Woodrow Wilson, the 28th President of the United States, witnessed the creation of the Federal Reserve. He was also President during the ratification of the Sixteenth Amendment, which allowed the federal government to tax income without regard to apportionment: “The Congress shall have to power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard for any census or enumeration.”[i]
Was he happy with either of these developments during his term? I wanted to know the thoughts of the man we often blame for the IRS and the Fed. Through interlibrary loan, I was able to get my hands on his book The New Freedom, published in 1913 by Doubleday Page and Company.
First, let it be known that the machinations leading up to the IRS started long before Wilson’s presidency. The same could be said about the Federal Reserve.
Even so, he must have been intimately involved with the bankers who convinced our Congress to allow them to create the Federal Reserve. He must have known the men of great industries, the wealthy of his time, who used our halls of government to write laws to favor their position and keep other businesses from competing.
Wilson’s words are as relevant today as they were back in his time. That is why I am copying excerpts from The New Freedom and publishing them here.
Wilson dedicates his book to: “…every man or woman who may derive from it, in however small a degree, the impulse of unselfish public service.”
“We are facing the necessity of filling a new social organization, as we did once fit the old organization, to the happiness and prosperity of the great body of citizens; for we are conscious that the new order of society has not been made to fit and provide the convenience or prosperity of the average man. The life of the nation has grown infinitely varied. It does not centre (sic) now upon questions of governmental structure or of the distribution of governmental powers. It centres upon questions of the very structure and operation of society itself, of which government is only the instrument. Our development has run so fast and so far along the lines sketched in the earlier day of constitutional definition, has so crossed and interlaced those lines, has piled upon them such novel structures of trust and combination, has elaborated within them a life so manifold, so full of forces which transcend the boundaries of the country itself and fill the eyes of the world, that a new nation seems to have been created which the old formulas do not fit or afford a vital interpretation of.
“We have come upon a very different age from any that preceded us. We have come upon an age when we do not do business in the way in which we used to do business, –when we do not carry on any of the operations of manufacture, sale, transportation, or communication as men used to carry them on. There is a sense in which in our day the individual has been submerged. In most parts of our country men work, not for themselves, not as partners in the old way in which they used to work, but generally as employees, –in a higher or lower grade, –of great corporations. There was a time when corporations played a very minor part in our business affairs, but now they play the chief part, and most men are the servants of corporations.
“You know what happens when you are the servant of a corporation. You have in no instance access to the men who are really determining the policy of the corporation. If the corporation is doing the things that it ought not to do, you really have no voice in the matter and must obey the orders, and you have oftentimes with deep mortification to co-operate in the doing of things which you know are against the public interest. Your individuality is swallowed up in the individuality and purpose of a great organization.”
“It is true that, while most men are thus submerged in the corporation, a few, a very few, are exalted to a power which as individuals they could never have wielded. Through the great organizations of which they are the heads, a few are enabled to play a part unprecedented by anything in history in the control of the business operations of the country and in the determination of the happiness of great numbers of people.”
Wilson, Woodrow. “Chapter 1/The Old Order Changeth.” The New Freedom; a Call for the Emancipation of the Generous Energies of a People. New York and Garden City: Doubleday, Page, 1913. 5-6. Print.