Why Is There No Socialism in United States?

I think that the reason why we Americans seem to be so addicted to trying to get rich suddenly is merely because the opportunity to make promising efforts in that direction has offered itself to us with a frequency out of all proportion to the European experience. For eighty years this opportunity has been offering itself in one new town or region after another straight westward, step by step, all the way from the Atlantic coast to the Pacific. When a mechanic could buy ten town lots on tolerably long credit for ten months savings out of his wages, and reasonably expect to sell them in a couple of years for ten times what he gave for them, it was human for him to try the venture, and he did it no matter what his nationality was. He would have done it in Europe or China if he had had the same chance.

-- Mark Twain,
"What Paul Bourget Thinks Of Us"

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Werner Sombart

Why Is [Was] There No Socialism in the United States?

A critical synopsis of Werner Sombart's classic study, by Dan Sullivan


Why Is There No Socialism In the United States is the title of an essay written in serial form in the late 1800s by Werner Sombart, the most prominent European socialist of his time, and compiled into a book with that title in 1906. Sombart had come to the United States to determine why American workers had rejected socialist remedies that had been embraced by European workers.

To those who support labor but oppose socialism, his essay is valuable for two reasons. First, he had accurately predicted changes of conditions in United States that would make socialism grow in popularity -- changes that opponents of socialism must address. Second, his observations point to the central defect of socialist theory: that the oppression of workers does not come from free-market monopolization of capital, as socialists claim, but from remnants of feudalism that manifest themselves in the monopolization of land and natural resources.

Throughout Sombart's book, one sees the biases of the European socialist mind, as in his interesting word choice when he compares the feudal organization of Nuremberg with the capitalist organization of Chicago. "The former is a village-like, spontaneous formation, while the latter is a real city artificially set up according to principles of rationality..." Sombart failed to apprehend that the "spontaneous" village formation had been built around the lord's villa under his aegis, making it hardly spontaneous, and that Chicago was, if anything, far less artificial, unless free-market rationality is artificial in itself, which someone living under a post-feudal class system might suppose it to be. Although Sombart's interpretations show a clear bias, his observations have the flavor of those made by a sincere scholar rather than those of a calculating propagandist. Even where he larded his descriptions with socialist interpretations, he had set out to gather facts and report them, and he did so with fascinating acuity.

Throughout the book, Sombart summed up the American capitalistic character with a European socialist disdain for what Americans would have considered virtues. Although we will see him get worse in this regard as he goes on, he is more reasonable in his first chapter, "Capitalism in the United States":

For the average American being successful means first and foremost becoming rich. This explains why that restless striving, which we recognized as an essential part of the American national character, is applied before all else to economic life. In America the best and most energetic people apply themselves to financial careers, whereas in Europe they go into politics. In the mass public an excessive valuation of economic matters develops for the same reason, namely because people believe that in this sphere they can most easily reach the goal for which they strive....[1]

It is easy (and accurate) to infer that the usual route to modest wealth in Europe was government work (there being virtually no routes to great wealth), and that the differences between Americans and Europeans was not just the American desire to get rich, but the opportunity to actually do so by enterprise instead muddling along with government work.

Sombart himself pointed this out by noting the aversion of Americans to seek public office (by which he meant government jobs), quoting reasons given by a member of the executive committee of the National Association of Letter Carriers, the first of which is that "the public official has no prospect of achieving a 'social position' by his own labour, in other words, of managing to become rich."

He also listed the following general characteristics of American workers as principle reasons they showed no interest in socialism:

1. One feels that the American worker... is not on the whole dissatisfied with the present condition of things. On the contrary, he feels that he is well, cheerful and in high spirits -- as do all Americans. He has a most rosy and optimistic conception of the world. Live and let live is his basic maxim. As a result, the base of all those feelings and moods upon which a European worker builds his class consciousness is removed: envy, embitterment, and hatred against all those who have more and live more extravagantly.
2. There is expressed in the worker, as in all Americans, a boundless optimism, which comes out as a belief in the mission and greatness of his country, a belief that often has a religious tinge. The Americans think themselves to be God's chosen people, the famous "salt of the earth".... "nowhere does the individual associate himself more constantly and directly with the greatness of his country." This means, however, that the American worker identifies himself with the present American State. He stands up for the Star-Spangled Banner. He is 'patriotically' inclined, as it would be expressed in the German sense. The disintegrative force that leads to class separation, class opposition, class hatred and class conflict is weaker in America than in Europe, while the integrative force that compels the affirmation of the national political community and of the State and that also brings out patriotism is stronger. Among American workers one therefore finds none of the opposition to the State that is to be found in continental-European Socialism....
3. The American worker is not opposed to the capitalist economic system as such, either intellectually or emotionally. ...noted workers' leaders positively emphasize the community of interests of capital and labour. One such leader has said that "They are partners and should divide the results of industry in good faith and in good feeling," that if "laborers in their madness destroy capital, such is the work of ignorance and evil passions," and that the future will again produce the full harmony between capital and labour that is now only temporarily disturbed.
However, I believe that the relationship between the American worker and capitalism is even more intimate than is expressed by these manifestations of friendship and demonstrations of respect. I believe that emotionally the American worker has a share in capitalism: I believe that he loves it. Anyway, he devotes his entire body and soul to it. If there is anywhere in America where the restless striving after profit, the complete fruition of the commercial drive and the passion for business are indigenous, it is in the worker, who wants to earn as much as his strength will allow, and to be as unrestrained as possible. Hence, only rarely do we hear complaints about the lack of adequate protection against dangers at work; instead, the American worker is ready to go along with these dangers, if protective arrangements might diminish his earnings. We therefore much more rarely encounter restrictions of output and complaints about piece-work or technical innovations than in England, for example. I shall demonstrate still more exactly but in a different context that the American worker puts much more into his work and accomplishes more than his European counterpart. However, the greater intensity put into his labour by the American worker is only the extension of his fundamentally capitalist disposition.[2]

All this was most frustrating to socialists, as according to their socialist theory, capitalism itself leads to socialism. Sombart pointed out that if this were so,

...the country with the most advanced capitalist development, namely the United States, would at the same time be the one providing the classic case of Socialism, and its working class would be the supporters of the most radical of Socialist movements. However, one hears just the opposite of this asserted from all sides and in all sorts of tones (of complaint if by Socialists, of exultation if spoken by their opponents); it is said there is absolutely no Socialism among the American working class and that those who in America pass as Socialists are a few broken-down Germans without any following.... The doctrine of the inevitable Socialist future is refuted by the facts. For the social theorist as well as for the social legislator nothing can be more important than to get at the root of this phenomenon.[3]

Sombart makes it clear that the American workers' rejection of socialism "does not mean that, like the old English pure trade-unionists, they are disposed to free-trade and free-market principles and abhor all State intervention or State-socialist reforms" but that they did not "embrace the 'spirit' of Socialism, as we now understand it in continental Europe, which is essentially Socialism with a Marxist character."[4]

"Constitutional fetish worship"

It is a frequently observed peculiarity of the American worker that he perceives a kind of divine revelation in the Constitution of his country, and consequently he reveres it with devout awe. His feelings toward the Constitution are as if it were something holy that is immune from mortal criticism. This has been rightly spoken of as "constitutional fetish worship."
The American worker is brought up from childhood, in school and in public life, with this orientation, and when he comes to reflect on it himself he has no reason to change the viewpoint inculcated to him in so many ways. Everything that he can reasonably demand in the way of rights is in fact guaranteed to him in the constitution because he is part of the People....
The frequent demand upon the citizens to participate in elections has given added impetus to this development. The call to exercise the "sacred rights of the people" is again and again being heard, and the simple man again and again feels that he is surrounded by the entire exalted prestige of the "sovereign." "We, the free people of America..." "We, the People of the State of..., grateful to Almighty God for our freedom...,; that kind of thing resounds in the American's ears from childhood onwards. The last and poorest commoner has a part in the sacred sovereignty; at least formally, he is the People and the People are the State.[5]

But is this a cause or an effect? Sombart himself acknowledges that,

As was stated in the Doléances during the French revolution:
"The voice of Liberty proclaims nothing to the heart of a poor man who is dying of hunger." A radical-democratic system of government... will not be able to prevent criticism of the prevailing society, and especially of the existing economic order, if the latter does not also guarantee a tolerable material existence to the people...."
The task of the following section is to present evidence that the economic situation of the North American proletarian is also such -- or, more correctly, was also such -- as to protect the country from the entanglements of Socialism.[6]

Was also such? Again, Sombart considered these to be conditions which were fading, and predicted that our resistance to socialism would also fade. History has shown Sombart to be at least partially correct, for while we are still more resistant to the socialism than the Europeans, we appear to be far less resistant than we were during his late 1800s description.

Standard of living

His chapter, "Standard of Living," and much of the rest of the book, is filled with data tables and citations comparing living standards in the United States and Europe. Those who wish to review them can refer to the original text. I only cite Sombart's conclusions:

On the basis of the preceding statistical material I believe that the following can be said with moderate certainty: monetary wages earned by workers in the United States are two to three times as high as in Germany...
However, it is not really the wages of the American worker we wanted to determine, but rather their living standard.[7]

In attempting to explain below how pricing differs between the United States, Sombart refers to the "continuing colonial character of the country." "Colonial" is something of a misnomer, for colonial character implies subordination to a foreign power. What Sombart really means that we were sparsely populated and young. It is an understandable European confusion, as European powers frequently colonized sparse populations. However, his observations would be inapplicable to colonies with old institutions and dense populations, such as India.

Like economic life as a whole, the determination of prices in the United States is particularly influenced by two forces: the continuing colonial character of the country and the highly developed state of capitalism, the latter being expressed preeminently in the advanced development of the technology of production and transportation.
...all commodities and entertainments whose production is highly labour-intensive are expensive. This applies particularly to all types of personal service, and the wages of domestic servants are particularly high. Similar considerations apply to all services and entertainments that rely to a large extent on human labour (for example, cabs, theatres, but also elegant restaurants and first-class hotels in which a large staff is employed.) Moreover, all goods that have to be traded or marketed by labour intensive methods (for example, goods offered for sale in small quantities like milk, fruit, and so on) are expensive. The same is true of all goods of manufacture of which a large amount of specially qualified labour is expended (i.e., all luxury items whose manufacture needs technical skill.
On the other hand, the colonial character of the country gives a cheap price to land, so that all commodities in which the price of the ground-rent amounts to a substantial proportion are relatively cheap. This applies to agricultural produce grown in bulk, and there is an inverse [sic] relationship between its price and the amount of human labour needed to produce and distribute it; but a further factor that also keeps the price of agricultural products low is the relatively high productivity of agricultural land. The overall cheap price of land is also seen -- even if to a lesser degree -- in the low ground-rent in cities, except when one is considering exceptional cases such as the island-city of New York. House prices are therefore low, at least for those houses where the very high cost of labour constitutes a small proportion of the price, although all large, elegant buildings require large amounts of labour in their construction.
In comparison, highly advanced technology means that industrial products made in bulk are cheap, especially when they are also sold through large-scale concerns.
What results from these few considerations is the following: life in America becomes more expensive as more personal services are required and the demand for luxury increases. A given domestic economic unit therefore finds life more expensive (relatively, of course) if it is at the comparatively high end of the income hierarchy. It is therefore quite inadmissible to compare overall the value of the dollar with that of the mark, as it varies entirely according to respective living standards. A family with an income of $20,000 in New York will perhaps be unable to afford any more luxuries than a family with an income of 20,000 marks in Berlin. A New York family with $10,000 is perhaps equivalent to one in Berlin with 15,000 marks, and so on down the range of incomes until a point is reached where a dollar has the purchasing power of three or four marks. As I note in anticipation of what follows, this is the case among the working population. The following enquiries should demonstrate this.[8]


I am beginning with housing, as it is the most important requirement. A well-known fact that should first of all be pointed out is the way in which the American worker in large cities and industrial areas meets his housing requirements: this has essential differences from that found among continental-European workers, particularly German ones. The German worker in such places usually lives in rented tenements, while his American peer lives correspondingly frequently in single-family or two-family dwellings. Apart from New York, Boston and Cincinnati, rented tenements are practically unknown in the large cities of America. Thus even the cities of Chicago and Philadelphia, each with over a million inhabitants, house their populations in dwellings of one or two storeys that hold for the greater part no more than two families, and three or four in exceptional cases. These dwellings derive their origin directly from the old log hut and even today they are still built of wood in the great majority of American cities. This method of building in separate units has undoubtedly had a great significance in the formation of national character, and one should not reject out of hand the hypothesis that the slow development of collectivist orientations in America (and in England too) is connected with the fact that housing needs are met by building in individual housing units.
...housing costs the American worker less rather than more than it does his German counterpart. When I said that at first sight the reverse would seem to be true..., this was connected with the fact that the much more bountiful manner in which housing requirements in America are satisfied is not being taken sufficiently into account.
To be sure, the American worker pays out much more than does, say, the German worker, frequently twice or three times the amount, but what the former receives in return is also correspondingly larger and more comfortable. If, on the other hand, one reckons what it costs to cover approximately the same housing requirements -- say a room -- one finds that prices in America are on average lower than in Germany.[9]


I have said already that the American worker spends his much higher income in satisfying more amply his "necessary" requirements in life. In other words, he is better housed, he dresses better and he eats better than his German colleague.[10]
To sum up: in his eating habits as in other things the American worker is much closer to the better sections of the German middle class than to the German wage-labouring class. He does not merely eat, but dines.
It is perhaps the American worker's clothing that shows most clearly that with regard to his standard of living he is much better classified with the German bourgeoisie than with the German working class. This attracts the attention of anyone who comes to America for the first time. Kolb gives the following impressionistic picture.
"There [in the bicycle factory -Sombart] many even wore starched shirts; the collars were unbuttoned during work; and the cuffs -- which were always solidly sewn -- were rolled back to the elbow. Then, when the factory whistle blew and people stripped off their overalls, they hardly looked like workers at all. Large numbers rode home on their bikes. Many rode off wearing elegant hats, yellow laced boots and fashionably colored gloves, looking as splendid as anyone. These are unskilled manual workers earning $1.25 a day."[11]

Discretionary Income

The American worker's custom of satisfying his requirements for housing, food and clothing in so abundant a manner naturally means that his "free" income as a percentage of his total income is no higher than is the case with his German colleague, despite the fact that the former's total income is so much higher. On the contrary, the German worker comes out with a rather more favourable proportion....
What does the German do with the surplus that remains after his "necessary" expenditure has been laid out -- a surplus that is (relatively) so much greater than what remains to the American worker? Does he spend it on education? Or on amusements? On clubs? On taxes? On the doctor? No, not any of these. What he "saves" after his expenditure on housing, clothing and food is squandered on drink. The entire difference -- and more -- between the "free" income of the American worker and that of the German one is absorbed by expenditure on alcoholic drinks!
...The German working-class family spends three to four times as much on alcoholic beverages as the American one, and this item debits the budget at least by the extra amount that the Americans spent for housing, food and clothing. It is probable that after deducting expenditure on alcoholic beverages the amount of income that remains to the worker to be spent as he fancies amounts to a larger percentage in America than it does in Germany.... The extra that the American gains in this way is partly used for religious and charitable purposes (1.30%) and partly for purchases for the home (3.42%), while the same amounts that remain over for "sundries" are distributed fairly uniformly, both in Germany and America, between the same items of expenditure. Approximately equal amounts are spent on amusements, taxes, books and newspapers, the doctor and the pharmacist, insurance (which is private in America and a State concern in Germany), memberships of organizations, and so on.[12]

Standard of living and ideology

It would be precarious to show in detail the effect that a standard of living as different as that of the American worker has upon social perception.... Abstinence fanatics who are favourable to capitalism will be ready to discover close connections between the poison of alcohol and the poison of Socialism. However, we shall let that be.
This much is certain: the American worker lives in comfortable circumstances. On the whole, he is not familiar with oppressively impoverished housing conditions. He is not forced out of his home into the tavern, because his home is not like the "room" of the worker in the large cities of continental Europe. Instead, he can indulge fully in sentiments of the most acute selfishness -- of the sort that is cultivated by comfortable domesticity. He is well fed and not acquainted with the discomforts that must necessarily result in the long run from the mixing of potatoes and alcohol. He dresses like a gentleman and she like a lady, and so he does not even outwardly become aware of the gap that separates him from the ruling class. It is no wonder if, in such a situation, any dissatisfaction with the 'existing social order' finds difficulty in establishing itself in the mind of the worker, particularly if his endurable -- indeed, comfortable -- standard of living seems permanently assured; We ought never to forget the continuous progress that "economic prosperity" in the United States has made, apart from short interruptions, in the last two generations, during which time one would have thought that Socialism could not have failed to take root. Evidently this prosperity was not in spite of capitalism but because of it.
To the extent that the economic situation of the average labourer improved and to the extent that the increasing affluence in his standard of living gave him the opportunity to experience the temptations of materialist depravity, he had to learn to like the economic system that shaped his lot for him; he had to learn slowly to adapt his mentality to the distinctive mechanism of a capitalist economy, and finally he had even to fall to the spell that is irresistibly exerted on almost everyone by the speed of change and the growing force of measurable size in this amazing period of time. An input of patriotism, impinging as it did upon the proud consciousness that the United States led all other nations on the path of (capitalist) progress, established the cast of his business-oriented mentality and made him into the sober, calculating without ideals whom we know today. All Socialist utopias came to nothing on roast beef and apple pie.
However, yet another set of different factors had to operate for the benefit of the worker before he could take full and hearty pleasure in these beautiful things. What I mean is that his style of living had to be not only materialistically ideal but it also had to be lived through in a situation of social ease. The following pages should explain this further.[13]

Social Position

It is not only in his position vis-à-vis the material world (that is, in his material standard of living) that the American worker is so much more favoured than his European counterpart. In his relations to people and to social institutions, and in his position to society -- in short, in what I call his social position -- the American is also better-off than he would be in the contrasting European situation. For him "Liberty" and "Equality" (not only in the formal political sense but also in the economic and social sense) are not empty ideas and vague dreams, as they are for the European working class; for the most part they are realities. The American's better social position is largely the result of his political position and his economic situation -- of a radical-democratic system of government and of a comfortable standard of living. Both these are to be found within a colonising population with no history, which basically consisted, and still does consist, wholly of immigrants; a population in which there are no feudal institutions, except in some Southern slave states....
Anyone who has ever observed, even only fleetingly, male and female American workers as they carry on their life outside the factory or the workshop, has noticed at first sight that they are a different breed of people from German workers. We saw earlier how smartly and frequently elegantly clothed the workers are, especially the female ones, as they go on their way to work. On the street they are like members of the middle class and they act as working gentlemen and working ladies. In the external appearance of the American worker there is not the stigma of being a class apart that almost all European workers have about them. In his appearance, in is demeanor, and in the manner of his conversation, the American worker also contrasts strongly with the European one. He carries his head high, walks with a lissom stride, and is as open and cheerful in his expression as any member of the middle class. There is nothing oppressed or submissive about him. He mixes with everyone -- in reality and not only in theory -- as an equal. The trade union leader taking part in a ceremonial banquet moves with the same self-assurance on the dance floor as would any aristocrat in Germany. However, he also wears a finely fitting dress suit, patent leather boots and elegant clothes of the latest fashion, and so, even in his appearance, nobody can distinguish him from the President of the Republic.
The bowing and scraping before the "upper classes," which produces such an unpleasant impression in Europe, is completely unknown. It does not occur to a waiter, or to a street-car conductor, or to a policeman, to behave differently when he is confronted by an ordinary worker than he would if he had the Governor of Pennsylvania in front of him. That produces a spirit of self-respect, both in the person who behaves in this way, and in one who to whom the behaviour is directed if he belongs to the poorer population.
The whole of public life has a more democratic style. The worker is not being reminded at every turn that he belongs to a "lower" class. Indicative of this is the one class of carriage on all railways (which just lately is beginning to be done away with because of the advent of the Pullman cars).
Snobbery about personal status is also less common in the United States than in Germany in particular. It is not what one is and still less what one's parents were that decides one's prestige, but what one accomplishes, and for that reason the very word "work" in its abstract form is made into an honorary title. Thus, even the worker is treated respectfully, although -- or rather because -- he is only a worker. It is therefore natural that he feels differently from his counterpart in a country where a person only begins to be considered a person when he is, if not a baron, then a reserve officer, a doctor, or a person on probation for a profession.
Because of the democratic system of government, universal education, and the higher standard of living of the worker, there is genuinely a lesser social distance between the individual strata of the population, and -- due to the effect of the customs and perceptions described -- this distance becomes even smaller in the consciousness of the various classes it really is.[14]

Relationship to the "boss"

This stress on equality of rights, to which social and public life in the United States is geared, is even to be found inside capitalist businesses. Even here the employer does not confront the worker as the Lord who demands obedience, which was and is the usual case in old Europe with its feudal traditions. From the beginning a purely business standpoint became the prevailing rule in the bargaining of wage agreements. There was no question of the worker having first to engage in long conflict with the employer for the equality between them to be formally recognized. The American woman was treated with great tenderness because she was scarce; similarly the employer took the trouble to behave toward the labour force, which was not originally available in the quantity he wanted, in a polite and accommodating manner that found strong support in the democratic atmosphere of the country. Today even English workers are still astonished at the respectful tone that employers and foremen in the United States adopt towards the worker, and they are astonished at the license given to the American worker even in his workplace; he is "freed from what one may call vexatious supervision." They are surprised that he can take a day or two off, that he can go out to smoke a cigar -- indeed, that he smokes while working -- and that there is even an automated cigar-vending machine for his use in the factory. It is also a characteristic of American manufacturers that they fail to put in to effect even the simplest protective measures in their plants and that they are not in the least bit concerned that the set-up of the place of work be good when objectively assessed. (Quite frequently places of work are overcrowded and have similar deficiencies.) On the other hand, they are most eager to provide anything that could be perceived subjectively by the worker as an amenity; in other words, they take care of "comfort": bathtubs, showers, lockers, temperature control in the workrooms, which are cooled by fans in the summer and preheated in the winter. This arrangement, which is found fairly generally in American factories, was a special source of amazement to the English workers on the Mosely Commission. "Imagine the response of an English manufacturer who was asked to take such measures for the well-being of his staff," says the ironfounder, Mr. Maddison, and all the others are "impressed by the exceptional organisation done to ensure the comfort and well-being of the staff."
These are certainly all trivialities, but the saying that "small gifts preserve friendship" is applicable even here. Later I shall try to show that -- when the matter is considered objectively -- the worker in the United States is more exploited by capitalism than in any other country in the world, that in no other country is he so lacerated into he harness of capitalism or has to work himself so quickly to death as in America. However, this is irrelevant if one is engaged in explaining what working-class sentiments consist of. To account for their character all that is important is what individuals perceive as being pleasure or pain and what they assess as being valuable or worthless. It is one of the most brilliant feats of diplomatic artifice that the American employer (in just the same manner as the business-oriented politician) has realised how to keep the worker in a good mood despite all the actual exploitation, and that the latter is a long way from achieving consciousness of his real position. The generosity in small matters has contributed substantially to the present situation.
However, there is yet another matter that has a similar effect; this is that the worker has been psychologically influenced into thinking that he was not an enemy of the capitalist system but even a promoter of it. American employers realized perfectly how to interest the worker in the success of the business in order to identify his interests to some extent with those of the capitalists. This is done not so much by profit-sharing (although this also occurs in all varieties in the United States) as by a system of small measures that are mutually reinforcing and that, when taken together, achieve miraculous results. Firstly, it is said in praise of all American employers (for example, the people on the Mosely Commission may again be cited) that they do not seek to reduce the extra high earnings that the worker occasionally obtains from an agreed piece rate by cutting the rates per unit, as the European employer usually does. When this liberal practice is followed, the worker remains in a constant fever of excitement about his work and earnings and he is kept in a good mood by the possibility of very high gains.
A second generally practised custom of the American employer is to interest the worker directly in technical progress by accepting with great alacrity every suggestion for an improvement of the machinery and so on, and, if it is introduced and proves its usefulness, letting the worker profit directly or indirectly from it. The worker therefore comes to be his own firm in which he shares the ups and downs. This custom of accepting suggestions and complaints from the workers and of always examining them seriously is found in all branches of American industry: in concerns using blast-furnace processes and in shipbuilding, in the manufacture of knives and in spinning, in leather processes and in bookbinding, in the manufacture of paper and in the chemical or optical building. In most factories there is a so-called "suggestion box" which is a container into which the workers cast their suggestions and proposals....
Finally, the capitalists seek to buy off the worker by granting him a proportion of their profits. The method of doing this is by offering them stock on advantageous terms. In certain circumstances the capitalists thereby kill two birds with one stone. Firstly, they draw the worker into the hurly-burly of running the business and arouse in him the base instincts both of acquisitiveness and the morbid excitement of speculation, thus binding him to the system of production that they champion. Secondly, however, they dispose of their inferior stock, averting an impending fall in prices and perhaps at the same time influencing the stock market monetarily in such a way as to secure extra pickings for themselves....
The result -- at least temporarily -- of a policy of this sort is clear: "Partners in the great enterprise, the multitude of petty shareholders are led more and more to consider economic questions from the employers' standpoint." "The chances of collision... will disappear... when their differences are merged in a sense of common ownership...." Above all, the worker becomes steeped in the capitalist mentality:
The present ambition of the higher wage earner seems to incline more to the pecuniary rewards of his work than to the work itself. Doubtless this tendency is due in no slight degree to the fact that the wage earner is brought into constant and immediate contact with the money-making class. He sees that the value of the industry is measured chiefly by its profits. Sometimes the profits are flaunted in his face. At all times the thing most in evidence to him is money.[15]

Escape into freedom

However enticing the temptations that capitalism uses to approach the worker may now be and however much these may affect the weaker souls, one may none the less doubt whether what capitalism was able to offer the worker would alone have been sufficient to turn almost all sections of the working class into the peaceable citizens that they are, unless the worker had been prevailed upon from another angle to reconcile himself to the existing economic system, or at least not to adopt a hostile attitude towards it. Even American capitalism puts tight fetters on the individual, even American capitalism cannot deny that it holds its workers in a condition of slavery, and even American capitalism has had periods of stagnation with all their destructive consequences for the worker (such as unemployment, pressure on wages, and so on). In time a confrontational mentality would most certainly have developed in America, at least among the best of the working class, if escape from the orbit of the capitalist economy, or at least from the restricted confines of wage labour, had not stood open to so many groups of workers: to the robust, to those upon whom the chains were beginning to press, to the rebellious, to those among the workers who were adventurous, and to those who were dissatisfied or refractory.
In saying this I am alluding to the characteristic of the American economy that has come to have the very greatest importance in accounting for how the proletarian psyche has evolved. One must accept that there is a grain of truth in all the nonsense spoken by the Carnegies and those parroting them who want to lull the "boorish rabble" to sleep by telling them miraculous stories about themselves, or others who began as newsboys and finished as multimillionaires. The prospects of moving out of his class were undoubtedly greater for the worker in America than for his counterpart in old Europe. The newness of the society, its democratic character, the smaller gap between the employing class and the workers, the colonial vigour of many of its immigrants, Anglo-Saxon determination of purpose, and many other things, all worked together to let a far from insignificant number of ordinary workers ascend the rungs of the ladder of the capitalist hierarchy to the top or almost to the top. Their much larger savings (as compared with the situation in Europe) enabled others in their turn to set themselves up in such petty-bourgious livelihoods as shopkeepers or saloon-keepers.
However, another goal beckoned to the great majority of dissatisfied wage labourers. In the course of the past century hundreds of thousands and millions actually sought and attained this goal, and it brought them emancipation from the oppression of capitalism, emancipation in the fullest sense of the word: their goal was a free homestead in the unsettled West.
I fully believe that the fact supplying the principal reason for the characteristic peaceable mood of the American worker is that many men with sound limbs and no capital or hardly any were able to turn themselves into independent farmers almost as they wished by colonising free land....
Through the Homestead Act from 1863 onwards any person who is over twenty-one years old and is a citizen, or expresses his intention of becoming one, receives the right to take possession of eighty acres of public land if these acres lie within railway land grants, or 160 acres if they are located elsewhere. The only condition is that he declares on oath that he intends to occupy and cultivate the property fully and exclusively for his own use and intends to bestow no direct or indirect benefit on anyone else in so doing. Nothing except an insignificant fee has to be paid for permission to do this. Under certain easily fulfilled conditions the settler is recognised as having proprietary right to this homestead after five years.
It is a universally known fact that during the last half century millions of people have settled as farmers in the United States.... an area twice the expanse of the German Empire became cultivated for the first time in the two decades from 1870 to 1890!
However, it is the Americans themselves who have comprised the largest proportion of this new settlement. In other words, settling free land in the West is just as much the goal of the inhabitants of American states that send their "surplus population" out there as it is of the foreign immigrant; it may be more so. Internal migration in the United States occurs on a greater scale than in any other country, and its character is very different from that of internal migration in European countries. Over here [in Europe] it is essentially the stronger pull of the cities and industrial regions vis-\E0-vis the predominantly rural districts that mobilises the population. At the moment a similar pull exists in the United States, especially in the East, and it is becoming stronger year by year. However, alongside this urban migration and far surpassing it in strength is an opposing movement from the more densely settled, more industrial areas into the sparsely populated regions with free land.[16]

Access to land vs. socialist revolt

However, if one is explaining the development of the proletarian psyche, the significance of the fact that American capitalism evolved in a country with vast areas of free land is in no way exhausted merely by stating the numbers of settlers who have escaped from capitalist bondage over the years. Instead, it has to be borne in mind that the mere knowledge that he could become a free farmer at any time could not but make the American worker feels secure and content, a state of mind that is unknown to his European counterpart. One tolerates any oppressive situation more easily if one lives under the illusion [sic] of being able to withdraw from it if really forced to.
It is obvious that this is why the position of the working class to the problems of the future shape of the economy was bound to develop in a highly idiosyncratic manner. The possibility of being able to opt for capitalism or not transforms every incipient opposition to that economic system from an active to a passive form, and it takes away the thrust of any agitation against capitalism.[17]
In the following words Henry George has splendidly described how far the America's cheerful and frank character, his inner contentment, his harmony with the world as a whole and with the social world in particular, are all intimately bound up with the existence of free, unsettled land:
This public domain -- the vast extent of land yet to be reduced to private possession, the enormous common to which the faces of the energetic were always turned, has been the great fact that, since the days when the first settlements began to fringe the Atlantic Coast, has formed our national character and colored our national thought. It is not that we have eschewed a titled aristocracy and abolished primogeniture; that we elect all our officers from School Directors up to President; that our laws run in the name of the people, instead of in the name of a prince; that the State knows no religion, and our judges wear no wigs -- that we have been exempted from the ills that Fourth of July orators used to point to as characteristic of the effete despotisms of the Old World. The general intelligence, the general comfort, the active invention, the power of adaptation and assimilation, the free and independent spirit, the energy and hopefulness that have marked out people, are not causes, but results -- they have sprung from unfenced land. This public domain has been the transmuting force which as turned the thriftless, unambitious European peasant into the self-reliant Western farmer; it has given a consciousness of freedom even to the dweller in crowded cities, and has been a well-spring of hope even to those who have never thought of taking refuge upon it. The child of the people, as he grows to manhood in Europe, finds all the best seats at the banquet of life marked "taken," and must struggle with his fellows for the crumbs that fall, without one chance in a thousand of forcing or sneaking his way to a seat. In America, whatever his condition, there has always been the consciousness that the public domain lay behind him; and the knowledge of this fact, acting and reacting, has penetrated our whole national life, giving to it generosity and independence, elasticity and ambition. All that we are proud of in the American character; all that makes our conditions and institutions better than those of older countries, we may trace to the fact that land has been cheap in the United States, because new soil has been open to the emigrant.[18]

Will it all change?

These are roughly the reasons why there is no Socialism in the United States. However, my present opinion is as follows: all the factors that till now have prevented the development of Socialism in the United States are about to disappear or to be converted into their opposite, with the result that in the next generation Socialism in America will very probably experience the greatest possible expansion of its appeal. [Italics Sombart's]

Sombart's Folly

The next generation of Americans did indeed push for Socialist proposals, just as Werner Sombart had predicted. The irony is that Sombart recognized, in one instance after another, that inexpensive access to land had given Americans the very advantages that Socialism promises, and made them disinterested in "the entanglements of Socialism." Yet he failed to see that making monopolized European land as accessible as it had been in America would give similar advantages to European workers, so they, too could be free of those entanglements. Instead he rejoices in the usurpation of American land and the resulting degradation of labor, because he sees this as making American labor desperate enough to embrace socialism.

This "failing to see the forest for the trees" is a common fault among socialists, who recount in great detail the insults and injuries perpetrated on labor, yet, instead of recognizing cause-and-effect relationships, leap to the self-serving conclusion that the only solution is for working people to demand that control of wealth production be turned over to socialists.

This failing is not limited to those who are personally grasping for power, but also to those who, like Sombart, are merely caught up in the larger power struggle between capitalist monopoly and socialist monopoly. Neither group can afford to consider the idea that society can be structured as to eliminate the privileges that underlie monopoly.


1Why is There No Socialism In the United States? pp 13-14

2 ibid. pp 18-20

3 ibid. pp 15-16

4 ibid. p. 18

5 ibid. pp 55-56

6 ibid. pp 58, 59

7 ibid. p. 74

8 ibid. pp 75-76

9 ibid. pp 76-77

10 ibid. p. 95

11 ibid. pp 97-98

12 ibid. pp 102-104

13 ibid. pp 105-106

14 ibid. pp 109-110

15 ibid. pp 111-113

16 ibid. pp 115-117

17 ibid. p. 117

18 ibid. p. 119, citing Progress and Poverty, pp 350-351


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