The shaping of a future president's economic thought: Richard T. Ely and Woodrow Wilson at "The Hopkins".

Author:Thies, Clifford F.
Position:Johns Hopkins University - Essay

Thomas Woodrow Wilson (1856-1924) was the first and is still the only president of the United States to hold an earned doctoral degree. His Ph.D. was awarded by the Johns Hopkins University ("The Hopkins") in 1886. He was also the president of an institution of higher education and, unique among U.S. presidents, rose to such a position from the ranks of the faculty. These characteristics might dispose scholars favorably toward an assessment of his presidency, and, indeed, in Arthur Schlesinger's 1948 survey (Schlesinger 1997), Wilson was ranked fourth among U.S. presidents, following only George Washington, Abraham Lincoln, and Franklin D. Roosevelt. Biographers appeared until recently to see Wilson uncritically as a "philosopher king," describing him and his policies as precursors of Roosevelt and the New Deal or of John F. Kennedy and the New Frontier, dismissing his failures and his party's rejection by the U.S. electorate in 1920, and apologizing for his unseemly positions on race and gender. (1)

The possibility of a critical review of Wilson was formerly constrained by the limited availability of his letters and other personal writings and of his previously unpublished speeches. William Diamond, who wrote specifically about Wilson's economic thought, indicates that he was granted access to these papers in 1941 only under certain restrictions (1943, 8). However, the publication of The Papers of Woodrow Wilson (1966-74, hereafter Wilson Papers) over the course of several years, under the editorship of Arthur Link, facilitates a reconsideration of the evolution of his economic thought, as Neils Aage Thorsen (1988) and Robert M. Saunders (1998) have done with regard to his political thought, and as John M. Mulder (1978) has done with regard to his religious thought. Thorsen indicates that the Wilson Papers "revealed new source material relating to Wilson's early years" (1988, 237). (2) This source material potentially calls into question the thesis advanced by Diamond that Wilson was not much influenced by his experience at The Hopkins.

In 1908, Wilson made a dramatic public conversion from conservative to progressive (Bragdon 1967). (3) With limited access to Wilson's personal letters and such, Diamond (1943) advanced a continuity argument that Wilson was always a conservative in his economic thinking. (4) Thorsen (1988) also advances a continuity argument that Wilson was always a reformer in his political thinking. Our disagreement is with Diamond. We relate Wilson's dramatic public conversion in 1908 to a change in his economic thought that occurred during or shortly after his time at The Hopkins.

According to Diamond, Wilson's economic thinking was "tempered" by his experience at The Hopkins, and "his thought [remained] essentially unchanged" (1943, 37). Again according to Diamond, it was only later that Wilson's thinking changed and that he associated himself with the progressive agenda, when he aspired to national office, not during the time he spent at The Hopkins (87). We reconsider here the evolution of Wilson's economic thought and develop an argument that, in fact, he was greatly influenced by his experience at The Hopkins. We necessarily consider Wilson's most prominent instructor there, Richard T. Ely (1854-1943), who, following his own doctoral training in Germany, had joined the faculty just prior to Wilson's arrival there. During his eleven-year career at Hopkins, Ely trained more future leaders in the social sciences than any other contemporary American economist (Tilman 1987, 142).

The Diamond thesis might appear to be supported by Ely's extended comment on Wilson in his autobiography (1938, 108-19). The section is clearly affected by Ely's disappointment in Wilson at Versailles (116-19). It is replete with faint praise (5) and subtle. "It cannot be said that we at The Johns Hopkins molded Wilson," says Ely (109), seemingly confirming Diamond. The key word in this sentence is molded. Ely saw his role to be that of a "mid-wife" (111), to get ideas growing in his students, not as that of a molder. Wilson's brother-in-law, Stockton Axson, also thought Ely played the role of something like a midwife: (6) "Mr. Wilson's chief teachers were Herbert Baxter Adams in history and Richard T. Ely in economics. For Ely, he had no admiration whatsoever, and for Herbert Adams only a limited admiration. But the point of it all is that these were modern men with modern methods of study and were able to guide Mr. Wilson and assist him in finding things out for himself" (1993, 58). Wilson was at first critical of Ely, regarding his teacher's research as shallow. But while at the Hopkins Wilson discontinued being critical and at least started to adopt the historical view. To be sure, he saw past the superficial dichotomy between the a priori and historical approaches taken by Ely, thinking that Adam Smith and other classical economists also used both a priori and historical methods. (7) Wilson also remained committed to lowering tariffs. By the time his book The State was published in 1889, however, well before his dramatic public conversion to progressivism in 1908, Wilson fully embraced the historical view of the state--that changing conditions might warrant new policies--and explicitly rejected the liberal or contractarian view of government. By the time his book The New Freedom was published in 1913, Wilson could argue that Thomas Jefferson himself would have rejected laissez-faire economics: "I feel confident that if Jefferson were living in our day he would see what we see: that the individual is caught in a great nexus of all sorts of complicated circumstances, and that to let him alone is to leave him helpless as against the obstacles with which he has to contend; and that, therefore, law in our day must come to the assistance of the individual" (1913, 284). (8)

Ely was not oblivious of Wilson's initial, critical evaluation of him (1938, 111). With regard to Wilson's public transformation from conservative to progressive many years after his graduate studies, however, Ely observed that Wilson's attitudes toward labor had changed prior to that, as indicated in a presentation Wilson made at an early meeting of the American Economic Association. Ely took pride in saying that "the seed which is sown and apparently rooted in the ground may at last sprout and bring forth fruit" (1938, 114).

The Young Wilson

Wilson's father and both of his grandfathers were staunch Presbyterian ministers. (9) Wilson was therefore reared in a household that held to two seemingly conflicting positions: first, individual responsibility; and, second, the church as an organic entity in the service of God. Calvinism taught that each individual is a "distinct moral agent" and also held the church to be a special organic body charged with carrying out God's mission. Each man is responsible for providing for his own family, and an elite council is responsible for leading the church in its mission. In one of his college essays, Wilson describes the church as an advancing army with a mission (Wilson Papers 1966-74, 1:180-81). This metaphor shaped his philosophy of the state. As Mulder (1978)-the first biographer to make full use of the Wilson Papers--argues, Wilson, as a result of his reconciliation of the two Calvinist positions, was something of a conservative in the manner of Edmund Burke, seeing society as an organic entity, not simply a liberal in the manner of the English Manchester school, seeing society as a nexus of contracts among individuals. According to Axson, "He long thought Jefferson too much of a political theorist, too immersed in an abstract something called 'the Rights of Man'" (1993, 72). Wilson's early association with liberal economic policies was not paralleled by an underlying liberal political philosophy.

As a teenager, Wilson was undoubtedly introduced to free-market economics by reading his father's subscription to The Nation. Edwin L. Godkin, the magazine's editor, advocated laissez-faire economics, the police theory of the state, the (British) Whig view that history slowly advances in the direction of individual liberty and that democratic constitutional government is the high-water mark of this process. Young Wilson's favorite authors included market-oriented liberals such as Charles Fox, Richard Cobden, and John Bright. His favorite statesmen included William Gladstone and Grover Cleveland (Diamond 1943, 18-19).

As an undergraduate at Princeton, Wilson studied economics as an a priori science connected to the wider discipline of ethics as developed by the classical economists. The Reverend Lyman Atwater, professor of logic and moral and political science, taught economics to the young Wilson. Atwater defended economics as a deductive science based on a few a priori axioms; he defined economics as "the science of laws according to which men in society under organized government can produce for themselves the maximum of utilities which are the products of human labor, with the minimum of effort" (1880, 429).

Unlike modern economics, which prides itself on being value free, but like Adam Smith, Atwater subsumed economics within the general framework of moral science. He recognized that market discipline encourages trustworthiness. "The ethical element is paramount because the best means of recognizing the true meaning of Political Economy is to attend the moral element. Faithfulness in keeping engagements is necessary to Political Economy." Atwater summarized his laissez-faire views: "Men and corporations hire men for labor performed. Men work for money to gratify their desires, and corporations hire men to gratify their desires, and government has no right to interfere" (qtd. in Diamond 1943, 21-22). The young Wilson supported free-trade principles and hard money. He had harsh words for protectionists and greenbackers: "Damnable heretics" (Wilson Papers 1966-74, 1:684).

Even as a young man...

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