The Wilson Presidency Woodrow Wilson's World

Byron King explains how the world we’re all living in today was essentially created by President Woodrow Wilson during his Presidency.

“If… Woodrow Wilson intended from his first day in office to transform America, to increase both the size and scope of government, and to put government ‘at the service of humanity,’ here were his tools.”

AT ANY GIVEN time in the life of a nation, events and circumstances offer its leader the opportunity to articulate and clarify key ideas that define its substance and govern its destiny. Woodrow Wilson (1856-1924) was such a figure, on both a national and international scale.

During his two terms as president of the United States, Wilson inalterably changed the face of not just the United States, but of the world. The community of nations today represents a world still spinning on a Wilsonian axis.

Since Colonial times, U.S. national governance and economic development had focused on westward expansion across the continent. When Wilson took office in March 1913, the United States was a gold-standard nation, developing inwardly and filling its own continent with people, industry and capital. The U.S. economy in 1913 was focused on internal investment and organic growth. The nation had few historical precedents or cultural proclivities for international adventurism.

To the extent that U.S. policy acted aggressively abroad — such as with the creation of the nation of Panama out of a province of Colombia and the construction of the Panama Canal — it was for matters perceived to be of vital national strategic interest. Beyond such vital strategic interests, the nation was experiencing a bad case of indigestion of even the modest fruits of the Spanish-American War , the military and financial cost in 1913 being a sore spot with the voters and taxpayers.

When Wilson left office eight years later, in 1921, he had involved the nation in Europe’s Great War and was in no small measure personally and exclusively attempting to dictate the world’s peace. Under Wilson’s stewardship, the federal government was large and getting larger, the U.S. currency was beginning a long slide into debasement, and no American could even buy a legal drink at a humble saloon.

The Wilson Presidency: Wilson’s World

No one can truly understand the issues of the modern era without knowledge of the man who midwifed it into existence. It is not too much to say that the 20th century was Wilson’s Century, and that we live in Wilson’s World.

Woodrow Wilson was the son of a preacher, born and raised in Virginia, and in almost all respects a son of the South. He pursued a career as an academic, making a name for himself as an Anglophile scholar of government theory. Wilson taught at several schools, Pennsylvania’s Bryn Mawr College and Connecticut’s Wesleyan University among them, eventually taking a position at Princeton University, in New Jersey. Wilson rose through the ranks of college teaching and academic politics to serve as president of Princeton between 1902 and 1910.

Somewhat late in his career, at age 53, Wilson leveraged his prestigious socioacademic position at Princeton into a very short tenure as governor of New Jersey (1911-1912). Then, being the top political figure in a politically important state, Wilson toured the country and ran for and won the U.S. presidency in 1912.

The election of 1912 was a close, three-way race, with about 43% of the votes cast for Wilson. The race was, in reality, Wilson’s to lose, because it was marked by a seismic fault line within the Republican Party, a split between incumbent President William Howard Taft and the former president, and iconic pillar of the Republican Party, Theodore Roosevelt.

Many people viewed the election results as a reflection of internecine Republican politics, as a short interruption in an otherwise long trend of Republican dominance of post-Civil War national governance. Woodrow Wilson, however, saw the election results in a somewhat different light. He is quoted as having told a key supporter, after the ballots were counted, “Remember that God ordained that I should be the next president of the United States. Neither you nor any other mortal or mortals could have prevented that.” Well, certainly. That should have settled everything.

Historian Paul Johnson has described Wilson as having “a self-regarding arrogance and smugness, masquerading as righteousness, which was always there and which grew with the exercise of power.” After all, how could anyone argue with a man “ordained” by no less than God to hold the nation’s executive power?

Historian Robert Nisbet wrote that Wilson was, if not ordained by God to lead the nation, “an ardent prophet of the state, the state indeed as it was known to European scholars and statesmen… He preached it.” Thus, according to Nisbet, from Wilson has come the politicization, the centralization, and the commitment to bureaucracy of American society during the 20th century.

The Wilson Presidency: Transforming America

Historian Donald Miller has concluded that Wilson intended, from his first day in office, to transform America, as well as the other nations. “From a domestic and economic standpoint, as with his foreign policy, he wanted to expand the power of government to effect a revolution in society. He sought to increase both the size and scope of government. He said that he wanted to put government ‘at the service of humanity.'” In retrospect, Wilson’s phrase is a masterpiece of irony.

In March 1913, when Wilson took his oath of office, the nation, if not humanity at large, was in the process of handing him the necessary tools that he would soon be using. Wilson’s ambitious political goals, refined during his hard years of labor in the academic library stacks and teaching political theory in the sweat mills of Princeton, could not have been accomplished without key changes in the power system defined by the U.S. Constitution.

From the earliest days of the republic, the U.S. federal government had sought out ways and means of raising revenues beyond customs duties, tariffs, imposts, and the like. The Civil War had given the nation a taste of a national income tax, but the politics and legal climate of the postwar environment led to its rapid demise. A later effort in the 1890s to raise a national income tax was struck down by the U.S. Supreme Court.

Finally, however, in 1909, Congress passed the 16th Amendment to the U.S. Constitution, explicitly giving Congress the “power to lay and collect taxes on incomes, from whatever source derived.” After several years of bitter political infighting (including the nullification of previous ratification by a number of states), ratification by three-fourths of the states was completed on Feb. 3, 1913, just prior to Wilson’s inauguration. And just in time for the new U.S. president, a man self-described as “ordained by God,” to put it to the test.

The 16th Amendment led directly to the enactment of a national income tax in Wilson’s first year in office, albeit only on a small class of people known as “wealthy” citizens. These “rich people” were then defined as those earning over $4,000 per year, or the modern equivalent of a household today earning about $80,000. But wealthy or not, the power to tax incomes was the breach in the dam holding back federal power and influence based on spending by the central government.

Before Wilson was elected president, federal government spending had never exceeded 3% of the gross domestic product, except during the War of 1812 and the Civil War. Federal revenues were derived primarily from customs levies, import duties, and various other excises and tariffs. During Wilson’s two terms as president, the dam burst, and federal spending rose to more than 20% of GDP.

Also, from the earliest days of the republic, the legislative power of the nation was balanced between a popularly elected House of Representatives and a Senate composed of individuals appointed at the level of state legislatures. Thus was the Senate, at least in some respects, insulated from popular sentiment. In general, U.S. senators were responsible to their state governors and legislatures, and only indirectly to the people as a whole.

But in 1912, Congress passed the 17th Amendment to the U.S. Constitution, which called for the direct election of senators. Ratification by three-fourths of the states was completed on April 8, 1913. Again, only a true scholar of governmental powers — such as the former professor of government from Princeton, Woodrow Wilson — could discern the import of this new enactment.

The direct election of U.S. senators greatly diminished the republican form of governance envisioned by the Founding Fathers, in which “the several states” had a semblance of influence and control over half of the legislative branch. That is, previously, senators were directly beholden to the interests of their electors in state legislatures. This system of selection insulated senators, at least to some degree, from the day-to-day whims and caprices of popular will.

The Wilson Presidency: The 17th Amendment

Up until the ratification of the 17th Amendment, the Senate had been traditionally focused on the interests of the states, as sovereign entities within a federal system, vis-a-vis the federal government. Before the change, the Senate only remotely reflected the so-called will of the voters and distinctly did not act like a popular assembly. With direct election becoming the law of the land, senators began to become simply another form of that scourge of democracy, the populist politician.

Both of these amendments, the 16th and 17th, changed the fundamental power structure of the nation, certainly altering the relationship between individual citizens and their national government. That the amendments occurred in such close sequence of time was the equivalent of another American Revolution, in the nature of the Restoration. Politically and economically, the central government gained an increased measure of power that would have been the envy of King George III .

With interests of “the several states” on the wane in the Senate and the prospect of federal revenues being raised via a national income tax, Wilson’s next alteration of the structures of governance came with his support of the Federal Reserve Act of Dec. 23, 1913. Note the date. This statute to create a federal central bank was signed into law, with little fanfare, by Wilson at a time when Washington, D.C., was all but deserted for the Christmas holiday. And it was fully intended to be that way.

Financial panics had plagued the nation throughout much of the 19th century. With the U.S. economy for the most part based on a hard-money system of gold and silver coinage, and paper currency backed by monetary metals, the nation had gone through numerous cycles of boom and bust in its first 125 years under the Constitution. Few people complained during the boom times. But the busts were another story entirely. Many critics viewed bank failures, business bankruptcies, economic downturns, and accompanying personal hardships as being caused by a poorly integrated, unregulated banking system and the lack of a flexible national money supply.

“Flexible money supply” or not, the historian Will Durant once wrote that “civilization exists by geologic consent, subject to change without notice.”

In a sudden calamity in 1906, an earthquake devastated the city of San Francisco . A significant portion of the insurance policies covering the vast losses within San Francisco were underwritten by British firms. Before the ashes of the wrecked city had cooled, millions of dollars (and/or pounds) of insurance claims were being presented in London.

The insurance claims from San Francisco caused many British carriers to have to sell assets to raise funds with which to pay the claimants. This led initially to a decline in stock and bond markets in Europe, and then in the United States. In addition, paying the claims in a gold-standard world, where there were absolute limits on the hard currency money supply, generated a huge outflow of gold specie from London. To attract capital back to Britain, the Bank of England nearly doubled British interest rates. The British government, in tandem with the Bank of England, exerted its influence on British banks to reduce their purchases of American stocks and bonds.

Higher British interest rates caused an outflow of money from U.S. banks to British depositories. This, coupled with reduced British purchases of stocks and bonds on U.S. markets, played a major role in causing an economic contraction and inciting a financial panic in America in 1907 and 1908. This financial crisis was of such severe scope that national solvency was preserved only through the active intervention of New York banker J.P. Morgan, who loaned funds to the U.S. government sufficient to keep the national government from defaulting on its sovereign obligations.

Not wishing to trust the financial fate of the nation to the goodwill or patriotism of even so fine a citizen as J.P. Morgan, the U.S. Congress was alarmed. In order to avoid the future need to borrow money from the Morgan interests, in 1908, Congress established a commission to investigate whether the government should play a greater role in managing the money supply. The entity established by Congress was called the National Monetary Commission. This commission was chartered to propose a solution that could deal with banking issues and other monetary problems. There was scarcely any doubt as to what course of action the commission would ultimately recommend.

After considerable debate, the National Monetary Commission proposed remedies that eventually were written into law as the Federal Reserve Act. The act stated that its purposes were “to provide for the establishment of Federal reserve banks, to furnish an elastic currency, to afford means of rediscounting commercial paper, to establish a more effective supervision of banking in the United States, and for other purposes.” (Yes, it uses that catchall phrase, “for other purposes.”)

But to pose an issue that has governed national history ever since, was this new federal entity a cure for the economic problem of “busts”? Or, by furnishing “an elastic currency,” and thus mitigating the effects of the busts, was the Federal Reserve structured from the outset simply to inflate the national currency beyond the inherent productive power of the national economy? Was the new monetary institution intended to push the booms along such that they would grow into bubbles? In all fairness, who could have even asked such a question back in 1913?

The Wilson Presidency: The Federal Reserve

Wilson’s new monetary organization, the Federal Reserve , was comprised of a Board of Governors in Washington, D.C., and 12 regional Federal Reserve banks. The statutory responsibilities of these entities are to:

  • Conduct the nation’s monetary policy by influencing the money and credit conditions in the economy
  • Supervise and regulate banking institutions to ensure the safety and soundness of the nation’s banking and financial system
  • Maintain the stability of the financial system
  • Provide certain financial services to the U.S. government, financial institutions, the public, and foreign official institutions, including a major role in operating the nation’s payments system.

Then as now, the Fed conducts monetary policy using three major tools:

1. Open market operations to control the level of reserves in the depository system

2. Setting reserve requirements for depository institutions

3. Setting the discount rate for lending reserves.

Policy regarding open market operations is the responsibility of the Federal Open Market Committee (FOMC), comprising the seven members of the board, the president of the New York Federal Reserve Bank , and the presidents of four other reserve banks on a rotating basis. However, the board has sole authority over changes in reserve requirements and the discount rate.

Since its inception, the Federal Reserve System was considered an “independent central bank” — a European concept reflecting the need to provide banking services to the sovereign. But the Federal Reserve is “independent” only in the sense that its decisions do not have to be ratified by the president or anyone else in the executive branch of government. It is more accurate to say that the Federal Reserve is “independent within the government.” But still, it is a creature of government.

The Federal Reserve is, of course, subject to the oversight of Congress, on the legal basis that the Constitution gives to Congress the power to coin money and set its value. In 1913, with the very active assistance of President Wilson, Congress delegated that power to the Federal Reserve. Congress could and can, in theory, reclaim its power at any time, but would it dare to do so? Throughout its existence, the Federal Reserve has tended to act within the framework of the overall objectives of economic and financial policy established by Congress.

Statutory provisions and lofty goals of monetary management aside, the Federal Reserve is fundamentally a European-style central bank that can create, on its own account and subject only to indirect oversight of Congress, credit denominated in U.S. dollars. In the world of 1913, these dollar-denominated credits would enter the economic flow to compete with the more traditional currency, gold, as money. This situation — fiat currency competing with gold — would last until March 1933, and the inauguration as U.S. president of one of Wilson’s disciples, a certain Franklin D. Roosevelt. But this gets ahead of the story.

Thus Wilson was able, in his first year in office, to establish an embryonic form of credit-backed U.S. fiat currency — a currency in direct competition with traditional gold money. Coupled with the ability of the federal government to raise revenue via a direct tax on “incomes, from whatever source derived,” this was the seed of an enlargement of central government based on spending financed by taxes, borrowing against national credit, and the resultant national debt.

If, as historian Donald Miller concluded, Wilson intended from his first day in office to transform America, to increase both the size and scope of government, and to put government “at the service of humanity,” here were Wilson’s tools.

In Part II of “Wilson’s World,” we will examine how the 28th president of the United States wielded these powerful tools.

Until we meet again…
Byron King

Wilson’s World, Part II

“Wilson’s legacy has lasted for nine decades and today seems immutable. In one sense, Wilson created a template…for our world…No one alive has experienced anything different from a Wilsonian world. No one can remember or recall firsthand any time when this world of ours worked otherwise.”
The Wilson Presidency: Wilson’s Activism

Wilson was by nature an activist in expanding the federal role in the economy. Leveraging the political forces that had already given him two critical constitutional amendments, as well as a fundamental reform of the nation’s monetary management, he successfully pushed through such legislation as the Federal Trade Commission Act (1914) and the Federal Farm Loan Act (1916). Both of these laws, which brought federal regulation into the minutiae of the everyday life of virtually every American citizen, were significant expansions of the power of the federal government that would have been incomprehensible to the Founding Fathers.

On the international front, during his first term, Wilson’s activism, if not his meddlesome nature, embroiled the United States in Mexico’s civil war, up to and including ordering U.S. troops to invade Mexico and, for all intent, to fight on behalf of the eventual losing faction. This would become a long-term bone of contention between the two nations. In the historical memory of Mexico, Wilson’s use of U.S. power remains a hostile, colonial act. (In his second term, Wilson would send U.S. troops into Russia to oppose the Bolshevik Revolution, also an act that led to problems in establishing a long-term relationship with the embryonic Soviet Union. But this gets ahead of the story.)

When the Great War broke out in Europe in 1914, Wilson’s administration of U.S. international trade and monetary policy was decidedly lopsided, and certainly lacking in a sense of balanced neutrality toward all belligerents. The Wilson administration, professing its desire for peace and a speedy resolution of the conflict, forbade “loans” by U.S. banks to the warring powers. Yet Wilson’s administration at the same time permitted U.S. banks to extend massive “credits” to the French and British, thus creating an economic situation in which the United States bankrolled their conduct of the Great War.

That is, a vast infusion of U.S. “credit” funded French and British purchases of U.S.-manufactured war materiel in 1914 and 1915. Traced to its origins, the credit originated with the newly created U.S. Federal Reserve and was a product of the philosophy of the United States having an “elastic currency.”

The Wilson Presidency: Favored Belligerents

Just a few years earlier, a cataclysmic event like the 1906 San Francisco earthquake had drained the U.S. economy of much of its marginal liquidity, leading to an economic contraction and financial panic in 1907 and 1908. Now, courtesy of the Fed and its elastic currency, another cataclysmic event like the Great War could be funded on American credit.

Absent the new American Fed and its elastic currency, and Wilson’s willingness to permit extending credit to favored belligerents, it is quite likely that Britain and France would have run out of cash after a few months of fighting with Germany. We can only speculate, but in all likelihood, Britain and France would have had to make some accommodation for peace with Germany and bring the war to a relatively swift conclusion. But absent peace imposed by the pocketbook, the European war went on and on, sucking more nations into the fray and wrecking the lives and cultures of many peoples.

It cannot be overstated that during Wilson’s first term in office, European combat was funded and supported on the Allied side by U.S. money — its elastic currency and U.S. materiel bought on credit.

Meanwhile, Germany was fighting on two fronts, in the west against the Anglo-French and in the east against the Russians. Germany was, in many respects, a militaristic nation-state that, although possessing a semblance of working democracy, lacked any real internal political process that would sanction failure of its armed forces to prevail. Thus, Germany had little choice but to tighten its national belt, dig deeper into its economy, and fight on.

Although the Germans technically, under the U.S. so-called “neutrality laws,” might have been able to purchase goods and war materiel from the United States on “credit” as well, there was a problem with ships not being able to run the British blockade of German ports. The British would, and did, seize German-bound cargoes and impound them in English ports.

In essence, Wilson’s economic and trade policies, abetted by the Federal Reserve, perpetuated the European war.

These policies also led to (and even required, from a military standpoint) German submarine warfare on the high seas. That is, as long as U.S. “credit” paid for war materiel, ships would sail from the United States to Britain and France, and the cargoes, once landed, would threaten Germany. With the relatively new technology of the submarine at its disposal, German military strategy and operational doctrine had no other option but to sink ships carrying war materiel to Britain and France.

There was deeply rooted opposition in the U.S. electorate to any direct American participation in the European war. However, the nation enjoyed the economic boom times caused by the war-related orders pouring in from Britain and France. Mines, mills, factories, and farms all posted and received premium prices for their wares, courtesy of U.S. “credits” to the Allies and the newly created Federal Reserve and its elastic currency.

The economic myth of the time was that the Allies were supporting the booming U.S. economy with their purchases of war material. The reality, however, was that the Allied purchases were based on U.S. credits, supplied ultimately by Wilson’s new creation, the Federal Reserve. Thus, the war boom was at root simply a manifestation of U.S. monetary inflation, created by the central bankers at the Fed.

The Wilson Presidency: “He Kept Us Out of War”

Running for his second term in 1916, Wilson’s campaign slogan was “He kept us out of war.” This was not quite correct, because by 1916, the United States was deeply invested, both politically and economically, in the British and French role in the fighting. After Wilson was safely re-elected for a second term, his obstinate pursuit of his otherwise failed economic and trade policies favorable to Britain and France led to a point where German submarine warfare became an American “cassus belli.” Within a few days after beginning his second term, Wilson called upon Congress for a declaration of war against Germany.

On April 6, 1917, the official Declaration of War against Germany was passed by the U.S. Congress. In the months leading up to this event, it was the prospect of America’s entry into the war that prompted the Germans to put a troublemaking man named Vladimir Lenin on a train to Russia. The German strategic goal was to take advantage of a long-festering political-social rebellion within Russia and to disrupt that nation’s internal governance to the point where Russia would withdraw from the war. German strategic thinking was that Russia’s withdrawal from fighting would free up German resources in the east, so they could concentrate on the Western Front against the British and the French. The German strategic goal was to remove Russia as a belligerent and then defeat the British and French before the arrival en masse of American forces.

On April 3, 1917, Lenin arrived in Petrograd/St. Petersburg (three days before the U.S. Declaration of War), a virtual stranger to Russia and the Russian people. That is, with the exception of a six-month stay in 1905-06, Lenin had spent the previous 17 years in exile abroad. But by virtue of his personal and political will, by November 1917, Lenin controlled the reins of political and military power in Russia. And on Dec. 22, 1917, the Bolsheviks began negotiating with representatives of Germany at the town of Brest-Litovsk , and Russia was out of the war. Thus, absent the impending U.S. entry into the war, it is doubtful that there would have been a Lenin in Russia or the subsequent Bolshevik Revolution.

Wilson often expressed a general view of war as a horrible thing, but not that he had any firsthand experience with the subject. Wilson never served in uniform. Despite Wilson’s previous willingness to invade Mexico in his first term, he had made news with a comment about the European war, that the United States was “too proud to fight.”

The Wilson Presidency: “Government Serving Humanity”

But after his re-election in 1916 and the formal U.S. entry into the war in April 1917, Wilson expressed his hope that something good would come of it. Once the United States had declared war, Wilson led the march to the martial spirit of the great European crusade. In Wilson’s words, America’s entry into the war served “the advancement of mankind and international comity.” This is along the same Wilsonian theme of “government serving humanity,” which for Wilson evidently meant that individuals should send their tax money and their sons to serve the government, which would reciprocate by fighting an intercontinental war in the name of the people.

Wilson began to speak of fighting the European war in order to free humanity from “the scourges of war and political oppression.” In his Flag Day speech on June 14, 1917, he referred to the immense strength of “the forces of justice and of liberalism” that were gathering. “This,” he said, “is a people’s war, a war for freedom and justice and self-government amongst all the nations of the world, a war to make the world safe for the people who live upon it and have made it their own.” Here was an early glimpse of what would eventually become several of Wilson’s “14 Points.”

But not everyone had made the war “their own.” Domestic opposition to Wilson’s policies was intense, particularly within the large U.S Irish and German populations. To confront the opposition, Woodrow Wilson, the learned scholar of government and former president of Princeton University, was prepared to control this dissent with some of the most sweeping laws ever passed to limit free speech and political opposition. One of Wilson’s efforts to free humanity from “political oppression” and to make the world “safe for the people who live upon it” involved suppressing the rights of free speech in the United States.

As one example among many, a film entitled The Spirit of ’76 had been made before the United States entered the war but, due to production delays, was released in the summer of 1917.

The film was a historical piece about the American Revolutionary War that was — no big surprise here — critical of the British. Wilson’s administration forced the film to be withdrawn from circulation. The filmmaker was prosecuted by Wilson’s Department of Justice, under the newly enacted Espionage Act, and sentenced to 10 years in federal prison. The judge in the case characterized the film as arousing people’s passions, and of raising questions about “the good faith of our ally, Great Britain.” No one, said the judge, should be permitted to detract from the war effort.

In order to pay for all of this — raising an army as well as undermining the Bill of Rights — Wilson’s Federal Reserve made full use of its powers to administer an “elastic currency.” The Treasury issued war bonds, and the Federal Reserve issued credit into the economy sufficient for the bonds to be purchased. Dovetailing with this, the recently enacted national income tax was expanded to fund the war effort, to include among other things the creation of the first federal tax on decedents’ estates. Thus did taxes, Fed credit, and the issuance of unprecedented amounts of U.S. bonds all serve to give Wilson the resources he needed to expand his domestic vision of a powerful central government.

And not only did Wilson’s administration exercise its powers to raise and command an army and navy to fight a war. Wilson’s powerful central administration of the economy, through the creation of the War Production Board, literally took over many elements of U.S. industry, such as railway transport (out of which it created a transportation disaster — another story for another time).

According to historian Robert Nisbet, “The blunt fact is that when [under Wilson] America was introduced to the war state in 1917, it was introduced also to what would later be known as the total, or totalitarian, state.”

As if the foregoing accomplishments would not be enough for any president, whether or not “ordained” by God to govern, another of Wilson’s enduring legacies was a direct outgrowth of U.S. participation in the Great War. This was Wilson’s effort to shape the peace and, in his remarkable turn of phrase, to “make the world safe for democracy.” This phrase, and its underlying Panglossian concept of remaking the world into a Princeton-honed image of American participatory government, has haunted U.S. policy ever since it was uttered.

The Wilson Presidency: Fundamentally Wilsonian

Nine decades later, U.S. foreign policy is fundamentally Wilsonian. The concept of a world “safe for democracy” has such Jovian gravity as to be inescapable, and essentially all modern political debate in the Western world is framed in its terms. One shows disrespect to the concept at one’s peril.

But a “world safe for democracy” requires certain underlying assumptions of power and price, which are the key elements in “making” anything happen anywhere, certainly in “making the world safe for democracy.” Whether he understood the implications or not, Wilson had a Federal Reserve, an elastic currency, and a national income tax with which to do his bidding. Not all peoples, races, and nations are so fortunate.

Had Woodrow Wilson never been president, would the United States and the world have had a far different 20th century? Or was Wilson just one man in a particular time of great change, a man who articulated fundamental political concepts that were lurking just beneath the surface and awaiting their moment to be revealed? It is an interesting question.

When Wilson walked into the White House in March 1913, Germany and Italy had already spent 40 years creating and building centralized, debt-financed governments with high degrees of government control and regulation. In this regard, Wilson was an imitator, not an inventor.

President Wilson was part of what U.S. historians call the “Progressive Era,” a time that set into motion a chain of events that has elevated the West in general, and the United States in particular, to political, economic, and military pre-eminence in the world. So did Wilson make history, or perhaps give it a shove in a particular direction, or was he merely governed by historical forces whose time had come? Based on the evidence, Wilson was, arguably, not merely one of many builders of this era; he was the prime architect.

These types of questions are endless, and just asking them certainly gives one thoughts of a world far different from this one in which we live. Absent Wilson, would there have been a U.S. central bank, the Federal Reserve, to fund the type of world economy that has evolved? Absent Wilson, what would U.S. politics have done with the 16th Amendment, the income tax amendment? And absent the tax revenue, what would have happened to the early growth of centralized federal power in the United States under Wilson and its extension to the world at large?

Absent Wilson, what would U.S. politics have done with the 17th Amendment, concerning the direct election of senators? How did Wilson’s presidency affect the direction of the federal relationship with the states? Would senators otherwise beholden to state interests, due to their being elected by committees of the state legislatures, have been so acquiescent to a Wilsonian federal government gobbling up powers and regulating everyday aspects of national life, such as agriculture and transportation? And absent the loss of influence of the states as political entities within the Senate, what would have happened to the growth under Wilson of centralized federal power in the United States?

Absent Wilson’s inept neutrality, his biased diplomacy, and willingness to throw U.S. dollars into the Great War on the side of Britain and France, would the United States have become directly and so deeply involved in what was later named World War I? Absent Wilson’s permitting of U.S. “credit” to fund British and French munitions purchases, would the Great War have lasted so long and caused so much damage to the fabric of European civilization and colonial influence? Would the world ever have heard, just a few years later, of war veterans — actually, they were war heroes in their own lands — such as Herr Hitler and Signor Mussolini?

Absent U.S. participation in the European war, would a pedestrian lawyer and middling state-level politician named Franklin Delano Roosevelt have found his first federal job as assistant secretary of the Navy? Would the United States ever have bred such soldiers as Douglas MacArthur , Harry Truman, and most of the rest of the list of future political-military leaders of midcentury?

We have previously noted that Wilson sent U.S. troops into Russia to take sides in the Bolshevik Revolution. But absent events put into motion by Wilson, would the Great War have lasted so long as to cause Russia to break up and descend into a Bolshevik Revolution in the first instance?

Lenin’s presence in Russia, discussed earlier, was directly the result of German concern that Woodrow Wilson was bringing the United States into the war on the side of its opponents, the British and the French. Of Lenin and his significance to the Russian Revolution, historian and Harvard professor Richard Pipes wrote that “One need not believe that history is made by ‘great men’ to appreciate the immense importance of Lenin for the Russian Revolution and the regime that issued from it. It is not only that the power which he accumulated allowed Lenin to exert a decisive influence on the course of events but also that the regime which he established in October 1917 institutionalized, as it were, his personality. The Bolshevik Party was Lenin’s creation.”

Thus, Lenin’s presence in Russia and the resultant revolution that he sponsored, it must be noted again, was due to Wilson’s obvious intent to enter the war on the side of Germany’s enemies.

In another region of the world, absent Wilson, would the Great War have gone on so long as to expedite the dissolution of the Ottoman Empire , which directly spawned the modern politics of the Middle East?

And absent Wilson, would the concept of the League of Nations and world governance ever have gained the traction it did?

Woodrow Wilson said that he wanted to put government “at the service of humanity.” But when you distill things to a basic essence, Wilson bequeathed his nation, the world, and the “humanity” in whose name he claimed to act the legacy of federal credit; national debt; a large centralized government; and an imperious, if not crusading, international moral ideology built and financed thereon.

What is more, Wilson’s legacy has lasted for nine decades and today seems immutable. In one sense, Wilson created a template of governance and international relations for our world. His template has endured, for better or for worse. No one alive today has experienced anything different from a Wilsonian world. No one can remember or recall firsthand any time when this world of ours worked otherwise.

In another sense, however, it is worth asking if Wilson did not so much create one world as defer another. What world might that be, one dares ask? The question deserves a hearing, because when things change, and change they certainly will, most people, if not most governments, will be trapped in a Wilsonian paradigm and not understand what is happening until it is too late.

Until we meet again…

Byron W. King
April 7, 2005