits, and more recently, basic income. None of these actually reverse wealth concentration.
Property monopolized, or in the Possession of a Few is a Curse to Mankind. We should preserve not an Absolute Equality – this is unnecessary, but preserve all from extreme Poverty, and all others from extravagant Riches.
© 2024 John Adams Institute. All rights reserved. The John Adams Institute, operating as the Adams Institute for the Preservation of the Democratic-Republican Model of Government, is not a government organization or affiliated with any government organization. We do not endorse or oppose any specific candidates for public office. This website is not a government website. No statement or suggestion of government endorsement is intended or should be inferred. No endorsement of any of our ideas or activities by any person referenced on this website is intended or should be inferred unless otherwise explicitly stated. The John Adams Institute is a nonprofit corporation, is not a tax-exempt organization, and does not engage in commercial activities. No communication on this website is intended as a lobbying communication or as a solicitation for financial support but is only intended to stimulate intelligent public discourse. For full legal terms and disclaimers, visit our Legal page.
© 2024 John Adams Institute. All rights reserved. The John Adams Institute, operating as the Adams Institute for the Preservation of the Democratic-Republican Model of Government, is not a government organization or affiliated with any government organization. We do not endorse or oppose any specific candidates for public office. This website is not a government website. No statement or suggestion of government endorsement is intended or should be inferred. No endorsement of any of our ideas or activities by any person referenced on this website is intended or should be inferred unless otherwise explicitly stated. The John Adams Institute is a nonprofit corporation, is not a tax-exempt organization, and does not engage in commercial activities. No communication on this website is intended as a lobbying communication or as a solicitation for financial support but is only intended to stimulate intelligent public discourse. For full legal terms and disclaimers, visit our Legal page.
