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The Two-Party System

The two-party system was not written into the plan. Indeed, the framers of the United States Constitution worked hard to create a government of checks and balances that would discourage the formation of political parties. Why? Because political parties were the result of factions, and factions had been the bane of every republic since, well, the Roman Republic. Madison, Hamilton, and Washington believed that political parties would divide the nation and ultimately cause the downfall of the American republic. Madison famously expressed these views in THE FEDERALIST nos. 10 and 51. And wouldn’t you know it? Within two years of the creation of the Federal Government, a political party began to take shape under the guidance of Thomas Jefferson and, incredibly, James Madison. The party was created in opposition to George Washington’s presidency. Jefferson and Madison feared that Washington’s nationalists policies (and those of his Treasury Secretary, Alexander Hamilton) exceeded the limited powers prescribed in the U.S. Constitution and, if not checked, would be ruinous to the Spirit of 1776 and return the nation to monarchy. In other words, King George III of England would be replaced by King George I of Virginia.

Did Jefferson and Madison actually believe this? Of course not. It was politics, where truth is the first casualty of political partisanship. At the time, Jefferson and Madison were government insiders and members of Washington’s inner circle. Why after two years would they distance themselves from the Washington administration and form an opposition party? A lot of it had to do with where they were from—Virginia. Virginia was a state without cities, where agriculture held sway and the ruling class was comprised of owners of large plantations worked by slaves. Virginia’s planter elite was a veritable gentleman’s paradise where everybody of means knew everybody else of means, and saw eye-to-eye on what was best for Virginia, and therefore best for the nation.

As a planter himself, Washington was a member of Virginia’s ruling elite, but he had undergone a transformation during his eight-and-a-half years as commander-in-chief of the Continental Army. He no longer saw the nation through the eyes of a Virginia grandee, but as an American. If America was going to be politically and financially strong, and—oh-by-the-way—avoid repeating the deprivation and hardship the Continental Army had suffered during the long war, it would need a strong federal government with the power to tax, a central banking system to manage the pubic debt, a business and manufacturing economy, and a standing army and navy. In other words, something that approximated the British government that the former colonies had rebelled against. Jefferson and Madison favored exactly the opposite: states’ rights, state banks, no debt, no taxation other than a mild impost on goods entering the country, local militia, and an agrarian economy. In other words, a return to what North America had been prior to the Revolution—a turning back of the clock to a simpler and more dignified Arcadian past, where men of reason and good breeding oversaw a limited national government, much as the Northern patroons oversaw their large estates in Upstate New York and the Virginia squires oversaw their vast plantations south of the Potomac River. It was a dream with roots deep in English history, and remains alive and well in today’s politics.


The dream began with the Anglo-Saxons, who farmed the river valleys, tended their flocks in the highlands, and traded with towns along the northern coast of Europe. It was an idyllic existence, interrupted every century or so by invading Scandinavians who, after the fighting was over, settled down as farmers and assimilated into the population. That changed in 1066 with the invasion of the French-speaking Normans. The Normans conquered but did not assimilate—they took over. They turned the sleepy village of London into a mighty fortress and capital city of their empire, that included most of northern France. The lines were drawn. The Norman ruling elite presided in London and consolidated their wealth in the towns, while the Anglo-Saxons lived in the countryside, farmed the land, and paid exorbitant taxes to a distant king whose court spoke French. Centuries passed, the Magna Carta was signed in 1215, the Glorious Revolution of 1688 ousted one king only to be replaced with another, and all the while the farming class fumed while increasing in prosperity and political power. The wealthiest among them became squires, earls, dukes and viscounts. But always the distrust of central authority remained, a distrust of the king and his court, and, by the 17th century a distrust of their corresponding class of moneymen—bankers, brokers, and speculators. And always there remained among the landed gentry a longing for the halcyon days before the Norman invasion.

The landed gentry became known as Whigs, or the Country party, while the members of the British ministry became known as the Court party. By the late 17th century, the dissenting Country party saw themselves as truly virtuous and the Court party as truly corrupt. In the early 18th century, a leader emerged as the symbol of the Country party—a wealthy landowner known as Viscount Henry St. John Bolingbroke. At the same time, a leader emerged who symbolized the Court Party—the British chancellor of the exchequer, Sir Robert Walpole. In the eyes of Bolingbroke and the Country party, Walpole was the most corrupt of all for having saved the Bank of England from financial ruin with a bit of creative bookkeeping that in turn shifted the nation’s wealth from one of land to one of capital. But what was capital compared with land? With land you could grow things, raise sheep and cattle, unearth iron ore and coal. What was capital but a shuffling of paper that yielded dividends, with nothing behind it except the government’s promise to pay upon demand? Thanks to Walpole, the tenuous balance between the landed elite and the London moneymen had been significantly altered in favor of the moneymen. In other words, personal property (mainly government stocks and bonds) was now quantitatively as important as real property (land) and qualitatively more so, for it was infinity more mobile and infinitely more dynamic. Under Walpole, vast new quantities of wealth were created, wealth that was financing the Industrial revolution and creating the British Empire.


With the influx of wealth came charges of corruption within the British government, and a vast amount of protest literature in the form of pamphlets, party newspapers, even novels and plays. Curiously, the protest literature failed to find an audience in England but did so in the American colonies. Thomas Jefferson, for one, had in his library copies of the major writings of Bolingbroke, John Trenchard and Thomas Gordon (writing under the pseudonym of Cato) and James Burgh. These writers had created a language, and indeed an ideology, of opposition to the arbitrary and abusive exercise of power by the British ministry. On the other side was a body of literature in support of the British government by the likes of David Hume and Adam Smith. The Founding Fathers read all of these writers, and after the Revolution adopted sides that strongly resembled the principles of the Country party (notably Jefferson) or the principles of the Court party (notably Alexander Hamilton). At the root of the opposing philosophies was how men viewed themselves, as “honorable” (Hamilton) or “virtuous” (Jefferson). According to another British writer from this time, Joseph Addison, honorable men desire the esteem of wise and good men, while virtuous men are motivated by self esteem. The honorable man accepts that there is corruption in the world, but would not stoop to it. The virtuous man shrinks with horror at the existence of corruption, and wants to stamp it out. The honorable man deals with the world as it is, not as he would have it become; the virtuous man seeks to make the world correspond to a utopian vision tied to a mythic past where virtue reigned supreme. Men of both persuasions met in Philadelphia at the Constitutional Convention, and the resulting document was the successful effort of balancing these disparate views. Indeed, James Madison’s political views fell somewhere in between, and so it seems fitting that he should be the one to have achieved the balance. Indeed, the U.S. Constitution is a document not of political extremes but of political moderation.


The idea that the Founding Fathers were one happy band of brothers is as untrue as the tale that Washington chopped down the cherry tree. The Founders quarreled and fought as politicians always do, but somehow managed to set aside their differences and make compromise decisions that created a new nation based on property rights and the rule of law. After the nation was created and its success somewhat assured, they retreated back to their opposing sides, with Jefferson at the head of the Democratic Republic party, and Hamilton at the head of the Federalist party. Today, the Democratic Party looks back to Jefferson as their spiritual leader, and the Republicans to Hamilton as theirs. Yet, to accept this as true is to ignore a great deal of history, and of what constitutes conservative and liberal ideology. From its inception, and up to the presidency of Woodrow Wilson, the Democrats were in fact the conservative party, clinging steadfastly to states’ rights, small government, minimal taxes, local militias, no federal bank, and conservative judicial appointments. The party of Hamilton, which would eventually become the Republican Party, was the progressive or liberal party, in favor of a strong federal government and military, a central bank, income tax, ending slavery, activist judicial appointments, and a number of amendments to the Constitution enforcing the civil rights of all Americans.

The change in party ideology that began with President Wilson was completed with the presidency of Franklin Roosevelt, in which the Democratic Party embraced the progressive policies of Alexander Hamilton. At the same time, and possibly as a reaction to FDR’s progressivism, the Republican Party become increasingly conservative. And our nation? Where does it stand politically? Judging by the elections, where every four-to-eight years the people oust one party and replace it with a another, this time with Democrats and next time with Republicans, and have done so for most of our nation’s 240 years, it’s safe to say the majority of Americans are neither liberal nor conservative, but moderate. Yes, moderate, like our Constitution. They work, pay their taxes, have kids, keep their heads, and avoid being drawn in by the extreme elements of either party.

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