Session Abstract

Americans are once again reconsidering capitalism.  After more than a quarter-century of considerable deference to capitalism, colossal market failures in the financial, manufacturing, and healthcare sectors have raised serious doubts about the efficacy of laissez faire capitalism.  In this panel, we revisit earlier moments of crisis and transformation in American history, asking a basic question:  How did capitalism become a fundamental feature of the American identity?  Sharon Murphy, Ben Soskis, and Christy Chapin demonstrate that the story of how capitalism came to pervade American culture was as much about crafting a positive image of private ownership and business as it was about efficient outcomes.   Starting in the nineteenth century and working their way up to topics of current political discussion, these three panelists uncover how citizens debated and shaped the precise form that capitalism would take.

Sharon Murphy pushes at the boundaries of standard narratives to inquire how image and public relations led to the demise of the Second Bank of the United States.  In a battle that pitted proponents of a strong centralized economy against Jacksonian Democrats, each group of policymakers understood that whoever won the battle over the Bank’s image would win the war over the Bank’s political future.  Murphy finds that Nicolas Biddle’s failure to convince the working and middle classes that the Bank was necessary for financial order, credit, and lending is the key to understanding the Bank’s downfall. 

Ben Soskis examines how businessmen attempted to portray themselves in a positive light during the Gilded Age and Progressive Era.  Rather than disregard the sensational stories that depicted the cruelty and excesses of “robber barons,” businessmen such as Rockefeller and Carnegie directly engaged the criticism. They attempted to convince the public that being wealthy entailed numerous difficulties.  Chief among these problems was the responsibility that wealthy businessmen had to define and meet public needs.  By tapping into Christian discourse, the businessman could project an image, not as one of the lucky few, but as a sacrificial lamb tasked with fulfilling a sacred duty for the people. 

Christy Chapin argues that policymakers transformed capitalism during the twentieth century by transferring many of the risks associated with private ownership from the individual to the corporation and the state.  By constructing federal policies that compelled bankers and insurers to reconceptualize risk and radically alter the products offered to the consuming masses, policymakers made capitalism more acceptable to Americans.  Chapin concludes that short term gains for consumers ultimately led to instability in the banking and health insurance markets. 

As various groups debated the nature of the American economy, policymakers and businessmen attempted to project a particular image of capitalism – one that promised safety and security to all citizens.  Citizens were told that if they accepted the Second Bank, the vast fortunes of a few businessmen, and industry regulation, then they would discover that the economy minimized individual risk and instead embodied a softer, gentler form of capitalism.  In this way, capitalism became a central feature of American life.