The Americans

by Hugo Münsterberg

Another factor is that the political situation is now certain, as it was not at the time of the last panic. The silver schemes of the West then filled the country with apprehension, whereas to-day there are no such political fears. However the Presidential election may turn out, there will be no dangerous experiments tried with the currency; and even if both parties should mildly oppose the trusts, the nation nevertheless knows that just the formation of these trusts has contributed to the steadiness and security of economic prosperity, that it has done away with unnecessary competition, has brought about an orderly and uniform production, and that although the purchasers of watered stocks may have been bitten, the purchasers of the finished products have suffered little inconvenience.

Then there are two other factors whose significance for economic solidity cannot be overestimated. The first of these is the increasing independence of the agricultural West, and the second is the industrial revival of the South. The financial condition of the New York Stock Exchange to-day no more represents the industrial life of the whole nation, as it did ten years ago. The West, which before the panic of 1893 was up to its ears in debts owned by the East, is now, by reason of six tremendous harvests, prosperous and independent, and its purchasing power and business enterprise are no longer affected by the fluctuations of Wall Street. Even if the shares of all New Jersey corporations should collapse, the nation could continue to buy and sell, produce, manufacture, and transport, because the Western agricultural states would suffer no relapse of prosperity. They have paid off their mortgages and laid money by; the farmer has bought his daughter a parlour organ, sent his sons to college, and bent all his energies to making his West into an economic paradise. Migration has once more set in from the Eastern to the Western States, while during the poor years it had almost stopped; and Western economic influence is asserting itself more and more in the political field.

The same is more or less true of the South. In former times, whenever a cotton harvest brought prosperity, the South still did not take the trouble to utilize its ample resources outside of the plantations. It did not try to mine its coal and iron deposits, nor exploit its forests, nor grow wheat and corn, nor manufacture cotton into cloth, nor the cottonseed into oil. It left all this to the North. But during hard times the South has learned its lesson, and at the time of the last great revival the whole South developed an almost undreamed-of economic activity. The exploitation of forests and coal and iron deposits made great strides, and the factories turned out articles to the value of $2,000,000,000. Cotton is still the staple article of the South, but the bales no longer have to be sent to the North to be made into cloth. As early as 1899 there were 5 million spindles in operation, and the manufacture of cotton has made the South more independent than any number of bales produced for export could have made it.

This economic independence of one another of large sections of the country, and at the same time of European capital, combined with the large increase of commerce with the whole world, the improvement in economic appliances, and a surprising growth in technical science and technical instruction, has created a national economic situation which is so different from that which prevailed in the beginning of the nineties, that there is no analogy to justify the pessimist in predicting another such panic. It had to come at that time. Industrial forces had suffered a serious disaster and had to go back to camp in order to recuperate. Since then they have been striding forward, swerving a little now and then, it may be, to avoid some obstacle, but they are still marching on as they have marched for seven years with firm and steady step, and keeping time with the world-power tune which the national government is playing.

CHAPTER THIRTEEN
The Economic Problems

We have aimed to speak of the American as he appears in the economic world—of the American in his actual economic life and strife—rather than merely of his inanimate manufactures. That is, we have wished specially to show what forces have been at work in his soul to keep him thus busied with progress. And although we have gone somewhat further, in order to trace the economic uplift of the last decades, nevertheless we have chiefly aimed merely to show the workings of his mind and heart—not the economic history of the American, but the American as little by little he builds that history, has been the point of interest.

Seen from this point of view, everything which stands in the foreground of the actual conflict becomes of secondary interest. The problems leading to party grievances which are solved now one way, now another, and which specially concern different portions of society, different occupations or geographical sections, contribute very little to reveal the traits that are common to all sections, and that must, therefore, belong to the typical American character. If we have given less thought to the political problems of the day than to the great enduring principles of democracy, we need still less concern ourselves with the disputes of the moment in the economic field. The problems of protection, of industrial organization, of bimetallism, and of labour unions are not problems for which a solution can be attempted here.

And nevertheless, we must not pass by all the various considerations which bear on these questions. We might neglect them as problems of American economy; and purely technical matters, like bank reform or irrigation, we shall indeed not discuss. But as problems which profoundly perplex the national mind, exercise its best powers, and develop its Americanism, silver, trusts, tariff, and labour unions require minuter consideration. The life and endeavour of the Americans are not described if their passionate interest in such economic difficulties is not taken into account; not, once more, as problems which objectively influence the developing nation, but as problems which agitate the spirit of the American. An exhaustive treatment is, of course, out of the question, if for no other reason than that it would distort our perspective of things. Had we only the objective side of the problems to consider, we might, perhaps, doubt even whether there were any problems; whether they were not rather simple events, bringing in their train certain obvious consequences, whether deplorable or desirable. These economic problems are, indeed, not in the least problematical. The silver question will not be brought up again; the trusts will not be dissolved; the protective tariff will not be taken off and labour unions will not be gotten rid of. These are all natural processes, rather than problems; but the fact that these events work diversely on men’s feelings, are greeted here with delight and there with consternation, and are accompanied by a general chorus of joy and pain, gives the impression that they are problems. This impression seizes the American himself so profoundly that his own reaction comes to be an objective factor of importance in making history. It is not to be doubted that the course of these much-discussed economic movements is considerably influenced by prejudices, sentiments, and hobbies.

The Silver Question

Perhaps the power of mere ideas—of those which are clear, and, even more, those which are confused—is shown in none of these problems more strongly than in the silver question. If any problem has been really solved, it is this one; and still no one can say that it has dropped out of the American mind, although, for strategic reasons, politicians ignore it. The sparks of the fire still glow under the ashes of two Presidential campaigns. The silver schemes have too strongly fixed public attention to be so quickly forgotten, and any day may see them revive again. Just here the possibility of prejudices which would not profit by experience has been remarkably large, since the question of currency involves such complicated conceptions that fallacious arguments are difficult to refute. And such a situation is just the one where the battle of opinions can be waged the hottest: the silver question has, in fact, more excited the nation than any other economic problem of the last ten years. And there can be no doubt that many valid arguments have been urged on the wrong side, and some untenable theses on the right side.