Fifteen Eighty Four

Academic perspectives from Cambridge University Press


The Necessary Mix

Joseph P. Tomain, Sidney A. Shapiro

Market favoritism has been aggressively supported for more than 50 years by the Right and adopted by many on the Left. The emphasis has been on the priority of markets over government for solution to policy problems and for enhancing political liberties. Our book, How Government Built America, flips the script by arguing the strength of America’s democratic values depends on a healthy mix between government and markets.

The necessity of a mix of government and markets is revealed by the history of government recounted in our book. While the mix has changed over time, government remained an instrumental part of the picture. Even in decades where markets are emphasized, it has taken both government and markets to bring the United States closer to its fundamental values of liberty, equality, fairness, and the public interest.

In one of history’s nice coincidences, 1776 saw the publication of The Wealth of Nations and the Declaration of Independence. The book supported capitalism and the petition against King George supported democracy. The United States has always been committed to both ideas, and our founders knew that if we wanted to play on the world economic stage a strong central government was key. The founders also knew, as Hamilton wrote in Federalist Paper No. 1, that the “vigor of government is essential to the security of liberty.”

Readers may be surprised that markets in the colonies and the states after the Revolution were heavily regulated. The founders argued about the relatively responsibilities of the federal and state governments, but they were not anti-government.  They did not oppose the regulation of almost every aspect of market behavior in the states from tavern laws to price regulations.

Market “virtues” may well consist of efficiency, innovation, and wealth creation; however, they do not have the sort of moral content that Adam Smith wrote about. For Smith, organized society, i.e. government, was necessary to create and sustain a virtuous community. Government supplies political virtues when markets cannot or fail to do so.

Broken down into chapters that focus on different time periods in American history, How Government Built America speaks to where we are today as a nation, provides an overview of how we arrived at this point, and offers a roadmap for collectively moving forward to create a better, more just America.

Markets did not end slavery or Jim Crow. nor did markets generate fair treatment of women, among other liberty expansion government actions. After WWII, there was greater income and wealth equality than at any other time resulting from New Deal initiatives continued by Presidents Truman and Eisenhower.

Without massive government financial support, the Great Recession of 2008 would likely have expanded into a global depression, and the COVID pandemic would have been longer lasting, Cell phones, search engines, and GPS devices that we rely on daily exist because government investments in research and development.

When markets overtake government, democratic norms suffer. Excessive neoliberal deregulation brought us to a near global depression and generated income and wealth inequalities unseen for over a century. This imbalance is the fundamental contributing factor today’s sociopolitical polarization and congressional gridlock. Government has made America a better place, and recognizing and understanding this truth is the first step in changing the current, damaging polarization that has become the hallmark of the political landscape over the past several years. “Government Built America” may not be so bad a slogan for an election discussion.

How Government Built America by Sidney A. Shapiro and Joseph P. Tomain

About The Authors

Joseph P. Tomain

Joseph P. Tomain is Dean Emeritus and Wilbert and Helen Ziegler Professor of Law in the University of Cincinnati College of Law. He is the author of Achieving Democracy: The Future...

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Sidney A. Shapiro

Sidney A. Shapiro holds the Fletcher Chair in Administrative Law at the Wake Forest University School of Law. He is the author of Administrative Competence: Reimagining Administrat...

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