An American Legacy

On September 19, 1796, as the end of his second term approached, George Washington published a farewell address—a series of prescient warnings for a young nation learning to stand on its own two feet.1 In the address, Washington foresaw the danger of two powerful political parties, or the “alternate domination” of one party over the other, as Republicans and Federalists developed into vicious adversaries. He cautioned against the accumulation of the national debt “ungenerously throwing upon posterity the burden which we ourselves ought to bear.” And he implored Americans to resist factionalism. With the North pitted against the South and the East against the West, he reminded citizens that they were all, by “birth or choice,” American.

The address is appropriately celebrated for Washington’s uncanny insight into the future. Parties, the national debt, and factionalism remain center stage in the United States over two centuries later. But the address also stood for something even more profound. It wasn’t just what the address said—it’s that it existed at all. The original title, “The Address of Gen. Washington to the People of America on His Declining the Presidency of the United States,” was big news: after two terms, Washington would not be seeking reelection. As historian Harry Rubenstein observed, “In that time and era, politicians would gain power, or kings would stay in office, until they die.”2 When Washington published his address, he was introducing a radical innovation: stepping down from power.

Unlike today, there was no norm or expectation that a president—especially one as popular as Washington—would be beholden to term limits. If he had decided to seek a third term, he would almost certainly have won. But instead, Washington grasped the danger of an entrenched executive and so established the limited-term tradition. In 1797 John Adams assumed the presidency in a peaceful transfer of power, setting us apart from much of the world.

From our nation’s infancy, the American project has depended on a series of innovations. The innovations of each generation illustrate a very American commitment to the idea that our politics is never a given and that changes to our system of government are not only possible, but also essential—such as ensuring a regular turnover of our commander in chief.

In fact, the very idea of American democracy was itself a revolutionary innovation. Democracy as a form of government, one in which power is vested with the people, has ancient origins. But representative democracy in the modern era, a system in which people elect representatives who make decisions on their behalf, was ushered onto the world stage by the American Revolution. After the Americans defeated Great Britain, the Founders rightly feared the kind of monarchical rule they had recently rejected. But they also feared direct democracy, or a “tyranny of the majority,” where the people would directly decide policies. Their solution was to devise a system of intermediaries—of legislators and government leaders whom we hire and fire to do the work of governing. Electing our representatives may seem intuitive and obvious now, but it certainly wasn’t always the case.

The list of innovative elements in our heritage goes on. The US Constitution provided the first formal blueprint for democracy. It codified a system of government that was nothing short of an outlier among nations, enshrining an elaborate structure of checks and balances that limited the power of any particular branch and prioritized the role of citizens in the revolutionary concept of self-government. It is today the world’s longest-surviving written charter of government—a gift from framers who established firm principles but allowed for amendments and evolution as the nation itself evolved. Indeed, each amendment that came after ratification tells the story of a national debate that fundamentally altered our political system. Political innovation is an American legacy.

But simply “keeping” our democracy has never been enough. Instead, it has required constant reinvention. Neither the Founders nor the Framers delivered a perfect government that needed only our protection, but instead one that was designed to evolve and adapt. What came out of that Constitutional Convention was both extraordinary and deeply flawed. Long, hard-fought struggles to improve our founding document came—and must still come—from a legacy of belief in big, system-level change. Over time, powerful, principled ideas competed for the nation’s attention as reformers made their cases and worked to change hearts and minds. Thomas Jefferson captured this ethos well. As the circumstances change, he wrote, our “institutions must advance also, and keep pace with the times.”3

Today, most Americans can be forgiven for thinking that the current system is beyond repair. With a politics industry optimized for the benefit of an entrenched duopoly, and the deck stacked against citizens, it’s easy to believe that our political problems are insoluble. Calls and promises for change are made every election cycle but go nowhere. But despite what many think, we as citizens have the power to reform politics in America and restore our democracy.

History proves it.

The Gilded Age: Political Dysfunction Spurs Americans to Take Back Their Democracy

On February 10, 1897, amid an economic recession, Bradley and Cornelia Martin, elite New York City socialites, invited eight hundred friends and associates to the Waldorf Astoria Hotel for a costume ball. Guests were to arrive dressed as royalty: kings and queens bedazzled in embroidered gowns and finery. In today’s dollars, the ball racked up a bill of nearly $10 million. Meanwhile, the average American was taking home around $400 a year.4 The lavish affair became a symbol of an era known as the Gilded Age. Inequality soared, as did polarization. Corruption and gridlock defined Washington. The very survivability of democracy seemed to be on the line. Sound familiar?

The challenges of the twenty-first century are serious. But America has been here before. This is not the first time our political system has fallen into disrepair and failed to tackle the nation’s most pressing problems. While polarization, for instance, has spiked to dangerous levels, they are not unprecedented. In fact, as shown in figure 4-1, polarization was just as high in the late 1800s, when the Martins were entertaining their guests.5


Political Polarization in the United States, 1880–2019

Current ideological gaps between the parties are at levels unseen since the Gilded Age.


During the Gilded Age, America was plagued by many of the same diseases we suffer from today. Republicans and Democrats competed as a dominant duopoly, serving their own interests and special interests rather than the needs of average citizens. Then, as now, the duopoly rigged the rules of politics in its favor, competed by dividing citizens, and infiltrated powerful areas of government to expand its influence. The resulting partisan rancor, governmental dysfunction, and inaction took a heavy toll on America. By the end of the nineteenth century, America was on the cusp of unraveling. But as we now know, the country emerged from this chapter with our democracy made stronger, thanks to groups of determined Americans who spawned a generation of political innovation.

By the late 1880s, American citizens had had enough. From 1890 to 1920, political reformers who emerged across the country took action to restore our democracy in a period that became known as the Progressive Era. Not progressive in today’s sense of being on the left, but progressive in moving the country forward through structural reform of the system.

The Progressives understood that to get beyond partisan loyalty, they had to actively reshape the rules of the game in politics. Though not all potential areas for improvement were addressed; the Progressives changed the direction of the country and left a long-lasting imprint on our democracy.

Progressive reforms have produced myriad benefits for our democracy. Candidates today are chosen in primaries, not by party bosses in smoked-filled rooms. US senators are selected by popular vote, not by partisans in state legislatures. Today we cast a single private ballot in elections instead of separate party ballots that invited coercion and bribery. And businesses can no longer give unlimited contributions to politicians without reporting them. Finally, ballot measures in twenty-four states make it possible for citizens to bypass politicians if they want to by passing legislation from the voting booth.

Progressive reforms ushered in an era of problem solving in our democracy that yielded sustained American progress in spite of two brutal world wars and periodic economic downturns. The systemic changes, coupled with economic growth and postwar expansion, enabled America to become not only the world’s richest and most powerful nation, but also a country with an ability to forge compromise and set policies that expanded citizen opportunity and shared prosperity.

The Progressive movement also carries important lessons about how our urgent need for political innovation could be realized today. First, no matter how bad things get, we as citizens retain control of our government—if we exercise it. We citizens have the power to shift the nature of politics and shape the architecture of our democracy if we can create a widespread understanding of how our political system actually works and galvanize action accordingly. The Progressive Era also illustrates the need for reform advocates to band together, regardless of ideology, and not allow partisan or policy preferences to deter or divide them on issues of political innovation. And finally, the Progressive movement shows us why we can never take our democracy for granted. There will always be incentives for the political-industrial complex to distort the system in its favor. Citizens are the only ones who can prevent it. It’s up to us.

Precursors of Political Dysfunction

Mark Twain coined the late nineteenth century as the Gilded Age, an era in which there was a thin veneer of gold-plated opulence but mounting strife and corruption. Economic and social disruptions gave rise to tensions, social divisions, and ethnic prejudice. This loss of unity provided an opening for political actors to divide citizens and shape the system in their favor.

Economic factors were important catalysts. Agriculture, an economic and social bedrock of many communities, was upended by mechanization.6 As the broader economy industrialized, self-contained local economies were disrupted by increasingly national competition. Railroads and the telegraphs connected previously separate communities and markets, and large national companies grew up to supplant many smaller, localized businesses.7 For example, brick-and-mortar local retailers were disrupted not by e-commerce as they are today, but by huge mail-order companies like Sears.

Companies such as Campbell’s, Quaker Oats, Procter & Gamble, Kodak, Singer, and General Electric became household names as the first truly national business enterprises.8 Industry concentration increased, and competition was blunted even further as companies merged entire industries into monopoly trusts led by infamous robber barons with names like Vanderbilt, Carnegie, Rockefeller, and Morgan.9 These titans of industry came to dominate not only markets but also politics, using their vast resources to gain undue government influence, distort policy, and extract special favors.

As America was remade into a modern industrial nation, many felt left behind.10 While consumers benefited from new products and lower prices, many communities suffered, and existing ways of life were lost.11 Many small businesses shuttered their doors, and employees were forced to search for work in jobs for which they had little training. Workers abandoned farms and local factories in droves in search of opportunity in cities but arrived to find millions of immigrants competing for jobs.12 Battles arose over what it meant to be American.13 Americans who were once immigrants themselves claimed that newly arrived immigrants—many from southern and eastern Europe—would be unable to assimilate into American society. Anti-immigration sentiment soared, the Ku Klux Klan was revitalized, and many argued that citizenship should be restricted according to race or creed.14 Anti-immigration sentiment also found its way into the law. In 1882, Congress passed the Chinese Exclusion Act—the first time the United States would flatly bar an entire group from immigrating. Violence against Chinese communities followed.15

Wages rose, but inequality skyrocketed.16 By the time of the Waldorf Astoria costume ball, the four thousand richest families in America had as much wealth as did all other families combined.17 Rapid industrialization led to robust economic growth but also far more economic volatility with vicious booms and busts.18 Deep depressions in the 1870s and 1890s threw millions into poverty, with no social safety net in place for support.19

The new economic and social challenges were different from anything the country had faced before, requiring more than local community action. But just when Americans needed effective government to address growing needs, the same pressures and division that were facing citizens gave rise to political partisanship and fractured government. As policy gridlock set in, legislators spent most of their time not creating policy solutions but waging partisan battles that had begun soon after the last shot of the Civil War.

How Political Competition Was Undermined

The year 1876 marked the nation’s centennial. Instead of celebrating American democracy, what took place soon thereafter was an abrupt end to Reconstruction and a stunning display of how self-interested political organizations could subvert the Framers’ vision.20

After the Civil War, formerly enslaved African Americans vigorously engaged in the democratic process, organizing voters and electing black candidates to local, state, and federal offices. More-egalitarian state constitutions were written, public education was introduced across the South, and the Fourteenth and Fifteenth Amendments—ensuring equal protection under the law and enshrining the right to vote regardless of race—were passed by Congress. After the extraordinary destruction of the Civil War came a brief period of zealous democratic activity.

Southern whites responded with intimidation and violence, mobilizing a determined resistance to Reconstruction. The result was the rollback of newly formed democratic gains through voter suppression, electoral fraud, and undemocratic changes to state constitutions. Poll taxes and literacy tests prevented black citizens from voting, while the advent of “white primaries” flatly barred black voters altogether. The tactics worked. From 1876 to 1898, the number of African Americans registered to vote plummeted by 97 percent in South Carolina and 93 percent in Mississippi, with similar declines elsewhere across the South.21 Sound familiar?

This turn of events was the consequence of a backroom deal made by the duopoly. In a bitter presidential race between Republican Rutherford B. Hayes and Democrat Samuel Tilden in 1876, each candidate lobbed negative attacks to rally his base. Hayes supporters painted Democrats as disloyal Southerners. Tilden supporters claimed that Republicans were punishing the Democratic South for the Civil War.

With voters divided, the election came down to three Republican-controlled states—Louisiana, South Carolina, and Florida. Partisan officials in charge of the vote count declared Hayes the winner. Tilden, who had won the popular vote, protested. A constitutional crisis ensued until the parties struck a backroom deal. Hayes was declared president. In return for forfeiting the election, the Democrats were rewarded with patronage, subsidies, government contracts for their special interests, and, most consequentially, the removal of federal troops from the South. After the Civil War, the federal government had kept troops in Southern states to protect the newly formed Republican state governments. But with the troops removed, the road was cleared for Southern whites to reestablish governments that barred black citizens from political participation. In 1898, a state constitutional convention was convened in Louisiana for the express purpose of establishing “the supremacy of the white race.” In 1896, there were 130,344 blacks registered to vote in Louisiana. By 1900, the first year after adoption of the new constitution, there were 5,230.22 Collusion between the parties ended Reconstruction and inaugurated a period of black disenfranchisement known as Jim Crow.23

Both sides of the duopoly got what they wanted out of this deal, but the country lost. This battle was a harbinger of the unhealthy competition that would come to define politics in the Gilded Age and that we face again today.

The Five Forces of the Politics Industry in the Gilded Age

To understand how political dysfunction rose during the Gilded Age, we can apply the same politics-industry analysis we employed to understand today’s political dysfunction. The Five Forces analysis that clarifies industry structure can also explain how the rivals could thrive while abdicating their responsibilities to the public interest.

Intense Rivalry but on the Wrong Dimensions

Today’s duopoly, the Democrats and the Republicans, emerged out of the Civil War. Rivalry between the parties was intense, but they were not competing to advance the public interest. Instead, by the early 1870s the duopoly began reshaping the politics industry through new rules and new ways of accumulating power while ignoring the needs of citizens who should have been its customers.24

Average Citizens’ Lack of Customer Power

The parties sought out potential supporters for their ability to deliver money and votes, just as the duopoly does today. Average citizens had little influence.25 Money, meanwhile, rose in importance as campaign expenses ballooned and party finances were constrained by efforts to reduce the patronage system and restrict the sale of government jobs to citizens.26 Republican National Committee chair, Mark Hanna, remarked in 1895: “There are two things that are important in politics. The first thing is money, and I can’t remember what the second one is.”27

To attract more money, the parties turned to the new corporate special interests. The parties offered an attractive value proposition that included lucrative government policies, such as subsidies, land grants, and tariff protections.28 Just as it is today, this transactional mix of business and politics was toxic, distorting competition in both arenas.

Co-opted Channels

The parties also co-opted the channels for reaching voters much as parties do this today. If today’s press seems polarized, the Gilded Age was even more so. Newspapers did not even pretend to be independent or fair and balanced. Most towns had two party-backed papers—one Democratic and the other Republican.29 Each paper promoted its own party platform while smearing the opposition. Loyal editors were rewarded with government posts.30

This era also saw the emergence of aggressive organizations aimed at direct voter outreach. Local party organizations hosted huge rallies. They also distributed campaign literature partly subsidized by the taxpayers in the form of free postal privileges.31

Control of Suppliers

As the economy industrialized, so did politics. A large political-industrial complex emerged, known during this period as “the political machines.” These included powerful party bosses, political operatives, and loyal foot soldiers who controlled nominations, doled out government posts, enforced party discipline in governing, and ran major election organizations that bribed voters for their support.32 The machines cultivated future candidates, polled with rising precision, and built sophisticated get-out-the-vote apparatus to ensure that their target voters reached the polls.33 With politics heavily localized, there were not yet many Washington think tanks or lobbyists. But party control over the election infrastructure made it almost impossible for nonparty competitors to break into the industry.

Barriers to Entry

Dismal political outcomes left many Americans grasping for alternatives. In response, new entrants were continuously trying to break in.34 In the 1870s and 1880s, the Greenback Labor Party emerged on the left. On the right, the Republican “Mugwumps” broke away from their party out of disgust with corruption. These anticorruption activists became a critical swing vote, credited with putting Democrat Grover Cleveland into the White House. In the 1890s, the Populist Party emerged, claiming to represent the interests of workers and farmers. While the Populists failed to establish a viable new party, they did create a base within the Democratic Party. Yet the barriers to entry for a new party were too great to overcome. Some barriers, like economies of scale, were natural. Others, like tying up channels and suppliers, were artificial, cultivated by the duopoly for its own benefit.

How the Parties Competed in the Gilded Age

As discussed, industry structure determines the nature of competition, providing insight into how rivals compete, and why. At the center of the politics industry in the Gilded Age was the duopoly, which predictably embraced a two-pronged strategy familiar to us today: collude to rig the rules and compete on division.

Colluding to Rig the Rules

With no independent regulator, not even an ineffective one like today’s FEC, parties struck deals with each other in both elections and governing rules to further entrench their power. In elections, the duopoly instituted and optimized a slew of anticompetitive rules and practices, some of which remain in effect to this day. With plurality voting already in place since the nation’s founding, new entrants were attacked as spoilers. Although gerrymandering dates even further back in time, Gilded Age parties were experts at drawing congressional districts to maximize partisan advantage.35 In fact, they didn’t content themselves with districts; they gerrymandered whole states. The divide between North and South Dakota, for example, is a legacy of Republicans’ carving up what was a single territory in 1889 to create two more safe Senate seats.36

Other rules in this period now seem extreme even by today’s standards. Nominees for office were selected in party conventions increasingly dominated by party bosses, who picked only loyalists. Parties designed the ballots, and voters going to the polls would receive separate and clearly distinct ballots distributed by each party, which included only that party’s candidates.37 Split-ticket voting was nearly impossible. Partisan ballots were often printed on different-colored paper so that onlookers could easily see for whom citizens had voted. Votes were cast under the watchful eye of party officials, who coerced and bribed citizens for support. New competitors who lacked the resources to print and distribute ballots at every voting station faced even higher barriers to entry.

On Capitol Hill, the legislative machinery of the day already gave party leaders tight control of the governing process. Under the so-called Reed Rules, adopted in 1890 by Republican Speaker Thomas Reed, the Speaker appointed all members and chairs of the standing committees and wielded complete power over the congressional agenda by chairing the House Rules Committee himself. Then, as now, bills and amendments that were not favored by the Speaker were denied a vote.38 Czar Reed, as he became known, summed up his view of how Congress should operate: “The best system is to have one party govern and the other party watch.”39

Competing on Division

Like today’s duopoly, neither party during the Gilded Age competed for the political middle, avoiding the accountability produced by head-to-head competition. Although the parties were less ideologically distinct than they are today, they accentuated their differences. Each party divided voters into separate groups along racial, religious, and ethnic lines.40 Republicans served Protestants, Nordic immigrants, and African Americans. Democrats targeted Catholics, German immigrants, and Southern whites.41 Democrats depicted Republicans as enemies of liberty, as evidenced by the Republicans’ promotion of tariffs and prohibition. Democrats also accused Republicans of corruption and punishing the South for the Civil War. Republicans smeared Democratic immigrant communities, fueling an ugly backlash against new Americans. Such sharp divisions turned party affiliation into a central part of citizens’ identity. Politics became tribal. To switch parties was to betray one’s group or community.

Campaign rhetoric made it appear as if the nation would be at grave risk if the other party took power.42 Once a party was in office, there was little working together. Moderates became an endangered species on Capitol Hill, paralleling today’s circumstances. Dedicated party loyalists did not dare to work with the other side on forging solutions. Compromise became a dirty word. With voters evenly divided, one party rarely dominated all branches of government. The result was gridlock.43

Then, as now, the parties not only differentiated themselves through partisanship, but also delivered value to core supporters by infiltrating government agencies. They accomplished this infiltration primarily by doling out government positions to party supporters, irrespective of qualifications, in what was known as the spoils system.44

The outcome was predictable: the parties failed to deliver solutions. Public outrage, together with failed attempts at regulation by individual states, produced a few pieces of significant legislation. For example, the Interstate Commerce Act of 1887 was designed to regulate the railroad monopolies, and the Sherman Antitrust Act of 1890 empowered the federal government to combat anticompetitive business practices. Overall, however, the legislative process ground to a halt—and the nation suffered.45

Markets went unregulated, leading to free-for-alls and destructive competition. With no policies in place to moderate the business cycle, wildly oscillating economic conditions ensued.46 Farmers struggled to stay afloat as crop prices plummeted and costs soared, with no real agricultural policies to address the economic difficulties.47

In the 1880s alone, businesses and their workers clashed in thousands of often-bloody strikes, with no collective bargaining rules or government mediators.48 Public schools failed to equip students with the skills needed for the new economy.49 Crime-ridden cities lacked basic services and infrastructure. Streets were lined with unlivable tenements and unsafe factories.50 Racial progress after the Civil War was largely undone. Reconstruction was rolled back and replaced with backward Jim Crow laws that reinforced segregation and disenfranchised black Americans.

All the while, our elected representatives stood idly by, delivering favors to their partisans and special interests while accumulating resources for themselves.51 Faith in government waned. Washington was seen as a swamp where big business and the trusts pulled the strings and where the average citizen had no voice. Historian Henry Adams captured the popular sentiment of the day: “One might search the whole list of the Congress, the Judiciary, and the Executive during the twenty-five years from 1870 to 1895 and find little but damaged reputations.”52

Consensus grew that the country could not sustain itself with government as it was operating. But the problem was not one of just policies or politicians. It was a systems problem.

The Progressive Movement: Americans Fight Back

At the beginning of the twentieth century, America emerged from the Gilded Age a divided nation, torn apart by divisive politics and unresolved economic and social challenges.53 Ethnic communities squared off. Farmers clashed with industrialists. Workers clashed with management. Some workers, like Eugene Debs, renounced capitalism in favor of socialism. An American trade unionist and five-time candidate for president, Debs led nationwide strikes against the railroads. Other observers questioned the very foundations of the republic, wondering whether a democracy built around the idea of decentralized power across states could survive economic concentration. Decades after the Civil War, America was again on the verge of fracturing.

But instead of accepting this divisiveness as inevitable, citizens came together around a shared goal: restoring democracy.54 From 1890 until 1920, reformers across America mobilized, devoting the time and resources necessary to change how politics worked and its results. The resulting major shift in political competition was powerful in the same way it would be today.

A bold vision for reform emerged, but not a starry-eyed one. The movement began with a shared recognition that the country was on the wrong track. Important to this acknowledgment were changes in the media. The party-owned papers of the Gilded Age gave way to what has been termed a golden age of journalism. Reform-minded journalists, known as muckrakers, spotlighted the corruption of corporate monopolies and political machines, laying the foundation for what would become investigative journalism.55 A deep depression and violent labor clashes increased the sense of urgency. Whatever their divisions, Americans found unity in their disgust with the status quo and their optimism that the future could be better.56

Progressives were idealists, but not ideologues. As individuals, they were pragmatists, willing to try different approaches to see what worked. They erected a big tent, unlike earlier reform efforts like those of the Populists, who had divided citizens into distinct social classes. Progressives engaged citizens of all persuasions, even if the citizens disagreed on tactics or even policy.57 This embrace of ideological diversity was essential to the movement’s ability to achieve a critical mass and eventual success.

The Progressive movement began as an uncoordinated effort involving hundreds of community organizations aimed at addressing state and local issues.58 Interestingly, we are seeing such decentralized efforts emerging today. Progressive reformers at the turn of the old century soon recognized the limits of a piecemeal approach, however, refocusing their efforts on transforming the political system itself and restoring good government. They recognized that effective government was also a prerequisite for success.59 A new form of political engagement emerged. It worked not through parties or ballot boxes, but by creating a wide coalition of concerned citizens and civil society actors setting out to change the rules of the political game.

There was never a single, national Progressive movement.60 Reform was city or state based, spearheaded by local coordinating organizations that loosely stitched together diverse constituencies. The Progressives did build some national infrastructure, including groups like the National Municipal League and the Direct Legislation League, both of which advocated model reforms. A nucleus of prominent reformers—including Teddy Roosevelt and Wisconsin’s Robert La Follette—joined in, providing much-needed hope, energy, and direction. The Progressives targeted not just reform-oriented journals, but also major national publications like McClure’s Magazine, a leader in muckraking journalism. As the movement’s profile rose rapidly, Progressivism transformed America’s political system in just three short decades.

The Progressive Reform Strategy

The Progressives advanced a series of structural innovations to make politics work for the people, not for political actors—a radical idea at the time. Reforms changed the way citizens cast their ballots. Voters now had the power to select their candidates in primaries. Senators were chosen in popular elections, not by party caucuses. Progressive reforms placed limits on money in politics and vested more power in citizens to influence policy through direct democracy. And the legislative machinery was reengineered through a revolt in Congress.

Ballot Reform

Innovation was kick-started in 1888, when a band of reformers from an elite Boston social club toppled the anticompetitive partisan-ballot system.61 Massachusetts became the first state to adopt the so-called Australian ballot, which was modeled after a system pioneered in Australia and replicated in several European countries.62 Government, not the parties, provided a single ballot that listed all candidates regardless of party—voters could select their favorite candidates in secret, without fear of coercion.63 Other states soon followed, and in just five years, the Australian ballot had spread across the country.64 Ballot reform was what energized the Progressive movement. The corrupt nomination system became the next target.65

Direct Primaries

Gilded Age candidates were handpicked by party bosses at party conventions.66 This setup began breaking down in the early 1890s once the parties’ dominant role in the political system became known to all because of the new government-issued ballots.67 A round of primary reforms kicked off in 1898 with the National Conference on Practical Reform in Primary Elections, held in New York City.68 In the crowd was La Follette, who two years later made primary reform a pillar of his successful bid to become governor of Wisconsin. Under his leadership, Wisconsin became, in 1904, the first state to endorse a direct primary, determining party nominations by popular vote. One year later, Oregon followed, with six more states joining the next year. Direct primaries for congressional and state races became the law of the land in most states within a decade.69

Still, direct primaries weren’t perfect. In previous chapters we have described the unintended consequences evident today. However, for a time, direct primaries were effective in curing the runaway power of party bosses and the political machines of the day.

Direct Democracy

The rapid spread of primary reform was aided by another Progressive innovation: direct democracy. Inspired by Switzerland’s election format, James Sullivan published Direct Legislation by the Citizenship through the Initiative and Referendum in 1892. Sullivan advocated giving Americans the ability to bypass a corrupt legislative system to directly shape policy.70 The book inspired the creation of the Direct Legislation League and led to Oregon’s becoming the first state where citizens could vote directly on bills at the ballot box, starting in 1902.71 Over the next fifteen years, twenty-two states followed suit.72 By 1912, direct democracy was a centerpiece of Teddy Roosevelt’s third-party campaign for president.73 It also became the preferred instrument to enact further political innovations.74

Direct Election of Senators

US senators were originally selected by state legislators instead of voters, as was specified in the Constitution. This unpopular practice survived attempts at a constitutional amendment; the efforts were routinely defeated in Congress.75 By 1913, however, the Seventeenth Amendment was ratified, giving citizens the power to pick their senators. In part, this breakthrough was spurred by David Graham Phillips’s exposition of corruption in “The Treason of the Senate,” a series of articles that exposed how various senators championed policies favorable to wealthy families like the Rockefellers and Vanderbilts in exchange for bribes and campaign contributions. But it was also made possible by the ability of citizens to circumvent Congress through their use of direct democracy, an expanded toolkit.76

In 1901, Oregon held a “primary” in which voters picked their preferred senators.77 A ballot measure in Oregon required candidates for the state legislature to indicate whether they would respect the primary results. Almost all signed on, transforming the primary into the Senate election in all but name.78 Other states soon followed. By the time the Seventeenth Amendment passed, it was less a radical transformation and more a recognition of an emerging reality.79

Changing the Legislative Machinery

The electoral reforms changed incentives in Congress, prompting members in 1910 to rebel against Speaker Joseph Cannon in what became known as the Cannon Revolt. Tired of oppressive partisan control, Progressive Republicans and Democrats, led by Rep. George Norris of Nebraska, united to strip away the Speaker’s power over the Rules Committee and decentralize control to committees made more independent by a new seniority system.80 This transition from a Congress built for partisans to one constructed around bipartisan committees was the first step toward a sensible governing structure reflected in the “textbook Congress” discussed earlier. The process culminated in the Legislative Reorganization Act of 1946, which reinforced a committee-centric legislative machinery designed for problem solving. It also professionalized Congress by increasing staffing and more sensibly dividing legislative work among committees.81 This system lasted until partisan forces rose up again in the 1970s to undermine it, as we described in chapter two.82

Regulating Money in Politics

Rules changes for elections and governing encouraged stronger regulation of money in politics. During the Gilded Age, big business spent large sums on campaigns and lobbying to advance its special interests.83 Citizens decried money’s pernicious influence but were skeptical that politicians would ever cut off their own funding sources. After the electoral changes were implemented, and after countless news stories of corruption, Congress itself finally took action. In 1907, it banned corporate contributions to campaigns. Four years later, other legislation required disclosure of all campaign contributions.84 Money in politics was tamed—though later unleashed again starting in the 1970s.

.  .  .

The Progressives transformed political competition.85 Polarization and partisanship declined, and compromise became the norm, allowing critical legislative solutions to be drawn up and passed. Badly needed regulatory agencies were formed, including the Federal Reserve System, which stabilized the capital markets, and the US Food and Drug Administration, which began regulating consumer products. Thanks to the Sherman Antitrust Act, the government reopened competition by breaking up monopolies, like Standard Oil, and created the Federal Trade Commission to improve its enforcement of fair business practices. The government also took steps to protect the most vulnerable by instituting workplace safety rules, restricting child labor, and improving public health. But it didn’t stop there. By changing the structure of the politics industry, Progressives set the stage for other landmark legislation in subsequent decades, from the Social Security Act in the 1930s to Medicare in the 1960s.

Progressives were not perfect. Some of their efforts came with serious unintended consequences, like the establishment of party primaries. And neither side got everything it wanted. Those on the left chastised Progressives for not doing more to protect the poor.86 Those on the right bemoaned the expansion of government.

But this is what progress looks like. Refinements are always needed. Importantly, progress cannot be driven by ideology. It isn’t all-or-nothing. It’s not either-or. Progress is about compromise and problem solving to steadily move the country forward. The legacy of the Progressives’ nonpartisan structural innovations allowed the nation to tackle our big challenges and ushered in what would become known as the American Century.87

Fertile Ground for Political Innovation

As was seen during the Gilded Age, economic and social disruption can provide fertile ground for political dysfunction—and innovation. Once again, we are living in an age of disruption. Digital transformations have shaken up virtually every industry, rendering old ways of competing obsolete. Just as these changes create possibilities for new companies, they also destabilize communities and companies alike.

Industrialization has given way to deindustrialization. Rather than the displacement of farmers and the creation of large-scale national companies by mechanization, automation creates concerns about where jobs will come from and the future of work. As new technology and skills grow in importance, economic gains have disproportionately flowed to the top, again fueling rightful fears of runaway inequality. Many citizens today are left to wonder whether there is a place for them in the economy of tomorrow.

Instead of the nationalization of competition that took place during the Gilded Age, we now have globalization. The years following World War II inaugurated a new era of global commerce and investment. Policy makers in nations across the world prioritized reducing barriers to trade, harmonizing intellectual property laws, and reducing capital controls. Efforts to economically integrate were successful: world exports as a share of gross world product climbed to 8.5 percent in 1970 and then to 16.2 percent by 2001.88 But as markets and competition have become increasingly global, companies and jobs that have been sources of opportunity and good wages—such as traditional small businesses (small shops, restaurants, personal services, etc.)—have come under threat. The net result has been that economic prosperity is increasingly uneven. While parts of urban America are booming, other urban communities face economic distress. Many rural communities are stuck in a secular recession. Workforce participation has declined, and many working Americans are not earning a living wage. And so there is, all too predictably, pushback against a free-market system that works well for some—and barely works at all for many.

At the same time that such divisive forces are altering the American economy, a new wave of immigration and the concurrent growing diversity are again putting strains on society and sparking another wave of anti-immigration sentiment.89 Since 1965, the absolute number of immigrants in the United States has more than quadrupled.90 While the economic consequences are not in dispute—immigration generates more innovation and greater economic productivity, with a net positive effect on public budgets—the social consequences are messier.91 Change instigates shifts in culture and a community’s sense of continuity and security. Together, economic and social changes create greater demands on government to innovate in public policy and to ensure that business and other systems incorporate the interests of all groups, not just a special few.

As in the Gilded Age, the divisions created by the economic and social changes of the last fifty years have again been used in the politics industry to create political division, harden partisanship, and block the kind of compromise-based policy solutions we now need more than ever. Ineffective government makes problems worse, which opens the door for further political division. Political dysfunction then feeds off itself.

Only we citizens can break this cycle.

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