The kind of economic order contemplated by the framers of the Constitution is a considerably more subtle and complex question than one might suppose. To be sure, the framers clearly regarded the protection of such rights as a primary purpose of government. The English philosopher John Locke, whose views were familiar to virtually every American of the founding generation, had taught that the ownership of property was a God-given natural right, antecedent to civil society; and the revolutionary state constitutions and bills of rights had given ringing approval to that dictum. James Madison, in the Constitutional Convention, cited "the security of property "the primary objects of civil society," and other delegates echoed that sentiment.
But one cannot leap from the framers' belief in the sanctity of private property to the conclusion that they advocated either capitalism or a free market economy. Neither of those had yet emerged--the word capitalism was yet to be coined--and they could not emerge until certain conditions, institutions, values, and circumstances had come into existence. Five clusters of conditions were indispensable. The first was a set of attitudes toward property: that it be freely transferable from one owner to another, that there be no discrimination against commercial property in favor of land, and that active development be socially preferred to passive enjoyment. In addition, capitalism required at least four other conditions: a general commitment to the proposition that economic growth is both possible and desirable, governmental sanction of private endeavor as the principal instrument of growth, recognition of the market as the prime determinant of economic value, and legal and institutional means of turning credit into money and capital.
Precapitalist Attitudes
These conditions were only beginning to exist in the 1780s, when the Constitution was adopted: the period was one of transition from ancient, no-growth conceptions of economic activity to modern, growth-oriented conceptions. Precapitalistic values, attitudes, and institutions, rooted in the feudal past, were far from dead in America, and those of mercantilism (a system in which economic activity was regulated by the state as a means of aggrandizing the state) were in full bloom. The new values, looking to free trade, entrepreneurship, and a market economy were little more than a gleam in the eyes of a few advanced thinkers.
The significance of the establishment of the Constitution, in the evolution of systems of political economy, was that it made possible--though it was neither designed to, nor did it, make inevitable--the transformation from the old order to the new.
An outline of the extent to which the preconditions of capitalism existed prior to 1787 is useful. To begin, though it is clear that Americans regarded private property rights as morally beyond the reach of government, it is not so clear what they meant by the term. Most would have approved Sir William Blackstone's celebrated definition: "that sole and despotic dominion which one man claims and exercises over the external things of the world, in total exclusion of the right of any other individual in the universe." Neither in law nor in practice, however, was the matter so simple. The right of property is not a single right but an intricate combination of many rights, powers, and duties, distributed among individuals, society, and the state. Blackstone, after
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