John Jay. The Federalist No. 86: The Great Anesthetic

Bribed with your Own Equity: The 80-Year Campaign to Neuter Democracy

When Alexander Hamilton, James Madison, and I addressed you under the common name of Publius in the autumn of 1787, we sought to demonstrate that the preservation of your union and liberty depended upon a well-ordered constitutional government. As the first Chief Justice of your Supreme Court, I took as my solemn duty the impartial exposition of the laws, trusting that an enlightened people would remain forever vigilant guardians of their own sovereignty.

 Having observed the long arc of your republic since the triumph of your arms in the Second World War, I feel bound to lay before you an unvarnished account of how that sovereignty was quietly disarmed. What has occurred over these past eight decades is neither a sudden revolution nor an invasion by foreign arms. It is a calculated, institutional counter-revolution—conceived in academic chambers, financed by concentrated capital, codified by a transformed judiciary, and, most tragic of all, permitted by a complacent public whose vigilance was purchased with paper wealth.

I. The Fragility of Majority Rule and the Rise of Buchanan’s Locks 

In the immediate wake of 1945, your nation exhibited a civic cohesion and broadly shared prosperity that seemed to fulfill the fondest hopes of our founding generation. Strong industrial compacts secured decent wages for honest labor, public investment constructed vast arteries of commerce, and the judicial branch began, at long last, to enforce the constitutional promise of equal protection under law.

Yet inside the quiet study of an economist named James M. Buchanan, this very realization of democratic will was regarded not with pride, but with terror. Beginning in the late 1950s in Virginia, Buchanan watched the expansion of public oversight, civil rights mandates, and progressive taxation, and concluded that majority democracy possessed an inherent and dangerous flaw. Operating under what he coined Public Choice Theory, Buchanan asserted that neither public servants nor citizens act for a noble common good, but merely pursue their own narrow economic interests.

 From this premise, Buchanan arrived at a radical deduction: if ordinary working majorities were permitted unhindered access to the ballot box, they would inevitably vote to tax the accumulated capital of the productive minority to provide for their own collective welfare. To Buchanan and his disciples, this was not the legitimate functioning of self-government; it was legalized theft. 

Because such a doctrine could never survive an open appeal to a free electorate, Buchanan proposed a strategy of constitutional enclosure. The objective was not to win popular majorities, but to design institutional "locks and bolts"—supermajority requirements, fiscal straightjackets, and legal barricades—that would permanently bind the hands of the sovereign people. If the constitutional machinery could be so rigged that no legislative majority could easily alter the prerogatives of capital, the supremacy of private property would remain inviolate, no matter who carried the vote

II. The Powell Manifesto: Capital Mobilizes Its Battalions

It was my illustrious compatriot, James Madison, who warned us in the tenth number of our essays that the violent disease of faction was the mortal infirmity of all popular regimes. He instructed us that the greatest peril lay in a faction so extensive and singular in purpose that it could sacrifice both the public good and private rights to its ruling passion. Yet in his fondest calculations, Madison assumed that the sheer variety of local interests across our vast Republic would forever hinder such a sinister combination from discovering its strength and acting in unison. What he dreaded above all—and what he hoped our extended sphere would forestall—has now taken concrete form: not a rabble of desperate citizens, but a consolidated, multi-faceted faction of private capital, corporate monopolies, and ideological legal syndicates. Uniting boardroom directors, academic chairs, and high tribunals across three thousand miles of territory, this modern interest has achieved the very nightmare Madison prophesied—a faction of extraordinary power that has overcome the natural friction of our continent, subverted the republican remedy of the ballot box, and bent the sovereign machinery of the state to the preservation of its own private wealth.

Yet this continental faction did not coalesce overnight; for a time, its underlying theories remained confined to academic tracts and seminar rooms. The decisive turning point arrived in the late 1960s, when corporate America found itself subjected to unprecedented public demands for safety, consumer honesty, and environmental preservation. Alarmed by this surge of civic assertiveness, a prominent corporate counselor from Richmond, Lewis F. Powell Jr., issued a confidential memorandum in August 1971 to the U.S. Chamber of Commerce. Entitled "Attack on American Free Enterprise System," it was nothing less than a military doctrine for domestic political combat.

Powell rebuked the captains of industry for their passivity and timidity. He warned that the free enterprise system was under systematic assault—not merely from radical factions, but from the universities, the press, and the halls of Congress. His remedy was total institutional mobilization:

1.         The Capture of Higher Learning: Powell instructed business leaders to endow professorships, finance compliant economics faculties, and police textbooks to ensure that the minds of the young were steeped in free-market orthodoxy.

2.         The Domination of Public Discourse: He called for the creation of well-funded policy institutes and think tanks to flood the public sphere with pro-business literature, while vigorously pressuring the press and airwaves for favorable coverage.

3.         The Enlistment of the Judiciary: Crucially, Powell recognized what our founding generation understood all too well: that the judiciary, possessing neither purse nor sword, nevertheless wields the power of final interpretation. He urged corporate America to treat the courts as the preeminent arena for social change, creating dedicated public-interest legal foundations to systematically challenge public regulation and advance corporate power.

Two months later, President Nixon elevated Powell to the very Supreme Court bench whose strategic capture he had so vividly mapped. In the years that followed, vast family fortunes and corporate treasuries heed the call, pouring billions into a sprawling counter-establishment of think tanks, legal foundations, and endowed academic chairs.

III. The Judicial Consummation: From the Reagan DOJ to the Roberts Bench

 The institutional pipeline engineered by the Powell memorandum found its political vehicle in the election of Ronald Reagan in 1980. Under the aegis of Attorney General Edwin Meese, the Department of Justice set out to dismantle fifty years of jurisprudence that had favored the regulatory authority of the federal government and the rights of labor.

It was during this era that the Federalist Society was formed, establishing an ideological nursery to recruit, screen, and cultivate young legal minds dedicated to curtailing the administrative state. Among the keenest of these legal foot soldiers was a young attorney named John G. Roberts Jr., who served in the Reagan Justice Department and White House Counsel’s office. In those internal deliberations, young Roberts laid the groundwork for his career: questioning federal voting rights protections, resisting affirmative action remedies, and seeking to clip the wings of federal regulatory agencies that curbed corporate overreach.

 Decades later, elevated to the station I once held as Chief Justice of the United States, Roberts presided over the full realization of the Powell blueprint:

•            In Citizens United v. FEC, the Court declared that the speech of natural persons and the financial expenditures of artificial corporate monopolies were of equal constitutional dignity, opening the floodgates to unlimited private capital in your public elections.

•            In Shelby County v. Holder, Chief Justice Roberts struck down the operative core of the Voting Rights Act of 1965, removing the federal shield that guarded against the dilution of the franchise.

•            In decisions stripping federal regulatory agencies of their authority—culminating in the recent overturning of the long-standing Chevron doctrine—the Court completed Buchanan’s design. By decreeing that executive agencies cannot act upon modern perils without granular, explicit authorizations from a perpetually gridlocked Congress, the judiciary has effectively paralyzed the republic's capacity to protect its own citizens from corporate harm.  

IV. The Great Anaesthetic: The Seduction of Paper Wealth

How did a proud, literate, and battle-tested citizenry permit this quiet confiscation of their birthright? How was the public kept docile while the cords of their self-governance were severed one by one?

The answer is both simple and sobering: the American middle class was bribed with the illusion of personal affluence.

The architects of this restoration recognized that an outright assault on the living standards of ordinary Americans would provoke a furious political backlash. A people who saw their wages stagnate, their pensions dismantled, their unions crushed, and their public services starved would naturally turn to the ballot box to demand economic redress.

To prevent this awakening, the architects constructed a grand anaesthetic: the relentless, debt-fueled escalation of the stock market and the domestic housing market.

Beginning in the late 1970s and 1980s, the traditional security of American labor—defined-benefit pensions, stable wages, and public guarantees—was quietly dismantled. In their place, the citizen was handed a 401(k) portfolio and a thirty-year residential mortgage. The citizen was subtly transformed into an investor-speculator.

Every evening, the working family was invited to look away from the decay of their civic life and gaze instead upon two numbers: the balance of their retirement fund and the estimated appreciation of their suburban home. So long as these numbers climbed, the vast middle America remained quiescent.

When the stock market rose, the suburban household believed itself to be growing rich, never noticing that the very mechanisms driving that index upward—corporate consolidation, the suppression of wages, the dismantling of domestic manufacturing, and the unbridled freedom of capital to gouge consumers—were stripping them of their true economic sovereignty.

When home prices climbed to dizzying heights, families felt a pleasant warmth of personal wealth. They did not stop to consider that their children were being priced out of the promise of homeownership altogether, or that their newfound "equity" was largely fictitious, backed by an ocean of household debt that tied them hand and foot to the financial apparatus of Wall Street.

By tying the daily comforts and retirement hopes of ordinary families to the inflation of financial assets, the managers of this system accomplished an astonishing political feat: they made the middle class complicit in their own political subjugation. Why protest the deregulatory rulings of the federal courts when your retirement portfolio gained twelve percent that very year? Why challenge the unchecked power of global monopolies when your home was ostensibly earning more per year than your portfolio?

You accepted the baubles of paper prosperity, and in return, you permitted the quiet theft of the Commonwealth. 

V. The Republic Enclosed

Now the bill has come due.

The asset inflation that once flattered your vanity has metastasized into an economy where the young cannot afford a hearth, where medical debt consumes the prudent, and where corporate giants extract immense profits by pricing life’s bare necessities not at the cost of production, but at the maximum tolerable ceiling the public can bear.

You find yourselves politically impotent because the locks and bolts envisioned by Buchanan have been firmly bolted in place. The money summoned by Powell has thoroughly corrupted the halls of legislation. And the lifetime magistracy envisioned by the Reagan legal movement sits upon the federal bench, ready to strike down any popular enactment that dares to restrain the supremacy of capital.

A free government cannot be sustained upon the fragile foundation of private greed and passive distraction. In 1787, we gave you a constitutional order intended to balance factions and allow sober, virtuous reason to prevail over the transient passions of men. We did not anticipate that a future generation would willingly trade the hard work of democratic citizenship for the narcotic of climbing balance sheets and cheap consumer spectacles.

If you wish to remain a republic, you must first break the spell. You must see with unclouded eyes that an escalating stock market is no substitute for self-governance, and that an inflated appraisal of your dwelling cannot purchase back a surrendered constitution.

Shake off your complacency. Demand that the courts serve the people, not the corporate balance sheet; demand that your representatives serve the Commonwealth, not the campaign donor; and recover, before it is too late, the severe, manly virtues of a citizenry that values liberty above comfort.

I remain, as ever, your obedient servant,

JOHN JAY