Debating the End of History: The Marketplace, Utopia, and the Fragmentation of Intellectual Life

Chapter 3: Economists Discover A New New World

55 3 ECONOMISTS DISCOVER A NEW NEW WORLD Sacvan Bercovitch, in his The American Jeremiad (1978), argued that the first English settlers coming to North America believed they had received a promise from the Divinity. They were promised that they were entering a land of timeless harmony. When they quickly experienced timeful change, they lamented that this was a sinful declension from the perfect world given them by the Divinity. They searched for scapegoats on whom they could blame the declension . Bercovitch declared that this pattern became secularized and was used by successive generations of European Americans to define America as a nation blessed by timeless harmony. Then always experiencing declension into timeful disharmony, they made prophecies that if scapegoats were purged the promise of an earthly heaven would be restored. I have described how Charles and Mary Beard used such a pattern in their The Rise of American Civilization. Good American sons, for the Beards, wanted to conserve their exceptional, timeless nation. Bad un-American sons committed to international capitalism wanted to end America’s isolation from the timeful chaos of other nations . But the Beards could prophesy that when the evil men creating a declension into time were defeated, then the American promise would be restored.1 In this chapter, where I discuss academic economists, I will argue that most American economists from the 1880s to the 1940s defined their nation in terms very similar to those used by the Beards. They too assumed that the American nation was a timeless space with perpetual equilibrium. They too assumed this equilibrium was not shared by other nations, which continued to experience timeful instability. They too saw a few Americans becoming un-American when they gave their 56 economists discover a new new world loyalty to international capitalism. These bad sons were prepared to lead their country out of the promise of endless harmony into the declension of timeful disharmony. Until the 1940s, most economists saw themselves fighting to defeat bad sons who had become international capitalists and to restore the promise of a uniquely stable America.2 Then in the 1940s economists were caught up in a revolution. National leaders managed to redefine the supposed isolation of the United States as un-American and internationalism as American. Indeed, the United States had suddenly become the political and economic center of international capitalism locked in mortal combat with international communism. In this revolution the promise of a timeless space where humans could live in perpetual harmony shifted from the nation to the global marketplace. And the members of the dominant nationalist school of economics abruptly found they had lost their status as good American sons. Overnight they had become bad un-American fathers . A younger generation of economists in the 1940s who embraced the global marketplace declared that their teachers, their academic fathers, in the 1930s were attacking the promise of a universal and timeless economic space. Their bad fathers were causing a declension into time because they seduced people into accepting the artful, timeful role of national politics in the artless, timeless global marketplace. But the good international sons would end the declension and restore the promise by purging the bad nationalist fathers.3 This is the story I will tell in this chapter. But, of course, the story of the jeremiad described by Bercovitch seems to be a never-ending one. The revolutionary sons of the 1940s became academic fathers. Today are we seeing, therefore, another generation of rebellious academic sons who reject the free-market capitalism of their teachers? Are they saying something similar to what their grandfathers had said? Are they saying that a laissez-faire policy leads to instability and a declension into timeful chaos? Are they contradicting their academic fathers by making a prophecy that action by the national government can end the declension and restore the promise of perpetual prosperity? First, however, I will discuss how difficult it was for me and other historians of my generation to comprehend this revolutionary conflict in departments of economics. When we historians accepted that humans are always within culture, it was difficult for us to know whether our colleagues in other departments were experiencing similar conversions . In the late nineteenth century academics redefined themselves as economists discover a new new world 57 professionals, and they created powerful boundaries between the disciplines . For example, if one were a political scientist, one was judged by other...