The Class Conflict Between Elites and Workers Goes Back to America’s Founding
Engraving of the Battle of Monmouth on June 28, 1778, during the Revolutionary War. (Bettmann Archive / Getty Images)
You wouldn’t know it from the widespread glorification of America’s “founding fathers,” but the years around American independence were shot through with class conflict between elites and working people. And most of the founding fathers were on the wrong side.
An interview with WILLIAM HOGELAND
If you listen to Jacobin Radio’s The Dig, hosted by Daniel Denvir, you know that the conventional story of the American revolutionary era, which portrays the war for independence as a simple struggle against British oppression, is a myth.
For one, it obscures the founders’ interest in accelerating and extending the dispossession of Indigenous people’s land by shaking off British curbs on westward expansion. In addition, the conceptions of freedom that predominated were fundamentally premised on the enslavement of Africans. William Hogeland’s book Founding Finance: How Debt, Speculation, Foreclosures, Protests and Crackdowns Made Us a Nation adds another important dimension to our understanding of this critical period.
In this Dig interview, conducted by guest host Astra Taylor, Hogeland narrates the violent conflicts over economics, class, and finance that shaped the US Constitution and shored up the power of the creditor class against poor, class-conscious, American radicals. Hogeland recovers a fascinating crop of mostly forgotten rebels like Herman Husband, the movements they led, and their radical demands that put the landlords and lenders of their day on edge. As Hogeland makes clear, financial clashes, foreclosure crises, investment bubbles, mercenary bondholders, scarce cash, regressive taxation, and war profiteering all made the United States what it is today.
The transcript has been edited for length and clarity.
ASTRA TAYLOR Can you talk about what your narrative of America’s founding emphasizes that mainstream ones typically don’t, and how the story you tell challenges both right-wing and liberal claims about this period and about the Constitution?
WILLIAM HOGELAND Class conflict is not just one of a number of interesting conflicts that, for me, begin the founding of the country, but a main driver of forming the nation. The significant central story, really.
That doesn’t mean it’s the only story, but since it’s constantly overlooked and dismissed, I began to think that actually it must be the central story or people wouldn’t be trying so hard to get it out of the way. The book we’re talking about was published ten years ago, and I was writing very directly about current politics — the Occupy movement, the Tea Party movement — in the context of the founding moment.
I have a forthcoming book, which develops some of these themes to another level. Some of its material that’s already been covered in The Whiskey Rebellion, my first book, Founding Finance, and Declaration, my second book — they’re all telling different aspects of the same story.
But here I’m really focusing on [Alexander] Hamilton in more detail—in the Hamilton moment. And again, trying to push back against some of—putting it somewhat crudely—the hero worship and the lack of dimension that’s gone along with the Hamilton craze of recent years.
ASTRA TAYLOR Your book opens on the first day of the meeting that would become known as the United States Constitutional Convention. It’s the spring of 1787 in Philadelphia. And you make vividly clear that the men gathered really feared democracy. What did they mean by the word democracy? What were they so afraid of? And why do we have to understand that it, to them, did very, very explicitly have an economic component?
WILLIAM HOGELAND When Edmund Randolph brought the meeting together, he said, you know, the problem we have in this country is that we don’t have sufficient checks on “the democracy.” They were talking about what they saw as excessive representation of the will of ordinary working people in government.
The founders, those people at the convention, were very well-off, well-educated, upscale people. And so that’s what they feared. They feared the advance of working people into government, which had been happening because of the need for majority support for the revolution.
We should underscore the fact that the movement on behalf of the working class was largely led by white men. It wasn’t what we mean by democracy. Although there were women who led food riots, when you get to the leadership, you find white men like Herman Husband, who you mentioned, and Thomas Paine.
ASTRA TAYLOR You say in the book there was an “open struggle” between ordinary people and upscale investors over “cash, credit, debt, taxes, foreclosures, lending” — access to economic opportunity and prosperity. Probably the one that people at least know by name is Shays’ Rebellion, which is emblematic of what these guys were worried about.
WILLIAM HOGELAND Yeah, it was super causal of the convention itself because it was a serious uprising in Western Massachusetts that spread all over Massachusetts and other parts of New England. Shays’ Rebellion was part of a whole kind of intercolonial movement where these things were happening in a bunch of places. This is just the most famous one. Revolutionary War veterans were being hit by incredibly crushing taxes, which were earmarked to pay interest to a small group of rich bondholders who were holders of the war debt.
They came home to a new constitution, the state constitution of Massachusetts, which actually tightened rules against voting and made it harder to vote than it had been before. And their farms were being foreclosed by the very same people who are the rich bondholders. They’re also the people who lend to ordinary people and charge extraordinarily exorbitant interest rates. And it just makes the whole revolution look like a complete scam.
Early-20th-century depiction of Shays’ Rebellion. (Wikimedia Commons)
So they started shutting down banks. They weren’t rioting in the classic sense necessarily, because these are veterans — they’re marching in good order. They have officers. They’re following orders. This is terrifying to elites around the country. Henry Knox wrote a letter to George Washington in which he’s basically saying, these people in every state wanted to seize power, divide property equally, and we’re not going to have any private property anymore. He was being a little hyperbolic, but some people did want to do stuff like that. And this is, of course, terrifying to the small group of elite people who are very invested in their own property and wealth.
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Shays’ Rebellion is the famous thing that drives elites to the convention. But there was another thing that was equally important in scaring the elites of the country: the Pennsylvania legislature withdrew a bank charter from its private owners. And when Robert Morris, one of the richest merchants in America and one of those bank owners, said, this is confiscatory, you’re taking away my charter, it was pointed out to him by the radical democrats that, no, that charter is not your property. It’s the property of the people.
This was just as scary, I think, to the elites around the country as Shays’ Rebellion, because in Pennsylvania, you’ve got this radically democratic government where through legitimate electoral means, people are able to express themselves and obstruct the power of wealth.
ASTRA TAYLOR Is it fair to say, then, that the founders were waging a war on two fronts: a war without and a war within?
WILLIAM HOGELAND Yeah, there’s a fundamental conflict in the revolution where the elites are like, we’ve got to have this revolution and get free of all this oppression by Britain so we can run our businesses the way we want and so forth. Ordinary people in mass numbers also wanted a revolution, because they thought it could be a revolution for changing things from the way they’d been for years. So the revolution seemed like an opportunity to bring these things together.
But really, there’s a fundamental conflict. The elites needed the people to be revolutionary, but they were not interested in sharing power and they were not interested in changing the economic structures that made them the elites. We still don’t often look at the Constitution as the elite attempt to resolve that fight in the elite’s favor, but that’s how I think the Constitution really functioned.
ASTRA TAYLOR What were the conditions of ordinary people, many of whom were tenants?
WILLIAM HOGELAND We live with this idea of the independent yeoman farmer. It is already incredibly reductive, but there were massive foreclosure crises marking this period. So, many people owned their own property, but they were frequently deeply indebted and got into cycles of bad debt. And this debt, of course, is to those very same people that we were just talking about — the elites who were in the business of lending money at exorbitant interest rates to the supposedly independent yeoman farmer. But they’re not independent very long in those kinds of debt cycles. And then those independent farming people, and artisans as well, end up working for the people who foreclosed them.
So there were mass epidemics of this. And the people who were being foreclosed had a very clear sense — they were extremely savvy about the economic nature of these problems.
But yeah, this myth of the kind of westward-moving yeoman farming family. It’s not that that ever happened, but there were whole periods where that was just kind of going away and people were quite, you know, educated. Even if they weren’t formally educated in how that was working, they knew they were being taxed to further enrich rich people.
ASTRA TAYLOR Before we start digging into the characters and some of the stories, I thought I would put my cards on the table. I’m the founder of the Debt Collective, the first union of debtors. And when we formed in the wake of Occupy Wall Street, we thought we were doing something really novel by organizing around debt. We saw ourselves as responding both to the 2008 financial crisis and changes in the economy that we understood as coming out of financialization and neoliberalism, where debt and the financial sector became more prominent.
It was only when I started researching my book on democracy and reading more of the founders’ writings and more about those debates that I started to realize that debtors’ revolts were much older than I had assumed. One of my favorite quotes is [James] Madison talking about how a more democratic system would lead to various wicked projects, including the wicked project of debt abolition. But also, like you said, the equal distribution of property, the implementation of progressive taxes, etc.
Without knowing it, I became part of this American tradition of revolt against what you call lenders and landlords. The creditors won the day back then, but the debtors are still here fighting. So that’s my interest in your book. And I’m curious how you came to this topic before we get into the actual substance.
WILLIAM HOGELAND I got into it by accident. I was trying to understand the Whiskey Rebellion of the 1790s, and I just backed into this, the debt issue, and I was very struck by it. This is around 2003. And I just thought I was going to write a quick, breezy, “founder’s chic” kind of book. And I just went into the library and didn’t come out for a long, long time. And when I came out, I was just stumbling around, like, whoa. It’s all different from what I thought it was. It’s much cooler as a story and much more timely. And then I got kind of obsessed. I didn’t intend to find these things out or get so interested in them.
ASTRA TAYLOR
Well, happy accident for us. We’re going to go through the book pretty faithfully to the way you’ve structured it. In chapter two, you introduce this very interesting character who we’ve already mentioned, Mr Husband, who was leading a movement: the North Carolina regulators.
You know, my family has lived in North Carolina for almost two decades. I have been to Alamance County, where this guy and his buddies led the revolt and never heard a word of this. Who was he? What was he up to?
WILLIAM HOGELAND
I think he should be a central figure in the founding period. He was weird, but that’s what makes him kind of great. Also, he had a vision of a whole different way of structuring economics in America. One thing that makes it very difficult, I think, for people on the Left sometimes to embrace him — although he was an ancestor of the Left — is he had an actual vision, like a religious vision. He saw visions like Joan of Arc saw visions.
I think this makes him hard for people to sort of cope with, but it also makes him fascinating because he was intellectually very adroit, smart, self-taught, and everything. He also just had this powerful sense of right and wrong — these economic issues of right and wrong as being, you know, on a high moral plane, like ordained by God.
And my thing is, yeah, maybe he was kind of crazy because if you can imagine things like Social Security, New Deal kind of stuff in the way he started imagining these things before the revolution — so the first half of the eighteenth century — well, maybe you have to be crazy. But that should make him a paradigmatic American for us to get excited about.
The 1787 Constitutional Convention by Junius Brutus Stearns, 1856. (Wikimedia Commons)
And the regulation that you mentioned — that was his first real big political action. We talk about regulation now, regulatory economics and stuff. Regulation was a common term then for the people just getting up and regulating the economy because they didn’t have the vote; they didn’t have access to legitimate means to regulate. And that meant they would riot because that was the only means they had — they didn’t have legal means.
So Husband was a leader of the North Carolina regulation, and they carried out regulatory action like violently shutting down debt courts. Husband was actually nonviolent. He had been a Quaker for a while. But he was caught up in all that violence as the only way to really make a point back then. So he kept running into these nightmarish contradictions in his beliefs. And he hung with it.