American Colossus: The Triumph of Capitalism, 1865-1900

by H. W. Brands

  Through all this, Henry George puzzled over why he did so poorly. He didn’t lack energy or intelligence, or at least he didn’t think so. But circumstances seemed to conspire against him—even as circumstances made it possible for others to become very rich. On many days pounding the sidewalks of San Francisco seeking work, he passed the Nob Hill mansions of Leland Stanford and his cronies and wondered what their secret was.

  He pondered the matter further as his fortunes began to improve. Another typesetting job led to a reporting assignment to cover the local mourning for Abraham Lincoln; this segued into a stint writing editorials. As the Pacific railroad neared completion, he asked “What the Railroad Will Bring Us” and concluded that its benefits would be less than its boosters promised. Merchants and manufacturers might profit, but workers would face increased competition from goods produced elsewhere, and they would pay higher rents as land values rose. Towns along the rail line would prosper, but others would wither and die. The political consequences would be hardly less significant.

  In the growth of large corporations and other special interests is an element of great danger. Of these great corporations and interests we shall have many. Look, for instance, at the Central Pacific Railroad Company, as it will be, with a line running to Salt Lake, controlling more capital and employing more men than any of the great eastern railroads who manage legislatures as they manage their workshops, and name governors, senators and judges almost as they name their own engineers and clerks.

  California’s experience after the driving of the golden spike confirmed George’s predictions. The rich got richer, corporations grew more powerful, and workers struggled as never before. George covered the great railroad strike of 1877 as it spread to California, and in its aftermath he commenced work on what would become his magnum opus.

  By his later testimony, the insight that inspired Progress and Poverty hit George on a horseback ride along the route of the recently completed Central Pacific.

  Absorbed in my own thoughts, I had driven the horse into the hills until he panted. Stopping for breath, I asked a passing teamster, for want of something better to say, what land was worth there. He pointed to some cows grazing off so far that they looked like mice and said: “I don’t know exactly, but there is a man over there who will sell some land for a thousand dollars an acre.” Like a flash it came upon me that there was the reason of advancing poverty with advancing wealth. With the growth of population, land grows in value, and the men who work it must pay more for the privilege.8

  Turning this idea into a manuscript required most of a decade, turning the manuscript into a book another two years. Several publishing houses rejected the manuscript as unlikely to cover costs; only after he set the type himself and paid for plates did a publisher agree to produce a small edition, offered to the public in 1879.

  The book began by noting that for generations scientific progress had held forth the promise of lightening humanity’s burdens—of ending hunger, diminishing disease, eradicating ignorance. At no time had science progressed more rapidly than of late. And some in society benefited immensely, as anyone who visited the wealthy neighborhoods of American cities readily observed. But for millions of others, the promise of progress went unfulfilled. “Disappointment has followed disappointment.… Discovery upon discovery and invention after invention have neither lessened the toil of those who most need respite nor brought plenty to the poor.” If anything, poverty had grown deeper and more punishing. In good times workers struggled from day to day and week to week, slaving long hours under harsh conditions. In bad times workers lost their jobs and homes and watched their children sicken and die.

  This association of poverty with progress was “the great enigma of our times,” George said.

  It is the central fact from which spring industrial, social, and political difficulties that perplex the world, and with which statesmanship and philanthropy and education grapple in vain. From it come the clouds that overhang the future of the most progressive and self-reliant nations. It is the riddle that the Sphinx of Fate puts to our civilization and which not to answer is to be destroyed. So long as all the increased wealth which modern progress brings goes but to build up great fortunes, to increase luxury and make sharper the contrast between the House of Have and the House of Want, progress is not real and cannot be permanent.

  To deliver the promise of progress to those trapped in poverty was the challenge of American democracy, George said. He devoted chapters of his book to assessing the problem from different angles, but in the end he proposed a simple solution—one so simple it had eluded the most brilliant thinkers on political economy. George illustrated with an example from San Francisco. In 1848 property there had been essentially worthless; the finest lot in that sleepy village sold for a pittance. Five years later the same lot sold for tens of thousands of dollars. What had happened? Gold had been discovered, hundreds of thousands of people had rushed to California, and those who settled in San Francisco bid up the price of that lot. The owner became a rich man. Did he deserve his riches? Had he done anything to earn them? No; the increase in the value of the lot was the result of the development of California’s economy as a whole, which in turn embodied the efforts of thousands upon thousands of ordinary people, who received no share in the lot owner’s windfall.

  This was wrong, George declared. It was inefficient. It mustn’t continue. He proposed that since society as a whole generated the increase in value of the property, society should capture that gain. He advocated a tax on the appreciation of land values; the rate of the tax might start low but it should eventually rise until society claimed the entire appreciation. At this point the tax would produce sufficient revenues to replace all other taxes—taxes on capital, taxes on labor, taxes on consumption. The single tax on land appreciation would fund measures to alleviate poverty, but, more to the point, it would change the entire dynamic of the American political economy. “Land, no matter in whose name it stood or in what parcels it was held, would be really common property, and every member of the community would participate in the advantages of its ownership.” George admitted the radical nature of his recommendation, and he understood that even those classes that would benefit most might blanch at its implications. “It is difficult for workingmen to get over the idea that there is a real antagonism between capital and labor. It is difficult for small farmers and homestead owners to get over the idea that to put all taxes on the value of land would be to tax them unduly. It is difficult for both classes to get over the idea that to exempt capital from taxation would be to make the rich richer, and the poor poorer.” Such resistance simply revealed how thoroughly the values of the capitalist class permeated social thought. “Behind ignorance and prejudice there is a powerful interest, which has hitherto dominated literature, education, and opinion. A great wrong always dies hard, and the great wrong which in every civilized country condemns the masses of men to poverty and want will not die without a bitter struggle.”

  But once workers and farmers got past their mistaken prejudices, a brilliant future would open up to them and all of American society.

  Give labor a free field and its full earnings; take for the benefit of the whole community that fund which the growth of the community creates, and want and the fear of want would be gone. The springs of production would be set free and the enormous increase of wealth would give the poorest ample comfort. Men would no more worry about finding employment than they worry about finding air to breathe; they need have no more care about physical necessities than do the lilies of the field. The progress of science, the march of invention, the diffusion of knowledge, would bring their benefits to all. With this abolition of want and the fear of want, the admiration of riches would decay and men would seek the respect and approbation of their fellows in other modes than by the acquisition and display of wealth. In this way there would be brought to the management of public affairs, and the administration of common funds the skill, the attention, the fid
elity and the integrity that can now be secured only for private interests.9

  EDWARD BELLAMY’S ANCESTORS included pirates and preachers. The preachers were more numerous but the pirates, naturally, more intriguing. Samuel Bellamy raided along America’s Atlantic coast from a base in New England in the early eighteenth century; according to the compiler of a pirates’ who’s who, Captain Bellamy possessed “considerable gifts for public speaking”—perhaps deriving from the same sources as the preachers’ fluency—and a progressive social conscience. “His views were distinctly socialistic.”10

  Edward Bellamy’s immediate antecedents were more conventional but still distinctive. His mother was the straightest-laced woman in Chicopee, Massachusetts. “My grandmother was orthodox about everything, even to sewing a seam,” Bellamy’s daughter remembered. Idleness was not permitted her children. “ ‘Get a book’ was Mother’s never failing suggestion,” Bellamy’s brother recalled. Bellamy’s father was the family libertine, although given his wife’s Calvinist views and the conventions of mid-nineteenth-century Massachusetts, he confined his indulgences to the dinner table. “That he will in the end kill himself with his knife and fork there is not the slightest doubt,” Edward wrote. “But I hope we may, by constant endeavors, persuade him to postpone his suicide for a few years.” A few years was all they managed: the elder Bellamy died young, of obesity-aggravated causes.11

  After a year at Union College in Schenectady, New York, Edward Bellamy toured Europe with a cousin. Conditions in the English countryside appalled him. Farm laborers lived in tiny huts with sodden floors, generations jumbled all together. “It is very common indeed for the father and mother of a family with their grown up sons and daughters, together with men lodgers, to be compelled to share between them one small bedroom,” he wrote. “The immorality is shocking, and crimes of the most abominable descriptions are exceedingly frequent.” Conditions were better in Germany, in part because German workers were better organized, in the German Workers’ Party, in part because the German state was stronger, under Chancellor Bismarck.12

  Bellamy studied law but never practiced, choosing a literary career instead. He wrote editorials for the Springfield Union of Massachusetts, occasional pieces for the New York Evening Post, and freelance articles for assorted periodicals. At thirty, in 1880, he started a paper, the Springfield Daily News, with his brother. The paper suffered its share of birthing problems; Bellamy searched for readers even as he struggled to find his voice. The plight of labor—and the problems labor’s plight caused the rest of society—furnished an early theme. “Don’t make it a point to say that the workmen are in the wrong when there is a strike,” a letter writer who sounded suspiciously like Bellamy himself requested of the editor. “Don’t fill your paper with lies about how terribly easy it is for a poor man to live on $1.00 a day. Remember it isn’t so very much easier than it would be for you, and don’t forget either that there are a hundred poor fellows for one even decently well off. I shall keep my eye on you, and a good many of my sort beside.”13

  The demands of the paper didn’t monopolize Bellamy’s time, nor its columns exhaust his store of ideas. The strikes of the 1870s and 1880s seemed to Bellamy signs that democracy couldn’t stand the strains of capitalism; the Haymarket affair of 1886, in which a bomb at a Chicago rally on behalf of striking workers, and gunfire that followed, killed several policemen and civilians and wounded many others, suggested that a crisis was imminent. In the months after Haymarket, Bellamy raced to commit his thoughts to paper; the result was published in 1888.

  Looking Backward, 2000–1887, was a socialist tract wrapped in science fiction romance. Bellamy put his Boston protagonist, Julian West, to bed in 1887 and kept him slumbering till 2000, when he awakens to find his home city transformed into an urban paradise. His hosts in the future, the insightful Dr. Leete and his charming daughter, Edith, master their surprise at seeing this Yankee Rip Van Winkle and query him regarding the world whence he has come. They have read of the labor troubles and other capitalist strife of the nineteenth century, but they want to hear the grim story from a survivor.

  “I cannot do better than to compare society as it then was to a prodigious coach which the masses of humanity were harnessed to and dragged toilsomely along a very hilly and sandy road,” Julian explains, in an image and a passage that became famous among Bellamy’s many enthusiasts.

  The driver was hunger, and permitted no lagging, though the pace was necessarily very slow. Despite the difficulty of drawing the coach at all along so hard a road, the top was covered with passengers who never got down, even at the steepest ascents. These seats on top were very breezy and comfortable. Well up out of the dust, their occupants could enjoy the scenery at their leisure, or critically discuss the merits of the straining team. Naturally such places were in great demand and the competition for them was keen, every one seeking as the first end in life to secure a seat on the coach for himself and to leave it to his child after him. By the rule of the coach a man could leave his seat to whom he wished, but on the other hand there were many accidents by which it might at any time be wholly lost. For all that they were so easy, the seats were very insecure, and at every sudden jolt of the coach persons were slipping out of them and falling to the ground, where they were instantly compelled to take hold of the rope and help to drag the coach on which they had before ridden so pleasantly. It was naturally regarded as a terrible misfortune to lose one’s seat, and the apprehension that this might happen to them or their friends was a constant cloud upon the happiness of those who rode.

  But did they think only of themselves? you ask. Was not their very luxury rendered intolerable to them by comparison with the lot of their brothers and sisters in the harness, and the knowledge that their own weight added to their toil? Had they no compassion for fellow beings from whom fortune only distinguished them? Oh, yes; commiseration was frequently expressed by those who rode for those who had to pull the coach, especially when the vehicle came to a bad place in the road, as it was constantly doing, or to a particularly steep hill. At such times, the desperate straining of the team, their agonized leaping and plunging under the pitiless lashing of hunger, the many who fainted at the rope and were trampled in the mire, made a very distressing spectacle, which often called forth highly creditable displays of feeling on the top of the coach. At such times the passengers would call down encouragingly to the toilers of the rope, exhorting them to patience, and holding out hopes of possible compensation in another world for the hardness of their lot, while others contributed to buy salves and liniments for the crippled and injured. It was agreed that it was a great pity that the coach should be so hard to pull, and there was a sense of general relief when the specially bad piece of road was gotten over.

  The worst pieces of Bellamy’s road were the strikes and violence that resulted when workers attempted to diminish the gap between themselves and the riders of the carriage they pulled. Julian’s first question, upon observing the wealth and splendor of the new Boston, is how America has solved the labor problem. “It was the Sphinx’s riddle of the nineteenth century,” he says, “and when I dropped out the Sphinx was threatening to devour society.”

  “I suppose we may claim to have solved it,” Dr. Leete replies. “Society would indeed have fully deserved being devoured if it had failed to answer a riddle so entirely simple. In fact, to speak by the book, it was not necessary for society to solve the riddle at all. It may be said to have solved itself. The solution came as the result of a process of industrial evolution which could not have terminated otherwise. All that society had to do was to recognize and cooperate with that evolution, when its tendency had become unmistakable.”

  Julian is mystified. The keenest minds of his age wrestled with the labor problem only to make it worse; now Dr. Leete says the problem has vanished of its own.

  The doctor traces its demise. “What should you name as the most prominent feature of the labor troubles of your day?” he asks Julian.r />
  “Why, the strikes, of course.”

  “Exactly. But what made the strikes so formidable?”

  “The great labor organizations.”

  “And what was the motive of these great organizations?”

  “The workmen claimed they had to organize to get their rights from the big corporations.”

  “That is just it. The organization of labor and the strikes were an effect, merely, of the concentration of capital in greater masses than had ever been known before. Before this concentration began … the individual workman was relatively important and independent in his relations with the employer. Moreover, when a little capital or a new idea was enough to start a man in business for himself, workingmen were constantly becoming employers, and there was no hard and fast line between the two classes. Labor unions were needless then, and general strikes were out of the question.” Things changed as capitalism matured and large corporations supplanted and subsumed the small. The individual laborer lost autonomy and bargaining power. “Self-defense drove him to union with his fellows.” Strikes and violence were the inevitable result.