All these institutions echo the findings of Tocqueville in 1831, that Americans were a self-governing people.  Americans instinctively came together and formed associations to solve their problems.  In the 1990s another foreign observer came to America.  Peruvian businessman Hernando de Soto wanted to know why the United States seemed to be governed so successfully.  Why had Americans succeeded so palpably when billions of other peoples suffered under tyranny and poverty?  He found that the secret began with self-government.  When Americans found themselves in need of new law to govern their affairs, they formed associations and created a living law themselves.  In this they were similar to peoples all over the world.  In villages everywhere people adjudicate property claims with competence.  But over most of the world the living law of custom and tradition is radically at variance with the formal law owned and operated by the governing elite.  The United States government was unique in having had the good sense to accept the living law developed in private associations and encode it eventually into the statute books.  In the early nineteenth century, in direct defiance of the governing elite, pioneer American farmers developed land associations and a living law that defined a right of property to western farmers and settlers that had developed their farms out of untitled wilderness.  In the 1860s, the federal government accepted this living law in the landmark Homestead Act of 1862.  Meanwhile, the California miners in the high Sierras found themselves without an established mineral law to guide their relationships.  They formed mineral districts and developed a living law to adjudicate their claims and ownership rights.  Twenty years later the United States Congress based its new mineral laws upon the body of living law created by the self-governing miners of the California gold rush.  The good sense exhibited by the elite in the United States in incorporating living law into its statute law kept down the tension between the elite and the common people.

Not all people possess the character and the inspiration to embrace the risks of business; not all people are willing to trust in the love of God; not all people are ready to spontaneously form self-government associations to face the challenges of the times.  Unable to imagine life except as an oppressed victim, and unblessed with the skills or education to rise out of indigence, they need the support of social solidarity, the comfort of living life in the rank and file, yet they still need to cope with the challenge of living in the city.  For these people another set of institutions grew up in the nineteenth century: the labor union, the political machine, and the criminal gang.

For ordinary people the nineteenth century was a great age of labor unionism.  As the corporation developed out of medieval merchant partnerships and transformed the economy with the power of limited liability and unlimited opportunity, the labor union grew out of the medieval craft and labor guilds to provide a bulwark of solidarity against a ruthless world that treated labor merely as a commodity and that ceaselessly sought out the lowest cost labor without regard for the need of workers to feed and clothe their families.  Workers found themselves, throughout the nineteenth century, in a frantic effort to obtain a living from an economy that, in wave after wave, obsoleted ancient skills and trades, and by a revolution in transportation that encouraged even the poorest to travel across the oceans to compete for employment with native workers.  What could they do about it?  They could combine to protect their status, and make it difficult for people to compete with them, just as the guild of the medieval city had protected its members from competitors from the countryside.

But the desire to combine with fellow workers to negotiate with employers ran afoul of a judge-made common law developed over the centuries to adjudicate the problems of merchants and traders.  The law disapproved, as any world-centered merchant would, of combinations in restraint of trade, and was quick to sanction working men who combined to set wages and to prevent other laborers from competing to offer their services to employers.  Combination in restraint of trade, for labor as for employers, requires political power and the sanction of the state.  With universal male suffrage, this was not such a distant prospect.  By the 1840s in the United States working men had become a political force and Commonwealth v. Hunt established the right of workers in Massachusetts to combine in restraint of trade. 

Early attempts to form labor unions achieved limited success.  Workers typically formed unions to protect themselves against increasing prices or falling wages during the late stages of a business boom.  Such conspiracies in restraint of trade, whether organized for the benefit of workers or employers, could not protect members from the larger economic forces, and the severe business cycles of the nineteenth century tended to wipe out the fragile worker organizations.  In addition, after 1840, the spontaneous associations organized by the workers were often hindered by the efforts of middle-class Fourierists (and later, socialists) to guide their movements.  The middle-class social reformers had better organizing skills and broader agendas than simple goals of the workers, so workers would often build up new labor unions only to have them taken over by the social reformers who had broader goals than the simple unionist agenda of better wages and working conditions, a ten-hour day and limitations upon child labor.  In the renewed prosperity of the 1850s a new generation of labor activists concentrated on “pure and simple” unionism that focused on work-related issues and not on a broader social agenda. 

The war-influenced 1860s saw increased union activity, as inflationary greenbacks lowered laboring purchasing power, but the severe depression of the 1870s transformed the labor movement.  The coal miners and the railroad workers resisted wage cuts and shortened working hours with strikes and riots, and discovered that they were not as helpless as their fathers twenty years before.  These workers found themselves no longer the helpless victims of the business cycle working in the expendable handcraft industries of the pre-Civil War era but the rank and file in labor armies working for the vast new railroads, the first really large-scale enterprises in North America.  And the railroads for which they worked had become the arterial system through which the nation’s entire commerce now throbbed.  All of a sudden the humble laborer, expendable in the early decades of the century, had become indispensable, integrated into the complex new economic machine of factory, mine, and steam transportation that could not be allowed to grind to a halt.  Led by remarkable immigrant leaders like Samuel Gompers, the workers were able to demand, in certain landmark industries, monopoly prices for their labor.  And they were able to keep the social reformers and bay and keep their movement focused on working class concerns, a band of brothers united in solidarity against a world of cruel oppressors.

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©2005 Christopher Chantrill