Mises Wire

U.S. Imperialism through the Lens of Mises’s Nation, State, and Economy

This lecture was originally delivered at the 2019 Austrian Economics Research Conference at the Mises Institute in Auburn, Alabama.

These imperialistic doctrines are common to all peoples today. Englishmen, Frenchmen, and Americans who marched off to fight imperialism [in World War I] are no less imperialistic than the Germans.

—Ludwig von Mises, Nation, State, and Economy (1983, p. 79)

In Nation, State, and Economy (1983), published in 1919 a few months before John Maynard Keynes’s The Economic Consequences of the Peace (2013), Ludwig von Mises analyzed the German nationalism, militarism, and imperialism that contributed to the advent of World War I (not that Germany alone was responsible for the war). In typical Misesian fashion, he blended economics, history, political philosophy, sociology, psychology, and other disciplines to assess the intellectual background of the German militarism of his day.

The Prussian empire that ruled for more than two hundred years had not “arisen from the will of the German people,” wrote Mises. It was “a state of German princes but not of the German people.” The German people acquiesced in this situation as long as there was “sufficient” prosperity and military pomp, a prosperity “that had nothing to do with the political and military successes of the German state” (pp. 4–5). An economically ill-informed segment of the German population believed otherwise, however, committing the post hoc, ergo propter hoc fallacy. The successes of capitalist development were falsely ascribed to the efforts of the state instead of the individual market participants.

A prerequisite for the militaristic German empire was an ideological war against classical liberalism and free-market economics. “To the statist school of economic policy,” said Mises, “an economy left to its own devices appears as a wild chaos into which only state intervention can bring order.” The state, on the other hand, was described as “all-wise and all-just” and “always wishes only the common good” and “has the power to fight against all evils effectively.” (This is universally true of all nations since the beginning of the Industrial Revolution, not just early nineteenth-century Germany.) Thus, “for all the difficulties that confronted the German people at home and abroad, the military solution was recommended; only ruthless use of power was considered rational policy. These were the German political ideas that the world has called militarism.”

The purpose of this paper is to incorporate these and other Misesian ideas regarding the economics and politics of empire and imperialism into an analysis of the extent to which they apply to at least some aspects of United States history. Mises developed quite a few theoretical constructs with which to analyze German (and Austrian) government nationalism, militarism, and imperialism, many of which, I shall argue, are clearly relevant to US history as well.

The Ingredients of Militant and Imperialistic Nationalism

The “princely state” in which the people are not citizens but subjects, wrote Mises, lives by the dictum of “the more land and more subjects, the more revenue and the more soldiers. Only in the size of the state does assurance of its preservation lie. Smaller states are always in danger of being swallowed up by larger ones.” By contrast, in a “free state,” there are “no conquests, no annexations” and “it forces no one against his will into the structure of the state.”

Secession is a hallmark of a free state, said Mises: “When a part of the people of the state wants to drop out of the union, liberalism does not hinder it from doing so. Colonies that want to become independent need only do so.” In American history, there are many parallels between the “princely state” and the associated nationalist tradition of Alexander Hamilton, John Marshall, Daniel Webster, Joseph Story, Henry Clay, and Abraham Lincoln on the one hand, and the opposing free state Jeffersonian tradition on the other. Indeed, the US was created by a war of secession by the colonies from the epitome of a “princely state,” the British empire.

Abolishing Civil Liberties

Another of Mises’s claims is that the Marxists of his day were for freedom of the press “as long as they were not the ruling party” (Mises 1983, p. 44). Once in power, “they did nothing more quickly than set these freedoms aside.” In the case of US history, some of the very same members of the founding generation who voted for the Bill of Rights, including the First Amendment protection of freedom of speech, once in power supported the Federalist Party’s Sedition Act (Miller 1951) that essentially banned freedom of political speech by making it a crime to tell a “falsehood” critical of the Adams administration. Of course, the government’s own judges, some appointed by John Adams himself, would determine what a falsehood consisted of.

Dozens of pro-Jefferson newspaper editors were imprisoned, as was Vermont congressman Matthew Lyon, a Jefferson supporter. Congressman Lyon’s “crime” was describing the Adams administration as filled with “ridiculous pomp, foolish adulation” of Adams. One David Brown of Massachusetts was given an eighteen-month sentence for erecting a liberty pole in his town that had a sign that read “Peace and Retirement to the President, Long Live the Vice President” (namely, Jefferson). The Sedition Act was written so that it would expire on the day that John Adams left office so that it could not be used in this way against the Federalist Party. In this regard, the European Marxists of Mises’s day were no different from John Adams’s Federalist Party.

Some sixty years later, Lincoln would become the biggest enemy of civil liberties of all American presidents, having illegally suspended the writ of habeas corpus and mass arrested tens of thousands of political dissenters in the Northern states during the war, shutting down opposition newspapers, intimidating judges, censoring the telegraph, deporting Congressman Clement Vallandigham, and more. Lincoln, like all presidents, had taken oath to preserve, protect, and defend the US Constitution against all enemies, not to become one of the enemies.

The 1918 Sedition Act (Stone 2004) was enacted during World War I and used to imprison war opponents such as Eugene Debs, the Socialist Party presidential candidate, for publicly voicing opposition to the war. The act outlawed “interfering with the war effort” and resulted in over a thousand prosecutions with prison sentences of five to twenty years according to the statute. The mail was censored by the US Postal Service, which searched for letters critical of US military intervention. Like Lincoln, Woodrow Wilson had taken a solemn oath to preserve, protect, and defend the US Constitution against all enemies, not to become one of the enemies.

The rounding up of more than a hundred thousand Japanese Americans and forcing them to live in concentration camps for the duration of World War II by a Franklin D. Roosevelt executive order was another gross violation of civil liberties by an American politician who had previously sworn an oath to defend and protect those same liberties.

As with the European Marxists that Mises wrote about, Americans have a long history of politicians who praise freedom of speech with their rhetoric while attacking and censoring it with their actions once in power.

American Wars of Conquest

An early example of the princely impulse for conquest on the part of the American state occurred barely three decades after the conclusion of the American Revolution with the invasion of Canada. Some historians ascribe the cause of the invasion to American outrage over British “impressment” of American sailors—essentially kidnapping them on the high seas and forcing them to participate in Britain’s war with France—but that can be questioned. There weren’t that many incidents as such, for one thing, and for another thing, some of those “American” sailors were actually British citizens working on American merchant ships to avoid British military conscription.

There is also evidence that the annexation of Canada was clearly desired by many prominent members of Congress including Henry Clay, the main “war hawk.” Congressman Richard Johnson said, for example: “I shall never die contented until I see England’s expulsion from North America and her territories incorporated into the United States” (Languth 2006, p. 262).

Congressman John Harper announced that “the author of nature Himself had marked our limit in the south, by the Gulf of Mexico and on the north, by the regions of eternal frost” (Ben 2006, p. 16). Before leading his men into battle during the War of 1812, General Alexander Smyth said to them: “You will enter a country that is to become one of the United States” (Taylor 2010, p. 210).

Henry Clay boasted that the Kentucky militia alone should suffice to conquer Canada and always expected the US to acquire at least part of Canada from the war. Historian Eliot Cohen (2012) stated in his book Conquered into Liberty that if the conquest of Canada had not been an objective at the start of the war, it soon became one.

Mexican-American War

In 1846, President James Polk offered to purchase from Mexico vast landholdings in what is today the American Southwest, including Texas, California, Nevada, Utah, New Mexico, Arizona, Colorado, and part of Oklahoma, Kansas, and Wyoming that were then a part of Mexico. The Mexican government rejected the offer, after which Polk claimed that “American blood” had been shed at the hands of Mexican soldiers in recently annexed Texas. This “bloodshed” was then used as “justification” for an invasion of Mexico and a two-year war (Eisenhower 1989). The end result was an American victory that allowed the Polk administration to add all of this territory to the United States. The US government paid Mexico $18.25 million for the land and for war reparations, less than half of the original offer for the land.

Levying War upon American States

The War of 1861–65 was nothing if not a war of conquest. Wars of conquest are characterized by eventual subjugation, plunder, cultural dominance by the victors, and in some cases genocide. Southerners were certainly the victims of all of these things, including a kind of genocide in that the Lincoln administration waged total war on the civilian population for four years, causing the deaths of at least fifty thousand civilians. William Tecumseh Sherman’s “bummers” famously plundered their way through South Carolina and Georgia, as did other elements of the US Army from the very beginning of the war. General Sherman even wrote to his wife that “extermination, not of soldiers alone, that is the least part of the trouble, but the people” was his war aim (DiLorenzo 2002, p. 182). Southerners were certainly subjugated by a decade of “reconstruction” that included disenfranchisement, military occupation, and the imposition of mayors and governors by the federal government. They are still being “reconstructed” today with the demolition of all remaining statues and monuments to their Confederate ancestors and the seemingly never-ending ridicule and demonization of virtually everything associated with traditional Southern culture.

The culture of New England became the dominant American culture after the war with the rewriting of history—especially the history of the war—the glorification of New England writers alongside the marginalization of the Southern literary tradition, and the creation of the legend of the morally superior “Yankee.” The New-Englandized government was said to possess a “treasury of virtue” after the war, as Robert Penn Warren (1961) described it in The Legacy of the Civil War. This supposed virtue was (and is) used to “justify” any and all aggressive wars of conquest in the postwar era under the guise of “American exceptionalism.” All such military aggression is said to be justified, by definition, because it is Americans who are the aggressors. As Robert Penn Warren wrote, “moral narcissism” became the driving force of American foreign policy and “justification for our crusades of 1917–1918 and 1941–1945 and the diplomacy of righteousness, with the slogan of unconditional surrender and universal rehabilitation for others” (emphasis added).

The Indian Wars

Armed with this newly acquired “treasury of virtue,” just two months after Robert E. Lee’s surrender at Appomattox, General William Tecumseh Sherman was given command of the Military Division of the Missouri (the entire US was divided up into five military districts after the war). His purpose was to commence what would become a thirty-year war against the Plains Indians, another war of conquest, subjugation, and extermination. The Indians had little to plunder but for their land.

“We are not going to let a few thieving, ragged Indians check and stop the progress [of the railroads],” Sherman wrote to Ulysses S. Grant in 1867 (DiLorenzo 2010, p. 231). In other words, the war of extermination against the Plains Indians was essentially a form of veiled corporate welfare for the government-connected (and created) transcontinental railroad corporations, the Union Pacific and Central Pacific.

The “great triumvirate of the Union Civil War effort,” Generals Grant, Sherman, and Philip Sheridan, pursued what Sherman called “the final solution to the Indian problem.” They were joined by other Union army “luminaries” such as John Pope, O.O. Howard, George Armstrong Custer, Benjamin Grierson, and Winfield Scott Hancock and eventually killed at least forty-five thousand Plains Indians.

American Wars against “the Lower Races”

Mises wrote of how many of the wars of conquest in the recent history of his time were against people of “the lower races.” These are people who supposedly “are not ready for self government and never will be ready” according to the imperialists of his day. He cites British imperialism in India and the Congo and American imperialism against “the Asiatic peoples” as examples. The Indian Wars should also be included on this list.

Sherman “justified” the mass slaughter of the Plains Indians, women and children included, on the grounds that the Indians were essentially subhuman and therefore deserving of extermination if they could not be “controlled” by the white population (DiLorenzo 2010, p. 233). “The Indians give a fair illustration of the fate of the negroes if they are released from the control of the whites,” Sherman announced. Sherman biographer Michael Fellman described Sherman’s war on the Plains Indians as having the objective of “a racial cleansing of the land” (Fellman 1995, p. 264). “All the Indians will have to be killed or be maintained as a species of paupers,” said Sherman, and be “obliterated or beg for mercy” (Fellman 1995, p. 270). Sherman gave Sheridan “prior authorization to slaughter as many women and children as well as men” when attacking Indian villages. “I am charmed at the handsome conduct of our troops in the field,” Sherman wrote to Sheridan in reference to the attacks on Indian villages, of which there were more than a thousand. So many women and children were murdered by the US Army that historian S.L.A. Marshall, a man who authored thirty books on American military history and who was the official US government historian of the European theater of World War II, described Sheridan’s orders to Custer as “the most brutal orders ever published to American troops” (DiLorenzo 2010, p. 236).

American Conquest of the Philippines

The American crusade of moral righteousness and universal rehabilitation for others was also on display in the Philippines barely a decade after the Indian Wars ended. The Filipinos had just ejected the Spaniards from their country and declared their independence, but the US government had different plans for them: they were to become a US colony instead of a Spanish colony. The Filipinos revolted in what is known as the Philippine Insurrection (1899–1902), during which some two hundred thousand Filipinos were killed by American soldiers, many of whom had gained their experience in mass killing in the Indian Wars. More than four thousand American soldiers also died. Some historians claim that the number of Filipino deaths may have been as high as one million.

As Jim Powell writes in his biography of Teddy Roosevelt, Bully Boy (2006), when “TR” became president after the assassination of William McKinley in 1901, he “justified” the mass slaughter of the Filipinos in much the same way that Sherman “justified” the mass slaughter of Indians, and of Southerners during the War between the States. He denounced the Filipinos, writes Powell, as “Chinese half-breeds,” “savages,” “barbarians,” “wild and ignorant people.” A “lesser race,” in other words.

US senator Albert Beveridge of Indiana rejoiced that “the Philippines are ours forever . . . the Pacific Ocean is ours” (Johnson 2004, p. 43). He believed it was America’s “duty” to bring Christianity and civilization to “savage and senile peoples” (p. 43). “Peoples” who had been Catholics for several centuries, by the way. Senator Ben Tillman joined Beveridge by saying that self-government was not possible in the Philippines for they were a “people racially unfit to govern themselves.”

Powell also quotes TR as explaining the importance of racial superiority and of creating a master race: “All the great masterful races have been war-like races,” he said, as he denounced “the menace of peace.” Afterward, he was awarded the Nobel Peace Prize. TR targeted not just the “lower race” of Filipinos; during his presidency, he plotted against Cuba, Hawaii, Venezuela, China, Panama, Chile, Dominican Republic, Nicaragua, and Canada as well.

The Philippine Insurrection followed the three-month-long Spanish-American War, a “splendid little war” in the words of American secretary of state John Hay, who had been Abraham Lincoln’s personal White House secretary. The Spanish-American War was the turning point in American history when the US formally became an imperial power in pursuit of empire, just like all the old, failing, or bankrupted European empires. Yale University sociologist William Graham Sumner (1898) explained the significance of this in a speech before the Yale Phi Beta Kappa Society that was later published in the January 1899 issue of the Yale Law Journal. The speech was entitled “The Conquest of the United States by Spain,” delivered shortly after the American victory in its “splendid little war.”

In old America, said Sumner, “there was to be no grand diplomacy, because they intended to mind their own business, and not be involved in any of the intrigues to which European statesmen were accustomed.” What the war had established, however, was the new foreign policy direction of “war, debt, taxation, diplomacy, a grand governmental system, pomp, glory, a big army and navy, lavish expenditures, political jobbery—in a word, imperialism.” This is the context within which the US had “become Spain.”

While all the politicians in Washington were crowing about newfound “greatness,” Sumner dissented by saying: “My patriotism is of the kind which is outraged by the notion that the United States never was a great nation until in a petty three months campaign it knocked to pieces a poor, decrepit, bankrupt old state like Spain.” Like Spain, the new American imperialism would be a system where “the people were bearing the burdens of the imperial system and . . . the profits of it went into the treasury,” which in the case of Spain was “the hands of the king.” It was the Misesian “princely state” personified.

Sumner anticipated the “military-industrial complex” when he spoke of how this system of “jobbery” would create enormous profits for “a few schemers” at the expense of everyone else in society in terms of blood and treasure, thereby constituting “a grand onslaught on democracy.” The US would forevermore be “conquered” by the ideas of empire and imperialism that had bankrupted “decrepit” old Spain, Sumner predicted.

The Conquest and Subjugation of Hawaii

In the early 1890s, American businessmen in Hawaii wanted the government to declare it to be an American province or territory and placed under US political control (i.e., their political control). As historian Gregg Jones wrote in Honor in the Dust (2013), Hawaiian queen Liliuokalani attempted to stave off the American imperialists by creating a new constitution. The Americans then plotted to overthrow the Hawaiian monarchy by forming a “Committee of Safety.” The businessmen recruited US envoy John Stevens, who arranged for American troops to land in Hawaii and take control, placing Judge Sanford Dole as the head of the new puppet government. They formed a paramilitary organization called “The Honolulu Rifles” that forced the Hawaiian king at gunpoint and with the threat of being stabbed to death with bayonets to sign a new constitution that came to be known as the “bayonet constitution.” This “constitution” disenfranchised all Asians as an “inferior race” along with most others with the exception of wealthy American landowners. James Dole, the cousin of Judge Dole, then founded the Dole Fruit Company.

But before formal annexation could take place by an act of Congress, Grover Cleveland became president (in March 1893) and killed the deal, denouncing the “lawless landing of the United States Force at Honolulu.” Cleveland was the last Jeffersonian president, and the last roadblock to untrammeled American imperialism.

Gregg Jones cites a speech that Teddy Roosevelt made in 1895 that was very well-received by a Boston audience in which he bemoaned the actions of President Cleveland, saying that “I feel that it was a crime . . . against the white race that we did not annex Hawaii three years ago.” Annexation finally did occur in 1898. Hawaii became an American territory in 1900 and achieved statehood with Alaska in 1959. More land, more subjects, more revenues, more soldiers.

The American “Unified State”

One difference between the German and the American (and French and British) imperialists of his day, said Mises (1983, p. 80), was that “while the other nations brought their imperialistic efforts to bear only against the peoples of the tropics and subtropics and treated the people of the white race in conformity with the principles of modern democracy, the Germans . . . directed their imperialistic policy against European peoples also.” The Americans, by contrast, “practiced imperialism only against the African and Asiatic peoples.”

The importance of this, said Mises, was that the Americans had not yet come into conflict with “the nationality principle of the white peoples,” as the Germans had. To justify “the application of imperialist principles in Europe [against white Europeans] the German theory saw itself compelled to fight the nationality principle, which was more friendly toward classical liberalism, and replace it with the doctrine of the unified state.”

Small states were said to no longer have any justification for their existence and cannot compete with larger ones on the battlefield, said the German unified state theorists. That was the theory; Mises next pointed out the reality that “we see that small states have maintained themselves for centuries just as well as the great powers” (Mises 1983, p. 81) thanks to the international division of labor and the capacity for free trade.

A case can be made, however, that US entry into World War I was in fact an extension of its imperialistic impulses to broader populations. Historically, there had always been a segment of the American political class that argued and made the case for the “unified state.” The unified state was certainly not a uniquely German invention. It is known as the “nationalist tradition” in American politics (“nationalist” being used in a different sense than how Mises defined it). It was of course the Lincoln administration that created the American “unified state” by destroying the rights of nullification and secession in particular, and all but abolishing the uniquely American system of federalism.

German Admiration for and Imitation of the American Unified State

When Adolf Hitler made his case for a unified German state in Mein Kampf (1999), he praised Lincoln and the American nationalist tradition as inspirational and as providing a roadmap for what must be done in Germany. He praised the “great statesman” Otto von Bismarck for almost eliminating federalism in Germany and greatly centralizing governmental power, but vowed that there was still much to do in that regard. “The individual states of the American Union . . . could not have possessed any state sovereignty of their own,” wrote Hitler, “For it was not these states that formed the Union, on the contrary it was the Union which formed a great part of such so-called states.”

Hitler is referring here to Lincoln’s principal argument against secession in his 1861 first inaugural address where he said: “The union is much older than the Constitution. . . . It follows from these views that no State . . . can lawfully get out of the Union.” (The late Joe Sobran once remarked that saying the Union is older than the states is like saying that a marriage can be older than either spouse. A union of two things, Sobran pointed out, cannot be older than the things themselves.)

Hitler went on to claim that “the struggle between federalism and centralization so shrewdly propagated by the Jews” was fortunately thwarted by Bismarck (1999, p. 565). And a rule “basic for us National Socialists is derived: A powerful national Reich.” “National Socialism . . . must lay claim to the right to force its principles on the whole German nation without consideration for previous federated state boundaries.”

The nineteenth century was the century of empire and consolidation—in Germany, the US, Russia, and elsewhere. Governmental consolidation was the key to turning what Mises called “the democratic state” into the authoritarian state, for the more remote is governmental decision-making, the less influence the citizens will have over their own government. This makes it more likely that government will become the master rather than the servant of the people.

Opposition to this threat to freedom was always part of the rationale for “states’ rights” or federalism in the US and elsewhere. As Mises wrote, in the authoritarian state stands “the state-serving elements, which regard themselves and themselves alone as the state; the government proceeds from them and identifies itself with them.” On the other side “stands the people, which appears only as object, not subject, of government actions” The imperialist, said Mises (1983, p. 79), “wants a state as large as possible; he does not care whether that corresponds to the desire of the peoples.”

Mises also pointed out that in European history “the cause of war was always the same,” namely, “the princes’ greed for power.” It never had anything to do with the desires of the people. And as Murray Rothbard argued in his essay, “Just War,” this is just as true of American history with one exception: the Revolutionary War. Rothbard discusses the War of 1861–65 in that essay, but he would argue that Lincoln’s invasion of the Southern states would fall into the category of “the princes’ greed for power” as a cause of the war, disguised at the time by the rhetoric of “saving the union” (Rothbard 2012).

Mises Was Right

Mises’s point about how “the imperialist” does not care about “the desire of the peoples” in his quest for war is along the same lines as the famous essay by Randolph Bourne entitled “War is the Health of the State,” published in 1918, one year before Nation, State, and Economy. Describing the United States in particular, Bourne noted that in peacetime, “the. . . . State has almost no trappings to appeal to the common man’s emotions,” a gimmick that encouraged acquiescence in the Prussian state, as Mises wrote. As such, said Bourne, during peacetime “the State almost fades out of the consciousness of men.”

“With the shock of war, however, the State comes into its own again.” The government, “with no mandate from the people, without consultation of the people, conducts all the negotiations, the backing and filling, the menaces and explanations, which slowly bring it into collision with some other Government, and gently and irresistibly slides the country into war.” Even in the “freest of republics,” all foreign policy that produces war is the exclusive “property of the Executive part of the Government” where even the elected representatives have virtually nothing to say about it, let along the people themselves. The people don’t want war; the ruling class of “princes” wants war. Such was Bourne’s description of the forces leading to American entry into World War I. America had become an imperialist power as, by then, “the intellectual foundations of American imperialism were set in place,” wrote Chalmers Johnson (2004, p. 51).

The US entered World War I, wrote Johnson, with the theory that “what should be sought was a world democracy based on the American example and led by the United States. It was a political project no less ambitious and no less passionately held than the vision of world communism launched at almost the same time by the leaders of the Bolshevik Revolution.”

Mises was certainly right when he wrote in the passage at the top of this article that the Americans who went off to fight in World War I—and the politicians who sent them there—were no less imperialistic than the Germans were.


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