One influence of war has repeatedly asserted itself in the past—an effect on the costs of production and on the competitive position of the industries and firms of victorious or neutral nations. This subject needs more study, but certain facts suggest a hypothesis, of three parts. First: war expands some industries or concerns, increases their efficiency, enables them to operate, at the end of the struggle, on a comparatively low-cost basis, intensifies their competitive advantages, and improves their position in relation to foreign competitors. Second: war—for the duration—bolsters up some high-cost units by enabling them to sell at a profit all they can produce. The end of the war places such high-cost units at a disadvantage in the process of absorbing the shocks of the transition to a peacetime economy. Third: the history of postwar periods usually exhibits a sharp contest between such low-cost and high-cost enterprises. While “low cost” and “high cost” may refer to the relative positions of units within the same country, in most of this discussion, the terms will be applied to the producers of one country (either victor or neutral) to mean that their costs are low or high in comparison with those of their foreign competitors.

Only in recent years have the economic problems involved in the conduct of war begun to receive much attention from scholars. As a result of sad experience we now also have substantial groups engaged in studying the problems of postwar readjustment, but I know of no attempt to present a summary generalization of the more enduring reactions of American wars upon the economic life of the country. By the more enduring reactions I mean those which are felt after the postwar period of readjustment and which may be due either directly to the war or to the depression caused by the war.

Operating theories are more or less concealed in the structure of all historical writing. They are readily discerned when the theories are comprehensive and at variance with generally accepted ideas, as in the case of Thomism or Marxism. They are hard to detect when like Spencerianism they conform closely to the mores of American life. Writers may honestly deny in this latter case that they have any special theory; they are simply recording the “facts” from a “common-sense” viewpoint. But since theory must be either implicit or explicit, it is better for scholarly purposes that it should be explicit. Carefully formulated theory restricts unconscious bias, gives meaning to otherwise formless data, and is more likely to reveal unexpected relationships.

Two propositions are suggested by a preliminary examination of the marketing of brass and brass products a century ago: first, that the manufacturer's quest for a near-monopoly market through product differentiation is not a new development; second, that this very quest of the manufacturer for near-monopoly has been the life blood of manufacturing progress.

After 1865 Southerners found their communities generally in a state of economic chaos. This was particularly true of the mercantile system. Before the war numerous small towns and villages were in the process of development, and the more localized system of merchandising was reaching out into the general trade. The merchants of the new stores were rapidly cutting into the virtually monopolistic control previously exercised by the system of cotton factorage on which the larger planters depended for supplies, for with the establishment of local stores, cotton planters looked more and more to their home merchants. During the four years of war these local stores were practically forced out of business by a lack of stock. The end of the war brought to the merchant a complete economic revolution. He was now to engage in a system of storekeeping which was unique in every respect except the name. Southern general stores became country stores whether they existed in the country or not, for the bulk of their trade was that of ”country” supply.

In accordance with the proper procedures of economic history and nicely within the limitations of my own knowledge, my comments upon the three papers presented take the form of recollections of some of the business conditions met with in my forty-four years of service with a single manufacturing and selling company.

The pamphlet literature and the public documents of our early national period show that in spite of repeated instances of governmental interference in economic life, a great deal of thinking was being done along laissez-faire lines. This thought was unsystematic. It was pragmatic rather than philosophical, never doctrinaire, concerned primarily with defending and attacking specific measures of public policy. Nevertheless, it was serious thought, and in many instances had an important influence on legislative action. It was not restricted to any political group, but pervaded to a greater or less degree the thinking of all leaders of the community. Owing little to the teachings of contemporary European economists, American libertarianism deserves analysis as an indigenous body of theory, growing out of, and adjusted to American conditions.

This paper will deal not with the development, but rather with the lack of development of laissez-faire thought in Massachusetts during most of the nineteenth century. A common misconception of American economic thought, as of American economy, ascribes a continuous laissez-faire bent to policy in the United States. This misconception will be found not only in the pretty publications of the National Association of Manufacturers where it might be expected, but also in the serious works of our most careful scholars into which it obtrudes almost automatically. Thus Mr. Nef recently referred to laissez faire as “part of our national heritage.” Yet, in general, and specifically as applied to Massachusetts, this is completely erroneous.

Nearly seventy-five years have elapsed since Henry Carey complained that the term laissez faire had become a meaningless symbol, an object, as he put it, of “word-worship.” If the task of definition seemed imposing in his time, it is not less so in ours. The concept has been used with abandon on various levels of political and economic discussion. It belongs to a whole category of catchwords in our social thought whose connotations, if they ever were precise, have become blurred through constant and polemical usage. They are dangerous labels for the historian. This paper seeks to analyze the ideas developed in Pennsylvania to oppose governmental action in economic life during the period from the Revolution to the Civil War. For the present purpose it is not a matter of significance whether one chooses to believe that any of these ideas are genuinely laissezfaire in character or not.

It is necessary to indicate at the outset the general character of the historical material with which this paper deals. I have been able to discover in this period of Georgia's history almost no advocacy or discussion of the doctrine of laissez faire as such. On the other hand, one finds much discussion of private and public enterprise which, if removed from the context of events, would seem to involve most of the commonly accepted tenets of laissez faire. Lastly, there are the main currents of social action, which, upon investigation, are found to have comprised a varying mixture of private and public activities. It is difficult, if not impossible, to determine the logic of the social policy which directed these currents simply by observing the varying proportions of private and public action; it would be necessary first to go behind the action and study both the ends and the means. In the limited space allotted to this paper, it is possible to present only the barest outlines of the more important events and discussions in which the issue of public interference or of private versus public action arose. Interpretations and evaluations must be left, for the most part, to additional studies

German political empire building had a decisive and powerful influence not only on the making, but also on the writing of economic history. The initial effect upon the history of economic history was negative rather than positive. The so-called “political historians” of the midnineteenth century were inspired by the contemporary struggle for the enhancement of the nation's political power and for constitutional liberty. The subsequent formation of Imperial Germany by “blood and iron,” instead of broadening the historical perspective and social vision of Droysen, Duncker, Häusser, Sybel, Treitschke, and the more docile among their followers, merely knocked out their liberalism and intensified and militarized their nationalism. In the new Reich they felt irritated and annoyed rather than roused and shaken by the grave economic conflicts and social disharmonies which grew out of the rapid industrialization of the German national economy and the narrow social class structure of the Imperial government and its Junker personnel. The hypnotic spell emanating from Bismarck's leadership accounted for the sterility of the political historians' response. Although the work of these academic civil servants greatly improved in technical perfection and thoroughness and extended the boundaries of factual knowledge, including knowledge not always worth knowing, it lost vigor and fertility and deteriorated into staleness and irksome monotony as to fundamental ideas and social ideals.

German imperial expansion, begun under Bismarck, swiftly unfolded with the aid of industrial technology along lines that adapted it ideally for the organization, not of a national state, but of a continent or even the world. In this fact lies a major contrast between the neo-mercantilism which followed 1879 and the cameralism borrowed from the Burgundians by the German princes in the sixteenth century. The system extolled by Becher was designed to meet the power needs of dwarf states perpetually torn, by a mule-and-the-two-haystacks dilemma, between the fractioning particularism of the lay princes on the one hand, and the centrifugal pull of a meaningless imperial universalism on the other. The ‘new age’ for which, as Schulze- Gavaernitz once remarked, Bismarck played the role of ‘obstetrician,’ employed a machinery for internal unification that fitted the national—in particular the German—state almost as badly as it did the political fractions of which it was compounded.

When Hitler based so much of his campaign of 1936–1937 for the return of the colonies upon the Fatherland's economic need of them, he was reverting to the pattern of Germany's colonial history. It mattered not that the economic value of these colonies had been proven negligible or, at least, problematical so far as any advantage in trade and raw materials accruing to the empire was concerned. He and the Nazi leaders continued to stress the economic motive of expansion and aggression; to emphasize the close connection between commercial and colonial policies which had always characterized German imperialism.

Historians are not so prone as their brethren of the social studies to lengthy disputation concerning the function, the objective, the method, the locus and the limit of their subject. They tell us freely enough and often enough and variably enough what history is and does, but they seldom justify their pronouncements by elaborate argument. They rarely seek to place the other social disciplines in relation to their own. Not uncommonly their own proceeds as though these others did not exist or as though they existed on another level of communication altogether. History takes so free an amplitude that these others become angles of incidence to its main highroad. It is presumptively concerned with the concrete reality, the wholeness of things, while these others attach to abstractions such as law and government and economics and morals. The other social disciplines vex themselves with the ambition to be entitled sciences and cast aspiring and emulous eyes on the physicist and the mathematician, but history loses no sleep over such aspirations—untroubled by the inferiority complex of its associates it is even ready to reject the title of science when offered.