Beyond the Founders: New Approaches to the Political History of the Early American Republic

12. Private Enterprise, Public Good?: Communications Deregulation as a National Political Issue, 1839–1851

richard r. john 12 Private Enterprise, Public Good? Communications Deregulation as a National Political Issue, 1839–1851 In June 1847, Supreme Court Justice Levi Woodbury delivered a remarkable paean to the regulatory powers of the federal government. ‘‘To dream,’’ Woodbury declared, that the Post O≈ce Department might be supplanted by ‘‘individual enterprise’’ was to ‘‘dream as wildly as in the tales of the Arabian Nights.’’ Private enterprise might conceivably meet the needs of a compact territory that was densely settled and bustling with commercial activity: ‘‘But what could it do for the county of Coos, or Tioga, or for Iowa, and Florida, and Oregon?’’∞ Woodbury’s remarks had been occasioned by one of the many lawsuits in the mid-1840s that pitted the federal government against a parcel delivery company. Beginning around 1840, these companies, known popularly as private expresses, challenged the various legal restrictions on private mail delivery by providing postal patrons with a low-cost alternative to the Post O≈ce Department on many lucrative routes in New England and the mid-Atlantic states. Private Enterprise, Public Good? 329 Supporters of the private expresses included David Hale and Gerald Hallock, the editors of the influential New York Journal of Commerce. Beginning in 1840, Hale and Hallock editorialized in support of the establishment of ‘‘free trade’’ in mail delivery in the conviction that this would foster a salutary competition.≤ ‘‘Private enterprise carries the letters better, as well as cheaper, than the government mails,’’ Hale and Hallock declared, in a typical column in February 1844.≥ Hale and Hallock went so far as to proclaim the postal monopoly unconstitutional , and to endorse the unsuccessful attempt of postal reformer Lysander Spooner to bring the issue before the Supreme Court.∂ Woodbury was well aware of the challenges to the postal monopoly that its critics had raised, and met them head-on. His critique was at once historical and normative. To contend that the postal monopoly lacked a constitutional warrant was to ignore the circumstances that had existed seventy years earlier, when the federal Constitution had been originally drafted. At that time, Woodbury observed , no one could have envisioned that the Post O≈ce Department might one day face private competition. On the contrary, such a situation had become conceivable only in the relatively recent past, with the improvement of the road network, the coming of railroads and steamboats, and the rise of ‘‘greater private enterprise and capital.’’∑ Normative considerations underlay Woodbury’s historical argument. The elimination of the postal monopoly, Woodbury warned, would benefit the few at the expense of the many. Should the courts dismantle the ‘‘great central regulations’’ that the federal government enforced, this would severely disadvantage the two-thirds of the American people who lived in the seven-eighths of the country that lay outside of the major commercial centers. No longer would these Americans be able to enjoy the postal cross-subsidies that the postal monopoly underwrote. While some contended that Congress might choose to fund these cross-subsidies out of the general treasury, Woodbury did not: like most public figures, he considered it axiomatic that the Post O≈ce Department should, at the very least, break even. As a consequence, he considered the postal monopoly an indispensable mechanism for transferring the surpluses generated in the major commercial centers to the thousands of towns and villages in the interior. In its absence, there would be no way to subsidize the circulation of the myriad newspapers, magazines, pamphlets, and government documents that crowded the mails. The subsidized delivery of such an enormous volume of printed matter was, Woodbury argued, one of the ‘‘great peculiarities’’ of the American government. Without it, Americans would be deprived of intelligence of every kind, including ‘‘food for the public mind, new views, new helps, new discoveries of inventions, new principles, richard r. john 330 new reforms—in short, new improvements in everything that strengthen or adorn society.’’∏ Woodbury found the rationale for the federal regulation of communications so compelling that he extended it to embrace even the electric telegraph, a means of communication unknown to the framers of the federal Constitution. Woodbury was well aware that, for some time, a small but articulate group of promoters, newspaper editors, and congressmen had been advocating the commercialization of the telegraph as a private enterprise. Here, once again, Woodbury demurred. Under no circumstances, Woodbury warned, should the government permit ‘‘private experiments’’ with the...