George H.W. Bush has died. Provides an opportunity to mention a few things regarding Bush in regards to the power politics dynamic that exists in Washington– a topic Murray Rothbard was brilliant on. This is a quick sweep through, not very developed in a formal sense, just a summary of how I understand these things.

The two leading groups of politically well connected and unimaginably wealthy “families,” by the turn of the century were the Morgans and the Rockefellers– this is what we now call “Old Money” in America. These two groups were fiercely competitive with each other, especially in the banking and finance world. In fact, many of the early 20th century political battles can be seen as reflective of the great wars between these two economic powerhouses. 

It was the signing of the Federal Reserve Act which caused the “House of Morgan” and the Rockefeller empire to no longer be required to compete in the world of banking. It was a union between the two most powerful and political influential economic groups in banking and credit.

While united on the banking front due to the Federal Reserve’s establishment in 1913, they still competed for dominance in other industries, including oil and manufacturing. But World War II solved this problem. It was the seal that tied them closely together. FDR and his decision to enter into the WWII was their connecting point. Rothbard explains helpfully:

During the 1930s, the Rockefellers pushed hard for war against Japan, which they saw as competing with them vigorously for oil and rubber resources in Southeast Asia and as endangering the Rockefellers’ cherished dreams of a mass “China market” for petroleum products. On the other hand, the Rockefellers took a non-interventionist position in Europe, where they had close financial ties with German firms such as I. G. Farben and Co., and very few close relations with Britain and France. The Morgans, in contrast, as usual deeply committed to their financial ties with Britain and France, once again plumped early for war with Germany, while their interest in the Far East had become minimal. Indeed, U.S. Ambassador to Japan, Joseph C. Grew, former Morgan partner, was one of the few officials in the Roosevelt administration genuinely interested in peace with Japan.

World War II might therefore be considered, from one point of view, as a coalition war: the Morgans got their war in Europe, the Rockefellers theirs in Asia. Such disgruntled Morgan men as Lewis W. Douglas and Dean G. Acheson (a protégé of Henry Stimson), who had left the early Roosevelt administration in disgust at its soft money policies and economic nationalism, came happily roaring back into government service with the advent of World War II. Nelson A. Rockefeller, for his part, became head of Latin American activities during World War II, and thereby acquired his taste for government service.

After World War II, the united Rockefeller-Morgan-Kuhn, Loeb Eastern Establishment was not allowed to enjoy its financial and political supremacy unchallenged for long. “Cowboy” Sun Belt firms, maverick oil men and construction men from Texas, Florida, and southern California, began to challenge the Eastern Establishment “Yankees” for political power. While both groups favor the Cold War, the Cowboys are more nationalistic, more hawkish, and less inclined to worry about what our European allies are thinking. They are also much less inclined to bail out the now Rockefeller-controlled Chase Manhattan Bank and other Wall Street banks that loaned recklessly to Third World and Communist countries and expect the U.S. taxpayer—through outright taxes or the printing of U.S. dollars—to pick up the tab.

Rothbard, Murray N. Wall Street, Banks, and American Foreign Policy (LvMI) (Kindle Locations 827-843).

The Eastern Establishment after this was suddenly in deep competition from the Sunbelt “conservatives,” who had CIA, construction, and American oil (as opposed to the Eastern Establishment, whose oil interested were in the middle east) connections and domination. Remember, both the Republican and Democratic establishment before the rise of the Sunbelt Cowboys were all Eastern establishmentarians, who might also be called the “Yankees” in the “Yankee and Cowboy War,” a book written by Carl Oglesby back in the 1970’s. It is Oglesby who first really articulated this paradigm between the Eastern Powers and the new Sunbelt (CA and TX) powers. And even as the Sunbelt Cowboys came roaring into power, their influence too stretched across both parties; LBJ was a Democrat and Nixon was a Republican.

After Gerald Ford, a Yankee Eastern Establishment type, came to power after the Establishment got Nixon, he was a breath of fresh air to Yankees, but unfortunately for them, the populace was growing annoyed as establishment “Rockefeller Republican” centrism. And so the popular movement arose which was a quasi revolt against Eastern Establishment and Reagan was voted in under the assumption that he would make good on his promise to clear house of the Trilateral Commission— which was basically the 80s version of the “draining the swamp” populist appeal.

Unfortunately, Reagan didn’t do very well in clearing out the Establishment. This part is important. The reason that Reagan only partially succeeded was his VP George H.W. Bush, whose family history and “Old Money” connections reach back to his father who was a key member of the banking world (Yankee) and yet who had done well in reaching out to the Texas oil world and thus making friends in the Cowboy empire as well. On top of this, Bush was a long time CIA man and even its director. Bush Sr.’s influence in the Reagan administration cannot be overstated. People like to think of George Bush Jr. as a Texas neocon. But it is more accurate to see him originally as an Old Money yankee, who made a fortune making friends in the Sunbelt industries, and was heavily influence by his neoconservative advisors, who ran his foreign policy because he was quite weak in that area (much to his father’s disappointment).

In other words, Reagan’s mistake is that he cleared out some of the Establishment, but left a considerable block of them, led by Bush I himself. But into the vacuum he created, the neocons crawled their way in and thus created the dynamic that would last until Trump: the neocon (which had subsumed the cowboy faction) vs. Establishment Yankee battle. Reagan, while perhaps meaning well in his war on the Yankees, also opened the neocon can of worms. While they wouldn’t find true and world-changing power until Bush II and 9/11, the neocons largely grabbed their footing, found their positions during the Reagan years– and they worked quietly under Clinton and made their splash under Bush II.

Bush I’s disappointment in his son’s foreign policy lies in the fact that Jr’s foreign policy was run by neocon Wilsonians– global crusaders on behalf of democracy. This should be compared to the Yankee’s preference for a so-called “Realist” foreign policy wherein the world is a chess board that should carefully considered. A realist foreign policy was what Bush 2 ran his campaign on, which makes sense, since his familial background belongs to the realist tradition. 9/11 was the death blow to realism. The neocons fully and unfortunately took everything over from there. And the GOP has since then been very neocon.

Bush I was not a neocon. He was a tried and true man of the 20th century centrist Establishment. He predates the neocons. He was one of the last remaining true blood yankees. Of course, not being a neocon does not itself win you points– we are talking power politics here, the internal battles for control over resources and power within the state. The Eastern Establishment set the stage for 20th century policy, foreign and domestic, just as the Neocons largely set the stage for the first quarter of the 21st century policy.

For more on Bush I’s world and connections, I recommend Rothbard’s monograph Wall Street, Banks, and American Foreign Policy.

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