Kaufman is dead right.
Theodore Roosevelt in 1910 said that the people of the United States suffered needlessly from periodical financial panics. He thought it vital to investigate and revise the US financial system to prevent such panics.
TR advocated fair play under the contemporary rules of the game, but wanted those rules changed so as to work for a more substantial equality of opportunity and of reward for equally good service. He did not mean that we should collectively support the man who remains poor because he has not got the energy to work for himself.
TR was the first to argue that government, National and State, must be freed from what he termed “the sinister influence or control of special interests.”
He said that while every special interest was entitled to justice, not one was entitled to a vote in Congress, to a voice on the bench, or to representation in any public office. The Constitution guarantees protection to property, and we must make that promise good, TR said; “but it does not give the right of suffrage to any corporation.”
“The true friend of property, the true conservative,” TR said, “is he who insists that property shall be the servant and not the master of the commonwealth.” So he insisted that the public was entitled to know whether corporations obey the law and whether their management entitles them to the confidence of the public. He thought it necessary to pass law to prohibit the use of corporate funds directly or indirectly for political purposes, and even more necessary to enforce such laws thoroughly. TR blamed corporate expenditures for political purposes, and especially such expenditures by public-service corporations, as one of the principal sources of corruption in US political affairs.
TR wanted government supervision of the capitalization of all corporations doing an interstate business. He insisted on thoroughgoing and effective regulation of corporations, especially of combinations that control necessities, such as food, and fuel. He said officers, and, especially, the directors, of corporations should be held personally responsible when any corporation breaks the law. He said we should be as sure of the proper conduct of corporations in interstate commerce as we should be sure of the conduct and management of the national banks..
TR pointed at what he saw as the absence of “effective State, and, especially, national, restraint upon unfair money-getting” which he said created “a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power.” TR’s priority was to change the conditions which enabled these men to accumulate power “which it is not for the general welfare that they should hold or exercise.”
TR had no objection to a man accumulating a fortune representing his own power and sagacity, with the proviso that it be exercised with “entire regard to the welfare of his fellows.”
He said we should grudge no man a fortune in civil life “if it is honorably obtained and well used.” But he thought it is “not even enough that it should have been gained without doing damage to the community. We should permit it to be gained only so long as the gaining represents benefit to the community.” He knew this would lead to far more active governmental interference with social and economic conditions that the country had yet had, but he thought such an increase in governmental control is necessary.
TR identified where to draw the line and what the standard regarding “greed was.” He said that the “really big fortune, the swollen fortune, by the mere fact of its size acquires qualities which differentiate it in kind as well as in degree from what is possessed by men of relatively small means.” This was the source of his belief in a graduated income tax on big fortunes, and in a graduated inheritance tax on big fortunes.