Mainstream historians and economists tend to see the period from about 1900 to 1920 as a glorious time for the Progressive agenda. In 1913 alone, the government headed by Progressive Woodrow Wilson created the Federal Reserve System, direct election of US Senators via voters (and not state legislators), and the federal income tax. The rise of regulatory agencies such as the Food and Drug Administration, the Interstate Commerce Commission, the Federal Trade Commission, and the Federal Communications Commission further directed the US economy away from ‘destructive’ laissez-faire and toward a more ‘rational’ model. Likewise, the US government at this time aggressively pursued anti-trust policies that sought to break up or prevent the creation of private monopolies, supposedly protecting the very heart of the American free enterprise system: competition.
Not surprisingly, upon further inspection, we find that the reality was different than the vision historians have produced. As economic historians such as Robert Higgs in Crisis and Leviathan, have documented, the economic regulation imposed by American Progressives actually formed monopolies where none had existed and Progressive policies created new and harmful barriers to entry that blocked whole groups out of occupational lines in the name of creating a better society.
This post was published at Ludwig von Mises Institute on SEPTEMBER 15, 2015.
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