Although the first shots were fired in 1775 and the Declaration was signed in 1776, the war had just begun. These colonists, facing the biggest empire and military force in the world, fought for five more years - the war didn’t end until General Cornwallis surrendered in October, 1781. Even then, some resistance remained; the last Loyalists and British left New York starting in April, and the treaty that formally ended the war was signed in Paris in September 1783.

The first form of government, the Articles of Confederation, was written in 1777 and endorsed by the States in 1781. It was subsequently replaced by our current Constitution, as has been documented in many books. In this chapter, we want to take a look at the visions that motivated what de Tocqueville would later call America’s “experiment” with democracy in a republic.

The first glimpses of a powerful American company

Very few people are aware that Thomas Jefferson considered freedom from monopolies to be one of the fundamental human rights. But it was very much a part of his thinking during the time when the Bill of Rights was born.

In fact, most of the founders of America never imagined a huge commercial empire sweeping over their land, reminiscent of Hewes’ “ships of an enormous burthen” with “immense quantities” of goods. Rather, most of them saw an America made up of people like themselves: farmers.

In a speech before Congress on April 9, 1789, James Madison referred to agriculture as “the great staple of America.” He added, “I think [agriculture] may justly be styled the staple of the United States; from the spontaneous productions which nature furnishes, and the manifest preference it has over every other object of emolument in this country.”

In a National Gazette article on 3 March 1792, Madison wrote, “The class of citizens who provide at once their own food and their own raiment, may be viewed as the most truly independent and happy. They are more: they are the best basis of public liberty, and the strongest bulwark of public safety. It follows, that the greater the proportion of this class to the whole society, the more free, the more independent, and the more happy must be the society itself.”

The first large privately-owned corporation to rise up in the new United States during the presidential terms of Jefferson (1801-1809) and Madison (1809-1817) was a bank, and its rise caused considerable consternation. Legislators railed against it for decades, particularly when the Bank started involving itself in politics, and tried to terminate its corporate charter, an effort that finally succeeded when the bank went under in 1841.

In the middle of the 30-year struggle, in May 1827, James Madison wrote a letter to his friend James K. Paulding about the issue. He said, “With regard to Banks, they have taken too deep and too wide a root in social transactions, to be got rid of altogether, if that were desirable. …they have a hold on public opinion, which alone would make it expedient to aim rather at the improvement, than the suppression of them. As now generally constituted, their advantages whatever they be, are outweighed by the excesses of their paper emissions, and the partialities and corruption with which they are administered.”

Thus, while Madison saw the rise of corporate power and its dangers during and after his presidency, the issues weren’t obvious to him when he was helping write the United States Constitution decades earlier. And that may have been significant when the Bill of Rights was being put together.

The Federalists versus the Democratic Republicans

Shortly after George Washington became the first President of the United States in 1789, his Secretary of the Treasury, Alexander Hamilton, proposed that the federal government incorporate a national bank and assume state debts left over from the Revolutionary War. Congressman James Madison and Secretary of State Thomas Jefferson saw this as an inappropriate role for the federal government, representing the potential concentration of too much money and power in the federal government. (The Bill of Rights, with its Tenth Amendment reserving powers to the states, wouldn’t be ratified for two more years.)

The disagreement over the bank and assuming the states’ debt nearly tore apart the new government, and led to the creation by Hamilton, Washington, and Vice President Adams (among others including Thomas and Charles Pinckney, Rufus King, DeWitt Clinton, and John Jay) of the Federalist Party.

Several factions arose in opposition to the Federalists, broadly referred to as the Anti-Federalists, including two groups who called themselves “Democrats” and “Republicans.” Jefferson pulled them together by 1794 into the Democratic Republican Party, united in their opposition to the Federalists ideas’ of a strong central government that could grant the power to incorporate a national bank and bestow benefits to favored businesses through the use of tariffs and trade regulation.

During the Washington and Adams presidencies, though, the Federalists reigned, and Hamilton was successful in pushing through his programs for assuming state debts, creating a United States Bank, and a network of bounties and tariffs to benefit emerging industries and businesses.

In 1794, independent whiskey distillers in Pennsylvania revolted against Hamilton’s federal taxes on their product, calling them “unjust, dangerous to liberty, oppressive to the poor, and particularly oppressive to the Western country, where grain could only be disposed of by distilling it.”

The whiskey distillers tarred and feather a tax collector, and pulled together a local militia of seven thousand men. But President Washington issued two federal orders, and sent in General Henry Lee commanding militias from Pennsylvania, Maryland, New Jersey, and Virginia.

The Whiskey Rebellion was put down and the power of the Federalists wasn’t again questioned until the election of 1800, which Jefferson’s Democratic Republican party won in an election referred to as the “second American Revolution” or “the Revolution of 1800.”

In the election of 1804, the Federalists carried only Delaware, Connecticut, and part of Maryland against Jefferson’s Democratic Republicans, and by 1832 as the Industrial Revolution was taking hold of America, the Federalists were so marginalized they ceased to exist as an organized party.

Jefferson and Natural Rights

Back in the earliest days of the United States, Jefferson didn’t anticipate the scope, meaning, and consequences of the industrial revolution that was just starting to gather steam in Europe about the time he was entering politics in the Virginia House of Burgesses. He distrusted letting companies have too much power, but he was focusing on the concept of natural rights, an idea which was at the core of the writings and speeches of most of the Revolutionary era generation from Thomas Paine to Patrick Henry to Benjamin Franklin.

In Jefferson’s mind, “the natural rights of man” were enjoyed by Jefferson’s ancient tribal ancestors of Europe, were lived out during Jefferson’s life by some of the tribal peoples of North America, and were written about most explicitly sixty years before Jefferson’s birth by John Locke, whose writings were widely known and often referenced in pre-revolutionary America.

Natural rights, Locke said, are things that people are born with simply by virtue of their being human and born into the world. In 1698, in his Second Treatise on Government, Locke put forth one of the most well known definitions of the “natural rights” that all people are heirs to by virtue of their common humanity. He wrote:

All men by nature are equal…in that equal right that every man hath to his natural freedom, without being subjected to the will or authority of any other man; … being all equal and independent, no one ought to harm another in his life, health, liberty or possessions… (Chapter 2)

As to the role of government, Locke wrote:

Men being…by nature all free, equal and independent, no one can be put out of his estate and subjected to the political power of another without his own consent which is done by agreeing with other men, to join and unite into a community for their comfortable, safe, and peaceable living…in a secure enjoyment of their properties… (Chapter 95)

This natural right was asserted by Jefferson first in his Summary View of the Rights of British America, published in 1774, in which he wrote, “The God who gave us life, gave us liberty at the same time: the hand of force may destroy, but cannot disjoin them.” His first draft of the Declaration of Independence similarly declared: “We hold these truths to be sacred and undeniable; that all men are created equal and independent, that from that equal creation they derive rights inherent and unalienable, among which are the preservation of life, and liberty, and the pursuit of happiness.”

Individuals asserted those Natural Rights in the form of a representative government that they controlled, and that same government also protected their Natural Rights from all the forces that in previous lands had dominated, enslaved, and taken advantage of them.

The danger of people having full natural rights

Hamilton and Adams’ Federalists, as we can read in The Federalist Papers, strongly objected to Jefferson and Madison’s notion that a government should be entirely elected and controlled by its people, with minimal taxation and military powers.

They were worried that if there wasn’t a strong federal government, with a perpetual army, taxation powers, and at least half the legislature (the Senate) made up of an elite appointed by professional politicians from the states, the newly-born United States might be too weak to fend off external foes like the French and Spanish - who both had stakes at that time in North America - or to put down internal rebellions that may arise in the future.

They suggested that Jefferson and Madison were idealists and dreamers, trying to recreate a utopian society in a dangerous world. Hamilton wrote about the risks of such idealism, responding to Madison, in Federalist #30, saying, “Reflections of this kind may have trifling weight with men [like you] who hope to see realized in America the halcyon scenes of the poetic or fabulous age; but to those [among us Federalists] who believe we are likely to experience a common portion of the vicissitudes and calamities which have fallen to the lot of other nations, they must appear entitled to serious attention. Such men [as those of us who would lead this nation] must behold the actual situation of their country with painful solicitude, and depreciate the evils which ambition or revenge might, with too much facility, inflict upon it.”

Nonetheless, over the strong objections of the Federalists, James Madison pressed through Congress the Bill of Rights, which he had worked out in correspondence with Jefferson. Made up of the first ten amendments to the Constitution, the Bill of Rights in its entirety was designed by Madison and Jefferson to prevent government from ever taking for itself the rights that they considered to be Natural and God-given.

The three threats

Thomas Jefferson’s vision of America was quite straightforward. In its simplest form, he saw a society where people were first, and institutions were second.

In his day, Jefferson saw three agencies that were threats to humans’ Natural Rights. They were:

Governments (particularly in the form of kingdoms and elites like the Federalists)

Organized religions (he re-wrote the New Testament to take out all the “miracles” so that in “The Jefferson Bible” Jesus became a proponent of God-given Natural Rights),

Commercial monopolies and the “pseudo aristoi” (pseudo aristocracy) in the form of extremely wealthy individuals and overly powerful corporations.

All institutions, in Jefferson’s view, must be subordinate to the humans that created them, including governments, religious institutions, and corporations.

Not unlike Asimov’s Laws of Robotics, he believed our institutional creations should serve the humans who created them, and never vice versa. Jefferson was as wary of an excessively centralized and powerful government as he was of a wealthy “pseudo-aristoi” made up of individuals, families, or corporations that were powerful enough to influence government.

Instead, he believed it was possible for people to live by self-government in a nation in which nobody controlled the people except the people themselves. He found evidence for this belief both in the cultures of Native Americans such as the Cherokee and the Iroquois Confederation, which he studied extensively, in the political experiments of the Greeks, and in histories that documented the lives of his own tribal ancestors of England and Wales.

Jefferson considers “freedom against monopolies” a basic right

Once the Revolutionary War was over, and the Constitution had been worked out and presented to the states for ratification, Jefferson turned his attention to what he and Madison felt was a terrible inadequacy in the new Constitution: it didn’t explicitly stipulate the “natural rights” of the new nation’s citizens, and didn’t protect against the rise of new commercial monopolies like the East India Company.

On December 20th, 1787, Jefferson wrote to James Madison about his concerns regarding the Constitution. He said, bluntly, that it was deficient in several areas. “I will now tell you what I do not like,” he wrote. “First, the omission of a bill of rights, providing clearly, and without the aid of sophism, for freedom of religion, freedom of the press, protection against standing armies, restriction of monopolies, the eternal and unremitting force of the habeas corpus laws, and trials by jury in all matters of fact triable by the laws of the land, and not by the laws of nations.”

Such a bill protecting natural persons from out-of-control governments or commercial monopolies shouldn’t just be limited to America, Jefferson believed. “Let me add,” he summarized, “that a bill of rights is what the people are entitled to against every government on earth, general or particular; and what no just government should refuse, or rest on inference.”

In 1788 Jefferson wrote about his concerns to several people. In a letter to Mr. A. Donald, on February 7th, he defined the items that should be in a bill of rights: “By a declaration of rights, I mean one which shall stipulate freedom of religion, freedom of the press, freedom of commerce against monopolies, trial by juries in all cases, no suspensions of the habeas corpus, no standing armies. These are fetters against doing evil, which no honest government should decline.”

Jefferson kept pushing for a law, written into the constitution as an amendment, which would prevent companies from growing so large they could dominate entire industries or have the power to influence the people’s government.

On February 12th, 1788, he wrote to Mr. Dumas about his pleasure that the US Constitution was about to be ratified, but also expressed his concerns about what was missing from the Constitution. He was pushing hard for his own state to reject the Constitution if it didn’t protect people from the dangers he foresaw. “With respect to the new Government,” he wrote, “nine or ten States will probably have accepted by the end of this month. The others may oppose it. Virginia, I think, will be of this number. Besides other objections of less moment, she [Virginia] will insist on annexing a bill of rights to the new Constitution, i.e. a bill wherein the Government shall declare that, 1. Religion shall be free; 2. Printing presses free; 3. Trials by jury preserved in all cases; 4. No monopolies in commerce; 5. No standing army. Upon receiving this bill of rights, she will probably depart from her other objections; and this bill is so much to the interest of all the States, that I presume they will offer it, and thus our Constitution be amended, and our Union closed by the end of the present year.”

By mid-summer of 1788, things were moving along and Jefferson was helping his close friend James Madison write the Bill of Rights. On the last day of July, he wrote to Madison: “I sincerely rejoice at the acceptance of our new constitution by nine States. It is a good canvass, on which some strokes only want retouching. What these are, I think are sufficiently manifested by the general voice from north to south, which calls for a bill of rights. It seems pretty generally understood, that this should go to juries, habeas corpus, standing armies, printing, religion, and monopolies.”

The following year, on March 13th he wrote to Francis Hopkinson about continuing objection to monopolies: “You say that I have been dished up to you as an anti-federalist, and ask me if it be just. My opinion was never worthy enough of notice to merit citing; but since you ask it, I will tell it to you. I am not a federalist… What I disapproved from the first moment also, was the want of a bill of rights, to guard liberty against the legislative as well as the executive branches of the government; that is to say, to secure freedom in religion, freedom of the press, freedom from monopolies, freedom from unlawful imprisonment, freedom from a permanent military, and a trial by jury, in all cases determinable by the laws of the land.”

All of Jefferson’s wishes, except two, would soon come true. But not all his views were shared universally.

The rise of an American corporate aristocracy

Years later, Jefferson would write to John Adams about their earlier disagreements over whether a government should be run by the wealthy and powerful few (the pseudo-aristoi), or a group of the most wise and capable people ( “natural aristocracy”), elected from the larger class of all Americans including working people.

“The artificial aristocracy is a mischievous ingredient in government,” Jefferson wrote to Adams, “and provision should be made to prevent its ascendancy. On the question, what is the best provision, you and I differ; but we differ as rational friends, using the free exercise of our own reason, and mutually indulging its errors. You think it best to put the pseudo-aristoi into a separate chamber of legislation [the Senate], where they may be hindered from doing mischief by their coordinate branches, and where, also, they may be a protection to wealth against the agrarian and plundering enterprises of the majority of the people. I think that to give them power in order to prevent them from doing mischief, is arming them for it, and increasing instead of remedying the evil.”

Adams and the Federalists were wary of the common person, and many subscribed to the Calvinist notion that wealth was a sign of a certification or blessing from above and a certain minimum level of morality. Since the Senate of the United States was elected by the state legislatures (not by the voters themselves, until 1913) and entirely made up of wealthy men, it was mostly on the Federalist side. Jefferson and the Republican Democrats disagreed strongly with the notion of a Senate made up of the wealthy and powerful.

“Mischief may be done negatively as well as positively,” Jefferson wrote to Adams in the next paragraph of that 1813 letter, still arguing for a directly elected Senate. “Of this, a cabal in the Senate of the United States has furnished many proofs. Nor do I believe them necessary to protect the wealthy; because enough of these will find their way into every branch of the legislation, to protect themselves. … I think the best remedy is exactly that provided by all our constitutions, to leave to the citizens the free election and separation of the aristoi from the pseudo-aristoi, of the wheat from the chaff. In general they will elect the really good and wise. In some instances, wealth may corrupt, and birth blind them; but not in sufficient degree to endanger the society.”

Jefferson’s vision of a more egalitarian Senate - directly elected by the people instead of by state legislators - finally became law in 1913 with the passage of the 17th Amendment, promoted by the Populist Movement and passed on a wave of public disgust with the corruption of the political process by giant corporations.

Almost all of his visions for a Bill of Rights - all except “freedom from monopolies in commerce” and his concern about a permanent army - were incorporated into the actual Bill of Rights, which James Madison shepherded through Congress and was ratified December 15, 1791.

But the Federalists fought hard to keep “freedom from monopolies” out of the Constitution. And they won.

The result was a boom for very large businesses in America in the 19th and 20th centuries, which arguably brought our nation and much of the world many blessings.

But as we’ll see, the way things have unfolded, some of those same principles have also given unexpected influence to the very monopolies Jefferson had argued must be constrained from the beginning. The result has sometimes been the same kind of problem the Tea Party rebels had risked their lives to fight: a situation in which the government protects one competitor against all others, and against the will of the people whose money is at stake - along with their freedom of choice.

As the country progressed through the early 1800s, corporations were generally constrained to act within reasonable civic boundaries. In the next chapter we’ll examine how Americans and their government viewed the role of corporations, up to the time of the Civil War and its subsequent amendments.