Monday, May 4, 2009

Religion and Capitalism in Early America

One of my favorite books during my time in graduate school was, The Market Revolution: Jacksonian America, 1815-1846 by Charles Sellers. In this book, Sellers attempts to discover the roots of American capitalism by analyzing first the roots of the American subsistence and bartering economy, which was both highly localized and an extremely intimate means of tying neighbors together in a communal relationship of trust. However, Sellers argues that this communal system of economics was quickly replaced by the emergence of market capitalism during the early years of the 19th century. He writes:

By 1815 the combined influence of Federalism and entrepreneurial Republicanism had completed an essential stage of the market revolution by committing the commercial states to the political economy of capitalism (40).
As a result, the means by which goods were bought, shipped, sold etc. had been changed, catapulting the new nation into a frenzy of capitalist expansion. States like New York were quick to take advantage of this capitalist explosion. The completion of the Erie Canal for example, illustrates just how much the United States had changed in the ways in which it conducted business since the founding era. Goods were now being shipped across the nation and the Atlantic as farmers, merchants, etc. converted from their traditional bartering system by embracing a capitalist mindset to the production and sale of their goods.

Not everyone, however, was happy with this change. After all, the communal/bartering system of economics, which had literally tied neighbors and towns together in a web of mutual dependence, was being pulled out from under their feet. Scores of impoverished families who had fallen victim to the swift changes brought on by market economics sought refuge and understanding in the wake of their local disaster.

As is often the case during difficult times, these downtrodden masses sought the security and reassurance of religion to alleviate their troubles. And since the American religious landscape was already caught up in a storm of Christian revival -- i.e. the Second "Great Awakening" -- citizens did not have to look far to find a pastor that was ready and willing to hear their plea. As a result, many pastors resorted to castigating the Market Revolution as being the fruits of greed and personal selfishness. Originally spawned by the passionate late 18th century pastors like Johnathan Edwards, Samuel Hopkins and others, the "New Divinity" hoped to capture the minds and hearts of its followers by presenting a creed based on "disinterested benevolence," which shunned personal gain in favor of communal security. As Sellers states:

For intensely pressured Yankees, the New Divinity's apocalyptic utopia was an irresistible fantasy of surcease from market pressures. Amid "universal peace, love, and general and cordial friendship." Hopkins (and others) promised "no unrighteous persons" would "invade the rights and property of others." Invoking one of the subsistence culture's favorite Biblical images, he declared that "every one shall securely sit under his own vine and fig-tree, and there shall be none to make him afraid." Lawsuits, luxury, and waste would cease. There would be "such benevolence and fervent charity" that "all worldly things will be in great degree common, so as not to be withheld from any who may want them" (207).
For a people caught between the "tug-o-war" of capitalist economics and religious communal Utopianism, this division became extremely personal. As could be expected, those who reaped success from the newfound opportunities of the Market Revolution saw their personal gain as the result of hard work, dedication, and divine intervention. Those on the "losing" end of the equation, however, were quick to accept the new doctrine of communal economics that pointed the finger at emerging Market forces as being, "the Biblically predicted time of rampant discord and worldliness that would immediately precede the Millennium" (207).

Of course this cultural "back-and-forth" between personal economic gain v. the prosperity of the community was nothing new in early America. For decades, Americans had argued that the personal greed often associated with capitalism would lead to the undoing of the whole by eventually concentrating the majority of wealth into the hands of the few. Even Adam Smith, the so-called "father" of capitalism understood just how polarizing the ideals of capitalism could be on the masses when he wrote:

The necessaries of life occasion the great expense of the poor...The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess...It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion

In a letter to Benjamin Vaughn, Benjamin Franklin also pointed out his distrust of the elite having too much money and power in their hands. Using an analogy to prove his point, Franklin writes:

When by virtue of the first Laws Part of the Society accumulated Wealth and grew Powerful, they enacted others more severe, and would protect their Property at the Expense of Humanity. This was abusing their Powers, and commencing a Tyranny. If a Savage before he enter’d into Society had been told, Your Neighbour by this Means may become Owner of 100 Deer, but if your Brother, or your Son, or yourself, having no Deer of your own, and being hungry should kill one of them, an infamous Death must be the Consequence; he would probably have prefer’d his Liberty, and his common Right of killing any Deer, to all the Advantages of Society that might be propos’d to him.

And while the early years of American capitalism were clouded in a fog of religious and popular skepticism, it is clear that today's American capitalism has been "piggy-backed" with the belief that God sanctions capitalism above all others. When and how this transition occurred is, well, another topic for another day.

***For an interesting discussion of capitalism in early America visit the website for The Thomas Jefferson Hour by clicking here. Scroll down to "Listen to the Show" at the bottom of the left column and then click on episode # 766: Adam Smith. Here, historian Clay Jenkinson takes on the role of Thomas Jefferson in a discussion with Adam Smith (portrayed by another historian) and their discourse on capitalism.***


Tom Van Dyke said...

Very nice, Brad. I'll listen to the radio thing when I can. Jefferson was an agrarian at heart, and the wonderfully wise Adam Smith was certainly no heartless bastard.

My question---did things settle down in Market Revolution upheaval? [At least until the Civil War, and then even greater technological/economic upheaval in the late 1880s...] Was religion unhelpful or irrelevant?

As for capitalism-as-God's will, capitalism-as-free enterprise is not quite the same as our current crisis, capitalism-as-corporatism. Corporatism as unaccountably spending [and receiving!] Other People's Money brings its own set of problems, as the entrepreneur and the manager and the investor are no longer synonymous.

Tom Van Dyke said...


Tom Van Dyke said...

Ah. I was even more correct than I gave meself credit for. As usual.


Brad Hart said...

Hey Tom, thanks for the links. Sorry for taking so long in responding. As for your question, Sellers argues that things didn't settle down until the late 1840s, when the Market Revolution's impact had taken hold over the majority of the country. As for religion being helpful/irrelevant, Sellers would probably argue that it was irrelevant but I disagree. I think religion was quite relevant. It was at this same time that you had more communal/utopian religious orders spring up all across the country than at any other time. Historian Richard Bushman claims that during these early years over 180 different Zionist/utopian congregations were founded, the most well know being the Mormons. I've written before about how Joseph Smith (the founder of the Mormons) was passionately opposed to market capitalism. In fact, the whole early history of the Mormons can be seen as essentially a reaction to market economics.

I hope to write more about this topic. It's something I am interested in quite a bit and I think doesn't get enough play.

Tom Van Dyke said...

Excellent stuff. Thx.