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The Evolution of American Capitalism

Although the American economic system has undergone significant change since colonial times, there are identifiable threads running through the centuries-long narrative. Chief among these are the themes of "liquidity" and state action – both of which can either be a blessing or a curse.

  • Jonathan Levy, Ages of American Capitalism: A History of the United States , Random House, 2021.

CAMBRIDGE – Jonathan Levy, a historian at the University of Chicago, is a leader in the burgeoning movement to place capitalism at the core of the American experience. His major new work provides a framework for reading American history over 400 years and a set of themes for explicating its conflicts and crises. Ages of American Capitalism is an outstanding work of scholarship and storytelling.

The “new history of capitalism” has been motivated in good part by the 2008 global financial crisis. The crisis demonstrated the impact that financial events could have on the real economy, thereby exploding the prevailing macroeconomic doctrine that treated such events as literally inconceivable. Levy is one of a number of generally younger historians whose work is available to enrich the ongoing construction of a macroeconomics that integrates the behavior of financial markets and institutions.

American Capitalism

The new history he delivers is different in kind from much that has gone before. It roots the “maps and chaps” of conventional historical narratives in the muck of economic life and the fantastic visions of financiers. It is a history constantly informed by what is happening in markets for goods, services, labor, and – especially – financial assets, but with the structure and movements of markets always understood to be shaped by political forces.

Levy’s book demonstrates the power of grand, synthetic history at its best. History of this kind is always subject to criticism for what it leaves out, particularly instances that might illustrate or call into question the historian’s argument. But, whereas much of American history’s energy in recent years has come from accounts that deliver the experience and the perspective of the exploited or the merely ignored – history from the bottom up – that is not the engine moving this narrative.

Levy draws on the work of the originator of macroeconomics, John Maynard Keynes, from whom he takes his central theme of “liquidity,” the defining attribute of money that enables its owner to effect transactions in goods and services (“transactional liquidity”), hoard resources for fear of an uncertain future (“precautionary liquidity”), and speculate on the appreciation of asset prices (“speculative liquidity”). It is the flux and reflux of liquidity within financial markets and between those markets and state agents and entities that drives Ages of American Capitalism , and have shaped how Americans have worked, earned, consumed, and invested – and protested and voted – over 400 years.

The Age of Commerce

Levy structures his book around four “ages.” The first, Commercial Capitalism, emerged in the colonial seventeenth century and broadly persisted until the Civil War. British mercantilism initially encouraged the growth of commerce, which gradually pulled colonists from subsistence farming into increasing dependence on market exchanges. A political economy of property – land and people – developed along a north-south axis, mediated by the rivers of the Mississippi system.

As he explores the multiform interactions between markets and political processes, Levy builds on one of the main achievements of the new history of capitalism: its in-depth investigation of “ slave capitalism ” and its interdependence with northern commercial and nascent industrial capitalism. Even as industry, led by textiles, appeared in New England and spread to the old northwest, the internal market in, and ownership of, slaves enabled the cotton kingdom to expand south and west.

In 1860, Levy notes, the value of property in slaves was three times the value of all US industrial capital. The expansion of slave capitalism thus drove the politics of the Age of Commerce. Not only was this evident in a succession of national compromises – the Missouri Compromise of 1820, the Compromise of 1850, and the Kansas-Nebraska Act of 1854; it also led to a rejection of Henry Clay’s effort to re-animate Alexander Hamilton’s vision of a federally funded “American System” of infrastructure investment. Levy aptly reports the warning of a North Carolina congressman: “If Congress can make canals, they can with more propriety emancipate” the enslaved.

From the Revolution to the Civil War, the defense of slavery meant that funding for “internal improvements” was overwhelmingly left to the states. Canals and turnpikes extended the market and, as Adam Smith had predicted, induced higher productivity through intensification of the division of labor. Growing internal-market demands, in turn, motivated more investment in northern manufacturing, supported by the one element of the Hamilton-Clay program that survived southern resistance: protective tariffs. And exports of slave-produced cotton, along with waves of speculative capital from London, funded the imports that domestic producers could not yet provide.

A turning point in the Age of Commerce came in 1832, when Andrew Jackson mobilized “the Democracy” against the East Coast capitalists and vetoed extension of the Second Bank of the United States. An era of “wildcat banking” followed, with state-chartered banks springing up, subject to no effective supervision and devoid of recourse to any lender of last resort.

The financial fragility that accompanied economic growth in the new nation highlights the role of confidence as what Levy describes as “the emotional and psychological mainspring of economic activity.” Levy brilliantly illuminates this theme by invoking P.T. Barnum’s exploitation of suckers and Herman Melville’s 1857 novel, The Confidence-Man. By then, American capitalism had arrived at a point that made Melville ask: “What would happen if economic life – nay, life itself – were nothing more than a running series of commercial transactions in pursuit of pecuniary gain?”


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Levy uses Melville to limn the contradictory dynamics of “capitalist cycles of boom and busts, just emerging in his day.” While “speculation can lead to genuine capitalist investment booms” – what I have termed “productive bubbles” – “individuals can also succumb to the temptations of short-term speculation alone.” And in Melville’s central character of the miser who hoards “the hard currency of gold for precautionary… reasons,” Levy finds the final contradiction that liquidity offers: the excessive “liquidity preference” that Keynes identified as the source of prolonged economic slumps.

The Age of Commerce ended when conflict between the expanding slave economy and an expanding industrial economy could no longer be managed through compromise. The North’s increasing investment in physical assets had fueled the development of a railroad network from the East Coast to the Great Lakes and beyond. When war finally broke out, the North’s infrastructure for moving men and munitions radically exceeded that of the South.

The Union’s victory in the Civil War ended 250 years of chattel slavery in the territory of what had become the US. Here, Levy cites economists Mary and Charles Beard’s observation that emancipation represented “the most stupendous act of sequestration in the history of Anglo-Saxon jurisprudence.” If human beings could no longer be capitalized into economic wealth, where would capitalism turn next?

The Age of Capital

What followed was industrialization on a scale never previously imagined. Railroads fundamentally changed the country’s economic geography – shifting the north-south axis to an east-west one – while a reduction in transportation costs enabled new economies of scale as specialized manufacturing reached markets that were now national in scope.

One shortcoming of Levy’s discussion of the post-Civil War industrial economy is that he misses an opportunity to put earlier economics-driven historical analyses in their place. Almost 60 years ago, the Nobel laureate economist Robert Fogel set out to extract the American railroad network from the statistical economy of 1890. On the critical assumption that the resources invested in building railroads would otherwise have been fully employed in extending canals and improving roads, Fogel concluded that the “social saving,” or incremental reduction in transportation costs, that the railroads provided was trivial – on the order of 2% or less of national income.

Since then, economists have shown that the railways had an economic impact orders of magnitude above what Fogel’s “cliometric” analysis found. For example, Dave Donaldson and Richard Hornbeck note that, “Removing all railroads in 1890 is estimated to decrease the total value of US agricultural land by 60%, with limited potential for mitigating these losses through feasible extensions to the canal network or improvements to country roads.” Hornbeck returned to the subject with Martin Rotemberg, this time to examine the increases in manufacturing productivity consequent on gaining market access through railroads: “We estimate that US aggregate productivity would have been 25% lower in 1890, in the absence of the railroads, with an associated annual loss of $3 billion or 25% of GDP.”

I linger on the railroads and their central role in the Second Industrial Revolution for three reasons. First, it is important to highlight the kind of quantitative economic history being done by Donaldson and his co-authors, where data is subjected to causal interrogation. The “empirical turn” in the economics discipline is not only liberating economists from the neoclassical fixation on efficiency as the sole criterion for evaluating market outcomes. It is also offering historians rigorous frameworks in which to anchor their narratives.

The second reason to focus on the advent of the railroads is that, as Levy explains, “a new industrial investment multiplier” now complemented Adam Smith’s “commercial multiplier” in driving economic growth. It was no longer just the increased extent of the market that mattered. Railroads needed steel, and steel production depended on coal. But with this expanded production came additional materials for industrial and commercial construction. Levy might therefore have gone one step further and recognized mail-order retail – invented and delivered by Montgomery Ward and Sears Roebuck – as the railroad era’s “killer app” that created a truly national market for consumer goods of all sorts.

The third reason is to highlight the much richer context in which Levy situates his discussion, compared with Fogel. Using the contrasting life histories of the financier Jay Gould and Andrew Carnegie, the reformed investor turned industrialist, Levy shows how the Second Industrial Revolution was finely balanced between speculation and productive investment, with corruption deepening the interdependence between markets and politics. And this dynamic played out at the same time that emancipation was being betrayed – a development happening “offstage,” but certainly not beyond Levy’s reach.

Gilded Greed

Onstage, following emancipation, the political economy of property was transformed into the political economy of income. Industrial workers and organized farmers began to contest for larger, more consistent shares of the rising value-added being generated by industrial capital and claimed by its owners. Carnegie’s defensive response to this was philanthropy – a story well documented by Levy. But while Carnegie was funding public libraries, his subordinate Henry Clay Frick was mobilizing the Pennsylvania Militia to shoot down strikers at Carnegie’s Homestead Steel Works.

The attempt to create a farmer-labor alliance against capital focused on the gold standard as both the symbol and engine of international financial discipline. The 1896 election represented the triumph of the first great wave of globalization – resulting from the confluence of new transportation (railroads, steamships) and communication (telegraphy) technologies – over populist domestic politics. Yet even as income and wealth inequalities reached their peak, there were indications that unbridled capitalism could generate political responses that represented some aspects both of regulation and of insurance from outside the market.

For example, the 1887 Interstate Commerce Commission (ICC) was created in response to agrarian outrage at the rate-setting power of the railroads and their corruption of local, state, and federal legislatures in pursuit of land grants. Ironically, as we shall shortly see, it also served to defend the railroads from themselves. Then, the 1913 Federal Reserve Act belatedly confirmed that President Abraham Lincoln’s National Bank Act was utterly inadequate as a bulwark against the persistent boom-bust, speculation-hoarding cycles that had continued to animate industrial capitalism.

The Age of Capital’s climax came between 1895 and 1904, and expressed itself in the Great Merger Movement, the unprecedented consolidation of some 1,800 industrial firms into 157 corporations organized as trusts to evade the common law prohibition of cartels. Levy correctly documents the revolution in the means of valuing businesses that accompanied (and rationalized) the trust movement. Businesses had previously been valued based on their historic record of paying dividends to their shareholders. But now, they were to be valued on their prospective earning – and thus dividend-paying – power.

The first wave of this phenomenon, as Levy notes, began when J.P. Morgan’s bankers took control of railroads that were facing default on debts that the bank had sold to its clients. But, surprisingly, Levy does not address the underlying logic that explains why the railroads, followed by enormous swaths of mid-scale manufacturing industry, needed to be recapitalized and consolidated.

The railroads exemplified network economics: enormous, debt-financed investment is required to yield a service whose marginal cost approaches zero for delivering the incremental seat-mile or ton-mile. The same logic applies to telegraphy and telephony, electric power generation and distribution, cable television, and internet connectivity. Under competitive conditions in these industries, prices will tend toward marginal cost, which is necessarily less than the average cost after accounting for debt service. All competitors lose money.

Beyond these technology-enabled service industries, the communications and transportation innovations that enabled the first great globalization radically intensified competition within vastly expanded markets across virtually all manufacturing sectors. Hence, the railroads and many other industries had an existential need to restrict competition and amass enough market power to raise prices above marginal cost.

While the ICC represented the political legitimization of this solution for the railroads, the trust movement invited antitrust intervention by the state. But regulated or not, the monopolies built during the Gilded Age could not freeze technological innovation or stop the process of Schumpeterian creative destruction. The power of the railroads would eventually be undermined by automobiles and the trucking industry, operating on – and therefore subsidized by – the most economically important infrastructure solely financed by the state: roads and highways.

Levy accounts for the variable of innovation as he moves from the trust movement to a detailed analysis of “Fordism,” the moving production line that became an industrial religion in the years before, during, and after World War I. In direct contrast with the defensive, financially driven restructuring of railroads and established manufacturing, Henry Ford the man and Ford the company rejected dependence on outside sources of capital, presenting an aggressive model of self-financed industrialization that could only rarely be emulated.

Levy passes swiftly through the great bull market on Wall Street, and thus largely misses the productive bubble within the boom that accelerated electrification, the second great deployment of transformational, technologically innovative network infrastructure after the railroads. On the international front, he recounts the ignorance and indifference with which the US emerged from World War I, incapable of accepting the responsibilities that attended its status as the world’s dominant economic and financial power.

Nemesis, in the form of the Great Depression, soon followed. Levy’s invocation of Keynes in his opening pages now resonates when he identifies the liquidity trap into which the economy sank. “Paradoxically,” he notes, “the Great Depression could not have happened a century earlier.” Only in an economy with so much of its wealth denominated in money – in contradictory fashion, both a potential means of investment in production and a potential store of value that saps production – could a crash have such collapsing economic effects.

The Age of Control

As a systemic loss of confidence threatened the liquidation of capitalism itself, the Age of Capital yielded to the Age of Control. Barely a week after taking office, in his first fireside chat, US President Franklin D. Roosevelt banned the private export of gold and announced a national bank holiday. Only “sound” banks would be allowed to reopen, and, as they did, the national bank run was reversed: cash flowed back into deposits. The volatile dynamics of liquidity, central to Levy’s fundamental argument, were tamed by an exogenous source of confidence emanating from the White House.

The “early pivot” of economic recovery, according to Levy, was Roosevelt’s decision to abandon the gold standard, freeing the US from its “ golden fetters .” But Levy fails to mention that Roosevelt went further than that, formally rejecting the international cooperation sought by the June 1933 London Conference, which would have subjected US domestic policy to deflationary international constraints. Instead, Roosevelt made an explicit and demonstrable commitment to inflation, and that proved sufficient to break “deflationary expectations and [lead] to a recovery of spending of all kinds.”

Levy analyzes the Roosevelt administration’s response to the Great Depression along two dimensions: regulatory and developmental. The New Deal’s regulatory initiatives both constrained business behavior and, by formally sanctioning trade unions and establishing a national minimum wage and the Social Security system, shifted the terms of the political economy of income. The developmental initiatives also operated through two channels: state-funded public corporations supported private-sector companies while new federal agencies invested fiscal resources directly into the construction of public assets.

Levy might have paid more attention to what at the time appeared to be the New Deal’s centerpiece: The National Recovery Administration. The NRA proposed to bring order to American industry, while a companion institution, the Agricultural Adjustment Administration, was to do the same for the farm economy. But both institutions reflected the profound confusion of conventional pre-Keynesian economics. Their architects looked out at mass unemployment and collapsing prices and sought salvation on the supply side of the economy. The idea was that by restricting production, state interventions in the market economy could raise prices, restore profits, and effect a recovery.

Keynes himself sought to intervene in this policy debate. And though he had already recognized that a shortfall of aggregate demand was the source of economic collapse, his political judgment was deficient. In an open letter in late 1933, Keynes saw that governments faced the double task of “Recovery and Reform.” He urged Roosevelt to defer reform and “not upset the confidence of the business world,” believing that a successful recovery would create “the driving force to accomplish long-range Reform.” Fortunately, while Roosevelt’s understanding of economics was primitive, his political instincts were sound. He saw that only in a crisis could radical reforms be enacted.

In 1935, the Supreme Court declared the NRA and other New Deal interventions unconstitutional. By denying that the federal government had the authority to respond to the crisis, the Court transformed a policy fiasco into a popular political rallying cry. When the incipient recovery appeared to stall, Roosevelt responded to the Court’s challenge by launching the substantially more radical “Second New Deal” of 1935, encompassing the Social Security Act, the National Labor Relations (“Wagner”) Act, the Banking Act of 1935, the Rural Electrification Administration, and the Public Utilities Holding Company Act. Contrary to Keynes, recovery and reform marched hand in hand to the tune of FDR’s radical rhetoric against “economic royalists.”

In the event, the recovery resumed in time for FDR’s landslide victory in 1936. Levy works his way through the complex, frustrating dynamics of politics and economics in Roosevelt’s second term. While the economy had recovered to 1929 levels, it remained manifestly fragile. When Roosevelt yielded to Secretary of the Treasury Henry Morgenthau and others who were calling for a return to balanced-budget orthodoxy, the result was the “Roosevelt Recession” of 1937-38.

But Roosevelt then followed the proto-Keynesian advice marshaled by US Federal Reserve Chair Marriner Eccles. With the Public Works Act of 1938, he presided over the first deliberate act of deficit spending in peacetime American history. By the time Hitler started World War II, a renewed US economic expansion was already taking hold.

From War to Golden Age

The fall of France in June 1940, 18 months before the Japanese attack on Pearl Harbor, triggered the massive commitment to rearmament that definitively ended the Depression. The Roosevelt administration implemented far more extensive controls of business and launched a powerful new type of public-private partnership: federally funded “government owned/contractor operated” defense plants. Even while the armed services argued over priorities – planes versus landing craft versus tanks – the war was won on the momentum of production.

In contrast with World War I, inflation this time was substantially constrained. With business’s contribution to victory having restored its political standing, politics in the immediate post-war years was dominated by the first efforts to end the Age of Control. The Republican-controlled Congress elected in 1946 made a bonfire of residual wartime controls. More strategically, it passed the Taft-Hartley Act in 1947, substantially weakening the Wagner Act’s pro-union provisions. While it took a generation, allowing individual states to enact “right to work” laws enabled the liquidation of private-sector unions.

Levy accurately charts the continuation of the Age of Control in the sphere of international finance. At Bretton Woods, the senior representative of the new hegemon, Harry Dexter White, was in full agreement with Keynes, his counterpart representing the previous hegemon. They concluded that international financial stability required limits to short-term capital movements, and that a return to free trade in goods between markets linked by “fixed but adjustable” exchange rates would require capital controls.

Domestically, American capitalism enjoyed a golden age after the war. A sustained boom in industrial investment was matched by a rise in mass consumerism and underwritten by an extension of Big Government from the nascent welfare state of the New Deal to the full-blown warfare state of the Cold War. But the golden age dissolved in what Levy properly calls the “ordeal” of the 1960s.

US President Lyndon B. Johnson’s mission to renew the New Deal and, especially, to address its exclusion of African-Americans, ran aground in the self-initiated tragedy of Vietnam. The legislation of the Second Reconstruction did establish a framework for advancing civil and voting rights; but as Johnson clearly foresaw, it also transformed the South from solidly Democratic to Republican. Race would remain a central pole of American politics.

Looking back, it is difficult to grasp the pretensions of policymakers at the time. I graduated from Princeton University’s School of International and Public Affairs in 1965. I had been taught that all public problems were management problems, and that we were now equipped with all the necessary tools for addressing them. But in the second half of the 1960s, I, along with the rest of the world, watched this assumption turn to dust. The Age of Control began its passage into what Levy calls the Age of Chaos, even as economic theory, and its influence on policy, underwent a radical transition.

The post-war golden age was complemented by the “neoclassical synthesis” formulated at MIT by Paul Samuelson and Robert Solow. This held that at the macro level, Keynesian demand management policies would ensure that all resources are fully employed; and that at the micro level, competitive markets would efficiently allocate those resources among competing demands, fairly distributing the resulting income to the factors of production in proportion to their (marginal) contribution.

But the new, nominally liberal economics abstracted from the actual power relationships in markets, especially the labor market, and thus contradicted much of the original rationale for the New Deal’s regulatory initiatives. It also left a hole in the foundations of theory – one that was exploited by the University of Chicago school of economists, led intellectually by Robert Lucas, and masterfully publicized by Milton Friedman . They argued that Keynesian macroeconomic theory had no “microfoundations” to link it to the utility-maximizing activities of individual, presumptively rational market participants.

A concatenation of events in the early 1970s generated a chaotic decade. The dollar shortage of the immediate post-war period became a dollar glut, fed by growing balance-of-payment deficits, as US manufacturing dominance was eroded by the competitive recoveries of West Germany and Japan, and by the unfunded expenditures on the Vietnam War. In 1971, the US recorded its first actual deficit in trade, and the Bretton Woods system collapsed. The interwar chaos of unconstrained capital flows returned. Two years later, OPEC effected a fourfold increase in the price of oil. As companies fought to maintain profit margins, and as unions fought to maintain real wage levels, inflation rose along with unemployment. This “stagflation” discredited both the Keynesian neoclassical synthesis and the liberal state.

Even before Chicago School economics was welcomed into the White House, Democratic President Jimmy Carter initiated the generation-long process of liquidating the regulatory institutions originally devised to constrain the power of concentrated capital. One of the New Deal’s central achievements had been to align real wages with productivity growth. But from the 1970s on, this alignment ended. Even as productivity continued its upward trend, compensation below the top 10% began to stagnate. When President Ronald Reagan proclaimed in his first inaugural address that, “Government is not the solution to our problem, government is the problem,” the Age of Control was definitively over.

The Age of Chaos

Levy might well have called his fourth Age of Capitalism the Age of Finance. From 1980 on, the dominant phenomenon of American capitalism, shared with the United Kingdom but much less so with other developed countries, has been the pyramiding of financial assets on the underlying cash flows generated in the real economy. Levy captures the consequences for the political economy of income: “The financial appreciation of the asset…generated pecuniary income. Income growth thus shifted from labor to the owners of… the appreciating asset.”

The inflation of the 1970s was reined in by Carter’s last Fed chair, Paul Volcker , who hiked interest rates to historically unprecedented levels in both nominal and real terms. With acute insight, Levy traces the real consequences of the Volcker Shock both at home and abroad. Volcker’s interest rates pulled liquid capital to the US, driving up the value of the now-floating dollar, deepening the US trade deficit, and accelerating the hollowing out of America’s manufacturing industries. The sharp recession reversed itself quickly, but the structural change in the US economy, and in its international position, lasted for at least a generation.

The US thenceforth became the “consumer of last resort,” while manufacturing dominance moved first to Germany and Japan and then increasingly to China. US employment in non-tradable services soared, as did income inequality and, even more, wealth inequality. What George Soros later dubbed the “super-bubble” took off. Liquidity provided by the Fed reversed the one-day crash of 1987 in its tracks and protected financial markets from twin shocks – the collapse of the hedge fund Long-Term Capital Management and the “Asian Flu” financial crisis – at the end of the century. Confidence in the bull market’s perpetuation became informally institutionalized in Fed Chair Alan Greenspan’s “put”: the expectation that the Fed would protect asset values and the real economy whenever they were threatened.

Within the super-bubble of ever-rising debt, a genuine productive bubble emerged in the second half of the 1990s. The dot-com bubble reflected the maturation of the digital technologies that had been nurtured by the US Department of Defense since WWII. The internet’s incipient commercialization heightened investor anticipation and led to the unsustainable capitalization of the next “New Economy” (not unlike the New Economy of autos and electricity transiently celebrated in the 1920s). When the bubble burst in 2000, the Fed duly stepped in once again.

Levy’s narrative skills are well deployed in recounting the excesses of financialization, from the first leveraged buyout (LBO) boom engineered by Mike Milken in the 1980s to the “truthful hyperbole” of the reincarnation of Melville’s confidence man in the person of Donald Trump. Unlike Trump, and unrecognized by Levy, Milken did leave some productive assets behind. His method of selling high-yield (or “junk”) bonds was judged criminal in federal court, but Milken not only funded corporate raiders and LBO financiers; he also financed the deployment of cable television and cellular networks across the country.

For more than 25 years after the Volcker Shock, the Fed’s underwriting of the increasingly financialized economy masked the underlying structural changes. In 2004, just three years before the onset of the worst financial crisis since the one that triggered the Great Depression, Greenspan’s successor, Ben Bernanke, could still speak confidently of a “Great Moderation” in economic volatility.

In somewhat piecemeal fashion, Levy identifies the key factors that contributed to the global financial crisis and subsequent Great Recession. The same technologies that triggered the tech bubble of the late 1990s also operationalized modern finance theory. The apparent ability to quantify, and thereby order and manage, risk was applied to generate limitless layers of derivative securities. Financial models (not liquid financial markets themselves) “priced” these securities in a vacuum.

At the same time, corporate managers’ “mission” had been simplified to maximizing shareholder value, as represented by the current stock price, which motivated a maximization of leverage on cash flows. Finally, the prevailing macroeconomic models had excluded the financial system by design, creating a massive blind spot.

The intellectual failure was bipartisan. Sadly, Levy does not invoke a key name in this narrative: Hyman Minsky (a mentor of mine). A renegade from neoclassical economics, Minsky spent a generation laying out the dynamics by which a prudently hedged financial system shifts endogenously, through increasing speculative exposure, to an unsustainable regime of “Ponzi” finance. At that stage, lenders must advance interest payments to debtors simply to maintain the fictional value of the outstanding credit. The “Minsky Moment” when Lehman Brothers went bankrupt in September 2008 turned my forgotten teacher into a household name.

Levy emphasizes that the crisis was all about liquidity, and he demonstrates that the crucial attribute of liquidity in times of stress is that the more you need it, the less of it there is. Once again, at an unprecedented scale, the Fed came to the rescue as the liquidity provider of last resort, not just for the US but for the whole world. Confronted with financial chaos and economic collapse, the Obama administration “skillfully cobbled the financial system back together.” Yet, as Levy reports, “End-of-millennium faith in a finance-led vision of globalization… persisted, incredibly enough, after the panic of 2008 and over the Obama years….”

Levy’s Age of Chaos is framed by the post-Volcker Shock retreat of political authority from responsibility for market behavior and the economic and social consequences of that behavior. Neoliberal administrations from Reagan to George W. Bush saw no legitimate reason for government to cushion the domestic consequences of US sponsorship of China’s full entry into the global trading system, or to address the return of Gilded Age inequalities. Only during his first two years in office did President Barack Obama shift the terms of trade in the American political economy, through his “Affordable Care Act” (Obamacare).

That legislation and the American Recovery and Reinvestment Act of 2009 provoked the Tea Party backlash, which led to the Democrats’ loss of the House of Representatives in the 2010 midterm election. But even while the Democrats controlled both houses of Congress, Obama used his January 2010 State of the Union address to champion the same self-destructive economic ignorance that had led Roosevelt in 1937 to compromise both the economic recovery he had engineered and his freedom of political action. “Families across the country are tightening their belts and making tough decisions,” Obama said. “The federal government should do the same.”

The fiscal austerity that followed had two main consequences: It slowed the recovery to a crawl, and it deepened the impression that the US government is incapable of buffering its constituencies from the shocks of economic life. The Tea Party then morphed into the “MAGA” bloc that delivered Trump his victory in 2016, leading to an administration whose only domestic legislative policy initiative was to tilt the tax system even more toward inequality.

Fiscal austerity also transformed the Fed from a successful crisis-fighter into what Mohamed El-Erian termed “the only game in town.” The Fed joined the other major central banks in driving real, risk-free interest rates to negative levels and holding them there for what has now been almost 15 years.

The Future After Chaos

A global crisis of excessive financialization thus launched a further appreciation of the prices of financial assets to heights never before observed – not in 1929 nor in 1999 – creating a bubble that has survived Trump’s chaotic four years and the first global pandemic since 1918. Wealth inequality has reached previously unimaginable levels. Regardless of whether this bubble deflates in a measured, managed fashion or implodes catastrophically, it must end eventually.

We don’t yet know what will emerge from the end days of the Age of Chaos. But we do know that throughout American history, it has always been state action that brought on each new age of capitalism.

Now climate change has emerged as a forcing function from outside the capitalist system. It is belatedly beginning to drive state action, and it is bound to “transform the structure of investment,” the key to changes in capitalism’s form and content. It may even prove to be compatible with the “democratic politics of capital” that Levy advocates. Such a politics is embodied in the progressive agenda being pursued by President Joe Biden, to the variously enthusiastic and enraged surprise of all.

I look forward to a second edition of this masterwork to see how it will deal with a fifth Age of American Capitalism: the green one.


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Center for Advanced Study in the Behavioral Sciences

A leading economic historian traces the evolution of American capitalism from the colonial era to the present—and argues that we’ve reached a turning point that will define the era ahead.

Today, in the midst of a new economic crisis and severe political discord, the nature of capitalism in United States is at a crossroads. Since the market crash and Great Recession of 2008, historian Jonathan Levy has been teaching a course to help his students understand everything that had happened to reach that disaster and the current state of the economy, but in doing so he discovered something more fundamental about American history. Now, in an ambitious single-volume history of the United States, he reveals how, from the beginning of U.S. history to the present, capitalism in America has evolved through four distinct ages and how the country’s economic evolution is inseparable from the nature of American life itself.

The Age of Commerce spans the colonial era through the outbreak of the Civil War, a period of history in which economic growth and output largely depended on enslaved labor and was limited by what could be drawn from the land and where it could be traded. The Age of Capital traces the impact of the first major leap in economic development following the Civil War: the industrial revolution, when capitalists set capital down in factories to produce commercial goods, fueled by labor moving into cities. But investments in the new industrial economy led to great volatility, most dramatically with the onset of the Great Depression in 1929. The Depression immediately sparked the Age of Control, when the government took on a more active role in the economy, first trying to jump-start it and then funding military production during World War II. Skepticism of government intervention in the Cold War combined with recession and stagflation in the 1970s led to a crisis of industrial capitalism and the withdrawal of political will for regulation. In the Age of Chaos that followed, the combination of deregulation and the growth of the finance industry created a booming economy for some but also striking inequalities and a lack of oversight that led directly to the crash of 2008.

In Ages of American Capitalism, Jonathan Levy proves that, contrary to political dogma, capitalism in the United States has never been just one thing. Instead, it has morphed throughout the country’s history—and it’s likely changing again right now.

Levy, Jonathan

Ages of American capitalism: a history of the United States

Random House

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CornellX: American Capitalism: A History

history of capitalism in america essay

American Capitalism: A History

About this course.

Perhaps no story is as essential to get right as the history of capitalism. Nearly all of our theories about promoting progress come from how we interpret the economic changes of the last 500 years. This past decade’s crises continue to remind us just how much capitalism changes, even as its basic features—wage labor, financial markets, private property, entrepreneurs—endure. While capitalism has a global history, the United States plays a special role in that story. This course will help you to understand how the United States became the world’s leading economic power, revealing essential lessons about what has been and what will be possible in capitalism’s on-going revolution.

Do I need to have taken economics before? No. Though there will be discussion of economic ideas, professors will assume no prior economic training.

I am not familiar with American history, but I am interested in how capitalism works. Can I take this course? Yes. We will have relevant links to helpful background material for each section that should make it possible for those with no knowledge of U.S. history to take the class.

Is this class about economic thought like Smith, Marx, Ricardo, Hayek, etc.? This class is primarily about what actually happened rather than theories of what happened. While we will touch on important economic thinkers, this class will focus more on the people and institutions that developed capitalism in the United States. If you want to know how capitalism works and came about, this is the class for you.

Will certificates be awarded? Yes. If you complete the work and achieve a passing grade in the course, you can earn a Honor Code Certificate, which indicates that you have completed the course successfully. Certificates will be issued by edX under the name of CornellX, designating the institution from which the course originated.

What will help me complete this course? We have found that the best help you can get is other people in the real world. Enlist friends, co-workers, family, and other people to take the class with you. Ask your friends on Facebook or Twitter. Arrange a time during a lunch break or an evening to discuss the week’s videos and readings. Think of this “MOOC club” like a book club! You will get more out of the material and be much more likely to finish.

I want to read more about American Capitalism! Professors Baptist and Hyman just wrote a course reader expressly for this MOOC (though it is also being taught at Cornell University).

Containing every reading from the MOOC, as well as additional readings from leading scholars (that could not be had for free!), this course reader provides the student with more background for every topic.

Each reading is introduced and discussed by the professors. Each reading, as well, has additional questions for the student to discuss with their friends.

Are there prerequisites?

This course is designed to be accessible for people without a strong background in U.S. history. Nevertheless, we make reference to many people, locations, events, or developments that may be unfamiliar to some students. Below are sources for additional information.

Wikipedia is a very helpful source for a quick definition or description of most of the material in this course. It can help you answer most factual questions you might have.

Digital History is a website that can serve as an online text book if you need a stronger grounding in U.S. history.

For more difficult questions, you can post a question on the discussion board where your fellow students may be able to help you.

An e-book has been designed for this class, containing all the readings and some additional essays by leading scholars in the history of capitalism, including the professors. American Capitalism: A Reader [Kindle Edition] Amazon.com.

At a glance

  • Institution: CornellX
  • Subject: Humanities
  • Level: Introductory

There is no formal prerequisite. 

  • Language: English
  • Video Transcript: English
  • Associated skills: Economic Development, Financial Market, Capitalism, Private Property, United States History, Economics

What you'll learn

  • Describe the development of American capitalism as a historical process that emerged from political choices, business cultures, entrepreneurial decisions, and technological transformations.
  • Recognize and criticize the policy programs derived from different analyses of capitalism.
  • Describe how government policies contribute to market success and failure.
  • Exercise reading, writing, and analytical skills vital to historical interpretation.
  • Display a critical sense of how capitalism is not a static economic system but changes over time.
  • Introduction: Considering Capitalism Historically
  • Capitalism Comes to America: 1492–1787
  • Making Capitalism American: 1787–1877
  • Making American Capitalism Corporate: 1877–1945
  • Making American Capitalism Global: 1945–2008
  • Conclusion: Assessing Capitalism Historically

Interested in this course for your business or team?

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American Capitalism (Gen Ed 1159)

Semester: , offered: , what is capitalism and how has it unfolded in american history.

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Sven Beckert

How did capitalism emerge, expand and transform daily life in North America over the past 500 years? In this course, students will gain an in-depth understanding of how North America turned from a minor outpost of the Atlantic economy into the powerhouse of the world economy, how Americans built a capitalist economy and how that capitalism, in turn, changed every aspect of their lives.  In the process, they will come to understand how contemporary capitalism is the result of centuries of human engagement, struggle, and aspirations. Topics range from the structure of Native-American economies to the economic consequences of the Civil War; from the impact of capitalism on gender relations to the changing structures of American businesses; and from the position of the United States in the world economy to the role of the government in channeling economic development. Boston merchants and Georgia sharecroppers, enslaved cotton growers and reforming statesmen, workers at the Ford assembly line and Silicon Valley entrepreneurs will all appear in the story. The course will put particular emphasis on the global context of American economic development and situate it deeply in political and social changes. Ultimately, students will gain an understanding of how the contemporary capitalism that so powerfully shapes all of our lives has emerged over the course of several centuries, and how the tools to understand the history of American capitalism can be applied to understanding our contemporary situation. Assignments in particular will encourage students to think about contemporary problems from historical perspectives.

Register for Gen Ed 1159

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In a Nutshell, Why American Capitalism Succeeded

How did the United States become the world’s center of business growth following its founding in 1776? Surely a number of nations had powerful natural resources, stable financial and legal institutions, and dynamic entrepreneurs over that same span. Why was American capitalism so successful, so unique?

Harvard Business School's Walter Friedman not only answers that question but does so in just 150 pages in the recently released American Business History: A Very Short Introduction .

The book is part of Oxford’s Very Short Introduction series, which provides concise surveys of broad subjects, from philosophy and globalization to more idiosyncratic topics, such as teeth. The books are only 35,000 words, about one-third the length of a typical book, and can be read in a few hours. “The audible version of my book clocks in at five and one-half hours,” says Friedman, director of the Business History Initiative and a lecturer at Harvard Business School.

Sean Silverthorne: Tell me a little about the book.

Walter Friedman: My assignment was to write a narrative history, stretching roughly from the arrival of European merchants in North America to the present, that would trace the rise of business in the United States. The book introduces readers to innovative business leaders, like Francis Cabot Lowell, who helped bring textile manufacturing, and the Industrial Revolution, to New England; Lydia Pinkham, who pioneered advertising techniques, including testimonials, in the sale of her alcohol-and-herb-based medicine for women; John Merrick, a founder of the North Carolina Mutual Life Insurance Company, one of a number of African-American-owned companies in Durham in the early 20th century; and Edwin Land, founder of Polaroid, whose work married art and technology in ways that anticipated what Steve Jobs accomplished at Apple.

Silverthorne: As an author, it’s often more challenging to write less about a subject than more. How did you go about organizing your task of covering four centuries of capitalist dynamism into just 150 pages?

Friedman: In thinking through how to organize this project, I was struck by James Truslow Adam’s 1929 book Our Business Civilization , which argued that, unlike prior countries in history, “business” had come to dominate American society, politics, and culture. At the time he wrote, a former mining executive, Herbert Hoover, entered the White House, and Andrew Mellon, a titan of banking, aluminum, and oil, had been treasury secretary for most of the decade. Other observers at the time came to similar conclusions as Adams, including the novelist Sinclair Lewis whose book Babbitt (1922) portrayed a real-estate salesman as an archetypal American.

I structured the book around trying to understand why business had come to have such a central place in America and to assessing the consequences of a society so shaped by business.

Silverthorne: What one finding in your book is likely to surprise readers most?

Friedman: The longevity of some firms might be surprising—Colgate-Palmolive dates back to 1806 and Chase Manhattan, all the way back to 1799.

DuPont has a history nearly as old as the nation. It was founded near Wilmington, Delaware, in 1802, during the presidency of Thomas Jefferson, by an immigrant from France who imported French manufacturing technology. The company has played a major role in America’s history. It sold gun powder during the 1812 war and dynamite to aid in the construction of canals and early roads. It pioneered the M-Form, or multidivisional structure of corporate organization that became standard at many US firms in the 20th century and was then exported to corporations in other countries. Its owners helped form General Motors and placed Alfred Sloan at the helm of that firm—which for many years was the nation’s largest enterprise.

DuPont also helped to introduce many products, including nylon for clothing and chemicals that allowed for refrigeration. The company was involved in the construction of the atomic bomb and in the space program. While the vast majority of firms have either failed or been short-lived, some, like DuPont, have reinvented themselves many times over the decades.

Silverthorne: You list four themes that contributed to the rise of American business: growth-friendly policymaking; business-friendly financial institutions; the professionalization of the managerial class; and the inventiveness and dynamism of entrepreneurs. Are any of these more significant than the others?

Friedman: All of these factors, taken together, have been essential. In shaping these themes I’ve drawn on the work of previous historians at HBS, from Alfred Chandler, whose Visible Hand: The Managerial Revolution in American Business , described the rise of the managerial class, and Thomas K. McCraw, who wrote Founders and Finance: How Hamilton, Gallatin, and Other Immigrants Forged a New Economy . McCraw’s book not only highlighted the role of financial institutions in promoting growth, but also looked at how the US benefitted from a global immigration of entrepreneurial talent. These immigrant entrepreneurs included Alexander Hamilton (from Saint Kitts and Nevis), featured in McCraw’s book, and continued through countless others, including Thomas Mellon (Ireland), Diane von Furstenberg (Belgium), and Google co-founder Sergey Brin (Russia).

Silverthorne: Why couldn’t other nations match what the US accomplished during this period?

Friedman: For one thing, the US benefitted by its vast geographic scale, which allowed for waves of innovation to spread in clusters across the country. This is evident in New Bedford and the whaling industry, Pittsburgh and iron and steel, Chicago and meatpacking, Detroit and automobiles, and San Francisco and computers and other aspects of IT innovation. Each of these regions developed large businesses that then were surrounded by a range of specialized suppliers, financial supporters, and training and apprentice programs. The scale of the country has given the US many frontiers of innovation, rather than just one or two.

Silverthorne: If you were to write this book again in 50 years, do you think the same four factors would hold true, or are there new forces at work that might accelerate or threaten America’s economic growth?

Friedman: Policymakers will have to strive to stimulate innovation while also suppressing the worst aspects of capitalism. Whether or not the US will be a home for democratic entrepreneurship, though, will depend on whether it lives up to its principles.

Social protests have helped to highlight the significant challenges faced by the country. Along with protesting racially motivated violence, the Black Lives Matter movement has opened broader conversations around social justice, including the need for economic opportunity to be far more inclusive. This need for greater inclusion is a vast and systemic challenge, of course, not just to business, but to education, law, policy, and culture.

Moreover, business and government leaders, working together, also face massive challenges that they have not sufficiently confronted before, such as climate change and the recurrent possibility, now realized, of global pandemics. These challenges, domestic and global in nature, will test the vitality, credibility, and effectiveness of US business in the decades to come.

About the Author

Sean Silverthorne is a writer based in the Boston area. [Image: gyn9038 ]

Book Excerpt

Introduction: a business civilization.

By Walter Friedman

American Business History: A Very Short Introduction

The thought of the United States becoming the world’s richest and most powerful nation would have been unimaginable at the time of the country’s founding. In 1783, at the end of the American Revolution, the United States was a marginal commercial center, far from the powers of Europe and the riches of Asia. It was a farm-based, subsistence economy with a small export trade in grains, tobacco, and salted fish and limited manufacturing.

In 1800, the US census, which excluded Native Americans, counted the population at 5.3 million people, about 17 percent of whom were enslaved. The population was significantly smaller than that of Great Britain, which stood at about 10.5 million people, and that of France, with 26.8 million, let alone China, the most populous nation, with 300 million.

In the nineteenth century, the United States, like several European countries, experienced unprecedented economic growth and a rise in per capita income. In terms of wealth, in 1820, the gross domestic product per capita of the United States was just below that of Italy and the Netherlands and about two-thirds that of Great Britain. Much of the rise in aggregate and per capita wealth in the United States, in the decades after independence until the Civil War, came from a growing manufacturing sector, especially in textiles; a rising international trade in commodities such as whale oil; and improvements in the enlistment of new energy sources, especially coal, and advancements in transportation in the form of canals and railroads. It rested, too, through the mid-1860s, on a cruel and brutal slave-based plantation system in the South producing raw cotton for the global economy.

In the late nineteenth century, the United States outpaced its European rivals in rate of population growth, industrial output, and agriculture. A major factor spurring this rise in wealth was the continued growth of business enterprise and the government policies that enabled its unprecedented scale and scope.

Entrepreneurs and innovators improved methods of transportation, completing transcontinental railroads and transatlantic telegraph cables. Some built vast trading networks—warehousing, packaging, and distributing the country’s agricultural resources. Others created massive factories churning out oil, steel, chemicals, and complex machinery like reapers, cash registers, and electrical motors. Still others built vital financial enterprises, supplied credit, made investments, and floated securities. By 1913, the United States was the world’s largest producer of both manufactured goods and agricultural products.

Moreover, the size of the country’s largest firms—which by then had as many as several thousand employees—meant that managerial and executive decision-making impacted not only the firm itself but also, in some instances, national economic achievements and trajectories.

Yet the growth of business in America was neither automatic nor predetermined. The idea that business would come to shape so much of American life, altering the very landscape and skyline of the country, would not have occurred to the nation’s founders. Nor would Adam Smith, who penned his classic economic treatise, The Wealth of Nations, in 1776, have predicted the rise of business in such a spectacular fashion. In Smith’s time, businesses shared none of the characteristics of modern enterprise—no separation of ownership and management, no professional managers, and no corporate bureaucracies. Smith could hardly have foreseen the development of a large, complex corporation like General Motors, which by 1955 had 624,000 employees around the world.

By the early twentieth century, the United States was frequently described as having a culture dominated by business. In 1929, Pulitzer Prize–winning historian James Truslow Adams published Our Business Civilization, which conveyed the extent to which business had permeated American society. In America, Adams wrote, “unlike Europe, the business man . . . finds himself the dominant power in the life of the nation and almost alone in his control over the direction of its entire life, economic, social, intellectual, religious, and political.” He added, “It is a situation that, so far as I know, is unique in history.”

More recently, the historian Sven Beckert likened iconic classical architecture to the extensive commercial and industrial infrastructure that spread across the United States during the nineteenth and twentieth centuries: “While Athens had its Parthenon and Rome its Colosseum, the United States had its River Rouge Factory in Detroit [and] the stockyards of Chicago.” In each case, these structures seemed to somehow capture the essence of these societies.

But how did business organizations gain such a central place in American society? What was it about the United States that made the country so alluring to entrepreneurs, both foreign and domestic? How did the United States come to have the largest business enterprises in the world by the early twentieth century? Moreover, what was the nature of a society in which businesspeople played such a leading role—not just in economic affairs, but also in politics and culture?

From American Business History: A Very Short Introduction by Walter A. Friedman. Copyright © 2020 by Walter A. Friedman and published by Oxford University Press. All rights reserved.

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Capitalism Has Become An Ideology In Today's America. Here's How It Happened

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Rund Abdelfatah

Ramtin Arablouei, co-host and co-producer of Throughline.

Ramtin Arablouei

Capitalism: What Is It?

history of capitalism in america essay

A demonstrator holds a sign reading "I love capitalism" during a protest against California's stay-at-home order in 2020. Capitalism started as an economic system; it has become an ideology in the modern United States. Robyn Beck/AFP via Getty Images hide caption

A demonstrator holds a sign reading "I love capitalism" during a protest against California's stay-at-home order in 2020. Capitalism started as an economic system; it has become an ideology in the modern United States.

The Throughline team has been thinking about capitalism a lot these days. It's hard not to when so many people are struggling just to get by.

Capitalism is an economic system, but it's also so much more than that. It's become a sort of ideology, this all-encompassing force that rules over our lives and our minds. It might seem like it's an inevitable force, but really, it's a construction project that took hundreds of years and no part of it is natural or just left to chance.

So here's what we did. First, we wanted to look at what makes American capitalism distinct, if it is even distinct ? Is it uniquely individual, uniquely efficient, uniquely cutthroat? Like, these are all the things that we've been thinking about a lot.

history of capitalism in america essay

A young girl interacts with an employee maintaining one of tanks at New Jersey SEA LIFE Aquarium inside the American Dream mall in East Rutherford. Michael Loccisano/Getty Images hide caption

A young girl interacts with an employee maintaining one of tanks at New Jersey SEA LIFE Aquarium inside the American Dream mall in East Rutherford.

And so we brought together three REALLY DIFFERENT experts who come at these questions from REALLY DIFFERENT points of view.

Bryan Caplan's an economist and adjunct scholar at the Cato Institute, Vivek Chibber studies Marxist theory and historical sociology, and Kristen Ghodsee is an expert in what happened after the fall of communism in Russia and Eastern Europe.

And we had a conversational round of analysis that led us from colonial times, through waves of innovation and American development to the American Dream Mall in New Jersey.

We compared the happiness index in countries to see crazy things like how much happier people in Denmark report that they are, compared to Americans.

But that's not all. We wanted to dive deeper into the dominance of Capitalism in the 20th century American mindset .

What's the role of government in society? What do we mean when we talk about individual responsibility? What makes us free? 'Neoliberalism' might feel like a term that's hard to define and understand. But it's the dominant socio-economic ideology of both major American political parties — Republican and Democrats — no matter how much partisan rhetoric might be geared towards absolute division.

Friedrich von Hayek at the end of the 30's. Hayek founded the Mont Pelerin Society and was an early leader in neoliberal thinking.

And this ideology, this belief in free markets, deregulation, and privatization can be traced back — pretty directly — to a group of men meeting in the Swiss Alps.

On April 10, 1947, a group of 39 economists, historians and sociologists gathered in a conference room of a posh ski resort at Mont Pelerin, Switzerland. Glasses clinked. Cigars burned. A mission statement was written.

And from that meeting, they would start an organization called The Mont Pelerin Society, MPS. The ideas discussed in that room more than 70 years ago would evolve and warp and, this is no exaggeration, come to shape the world we live in. Those ideas have dominated our economic system for decades. In the name of free market fundamentals, the forces behind neoliberalism act like an invisible hand, shaping almost every aspect of our lives.

From the TV advertisements we all grew up watching to the way the internet is understood today.

Capitalism: What Makes Us Free?

That's not all. We're also dropping a third episode on Capitalism this coming Thursday, July 8. For that episode, we explore how religion and capitalism joined forces to change the way we think about our work, our society, and ourselves — the Prosperity Gospel.

To receive it when it drops subscribe here in Apple Podcasts or wherever else you get your pods.

EduHam Online: Join us on Zoom for a Q&A with Hamilton cast members.

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  • Capitalism in American History

By 1900, the United States was the world’s leading economy. Through a clear definition of capitalism and a set of core questions, this course examines the trajectory of capitalism from its emergence in British North America to the erosion of US global competitiveness in the 1970s and the rise of neoliberalism and financialization since the 1980s. Students will also learn about the role of slavery, the state, and corporations in nineteenth-century capitalist expansion; the rise of big business and its impact on US politics, society, and industrial work; the Second Industrial Revolution; causes of the Great Depression; how the New Deal and World War II created a mixed economy; and the predominance of consumerism in postwar America. 

Read the course outline here and listen to a history teacher introduce the course below.


Please  create a free K–12 student account . Note: Only K–12 logged-in students will be able to access the registration form.


  • Twenty-five  video sessions led by Professor David Sicilia
  • A certificate of completion for 12 hours of course time

Readings: Recommended readings related to the course are listed in the Resources link on the course page. You are not required to read or purchase any print materials. Quizzes are based on the content of the recordings rather than the readings.

Course Access: After registering, you may access your course by logging in and visiting your “My Courses” link.

David Sicilia is an associate professor of history at the University of Maryland and the Henry Kaufman Chair of Financial History at the Robert H. Smith School of Business. His research expertise includes economic, technological, and exchange history. Sicilia has published several books on these topics, ranging from in-depth investigations of specific entrepreneurs or businesses to explorations of wider global trends. Some of his works include The Entrepreneurs: An American Adventure , co-authored with Robert Sobel; Labors of a Modern Hercules: The Evolution of a Chemical Company , co-authored with Davis Dyer; and Constructing Corporate America: History, Politics, Culture , co-edited with Kenneth Lipartito.

The views expressed in this course are those of Dr. David Sicilia.

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American Capitalism: A Reader

American Capitalism: A Reader

  • 2014 , Simon & Schuster
  • Louis R. Hyman, co-author
  • Purchase Online

From Cornell University Professors Louis Hyman and Edward E. Baptist, a collection of the most relevant readings on the history of capitalism in America, created to accompany their EdX course  American Capitalism: A Reader . To understand the past and especially our own times, arguably no story is as essential to get right as the history of capitalism. Nearly all of our theories about promoting progress come from how we interpret the economic changes of the last 500 years. This past decade’s crises continue to remind us just how much capitalism changes, even as basic features like wage labor, financial markets, private property, and entrepreneurs endure. While capitalism has a global history, the United States plays a special role in that story. American Capitalism: A Reader  will help you to understand how the United States became the world’s leading economic power, while revealing essential lessons about what has been and what will be possible in capitalism’s ongoing revolution. Combining a wealth of essential readings, introductions by Professors Baptist and Hyman, and questions to help guide readers through the materials and broader subject, this course reader will prepare students to think critically about the history of capitalism in America.

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Interchange: The History of Capitalism

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Interchange: The History of Capitalism, Journal of American History , Volume 101, Issue 2, September 2014, Pages 503–536, https://doi.org/10.1093/jahist/jau357

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This “Interchange” discussion took place online in late September and early October 2013. As with past interchanges, we encouraged participants to engage in a free-flowing discussion focused on our moderator's questions, their own perspectives and conjectures, and each other's comments. What follows is an edited version of the very lively online conversation that resulted. We hope JAH readers find it to be an excellent guide to the debates swirling around the dynamic and rapidly emerging scholarship on capitalism and the history of the United States.

The JAH is indebted to all of the participants for sharing their thoughts on this subject.

S ven B eckert is the Laird Bell Professor of American History at Harvard University. He just published Empire of Cotton: A Global History (2014). Readers may contact Beckert at [email protected] .

A ngus B urgin is an assistant professor of history at Johns Hopkins University. His book The Great Persuasion: Reinventing Free Markets since the Depression (2012) won the 2013 Merle Curti Award from the Organization of American Historians and the 2013 Joseph Spengler Prize from the History of Economics Society. Readers may contact Burgin at [email protected] .

P eter J ames H udson is an assistant professor in the Department of African American Studies at the University of California, Los Angeles. Readers may contact Hudson at [email protected] .

L ouis H yman is an assistant professor of history at the ilr School, Cornell University. He is the author of Debtor Nation: The History of America in Red Ink (2011) and Borrow: The American Way of Debt (2012).

N aomi L amoreaux is the Stanley B. Resor Professor of Economics and History, and chair of the Department of History at Yale University. She is also a research associate at the National Bureau of Economic Research. She is currently finishing a book with Ruth Bloch entitled “Private Sector/Private Sphere: Organizations and the Right to Privacy in American History.” Readers may contact Lamoreaux at [email protected] .

S cott M arler is an associate professor of history at the University of Memphis, where he teaches southern, American, and Atlantic history. He is a former editor at the Journal of Southern History , and his book The Merchants' Capital: New Orleans and the Political Economy of the Nineteenth-Century South was published in 2013 by Cambridge University Press. Readers may contact Marler at [email protected] .

S tephen M ihm is an associate professor of history at the University of Georgia. He is the author of A Nation of Counterfeiters: Capitalists, Con Men and the Making of the United States (2007). He is currently at work on a history of standards and standardization in the United States. Readers may contact Mihm at [email protected] .

J ulia O tt is an associate professor in the history of capitalism at The New School, where she co-directs the Robert L. Heilbroner Center for Capitalism Studies. She is the author of When Wall Street Met Main Street: The Quest for and Investors' Democracy (2012), which won the Vincent P. de Santis Prize from the Society for Historians of the Gilded and Progressive Era. She holds a Ph.D. in history from Yale University. Readers may contact Ott at [email protected] .

P hilip S cranton is the University Board of Governors Professor, History of Industry and Technology, at Rutgers University, Camden.

E lizabeth T andy S hermer is an assistant professor of history at Loyola University Chicago. She is the author of Sunbelt Capitalism: Phoenix and the Transformation of American Politics (2013). She has published two edited volumes as well as several journal articles, historiographic essays, and book chapters. She is currently coediting University of Pennsylvania Press's Business, Politics, and Society series and writing a new monograph entitled “The Business of Education: The Corporate Transformation of America's Public Universities.” Readers may contact Shermer at [email protected] .

JAH: How does the growing interest in the history of capitalism appear to you from your various scholarly vantage points? Where do you see this field coming from, and how does it differ from or relate to fields such as business history, economic history, or the history of consumerism? How should we define the history of capitalism?

S tephen M ihm : This thing we call “the history of capitalism” is new. Its novelty, though, lies in the ways that it combines fields that began growing apart in the 1960s. For example, the great efflorescence of social history—especially labor history—was a kind of history of capitalism, but it told the story largely from the worker's perspective. Business history, by contrast, took the firm as the essential unit of analysis, and while labor might occasionally intrude, actual workers, never mind class struggles, were banished to the margins. Each subfield has described the capitalist elephant from a perspective that, while narrowly accurate, does not grasp the entirety. The history of capitalism attempts to see capitalism from multiple angles using multiple methodologies. That means writing works of history that deliberately erode disciplinary barriers. It means, for example, doing history “from the bottom up, all the way to the top”—and here I'm quoting Louis Hyman. 1

P eter H udson : I mostly agree with Stephen Mihm. Yet I also feel that he is describing what the history of capitalism should be doing. It seems to me that the field is torn by, on the one hand (and as Stephen suggests), a tendency toward cross-disciplinarity, multiple sites, the vertical integration of historical approaches, and, ideally, a similar, horizontal integration of perspectives and “voices.” On the other hand, the arrival of the history of capitalism appears to mark a triumphal defeat of postmodernism, difference, fracture, and the 1990s identity politics that allegedly rebuffed the possibility for a unified (read: white) labor (and, less so, business) history that has for too long been agitated by those other perspectives and voices. Perhaps that's a productive tension. But I'm surprised that neither the rich historiography of black women and slavery nor that of the prison-industrial complex is immediately evoked when discussing the history of capitalism. 2

E lizabeth T andy S hermer : Placing such work under a new history of capitalism is a new(ish) phenomenon. Here, I think of Andrew Wender Cohen's The Racketeer's Progress and Shane Hamilton's Trucking Country , which seemed on the cusp of arriving at the term capitalism not only to describe their efforts to interrogate the bottom, top, and middle but also to unite the questions and methodologies that have shaped policy, social, labor, legal, and business histories. 3

I was fortunate enough to attend the second Harvard University History of Capitalism in the United States conference for graduate students in 2008, and I remember a sense of excitement of those interested in the intersections of numerous subfields, especially at a moment when I began publishing and looking for jobs and frequently encountered skepticism that I belonged to any particular field at all. To that end, I think it was the conferences on capitalism that rotated between the New School, Harvard, and the University of Manchester that built momentum behind the term.

But I am also intrigued by Peter Hudson's idea. I would agree that the new work on prisons does not seem to have situated itself in the history of capitalism, perhaps because the two fields were growing simultaneously and works on prisons were pioneered by folks trained in the history of civil rights and labor. But, based on what I have been reading, I think that slavery has dominated the history of capitalism. Much more needs to be done on the twentieth century; so far, this work does not seem to be grappling with the historical conclusions regarding the nineteenth century and how they challenge so much about what historians have presupposed about the Progressive Era, New Deal, Cold War defense-consumer economy, and the 1970s, which may not (based on this recent work done on early eras) represent the kind of monumental transition from factories to finance that many once assumed took place.

I wonder why there has been a surge in this scholarship. I have heard the joke that “Seattle went to grad school,” suggesting that the 1999 World Trade Organization protests in that city foretold a generation of scholars interested in political economy. Yet I have never met anyone who describes the late 1990s as influential in drawing them to the study of capitalism. My interest was sparked because, as an early 2000s undergraduate, I was dissatisfied (if not mystified) by the argument about postwar economic security, stability, and prosperity. Assertions of a postwar liberal consensus also did not make sense, especially regarding economic policy. I had no context to understand the idea that the New Deal had inaugurated supposedly long-standing power-sharing arrangements between business, labor, and the state. I came of age in an era marked by concession bargaining and Republican presidential hostility to labor (and none of my southern relatives had ever been in a union). Likewise, the histories of modern conservatism's origins seemed overly focused on the post-1968 period and uninterested in its economic agenda. Indeed, only recently have historians (notably Kim Phillips-Fein) explored this aspect of the Right, which always seemed to me to be of the utmost importance. 4

J ulia O tt : To me, “history of capitalism” is first and foremost a rallying cry and a meeting place where all sorts of provocative conversations take place. Elizabeth Tandy Shermer already suggested this, but it bears repeating because it strikes me that whatever falls inside or outside the history of capitalism is a matter of self-identification by the scholar. I do not know of any plot to derail the linguistic turn. In fact, I consider the history of capitalism to be deeply concerned with performativity, with the ways economic theories operate as ideology and shape the reality they purport to describe in a neutral fashion. And I'm perplexed by the suggestion that historians of capitalism have abandoned difference (read: gender and race).

When my graduate cohort was coming up, we perceived that business history, economic history, and the history of consumerism were engaged in inspiring interdisciplinary work. But that work had not yet translated into new intradisciplinary conversations. My cohort came of age in the 1990s and 2000s and experienced mounting inequality, skyrocketing asset prices, soaring debt levels, stagnating standards of living—even as both political parties assured us that capitalist markets would save us all. The topics many of us chose reflected our anxieties. The methods came from social, cultural, political, and intellectual history—whatever seemed most suited to the inquiry. So in that sense there was (and is) novelty regarding new combinations: that is, what is studied and how it is studied.

Folks rallying around “history of capitalism” retained the analytic emphasis on gender, ethnicity, and race. But this work brought class, policy, and (yes!) capital back to the fore. Can we, for example, historicize the valuation of a capital asset—whether a slave, a home, or a bond? Isn't that valuation process as open to social and cultural context as the meanings individuals and groups assign to consumer goods?

The “history of capitalism” identifies capitalism as “the thing,” whose existence needs to be explained. As historians, we embrace agency and contingency. Capitalism cannot be taken for granted as an organic expression of human nature. But we are also attuned to the significance of power relations for structuring economic life, for privileging certain forms of economic knowledge, and for shaping economic outcomes.

Although I believe that transnationalism has been an important commitment of those studying the history of capitalism, the scholars identifying with this emerging subfield trained primarily as Americanists. I would love to know more about how concerns in the history of capitalism subfield link up with other national literatures.

S cott M arler : I, too, am curious why capitalism has become an acceptable term after two-plus decades of loaded but unsatisfactory phrases such as the market revolution . (Ironically, though, Charles Sellers, the progenitor of the market revolution paradigm, was no stranger to the languages of class.) It was last permissible to talk about capitalism back in the heyday of the new social history in the 1970s and 1980s, especially as it was then practiced by labor historians, most of whom proudly wore their radical sympathies on their sleeves. But much of the recent resurgence, it seems to me, reflects the persistence of culturalist approaches from the 1990s, and the result has been a flurry of new works about capitalism that are resolutely apolitical and devoid of much critical content. 5

Per Julia Ott's comments on business historians during the late 1990s and early 2000s, it's curious how perceptions can be so different. I was also a graduate student then, and I was disturbed by the excessively posh conditions at business and economic historians' meetings. Moreover, far from being exciting and interdisciplinary, too many of the works presented were either purposely unintelligible to mere mortals or seemed to make implicit concessions to the ideologies of their financial patrons. What remained off limits in such semi-“authorized” histories (and to a large extent, still is) was the third leg of historians' holy triad: class. To this day, it strikes me that even when class appears in capitalist histories, it is too often clothed in the modest, inoffensive garb of cultural studies. Of course, there are exceptions.

Finally, I disagree somewhat with Elizabeth about the dominance of nineteenth-century histories of capitalism. Apart from the ever-simmering slavery-as-capitalism issue, the majority of studies now center on the twentieth century. That represents a switch from the 1970s and 1980s.

A ngus B urgin : How we should define the “history of capitalism” raises the question of why the term capitalism has become a focal point for this subfield. While the concept has performed useful work for historians who share a loose cluster of interests, it also carries potential hazards and limitations.

Our discussion has suggested a few reasons for the reemergence of the term. One is multivalence: the history of capitalism “combines fields that began growing apart” (Stephen), gestures toward “vertical” and “horizontal integration” (Peter), and allows us to “interrogate the bottom, top, and middle” (Elizabeth). Sven Beckert's historiographic essay situates this partly as an analytical orientation toward “embeddedness,” or the mutual imbrication of markets and the state. While I largely agree with these observations, I wonder why we don't instead rely on “political economy,” which invokes this dynamism more explicitly without confining its analysis to a specific mode of social organization. 6

Sven's essay suggests that this specificity might be the point: the very existence of the term capitalism gestures toward the particularity of a social order and thereby helps us recognize the contingency of its social and ideological underpinnings. Many of the works in the subfield emphasize denaturalization; the current proliferation of interdisciplinary research into the invention of the concept of the “economy” provides a striking example (from scholars including Margaret Schabas, Timothy Mitchell, David Grewal, and Tim Shenk). Although Scott Marler is right that recent work along these lines has largely shed the radical undertones of earlier research into the history of capitalism, much of it is invested with a critical energy that resists any attempt to describe it as “modest” or “apolitical.” 7

But historians of all varieties have long sought to denaturalize and demonstrate the contingency of their subjects; this is not unique to the history of capitalism. And at times the term can have the opposite effect, by implicitly positing the existence of an (often vaguely defined) ideal type within societies that remain rich with contrary practices and ideologies. Capitalism , after all, did not enter into common parlance until the closing decades of the nineteenth century. During the interwar years many scholars wondered if it signified a social order that had been superseded. As Howard Brick has powerfully revealed, in the middle decades of the twentieth century a wide range of social theorists argued that we were in the midst of an emerging “postcapitalist” society. Scholars have only recently developed an implicit consensus that “capitalism” connotes a coherent social order that has been predominant in the United States for generations and remains firmly entrenched today. This presumption has allowed historians to construct narratives that are sometimes, as Jeffrey Sklansky wrote, more inclined to represent “capitalism as constituting the entire terrain of social struggle instead of counterposing it to the roads not taken.” 8

In that sense, the proliferation of studies that invoke capitalism reflects the idiosyncratic logic of our own moment. Historians find a ready audience of students and readers who feel subject to the caprices of an increasingly (or inexorably) capitalist world and seek to understand its origins and implications. Despite these contemporary resonances, we should remember that the very term our subfield has embraced for its multivalence can itself become totalizing.

P hilip S cranton : At the outset I'm curious about what “boundary work” historians of capitalism are undertaking to frame a distinctive field and a bit concerned, at least after reading a dozen syllabi and several (but far too few) articles, about what seems a heavily American emphasis and a discreet silence about theory—economic, social, or cultural/anthropological—in the field.

In relation to the “varieties of capitalism” literature, how many capitalisms are there (likely more than the two—coordinated market economies and liberal market economies—initially posited by Peter A. Hall et al. in 2001) and what difference might it make were capitalism plural? Has global financialization reconfigured producer/consumer capitalism sufficiently that we have entered a new environment/configuration? Do religiously inflected political economies instance yet other forms? 9

What is capitalism's relationship to the varieties of modernity, as evoked over recent decades by folks such as Ulrich Beck, focusing on risk and cosmopolitanism, or Zygmunt Bauman, arguing for a twentieth-century shift from solid (not static) modernity to liquid (don't sit still) modernity? 10

The 2008 economic smash may have enhanced our concern about and our desire to understand capitalist dynamics—in real and fantasy/speculative economies, in the media, in the production of politics, etc.—but the deeper instabilities exhibited by this mode of social practice are revealed in the slaughter of the Cold War's great industrial corporations and their replacement by new giants. How might the emergent history of capitalism, whose current trajectory may date to the turn of the century, engage cycles of mass institutional wrecking? The current crush may date to the Volcker Recession of the 1980s, but earlier episodes are evident and not necessarily connected to economic depressions. 11

How do historians of capitalism wish to deal with the array of great transformations that reach well beyond Karl Polanyi but that resonate with his insights? These changes include the technological and chemical transformation of agriculture, the radical restructuring of extraction (mining, forestry, fisheries), the mediatization of culture and communications, or expanded consumption as an unsustainable entropic vector. If the history of capitalism is to offer something fresh, perhaps framing questions in domains outside our usual neighborhoods might be plausible. 12

S chermer : Angus Burgin makes many excellent points about how scholars should be careful about embracing terms; capitalism seems an odd mix—prochronistic, anachronistic, and ahistorical all at once. But still, there is something to using the idea of a history (or histories in considering Philip Scranton's point) of capitalism(s) to bring together scholars across time, field, and place. Capitalism, as scholars are deploying it now, seems more a gateway to an interchange of ideas and methodologies than a scholarly hindrance, as long as we are cautious and aware of caveats. And the history of capitalism, as it is being practiced, also seems to speak to Julia's and Philip's questions about transnational and world histories.

N aomi L amoreaux : I worry that the “history of capitalism” takes for granted something that should be a question by assuming that economic behavior is fundamentally different in so-called capitalist societies. That assumption is a new, dressed-up version of modernization theory and is difficult to subject to critical scrutiny because no one is clear about what capitalism is. (I should say no one today; Karl Marx was clear.) It's easy to be dazzled by mbbs (mortgage backed securities), cdos (collateralized debt obligations), and cdos squared and think that we are in a new economic environment. But many problems that economic actors face today would have been familiar in their essentials to economic actors a thousand years ago. To give one quick example, the ways eBay confronts the problem of how to deal with fraudulent behavior in an environment where transactors may never deal with each other again is interesting to compare to the solutions devised by overseas traders in the medieval world.

My own preferred approach is to examine how human beings confront similar economic problems in different contexts. Sometimes modern solutions and behaviors are different, but sometimes they are remarkably similar. I'm as intrigued by the similarities as I am by the differences. But it's hard to fit the similarities into “capitalism studies,” unless the word capitalism is going to lose all meaning.

M arler : I would also echo Phil's concern that we avoid discussing capitalism in a relative vacuum, and his belief that we should try to draw on other disciplines, such as historical sociology and economic anthropology, from which capitalism never really disappeared from the radar as it did for most historians. I'd like to address how we see the resurgent history(ies) of capitalism affecting our fields, then use that to discuss a couple of threads developed by participants here.

My field is nineteenth-century southern economic history, which has been changing in two interrelated ways. First, practitioners in the field have shown a tendency toward seeing the antebellum South's economic structures and mentalities as converging with those of the North. What I call “convergence studies” maintain, often through the prism of the “market revolution” thesis, that the South and North were more alike than different prior to the Civil War; the postwar South is even more frequently described as “bourgeois” and “capitalist” almost immediately after emancipation. I am skeptical of these descriptions, which draw to a degree on the second recent trend: regarding southern slavery as of a piece with American and global capitalism. I disagree with this characterization both at the ground level (slave owners displayed a variety of precapitalist and anticapitalist proclivities) and theoretically (if capitalism's essence is free/wage labor, then a slave regime is not capitalist by definition).

To pick up on a couple of threads: first, I strongly endorse Phil's suggestion that we should consider what Peter Hall terms the “varieties of capitalism.” Capitalist development was uneven and protracted, so naturally it yielded a wide range of types. My work focuses on the peculiarities of merchant capitalism, but certainly others exist: among them, consumer, financial, agrarian, corporate, industrial, and proprietary. It's worth noting that some of these were at odds with one another—what Charles Sellers called “rival capitalisms,” or what Marx termed “the division of labor between capitals.” 13

The second thread concerns capitalism's transnational dimensions. One might think that the Atlantic world paradigm has contributed to the resurgence of the history of capitalism, but I don't think it has, at least not much. Atlantic world studies that focus on commodities networks and merchants, some of them highly insightful, have been far outnumbered by those predicated on cultural, demographic, or other issues. 14

While we probably need to discuss transnational dimensions further, for now, let me say this: it is not invariably true that capitalism can only be studied profitably within a global framework. Indeed, from the perspective of now-neglected but still relevant historians of capitalism in early modern Europe, such as Maurice Dobb or Robert Brenner, the prime movers behind the transition(s) to capitalism were “internal” determinants rather than exogenous ones. In terms of U.S. history, think of the excellent “internalist” studies of early agrarian capitalism by historians such as James Henretta and Allan Kulikoff. 15

H udson : I came to the history of capitalism via a different route, with a different set of normative concerns and a different group of foundational texts. The impact of British cultural studies on American studies is well known, but it also resonated with historians of the United States, especially through Stuart Hall's attempts to demonstrate the interrelations between racial formation and class formation and class identity. Nell Irvin Painter's Standing at Armageddon (1989) also opened up the field to my cohort. It attempted the kind of audacious, synthetic analysis that was daunting precisely because, through its combination of political economy and social history, it succeeded at an analytical task that we were told was pointless to attempt. It's a book that is inexplicably neglected. Robin D. G. Kelley's essay “‘But a Local Phase of a World Problem’” (1999) offered a portal to writers, historians, and activists who were debating the history of capitalism—alongside that of globalization, imperialism, and colonialism—over the sweep of almost one hundred years. My cohort, because of a dissatisfaction with the work then coming out, reclaimed and reassessed older texts. Cedric Robinson's Black Marxism: The Making of the Black Radical Tradition , with its ambitious attempts to tie the origins of global capitalism with the beginnings of global white supremacy—and his development of a historical analysis of “racial capitalism”—also proved an important touchstone. First published in the United Kingdom in 1983 by Zed Books and reissued in the United States by the University of North Carolina Press in 1999, Black Marxism is also a silent interlocutor of Walter Johnson's River of Dark Dreams , with his notion of “slave racial capitalism.” Another was Walter Rodney's How Europe Underdeveloped Africa (1972). And of course, before them came Eric Williams's Capitalism and Slavery (1944), C. L. R. James's, The Black Jacobins (1938), and W. E. B. Du Bois's Black Reconstruction (1935) and The Suppression of the African Slave-Trade to the United States of America, 1638–1870 (1896). 16

At the same time—for those of us working on the twentieth century—geography provided the most compelling analysis of capitalism, most notably in the work of David Harvey and Neil Smith, particularly their representation of capitalism as dynamic, contradictory, and uneven. Harvey was useful in thinking through transitions and transformations that Phil alludes to, especially in the emergence of “post-Fordist” regimes of production and accumulation and, of course, they attended to the spatial character of such transitions. 17

There is nothing wrong with dissatisfaction with the terms and limits of our analysis and approaches. My graduate seminar read Sylvia Federici's Caliban and the Witch (2004) last week. While most of the students complained that she wasn't a good historian, they were all rocked by her attempts to prioritize gender in the history of the transition to capitalism and in an account of primitive accumulation. 18

M ihm : I would like to add my own two cents—or more, adjusted for inflation—on why the “history of capitalism” has taken precedence over different ways of describing this emerging field. I'm reading between the lines, but Naomi Lamoreaux would seem to prefer the broader rubric of economic history; Angus, by contrast, has a fondness for political economy. Both of these terms are more expansive than the “history of capitalism,” which is limited to the modern era and focuses too exclusively on capitalist nations.

Perhaps these other terms will supplant the history of capitalism; I doubt it, though I have mixed feelings. For scholars trained in cultural history, the phrase economic history implies a faith in quantification and “data” that strikes them as naïve. Political economy may be viewed by social historians as either too obsessed with high-level policy making and politics, or insufficiently attentive to questions of agency, much less historical actors other than white men.

The history of capitalism, by contrast, is at once both specific (capitalism!) and yet maddeningly vague about its methods, its focus, and even its politics. But this, perversely, is its strength. It is a blank screen onto which people from a wide range of fields project their interests and ambitions. Consequently, departments may find it easier to build a consensus around hiring a historian of capitalism as opposed to a business historian or an economic historian.

While I understand the skepticism toward the “history of capitalism,” this conceit has served a constructive purpose in moving economic history, business history, and policy history back toward the center. What happens when these fields collide with a generation of scholars trained in social and cultural history will be interesting to watch.

M arler : Stephen is on target when he describes the greater willingness of today's history departments to hire someone to teach the history of capitalism. The American Historical Association recently published data that showed that only 2.3 percent of listed faculty in U.S. history departments in 2005 were self-described economic historians, which represented a drop of over 50 percent since 1975. This continued balkanization of economic historians, which began in the 1970s, is unfortunate. The vast majority of today's economic historians work in business schools or economics departments; a simple glance through the author bios in back issues of the flagship Journal of Economic Histor y is a simple way to confirm this fact. If one considers this to be a problem (although only a handful of economists seem to think so), then “bridges” ought to be (re)built. This well-known disciplinary division originated in the clashes between “cliometricians” and mainstream historians during the 1960s and 1970s, especially as they culminated in the heated controversies over Robert Fogel and Stanley Engerman's Time on the Cross: The Economics of American Negro Slavery (1974). By the mid-1980s, a few level-headed (if rather condescending) economists sought to begin repairing the breach. For example, Economics and the Historian (1996), by Thomas Rawski et al., which was based on a series of workshops and conferences held in the years 1987–1988, has as its first line: “We aim to broaden and deepen the exchange of ideas between economists and historians.” Sadly, they failed, and things since have only gotten worse. Now, even within economics departments, economic history has become passé. A good example of this is a recent memoir by the distinguished mit economic historian Peter Temin, who describes how, over a period of decades, the denigration of economic history reached a point that “the mit economics department abandoned the graduate requirement of a course in economic history late in the first decade of the twenty-first century.” But there are also institutional factors that inhibit such cross-fertilization. When I once approached a junior-level economic historian about submitting her work to the Journal of Southern History , she told me that the tenure/promotion process within economics departments gives practically no weight to work that appears in our “fuzzy-minded” journals. Ouch. 19

L ouis H yman : I came to the history of capitalism as a proto–labor historian around 2000, asking questions about hegemony. I quickly found that I needed to answer larger questions about the operations of capital. Perhaps it was the lingering effects of reading too much volumes 2 and 3 of Karl Marx's Das Capital in college, but what struck me was that labor history seemed dominated by questions of production rather than the circulation of capital. 20

Like Peter, a lot of my formative thinking came out of the “transition to capitalism” literature, both in Europe and especially in the work of Eric Williams. For me, Eugene Genovese's whole “in but not of” formulation in Roll, Jordan, Roll as a way to describe how the plantation was “in but not of” capitalism got hung up on social scientific definitions and confused the issue. The problem with capitalism is not defining it, but figuring out why it resists easy definitions. If capitalism is about free labor, then slavery is not a part of it. If it is about investment, then slavery is foundational, since that is where safe money was invested for most of the eighteenth and nineteenth centuries. Tracing the movement of capital, for me, is what makes this history different. 21

S ven B eckert : Let me summarize what I see as the crucial points. First, historians have written about capitalism for more than a century, and some of the most important debates in the writing of history have focused on capitalism. These debates have had, all in all, less of an impact on the writing of the history of North America than on the writings on European history, but they have been important.

Second, rich debates have focused on the history of business, labor history, economic history, and social history. Developments in those fields followed slightly different rhythms, but by the 1990s they shared the sense that their vibrant scholarship had moved away from the center of American history. They also increasingly engaged in self-criticism, partly focused on their sense of marginality (business history), or a sense of the lack of exciting new perspectives (labor history), or a sense that the many parts did not result in a greater whole (social history).

Third, within those fields a sense pervaded that one's research needed to be connected to neighboring fields and speak to large, more synthetic questions. Labor historians discovered that they needed to understand more about the history of business; social historians became more interested in questions of economic change; business historians discovered, for example, the importance of women's history; and economic historians began to think much more comprehensively about the history of slavery. These questions propelled the search for a way to frame research—and it was at this moment that the history of American capitalism began to take off. The big question of American capitalism allowed historians who came from different vantage points, with different qualifications and questions, to relate their interests to something much larger. Framing our thinking on American history in terms of capitalism made it clearer, for example, that neither workers, nor industrialists, nor slaves, nor farmers, nor financiers could be understood separately from one another.

I have observed much of that excitement: when I first taught a course on the history of American capitalism at Harvard in 1996, there was huge interest among undergraduates, but few graduate students ventured into the seminars. But this changed quickly. As we brought together business, labor, social, and economic historians, among others, enormously interesting discussions emerged. Students learned from one another and began to broaden the questions they were asking and increasingly also drawing on multiple subfields—heavily quantitative analysis, for example, suddenly appeared next to the careful reading of language. Most impressive was a series of graduate student conferences that we ran starting in 2005. For many, this was their first time encountering other students so interested—and they took with them from these encounters not just new professional networks but also new questions.

Fourth, the history of American capitalism also arose in response to the wish of undergraduate students to understand a history that they perceived to be of great importance. Once faculty members began offering lecture courses in the field, they quickly attracted large enrollments. As many history departments struggled with attracting undergraduate students, hiring historians of American capitalism seemed to be a way to bolster student numbers.

Fifth, and related to the previous points, since the crisis of 2008, the amount of public debate on capitalism has skyrocketed. Historians could not help but notice that the issues being debated in public had a long history themselves, and that this history was often ill-understood by the general public. These historians hoped to speak to these issues.

Sixth, I cannot help but think that the end of the Cold War has opened new spaces of public debate. Debating capitalism was certainly deeply intertwined with the Cold War's ideological struggles. With that conflict now a distant memory for most students, they can approach the history of capitalism with fresh eyes—and, indeed, the research they are producing is providing new vistas onto the American past.

I would also like to offer one quick response to Peter's assertion that the history of capitalism has ignored the question of slavery. This is demonstrably false; just the opposite—slavery has been a core issue of the new history of American capitalism. One of its most important contributions has been to find ways to make the history of slavery more central to the history of American capitalism.

H udson : To clarify, I wrote that when one thinks of the history of capitalism as an insurgent field one does not immediately think of the work on black women and slavery—and I was thinking of the work of scholars such as Angela Davis, Deborah Gray White, Jacqueline Jones, and Jennifer Morgan. Certainly, this work could fall under the history of capitalism banner, but I don't see them giving keynotes at the conferences. 22

M ihm : Another way to understand the “history of capitalism” is to see it as part of a renaissance of fields that were marginalized vis-à-vis social and cultural history. The growing interest in political history, for example, shares many things in common with the history of capitalism. So, too, does the recent growth in scholarship in policy history, diplomatic history, and even military history. It is not that these fields didn't exist for the past forty years. Yes, business historians, political historians, and policy historians had conferences and journals. But these spaces tended to be refuges from a profession that was indifferent or even hostile to their interests.

I see a few commonalities between young historians who are studying topics that have been in historiographical exile for decades. The first is a tendency to move beyond the obsession with historical agency that was a hallmark of social and cultural history. This trend first surfaced in essays by Nell Painter and Walter Johnson, who moved beyond the traditional focus on agency to acknowledge the psychological lives of the enslaved. 23

A second point of commonality is renewed interest in the structure and operation of institutions. These can be corporations and trade associations or branches of government, regulatory bodies, and any number of institutions that play powerful but often-invisible roles. Historians of capitalism are interested in how organizations work as well as how they often fail.

Third, this new generation of historians wants to know how things work. That goes hand in hand with a willingness among some to learn things such as economics, corporate accounting, or the inner workings of the federal regulatory process. Many historians of capitalism want to pop the hood and look inside.

M arler : I want to respond to Sven's observation about slavery. Quite a few of us out here are still unconvinced by assertions of southern slavery's capitalist character and affinities. Few would deny that U.S. plantation slavery helped fuel the industrial transformations of the nineteenth century. The problem arises when historians assert that the slave South was “a flexible, highly developed form of capitalism” (as Robert Fogel does). The evidence for such characterizations is thin and usually hinges on questionable interpretations. For example, some will emphasize the careful attention given to profit among that minority of big planter–slave owners, despite the facts that the majority of slaves were held on small units, using roughly five or fewer slaves, and that three-fourths of white households held no slaves on the eve of the Civil War. This is why definitions of capitalism matter. The relationship between master and slave was, at bottom, a nonmarket relationship, redolent of precapitalist relations between lords and serfs—not an economic one, as with the qualitative changes apparent in fast-growing wage-labor societies elsewhere. 24

The aggregate data make it clear that the slave South did not industrialize, nor did its elites invest in the infrastructural improvements that might have helped it maintain a regional competitive advantage. Furthermore, the antebellum South not only failed to foster a significant middle class but its lower classes were unable to sustain demand-driven economies for manufactured consumer goods, as well as the multiplier effects that might have accompanied mass production regionally. And wealthy planters and urban merchants failed to demonstrate the class cohesion evident among nascent bourgeois classes elsewhere. Yes, they profitably participated in atomized, inefficient, long-distance markets, but those exchange relations proved insufficient to create much more than defensive, even aggressive, attitudes regarding the propriety of their “peculiar institution.” Market participation does not necessarily equate with quintessentially capitalist behaviors.

B eckert : The debate on slavery and the antebellum South is quite helpful on multiple levels. I agree with Scott that the South was different and that the political economy of slavery is different from that of industrial capitalism. For a start, the world's industrialization in the nineteenth century focused on economies not dominated by slave labor. However, as Scott also noticed, slave economies were exceedingly important to the economic transformations that the advent and spread of industrial capitalism brought about. The one cannot be thought of as separate from the other. Thinking about capitalism broadly makes this relationship a core analytical problem and allows us to see the transformation of the global countryside as important to the rise of industrial capitalism. Therefore, the history of capitalism does not privilege a small number of core countries; indeed, such privileging would make it impossible to explain the economic changes and inequalities of the past three centuries. One reason why the concept of the history of capitalism is so powerful is that it allows for an expansive way of thinking about the problem of economic change, both in spatial terms as well as in terms of the kind of issues that are important. It intersects well with an often-advocated-for global perspective on the American past.

JAH: What do you see as the promise of the history of capitalism for your specific subfield(s)? Does it offer the same potential to a historian of the antebellum South as it does to a historian of the New Deal? What will it or can it do vis-à-vis specific bodies of scholarship? In part, these questions get at the issue of the history of capitalism's definitional elasticity raised by several of your comments. What are the practices, institutions, or values that need to be present before we can situate a place and time within the history of capitalism?

H yman : Tracing the movement of capital within capitalism makes this historiography distinct. Putting capital at the center of the story stitches together divergent subhistories. Money moves. But it is not the same as financial history, which is concerned with financial markets and institutions. In the history of capitalism field, those markets and institutions are stepping stones to larger questions about everyday lives.

Simply defining capitalism is a bad idea. It is too deductive. We should instead trace its transformations, taking a few sets of qualities (labor, investment) and seeing how they vary over time in importance. Inductive reasoning is the foundation of our discipline.

In terms of the utility of the term, time matters a great deal. When I teach my labor history class, I begin by discussing how capitalism is a radical shift in human experience. For most of human history, excess resources were given away to promote social power. Only in the last few hundred years have people been taking those resources and investing them to produce more resources. The profound oddity of European capitalism was driven home to me when I was doing a graduate field in precolonial African history. As we read about precolonial Africa's encounter with European slave traders (especially in the work of David Northrup and Joseph Calder Miller) it was clear that even if the trade was balanced, the surplus of that trade was used in different ways. Africans used the extra resources to reinforce social power, and Europeans used the resources to expand production. Capitalism is the oddity that needs to be explained, because for most of time, we just gave away our surplus to be popular. 25

Williams has been shown to be wrong about primitive accumulation being the source of European industrialization, but he has been shown to be right that slave investment and plantation demand were essential to the British transition. Slavery, as investment and consumption, is at the center of capitalism's origin story. Capitalism made investment possible for the first time. And this investment was in African slaves and then in European machines (and out of both come modern management). Tracing the temporal changes in how investment operates over time is essential to making sense of what is new about capitalism and what is not. 26

L amoreaux : I do not want to reopen the discussion of whether plantation owners were capitalist. It's now generally agreed that slave owners aimed to profit from the labor they commanded, though they varied in the extent to which they pursued profits versus other goals and also in their competence. Caitlin Rosenthal has recently shown that as a group southern planters more assiduously adopted state-of-the-art bookkeeping methods than did contemporary northern manufacturers. 27 The interesting questions are exactly the ones that Louis posed. How did plantation owners' pursuit of profit affect others (the enslaved, free blacks, poor whites, artisans, manufacturers, etc.), southern society and its economy, the rest of the nation, and the world? Where we might disagree is how to get good answers to those questions. I do not think it is sufficient to “follow the money”; nor do I think it is sufficient to examine what people were saying at the time, though those are both important. Quantification is also necessary, and economic theory provides tools that can usefully structure quantitative (and even qualitative) inquiry.

Using economic theory (even simple neoclassical theory) does not mean that one has to buy into the so-called neoclassical view that people are rational profit maximizers whose activities lead to optimal outcomes. It is true that Fogel and Engerman offered an essentially neoclassical view of slavery, arguing that slaveholders' rational pursuit of profit led them to treat the humans they held in bondage well (compared to northern employers' treatment of their work forces). But research has moved well beyond that position. Rick Steckel, for example, has been compiling data on heights that suggest that slave children were severely malnourished, and the differential mortality data that we have is consistent with that conclusion. Indeed, it seems that the high mortality of enslaved children explains why the break-even age (that is, the age at which the cumulative earnings the master obtained from an enslaved person first exceeded the cumulative cost of maintaining that slave) was so late. One avenue for follow-up would be to explore what happened after emancipation. Once parents could control what their children were fed, infant and child mortality of blacks in the South relative to whites should have fallen, and that seems to have been the case. Another line of inquiry would be to investigate the malnourishment of children under slavery. Why didn't plantation owners take better care of their property? Steckel poses some possible explanations. One is that feeding enslaved children was not, in fact, cost-effective. Another is that enslaved parents faced terrible allocation choices—if they were not able to keep up their own strength and work productively they faced severe punishments. Steckel has been pursuing the first possibility using quantitative tests, but his work also suggests other ways to explore the issue. Some plantations allocated rations to households, and others had communal kitchens. Did children fare differently depending on how provisioning was organized? It seems unlikely that this question could be looked at quantitatively, but it could be explored systematically using textual sources and paying close attention, for example, to childhood recollections of hunger. The larger point is that we can get somewhere very interesting by using theory (even this kind of basic neoclassical theory) to structure systematic inquiry. 28

Now my response to Louis. In his post he writes, “When I teach my labor history class, I begin by discussing how capitalism is a radical shift in human experience. For most of human history, excess resources were given away to promote social power. Only in the last few hundred years have people been taking those resources and investing them to produce more resources.” I don't think this statement is true, but my opinion is not worth any more than Louis's. But I do think this is a good example of the kind of assumption that underpins capitalism studies that needs to be examined. I could falsify Louis's statement by just giving an example from an earlier time (such as Roman history), but that would be too easy and not really add much to our understanding. Doing better is difficult, but one interesting attempt was a MacArthur Foundation–sponsored effort to run simple economic games in societies around the world. The main game was the “ultimatum game.” There are two players (unknown to each other). One is given some amount of money and told that s/he can share it with the other in whatever proportion s/he chooses. The kicker is that the other party can accept or reject the offer. If the offer is accepted, the parties walk away with their respective shares of the money. If the offer is rejected, no one gets anything. Basic neoclassical theory predicts that the first party would offer very little and the second party would accept the little bit offered because something is better than nothing. But when the game was played by students in university labs, the modal offers tended to be 60-40, and less generous offers tended to be rejected. Then Joseph Henrich, at that time a graduate student in anthropology at the University of California, Los Angeles, decided to run the experiment on a hunter-gatherer population he was studying in the Peruvian Amazon. To everyone's surprise, members of that society conformed to the neoclassical prediction, with the first party offering very little and the second party accepting it. Those results stimulated the MacArthur Foundation study, which basically confirmed the two sets of results. In more market-oriented societies (and also in societies whose main economic activities required organized cooperation), people offered 60-40 or even closer splits. The larger point is that trade requires some element of sharing the surplus. We see that kind of sharing all the time in “capitalist” societies, and it is not at all incompatible with accumulation and reinvestment. Indeed, one could argue just the opposite. 29

S hermer : Louis's focus speaks to an alarming trend in the scholarship lumped under the history of capitalism of late. Such a focus on the world of finance actually undermines, as Louis put it, “larger questions about everyday lives,” because not all of those questions are best answered through the world of finance. There were, in fact, a manufacturing economy (and the United States does still build things), transportation sector, retailing component, service sector, knowledge economy, etc., which were (and are) important to understanding everyday life in America (even before its independence). 30

As much as Naomi is right to point out how helpful the rigor of economic theory and quantitative inquiry is, there is still much to be said for writing these histories in a way accessible to historians and lay audiences, the latter of which are primed for this kind of work because of the great recession that began in 2007 and still lingers. I think here of the popularity of Richard White's Railroaded (2012). 31

The emphasis on quantitative work seems to leave out other rich fields that have been touched by this interest in capitalism. Intellectual history comes to mind, not only Jonathan Levy's and Angus's work but also Jeffrey Sklansky's The Soul's Economy and his new work on “the money question.” And regarding social history—I would hate to lose the sort of work Michael Zakim has done on men's dress. I am eager for someone to question how changes in political economy transform the body; it is now the super-rich that have the physique of the hypermasculine worker seen throughout 1930s labor agitprop. The power of words and ideas must be taken seriously. For example, Andrew Wender Cohen's and David Witwer's work on the idea of racketeering offers an important method to understand how one's “boss” became a union representative, not a manager or chief executive officer. 32

I appreciated that we followed up with a query juxtaposing the antebellum South with the New Deal. That speaks to the kind of conversation that many of these new histories across time and place are demanding. Historians must begin reconciling the rich history done on risk, insurance, financial underwriting, and bailouts, for example, in the nineteenth century and what occurred across the twentieth century. Right now, a lot of the new histories of nineteenth-century finance end with an epilogue about the 1970s, but that approach skips over a vital period that privileged and protected specific kinds of capital accumulation, organization, and labor regimes/managerial practices. It brings up questions about what the New Dealers faced and what they actually wanted to accomplish. 33

Attention to political economy has a lot to offer many subfields in and outside American history. They can be especially helpful in questioning what has been assumed of the postwar economy and examining how hidden the worlds of finance, business hostility to the New Deal order, and capital flight were.

The resistance within subfields to embrace new inquiries is troublesome. But I also want to emphasize that subfields are clearly changing because folks who more closely identify with a specific subfield are asking new questions and reconsidering base assumptions. That certainly made the difference in Scott Nelson's A Nation of Deadbeats and Bryant Simon's Starbucks book, which turned Alfred Chandler's firm inside out. And there's more work on the way that builds on important studies in labor history, which reasserts the importance of old issues to new questions. This trend is particularly welcome since much has seemingly been quickly forgotten in the rush to malign the scholarship of the New Left generation. I am particularly excited by Ron Schatz's new project on labor intellectuals, which takes seriously the power and struggles that federal appointees had trying to manage compromises between labor and management to fight World War II. 34

I am hopeful that the questions and ideas that labor historians raise will continue to inflect histories of capitalism. How different late 1970s tax revolts look when one goes back and rereads the Edsalls and rediscovers that Bank of America was one of the biggest backers of efforts to stop Howard Jarvis's anti–property tax initiative in California. Indeed, the best work that takes seriously late twentieth-century taxation and working people's response is Kevin Kruse's White Flight . His story of the rise of Lester Maddox helps align recent work on the white suburban South (and its attendant populism) with histories of political economy. 35

The books mentioned above underscore how powerful the questions asked by historians of capitalism are for the field of politics and policy, and not just for the recent renaissance of the history of American conservatism. Robert Johnston's and Charles Postel's works push historians to think about how changes in urban and rural political economies were important to the shaping of petit capitalist and Populist responses to industrial capitalism. I hope that historians begin to reconsider the history of the middle and Left as much as the Right in their responses and considerations of the development of American and global capitalism. 36

I cannot think of any greater proof to take region seriously (despite what recent scholarship on the postwar suburban South contends) than the importance of regional differences in political economy. White's Railroaded boldly shows that the West was as much the kindergarten for the American federal government as it was for financiers and investors. White's assertion that the twentieth century would be marked by a flow from west to east (not east to west) is important, though the twentieth-century South was also important to the shaping of policy and large shifts in the American political system and economy (particularly after World War II). The South and West were home to the trend-setting cities, which would be the kind of sprawling sub/urban metropolises whose development differs greatly but was also intimately connected to the trajectory of northeastern and midwestern cities. 37

All that is to say that the history of capitalism may be doing as much to create a distinct set of books, graduate programs, and seminars that draw on rich traditions in other subfields as it is opening up new questions in those same subfields.

B urgin : In answering the previous question, Stephen wrote that “the history of capitalism attempts to see capitalism from multiple angles using multiple methodologies.” This suggests the difficulties involved in sorting through the implications of the “history of capitalism” for other, more established subfields. Rather than establishing a discrete methodological program of their own, historians of capitalism tend to be omnivorous, relying on the insights of other historiographies to develop an approach that is ostensibly more multiperspectival, more attentive to systematic connections, or more capable of illuminating dynamic changes over extended periods.

An effect of this methodological promiscuity is a privileging of motion. Most recent histories of capitalism have oriented their narratives around phenomena that traverse across broad geographies or diverse social communities: finance capital, commodities, business enterprises, ideas. They leverage the motion of their subjects to identify un­expected connections, to bring together modes of historical analysis that are otherwise kept separate, or even to arrive at expansive structural claims. To this extent, it's unsurprising that the rise of the “history of capitalism” has coincided with a trend toward heterogeneity within the discipline of history. As traditional methodological silos break down, it becomes both more acceptable and more exciting to draw connections between them.

There is much to celebrate in this new work, and it has helped inspire historians of all varieties to engage questions of political economy. It has also generated significant costs. One cost is simply the difficulty involved in performing research in this mode well or in training graduate students to do so. It is easy to speak of appropriating tools from economic history, social history, political history, business history, intellectual history, and cultural history, but each of these subfields has a rich and complicated historiography that many graduate students have been asked to spend the better part of a decade trying to comprehend. Engaging in cross-pollination necessarily involves a thinning of training in those discrete historiographies and an effacement of the empirical standards that they have developed over time. For these reasons, the ambition, reach, and originality that have marked the best recent work on the history of capitalism are often accompanied by analytical ambiguities and a selective approach to evidence.

Another cost is more tangibly felt within the subfields that the history of capitalism works to consolidate or supplant. Take intellectual history. Intellectual historians have benefitted enormously from interest in the history of capitalism: due partly to the latter field's integrative approach to cognate historiographies, scholars working on conservatism or neoliberalism, for instance, now consider changes in social-scientific research agendas an important element of a broader historical transformation. Novel opportunities have emerged for intellectual historians to engage in dialogue with colleagues working on topics in what would once have been considered rival subfields. For obvious reasons, this is in many ways a laudable development. But it also serves to reshape work within intellectual history in curious and problematic ways. Scholars in that field today face significant pressure to work on topics that reflect on the kinds of problems that engage historians of capitalism. Consider the efflorescence of work on neoliberalism, conservatism, welfare, modernization theory, human rights, or risk, and compare it with the relative paucity of work on theoretical disputes that have less tangible connections to economic or policy outcomes. There is too little room in the American academy today for an intellectual history of, say, analytic philosophy (of the kind Joel Isaac has been pursuing from a position in Cambridge, England). These pressures are not unique to intellectual history: even as the “history of capitalism” draws on generations of work in labor history, business history, economic history, and so on, its distinctive and sweeping problematics accelerate the decline of long-standing debates in those fields. Looking back to one of Stephen's comments in response to the first question, I would say that the renewed interest in capitalism has made it easier for business historians to be hired, but more difficult for them to pursue the lines of inquiry that used to characterize their research.

I don't make these observations to complain: I share an orientation toward methodological heterogeneity, sympathize with historians' attempts to find integrative themes, and admire the capacity of recent scholarship to reframe static discussions in novel and illuminating ways. But recognizing the sacrifices this research program entails might inspire us to consider how best to overcome the hazards involved in assimilating diverse methodologies, or help us preserve space for historians who work on topics that remain peripheral to the new vistas that the “history of capitalism” has opened.

M arler : Earlier, Louis wrote, “simply defining capitalism is a bad idea. It is too deductive…. Inductive reasoning is the foundation of our discipline.” First, if we refuse to define what it is we're studying and teaching, it's going to be difficult for anyone to take us seriously. True, there is nothing “simple” about defining capitalism, but the effort must be made. Certainly, many attempts to define the qualitative changes that resulted in a new economic system called “capitalism” have been made, beginning at least with Adam Smith and proceeding through Marx and Max Weber. Moreover, historians continued these efforts deep into the twentieth century. I see no good reason to give up the ghost now.

The discipline of history is not exclusively beholden to inductive logic (reasoning from the particular to the general), rather than deductive logic (vice versa). History sits astride the arts and the sciences, with a hybrid nature best described as “craft.” If we insist on using inductive logic exclusively, then we end up with primarily anecdote-based histories, which frequently do not provide sufficient grounds for drawing broader conclusions. A plethora of fascinating, deftly told stories about discrete individuals may make for compelling narratives, but they usually can't provide adequate answers to the systemic questions raised by the variegated histories of capitalism.

In a more speculative vein, I think an insistence on inductive logic partly reflects most historians' ongoing preference for agency over structure. If we're going to analyze capitalism satisfactorily (especially in terms of causation), it would behoove us to strike a better balance between the two, a project best captured in Marx's oft-quoted line from The Eighteenth Brumaire of Louis Napoleon: “Men make their own history, but not of their own free will; not under circumstances they themselves have chosen but under the given and inherited circumstances with which they are directly confronted.” 38

The resistance to working, flexible, historically based definition(s) also risks contributing to the still-common fallacy that the essence of capitalism is simply acquisitive behavior and/or the pursuit of profit. Of course, such behaviors have been exhibited since antiquity, so we end up endorsing views of a system that have thereby been naturalized; that fail to emphasize the many empirically demonstrable qualitative changes in social relations that date from the sixteenth century forward; and that don't distinguish capitalism-as-system from the mere quantitative expansion of markets, exchange relations, and careful bookkeeping practices.

The goal of defining capitalism (and then explaining how it has developed in numerous guises) should not mean insisting on a normative, static abstraction but instead should provide us with well-considered conceptual starting points for our empirical studies.

S cranton : I went back to the initial query concerning the value of the history of capitalism for our particular subfields, how it relates to specific bodies of scholarship, and how we can locate research under this rubric in time and space (and thus, in the process, define what capitalism means to us). One minor revelation was that evidently I, among others, was “doing the history of capitalism” before the term arrived. My first book, Proprietary Capitalism (1983), pretty much announced an alternative narrative to corporate capitalism. But as a historical study of what we learned to call “industrial districts,” it was neither fish nor fowl at the time: not quantitative economic history and not exactly labor, business, or urban history, or a history of technology. I thought of myself then as a historian of industrialization, but soon the nonquantitative focus shifted toward consumption and culture. 39 So the history of capitalism would be interesting to me were it to emphasize, as one initiative, how foreshortened has been our understanding of trajectories and decision/investment options in agriculture, extraction, manufacturing, and the production of services—often jammed into Fordist or post-Fordist categories that were inadequate from the get-go.

Nowadays my work seems to be located in business history and the history of technology, so let me reflect on how one might think about the history of capitalism in relation to these two areas. With a nod toward Anthony Giddens's concept of “structuration,” I think business historians would regard capitalisms as discrete sets of emergent, situated practices (such as families or firms, perhaps) having to do with economic activity variously bounded, including investment, the creation and circulation of goods and services, sustained by institutions and conventions backstopped by state guarantees, provisions, and regulations. The key questions, among others, might be two “hows” and two “whats”: How does it work (differently here and there) and why? How does change arise (and with what implications)? What meaning is made of it (and by whom)? What consequences does it generate (and for whom)? 40

Just to consider the last question, we could argue that U.S. industrial capitalism generated extensive appropriation of natural and human/social resources, driving both material growth and nonmaterial claims to power and authority (via, in part, expanding notions of property). Yet at the same time it produced moral bankruptcy, profound inequalities, and accumulating environmental damage, plus an enshrinement of individualism and disgust for failure(s). Were we to look at the European version of these dynamics, the roles of collective projects and benefits (from warfare to welfare) would shake out quite differently, as would the status of the state in regulating, guiding, and constraining capitalist agents (traders, cartels, firms, and “branches”). Such contrasts would help American historians understand U.S. business's persistent drive to manage or control governments, whether at the local, state, or national level, given that such agencies provide one of the few checks on businesses' search for power. Such a rubric may well mark the New Deal and early Cold War eras as anomalous periods in which the national government limited business's options across multiple domains; and it may find the era since as one characterized by un­relenting drives by businesses to restore untrammeled latitude for decision making, without popular responsibilities or restraints, by taming or reframing the state.

For the history of technology, things are murkier, as scholars (chiefly U.S. based) in that field remain focused on cultural dimensions. At this fall's Society for the History of Technology conference, capitalism barely surfaces, and technology's materiality is peripheral to research on memory, perception, visions, bodies and the senses, and, of course, computing. Bringing the history of capitalism to bear on this situation could remind scholars of the economic, institutional, and power-related dimensions of technological choices, innovations, and dead ends. That would be the case, that is, were the history of technology not substantially populated by cultural historians seeking new research perspectives. Perhaps there's a place for a “material turn” somewhere down the road, as taking account of the last generation's technological disasters, failures, and fantasies will involve learning in detail about devices, decisions, and investments.

B eckert : Let me focus on how the history of capitalism fits into the history of the United States and its colonial antecedents. This is a difficult question that I don't think we have figured out completely. In ways, of course, capitalism is part of the scenery in which much of American history unfolds. Any investigation of North American history needs to grapple with the issue in some way. However, much historical research will continue to be focused on topics not primarily concerned with untangling and explaining that history of capitalism, at least not explicitly. When I think of the field, I think of it as both expansive and narrow. Narrowly conceived, it focuses on understanding trajectory of economic change in North America. The question of economic change itself, however, is expansive—it includes everything from the growth of manufacturing to the creation of bourgeois cultural capital. Moreover, understanding that economic change calls for a broader history of politics, ideas, the state, gender relations, imperialism, racism, and so on. It is concerned with social change, with the questions of who has access to what kind of resources and why. Power in all of its dimensions is crucial. Seen in that way, the field is just as relevant to understanding certain questions about the antebellum South—its plantation economy, for example—as it is to understanding the New Deal. Tracing the movement of capital, as was suggested earlier, is certainly one aspect in the history of American capitalism, but just one.

M ihm : As someone working in the “long nineteenth century,” the history of capitalism—however defined—promises to focus scholarship on subjects long neglected. For example, let's say you want to know about the tariff controversies, which were easily one of the most divisive political issues during the long nineteenth century. You'll need to check out Frank Taussig's The Tariff History of the United States , first published in 1888, or Edward Stanwood's American Tariff Controversies in the Nineteenth Century , from 1903. These are subjects of immense importance to the political economy of nineteenth-century America. For all the talk of transnational history, it's rather difficult to grasp the inner workings of the global economy in the age of empire without some understanding of tariffs. Yet the signal works on this subject are over a century old—an eternity in historiographical terms. 41

Dig deeper into any of several other hot-button issues in the political economy of the nineteenth century, and you'll find swaths of historical territory largely forgotten, save for occasional articles by quantitative economic historians. Want to learn more about the “Independent Treasury,” an institution of considerable importance in the monetary and financial history of the United States? You'll need to read a book written by a student of Frederick Jackson Turner in the 1890s. 42

Why should we care about things such as the tariff? Why should we care about banks and other financial institutions? You ignore them at your peril. To take financial institutions out of, say, the history of slavery is to miss a key pillar of the southern economy, one that used slave bodies as collateral for mortgages. This, in turn, enabled the expansion of slavery and cotton cultivation, ensnaring millions of people free and unfree in intricate webs of credit and debt. When financial markets shuddered, these relationships came undone. Cash-strapped planters had to hand over the slaves they had mortgaged. In the process, slaves were sold and families destroyed. Here's another example. The independent scholar Richard Kilbourne published a book in 2006 about the Mississippi branch of the Bank of the United States. He discovered that the Bank of the United States—headquartered in Philadelphia—was at one time “one of the larger slaveholders” in Mississippi by virtue of owning paper instruments that gave it possession of slaves living in that state. 43

There are signs that in studies of the postbellum era, too, the history of capitalism will pay significant dividends. Until recently, the history of the corporation has not been a hot subject in the mainstream historical profession, even if business and economic historians have built a vast literature on corporate organization and structure. But Richard John's Network Nation and Richard White's Railroaded herald a more hard-nosed, critical—one might say neo-Progressive—slant on the history of corporate behemoths such as Western Union and the Union Pacific Railroad. 44

H yman : I want to respond to Naomi's points. I support the belief that we need to up the quantification ante of history. The History of Capitalism Summer Camp I ran this past summer at Cornell University brought together thirty scholars to learn skills toward that end: statistics, accounting, corporate finance, econometrics, microeconomics and macroeconomics. It was intense, but it showed how certain kinds of questions can be answered best with numbers. Want to know the dollar value of being white in 1955? Come to camp next summer! 45

But I also think (and here is where I think we part ways) that many important questions cannot be answered with numbers. The imperious overreach of cliometrics led to its downfall. The skill sets of cultural and intellectual history are essential for answering many questions in the history of capitalism, and this is why the history of capitalism cannot be folded into economic history.

On the investment point: the data that I am thinking of is, of course, from the late great economist Angus Maddison, who showed how ridiculously Malthusian the world was before capitalism. Gross domestic product as a rough approximation of economic activity is important because capitalism marks a take-off in economic growth that had never happened before. The Malthusian stasis was Thomas Malthus's belief that all increases in economic production would create a rise in population, thus all per capita production, in the long term, would be stable. For the last few hundred years in capital countries, this prediction has not been true—and that is novel. Investment occurred in the ancient world but not in the intervening centuries and certainly not in a way that produced extra-Malthusian growth. Capitalism is what made that growth possible. I don't know about hunter-gatherers and behavioral economist experiments with them, but I do know about the Dutch East India Company, Slater Mill, and Carnegie Steel. I think the flattening of history into disconnected case studies of economic theory creates a different world view for economic historians than for historians of capitalism. 46

L amoreaux : I agree with Louis that not everything can be quantified, but we probably disagree about where the boundary lies. Our more important disagreement, though, is about history. Certainly, modern economic growth depends on getting out of the Malthusian trap, but that is a different story from what most historians of capitalism would tell and comes later than one might expect (see Timothy Guinnane's 2006 review of scholarship on the demographic transition in the Journal of Economic Literature ). 47

H udson : From the subfields of African American, African diaspora, and Caribbean history and cultural studies, the recent work on the history of capitalism, other than that on slavery, has largely been on the history of anticapitalism, especially through the recovery of the biographies and intellectual histories of black Marxists and black Marxist feminists. 48

While this literature often takes place against the backdrop of the 1930s global economic turmoil, its focus on radical individuals and organizations often leads it to paint capitalism's history with broad brushstrokes while providing scant attention to the nuances of the structural conjunctures of capitalist institutions with those of colonialism and imperialism. I don't mean this as a criticism since these studies don't purport to be histories of capitalism. That said, many of the figures evoked could be seen as vernacular historians of capitalism who were engaged in a more rigorous study of capital, and of these conjunctures, than are their latter-day amanuenses. A self-conscious engagement with the history of capitalism, through many of the varied approaches discussed in this forum, would be productive; a “corporate turn” might offer a generative interchange that could stretch and extend the concerns with social and cultural history that are often the foundations for this research.

That said, there also appears to be a growing movement outside the United States, but from within these subfields, that is taking interest not in the history of capitalism per se, but in business and economic history. The Asociación de Historia Económica del Caribe was launched in 2010. One of the association's founders, the Haitian economic historian Guy Pierre, recently coedited a pathbreaking collection of Caribbean economic history, Histoire économique de la Caraïbe (1880–1950) . A contributor to that volume, Inés Roldan de Montaud has done important research on the history of banking in Cuba and Puerto Rico under colonial rule as well as on the transformation of institutions such as the Banco Español de Puerto Rico during the transition from Spanish colonialism to American capitalism after 1898. Similarly, in the Anglophone Caribbean, the historians Kathleen E. A. Monteith and B. W. Higman have edited an anthology, West Indian Business History . Monteith has also written a pioneering history of Barclays dco in the West Indies. In the context of West Africa, the anthropologist Jemima Pierre has explored the structural transformations of race and political economy in Ghana's transition to independence in The Predicament of Blackness . Her book marks a decisive shift from the culturalist narratives favored by anthropologists and ethnographers of Africa by borrowing from the historian's repertoire. Pierre's work is in conversation with that of the business historian Stephanie Decker, who has researched the banking and business history of colonialism and postcolonialism and who has recently posed the question, Does Africa need business history? on the nep-his blog, while pointing to the fact that Africa's economic encounters with the world were not simply that of colonialism and slavery. 49

One of the more intriguing books to emerge is Playing the Numbers (2010). Examining the illegal lotteries organized by African Americans and Afro-Caribbean migrants in Harlem during the 1920s, the authors argue that such forms of financial organization were of such a scale and of such import that they need to be seen alongside the work of Marcus Garvey's Universal Negro Improvement Association. The authors also implicitly suggest the possibilities for thinking of the history of forms of economic organization and financial institutions on the margins of the formal market as economic and political forces. 50

Monographs such as Playing the Numbers suggest that we need to consider not only those modes of exchange and financial and economic organization that are outside of the formal market but also how they are often a necessary component of capitalist regimes of accumulation. Instead of trying to draw clear lines between precapitalist and capitalist forms or noncapitalist and capitalist forms of exchange and accumulation, it seems more productive to try to understand how, in many cases, the former—precapitalist modes of accumulation—are mobilized, used, and continued by the latter—especially in those regions where the transition to capitalism was contingent, provisional, and unfinished. Here, again, the work of critical geography is useful for its insights into the spatial manifestations of unevenness and the manifestations of the histories of circulation within the built environment (consider Nathan Connolly's A World More Concrete [2014]). On Louis Hyman's point about excess resources, I would disagree with him. Even in austere times, extravagance, excess, and waste remain sources of social power and philanthropy, suggesting that the impulse is not always to invest, unless we expand the meanings of the term. Should we begin to research the histories of capitalism's irrationality and its forms of nonutility? 51

It is important to follow the money. The recent research of Catherine Hall and Nicholas Draper on compensation for slavery in the Caribbean demonstrates this while lending empirical ballast to moralistic approaches to the study of slavery and the calls for reparations. A figure such as Hilary Beckles, who has taken a prominent role in the call by Caribbean nations for reparations from European countries involved in slavery, suggests that historians will use the past to understand the present. However, I also think of Harold van B. Cleveland and Thomas F. Huertas's Citibank, 1812–1970 in this regard. The book was commissioned by Citibank's head, Walter Wriston, as a corporate strategy to mobilize the bank's history to understand the contemporary and future regulatory context. In the introduction, Alfred Chandler states, “Thus Citibank itself will reap rich rewards from its enlightened attitude toward its own past.” 52

“Following the money” is also important because the world of finance is not simply a morass of inscrutable figures but the representation of social and cultural practices. The loan negotiations between the Chase National Bank of the City of New York and the government of the Republic of Cuba during the 1920s often took an epistolary form; those letters—and there are hundreds of them—describe not just the terms of the agreement but also the social and political turmoil that engulfed Cuba, which was partly due to bad debt. 53

JAH: What do you see as the biggest challenges and payoffs when teaching these topics to undergraduate or graduate students? How does, can, or should the framing of a course—such as in terms of the “history of capitalism,” “political economy,” or “economic history”—shape its focus? What techniques or insights would you share with others?

S hermer : The biggest payoff when teaching the history of capitalism is student interest. The great recession sparked an interest (no matter the background of my students) in business, economic, and labor issues. The best example: before I hand out the syllabus for my 1865 to the present survey, I ask students what topics, people, events, etc. they believe must be included. Rarely did I find a student who mentioned the Great Depression, Social Security (or Medicare), or unions before 2008. Now, half the class wants to know about the 1930s and the New Deal.

That said, there are definitely pitfalls. We have only a set amount of time and readings that can be assigned. I am concerned that the nitty-gritty of political economy will be too top-down and without a sense of the lived experience that kindles so much student excitement. Critics of the new history of capitalism have been correct to point out that folks outside the most elite regional, national, and local circles have faded into the background, which should give us pause to consider: How does one bring in all of these voices and make clear the actions and clashes between so many different historical actors? Also, where do we go for teachable secondary and primary sources? For me, the biggest help in transforming my offerings have been the material put together by the Harvard Business School and Harvard's Program on the Study of Capitalism. 54

O tt : Back in 2006 I was hired as the first professor in the “history of capitalism” (so far as anyone seems to know). But until 2008 I hesitated to use the phrase. I too worried that it reified that which ought to be historicized. In my teaching and in my research, I talked about market culture, consumer culture, financial culture, commercial culture, corporate culture, business history, economic history, and financial history. I strove always to be precise about identifying particular people, processes, and institutions. I still bristle when I read sentences that cast undifferentiated/monolithic “capital” or “capitalists” as the subjects.

But Sven and Colleen Dunlavy made me recognize the power of the term history of capitalism for attracting students. This has been especially true at the New School, where the term capitalism never fell out of favor, and no one would ever perceive its use as antithetical to the application of critical theory, gender/queer theory, race theory, etc. My instrumental embrace of history of capitalism did coincide with the financial crisis. Students from all divisions suddenly wanted to understand how contemporary capitalism works (and why it seemingly stopped “working”). I think history offered them something more accessible, more human(e), more engaging, and more contingent. It gave/gives them hope to learn how any given economic system is made by people (some more powerful than others) at a given moment in time. Economic arrangements have been—and might yet be—revised. No other discipline—and no other history courses or subfields—offered them that.

For example, I've found that walking students through financial history helps them understand something about technical matters that they otherwise consider beyond comprehension. If, for example, we use sections from William Cronon's Nature's Metropolis and talk about farmers and millers hedging risks, then I've moved them much closer to understanding derivatives and swaps. If I assign parts of Greta Krippner's Capitalizing on Crisis to explain financialization, then my students are much better equipped to reexamine their entanglements with consumer debt—and to understand that those entanglements are not just about personal choice (much less fallibility or profligacy). Research on the role of the state and the use of retained earnings to fund enterprise in the twentieth century helps my students understand that financial instruments, institutions, and markets have rarely been “doing God's work,” that is, funding innovation and distributing risk efficiently. Try asking a student—or anyone—what happens if they buy a share of Apple stock. Unless they work in finance, it's highly likely that they think their money goes straight into the coffers of Apple, Inc., to help that corporation invent and market awesome gadgets. I find my students (and other audiences) tremendously appreciative to learn that this is not the case. Then there's the whole field of consumer culture—another group that was doing “history of capitalism” before the coining of the phrase—which consistently challenges students to think critically about the political, social, and environmental consequences of what they perceive as their intimate, private, and uniquely original economic choices. 55

B eckert : At Harvard, undergraduate students seem to be drawn in large numbers to the study of capitalism. They come from different perspectives. Many believe that it is a “useful” history that will help them maneuver a career. If only we understand the history of American capitalism, they believe, we will be able to see into the future, both regarding the United States and even more so other parts of the world, such as China. They also appreciate a certain way of thinking that is in a refreshing way old-fashioned—the kind of political economy that once was taught in economics departments. For other students it is relevant for different reasons: they see problems in the United States—from inequalities to environmental degradation—and believe that capitalism has something to do with them. They hope that studying the history of American capitalism will help them understand how we got into the mess we are in. The vast majority have no great interest in American history as such. But the course often draws them into some of the themes historians debate. There are great pedagogical opportunities here: I can, for example, teach the history of American labor as part of the course on capitalism, a theme that would not have attracted many students if I had advertised a course on labor history. I can debate the history of slavery, of Native Americans, of 1968 with students who would not have encountered these subjects otherwise. Other students would never have wanted to hear about the changing form of American businesses, but they encounter and learn to appreciate such a focus in a course on capitalism. Debates among students can be tough; they disagree with one another passionately. At one point, they distributed flyers in front of the lecture hall! Perhaps the best thing about teaching the history of American capitalism, aside from its relevance, is the ability to constantly surprise students and make them think in ways that go beyond the stale stupidities that characterize so much of the public discussions in the media on capitalism.

M arler : I teach at a large metropolitan public university, one in dire financial straits, and although I have many students who I believe could succeed nearly anywhere, the vast majority not only need to work for a living while pursuing their degrees but a disproportionate number were also deprived of an adequate K–12 education. I am not among those cynical professors who think students have become progressively “dumber” over time. I've found that even my students from difficult backgrounds are typically hard working and very eager to be intellectually challenged.

I teach Atlantic history, but given the sprawling nature of that field, I emphasize the merchant-sponsored commodities networks that were the primary basis of the exchange processes that made up the Atlantic world, with particular focus on the African slave trade and the plantation complex. My course Studies in Atlantic Capitalism is cross-listed for both undergraduate and graduate students. Initially, I ask the students what they think capitalism means, and most respond along the lines of acquisitiveness and profit seeking—that is, in terms similar to Adam Smith's idea of “a certain propensity in human nature … to truck, barter, and exchange one thing for another.” I encourage them to begin honing and revising their conclusions about the nature of the beast. When I started teaching this course, several of my colleagues were skeptical of some of the readings: John Locke, Adam Smith, Karl Marx, Max Weber, among others. But as it has turned out, my undergraduates have done extremely well teasing out the subtleties of such classics; it's actually the Atlantic paradigm that confuses them the most—not capitalism. 56

I'm sure it won't be long before we have textbooks and primary-source anthologies on the histories of capitalism. But for now, the primary and secondary sources available online seem more than sufficient. At least for my undergraduates, monographs just don't work very well, except for the handful of books the chapters of which can be staggered over the course of the semester.

H udson : Scott has framed the question of pedagogy in an important way. I've taught a course called Blacks and Money at both the University at Buffalo and Vanderbilt University. The Buffalo students were mostly working-class kids and some adults, many of them the first generation in their family in college. I don't think they suddenly became interested in the history of capitalism because of the financial crisis; instead, many of them already had experienced an ongoing economic crisis. Certainly, this was exacerbated by the subprime crisis, but many of them were depressingly familiar with redlining, payday loans and check cashing institutions, the kinds of usurious fees attached to credit and debit cards, as well the experience of being from places unbanked and underbanked. At the same time, many of the students had connections to rotating credit associations and other modes of informal credit organization, and a good number of them saw themselves as entrepreneurs, be it in the formal or informal sector. The course gave depth and context to what they already knew while giving them a different sense of scale: moving from household to national and global economies. Many of these institutions are abstractions for my Vanderbilt students, though they are more adept at analyzing and discussing the abstractions of contemporary global economics and finance and their modes and institutions of regulation.

I also have a class called American Foreign Banking. For whatever reason—and I really don't know why—enrollment for the class is consistently made up of white men. Many of them enter the class expecting to become better bankers—and many of them are jockeying for internships. I have them read Vladimir Lenin and Charles Conant, Emily Rosenberg's Financial Missionaries to the World and Yousseff Cassis's Capitals of Capital , James Weldon Johnson on the National City Bank in Haiti and Vincent Carrosso on the Morgans' international lending. The course develops a social, cultural, and political-economic approach to the history of the internationalization of American banking while asking students to denaturalize the presence of banking and financial institutions in their everyday lives. The occasional student will rethink his or her path to Wall Street. 57

O tt : The New School is an expensive private university located in a very expensive city. Although most of my students come from comfortable and affluent families, they still struggle to juggle multiple jobs and to keep down their debt.

I'm committed to integrating material culture into the study of the history of capitalism, which works well at my institutions. We have a large body of design students, and the typical student may struggle with primary documents written prior to the twentieth century—especially if English is their second language. Material and visual culture offers a different type of “source” for them to analyze, a more exciting entry point into a period, a region, a topic. In New York City I can take my students on a lot of field trips, but I build assignments around collection Web sites with good, searchable databases. It's been successful for me in dealing with issues of costs, reading skills, and student engagement and participation when teaching the history of capitalism. Also, around issues of inequality—there are so many policy institutes out there with amazing free research and engaging, interactive content. In particular, I like the Economic Policy Institute and the Schwartz Center for Economic Policy Analysis. 58

L amoreaux : I agree that the history of capitalism is most important for teaching and that its great value is its potential for attracting students to the study of business/economic/technological/labor history. Years ago I taught a number of different undergraduate seminars in business history, and I was intrigued by how changing the title of a seminar dramatically changed the kinds (and number) of students who wanted to take it.

My main lecture course has always been American Economic History, which I have taught as a history course, an economics course, and a cross-listed course. The topics I covered and the way I covered them have varied. In the most recent (cross-listed) variation, my goals were methodological—to get the history students to learn to reason quantitatively and economics students to learn to think about texts. A course I taught that came closest to something that might be called the history of capitalism focused on the murder of a female mill worker in the early 1830s and used documents associated with the case to get at many important themes related to industrialization and religious and political democratization.

M ihm : There is a great deal of skepticism in the media about supposedly “impractical” college majors, particularly in the humanities. “What good is a history degree?” is a question I hear a bit too often in public debates. But this worrisome trend goes hand in hand with a rather striking countertrend. When faculty members such as ourselves offer courses titled “the history of capitalism,” we seem to have no problem filling classes. We often fill them, in fact, with people who aren't majoring in history. To the extent that we have problems as a profession, I don't think the magic words “history of capitalism” will solve them. But I do think that it is not entirely surprising that students coming of age in today's relentlessly competitive global economy gravitate toward a course that connects the present to the past.

H yman : I teach courses with labor, management, and business in their titles from a history of capitalism perspective. The freshmen in our required Introduction to Labor History course learn not only the requisite classical topics (1877, Knights of Labor, International Workers of the World, 1919, etc.) but they also learn about how to understand labor as both social history and business history. To understand the steel industry one must take a history of capitalism perspective: tracing capital investment, labor organization, and product markets. Students love it. They care about workers, but they want to know how capital constrained worker actions and how capital was, in turn, constrained by other forces, such as patriarchy and white supremacy. And yet, for all these hegemonic structures and seemingly deterministic imperatives, change still occurs. To me, teaching history of capitalism is about teaching the moments when agency is possible: for workers, for entrepreneurs, for policy makers. I want students to be able to recognize those possibilities for change.

B urgin : Undergraduate course work in the history of capitalism has notable advantages, including (as participants in this interchange have suggested) the ability to bring together students with a broad range of interests and disciplinary commitments. But this raises difficulties as well. In teaching an upper-level undergraduate course on the intellectual history of capitalism, for example, I've found that I can take almost nothing for granted. Historians are puzzled by the abstract language of postwar economics; economists are wary of social theory; political theorists struggle with historical modes of argumentation. This provides an opportunity to challenge the students' methodological assumptions, but it also means that I can assume little about their baseline of knowledge.

We can address this challenge, in part, by creating institutional contexts that prepare students to engage with interdisciplinary problems. One route might be to foster historically oriented variants of the philosophy, politics, and economics model that has flourished in the United Kingdom, for which many scholars who work on the history of capitalism would be well-situated to play an integrative role. The problem of disciplinary boundaries arises in graduate training as well. We too often expect students to engage in interdisciplinary work without providing them with the disciplinary tools they need to pursue it.

JAH: Moving forward, what is the one thing that you would most like to see the scholarship on the history of capitalism do?

L amoreaux : The great potential of the history of capitalism is that the new interest in the economy will lead to more truly interdisciplinary conversations and even collaboration. To give an example, once upon a time many historians took at face value contemporary claims that Andrew Jackson's veto of the bill to recharter the Second Bank of the United States was behind the inflation of the 1830s. The economic historian Peter Temin posed a simple test. If those contemporary claims were correct, then one should observe that banks' reserves of specie fell after the veto relative to liabilities such as currency issues and deposits. They did not, so the inflation had to have another source. This test did not require any sophisticated quantitative skills and the necessary data were readily available, but the historians had not even thought to look. I very much hope that now that historians are returning to the study of economic questions they will not be so naïve. And I very much hope that the skill in textual analysis that they will bring will similarly counter the very different kinds of naïveté exhibited by economists and other social scientists. 59

S hermer : This scholarship should remain inclusive and expansive, and should, as Stephen wrote, look underneath the hood. But I fear that tendency is being defined as just understanding the financial side when there is much to be done to bring forth, for example, the politics in political economy. I heartily agree with Naomi's emphasis on interdisciplinary collaboration but only as long as it is not limited to economics. To be sure, as she points out, historians can certainly benefit from economists' insights, but they can also learn from literary scholars, sociologists, and anthropologists interested in capitalism. The question of conferences speaks directly to the issue of being inclusive and expansive. Capitalism conferences were formative for me and this new scholarship as a whole. I am sad to see fewer of them organized but excited to see panels and peers cropping up at diverse conferences. I hope that panels will keep the field vibrant and not confined to a particular wing or corner of the profession.

M arler : Some scholars have begun to ask whether the linguistic turn was actually a conceptual (and political) cul-de-sac and to wonder just how many more literary-inflected studies we really need on protean topics of identity formation, collective memory, and the like. Let's get back to basics. To paraphrase Eugene D. Genovese and Elizabeth Fox Genovese, history is fundamentally the story of who rules whom, and how. From that rather blunt perspective, there's no better platform for understanding the developments of the last half millennium than the various histories of capitalism. But this time, perhaps we might be better off trying to relate more of those histories from the top down instead.

H udson : Internationalism. Despite the recent turns to diaspora, empire, and trans­nationalism, U.S. history remains provincial. The history of capitalism should not simply be the history of U.S. capitalism. Local studies are necessary, but local places are embedded in regional, national, and international processes. We need to push students to develop this global vision and encourage them to engage with the historical literatures produced outside of the United States and with the histories of capitalism beyond U.S. borders.

B urgin : Those who self-identify as historians of capitalism, and especially those who study the twentieth century, would benefit from a less presentist approach. The many benefits of contemporary relevance create a temptation to focus excessively on issues that resonate with the problems of the moment. Take, for example, two of the most vibrant subjects in the history of the twentieth-century United States: conservatism and the economic crisis of the seventies. After an extended period of neglect, the politics of the late 1990s and 2000s has led many historians to construct new narratives in which these subjects are now central. Such a stunning historiographic inversion was only possible because the contemporary situation made earlier narratives seem inadequate. The result, however, has been a scholarship that overemphasizes origins of and analogues to the present, and underemphasizes alternatives and antitheses. The problems and periods that drove research a generation ago are now understudied and inadequately understood. As work in our emerging field matures, we have an opportunity to leverage our new confidence and capacities to explore subjects that are less anxiously framed in relation to the contingencies of our time.

B eckert : Seventeen years ago, when I taught my first course in the field, colleagues tried to persuade me that this was a hopeless undertaking. The history of capitalism has brought important topics into our classrooms and our research, topics that are also of great contemporary relevance. Doing the history of capitalism has become more or less uncontroversial. We can now move on to some of the great questions that the history of capitalism raises and that we debated here in passing. And I agree with Naomi—to do so well we need to engage again more fully with the social sciences, including economics, and vice versa. I also agree that no history of American capitalism will succeed without a global perspective.

I hope that historians of capitalism take up some of the intellectual space that economists occupy in our contemporary political debates. I am looking forward to the day when the ubiquitous “as economists have said” will sometimes be replaced by “as historians have said.” It would make for better politics.

M ihm : That the history of capitalism is popular within the academy is indisputable. But its popularity outside the academy strikes me as even more promising. This suggests that Sven's hope that one day historians will take their rightful place in public debates is already at hand. To do so, however, historians need to be willing to wear more than one hat. Yes, we can still write books read by a few hundred scholars in our field. But we must also write op-ed pieces and essays for an audience of millions. A general audience isn't so different than the students who populate our courses. We already have the skills to speak to the public; and we should.

H yman : The most important thing to demonstrate is that capitalism has a history. Capitalism is not fixed but flexible. Showing that people have some choice over the movement of capital is a radical corrective to the idea of the “free market.” If one of the main engines of nineteenth-century capitalism—slavery—can be ended, despite its profitability, productivity, and deep imbrication with the largest financial institutions of the time, then transforming today's troubling aspects should be fixable as well. Profits don't shape everything, even in capitalism.

Louis Hyman, “Why Write the History of Capitalism?,” Symposium Magazine , July 8, 2013, http://www.symposium-magazine.com/why-write-the-history-of-capitalism-louis-hyman .

For an overview of the historiography of black women and slavery, see David Barry Gaspar and Darlene Clark Hine, eds., More Than Chattel: Black Women and Slavery in the Americas (Bloomington, 1996); Angela Y. Davis, Women, Race, & Class (New York, 1983); Deborah G. White, Ar'n't I a Woman? Female Slaves in the Plantation South (New York, 1985); Jacqueline Jones, Labor of Love, Labor of Sorrow: Black Women, Work, and the Family from Slavery to the Present (New York, 1985); and Jennifer L. Morgan, Laboring Women: Reproduction and Gender in New World Slavery (Philadelphia, 2004). On the prison-industrial complex, see, for instance, Avery Gordon and Angela Davis, “Globalism and the Prison Industrial Complex: An Interview with Angela Davis,” Race and Class , 40 (no. 2, 1999), 145–57; Critical Resistance Publications Collective, Abolition Now! Ten Years of Strategy and Struggle against the Prison Industrial Complex (Oakland, 2008); Ruth Wilson Gilmore, Golden Gulag: Prisons, Surplus, Crisis, and Opposition in Globalizing California (2007); and Julia Sudbury, ed., Global Lockdown: Race, Gender, and the Prison-Industrial Complex (New York, 2005).

Andrew Wender Cohen, The Racketeer's Progress: Chicago and the Struggle for the Modern American Economy, 1900–1940 (New York, 2004); Shane Hamilton, Trucking Country: The Road to America's Wal-Mart Economy (Prince­ton, 2008).

Kim Phillips-Fein, Invisible Hands: The Businessmen's Crusade against the New Deal (New York, 2009); Benjamin C. Waterhouse, Lobbying America: The Politics of Business from Nixon to nafta (Princeton, 2014).

Charles Sellers, The Market Revolution: Jacksonian America, 1815–1846 (New York, 1991). It is not widely known, but Charles Sellers had been using the term market revolution for several decades. See the relevant pages of chapter 9 of Charles Sellers and Henry May, A Synopsis of American History (Chicago, 1963), 109–22. Sellers was solely responsible for chapters 1–15.

Sven Beckert, “History of American Capitalism,” American History Now , ed. Eric Foner and Lisa Mcgirr (Philadelphia, 2011), 314–35.

Margaret Schabas, The Natural Origins of Economics (Chicago, 2005); Timothy Mitchell, Carbon Democracy: Political Power in the Age of Oil (London, 2011), 109–43; David Grewal, The Invention of the Economy: The Origins of Economic Thought (Cambridge, Mass., forthcoming); Timothy Shenk, “Inventing the American Economy, 1917–1981” (Ph.D. diss., in progress, Columbia University).

Howard Brick, Transcending Capitalism: Visions of a New Society in Modern American Thought (Ithaca, 2006). Jeffrey Sklansky, “The Elusive Sovereign: New Intellectual and Social Histories of Capitalism,” Modern Intellectual History , 9 (April 2012), 236.

Peter A. Hall and David Soskice, eds., Varieties of Capitalism: The Institutional Foundations of Comparative Advantage (New York, 2001).

Ulrich Beck, Risk Society: Towards a New Modernity (Thousand Oaks, 1992); Ulrich Beck, Power in the Global Age: A New Global Political Economy (Cambridge, Eng., 2006); Ulrich Beck, Cosmopolitan Vision (Cambridge, Eng., 2006); Zygmunt Bauman, Liquid Modernity (Cambridge, Eng., 2000); Zygmunt Bauman, Liquid Times: Living in an Age of Uncertainty (Cambridge, Eng., 2006); Zygmunt Bauman, Collateral Damage: Social Inequalities in a Global Age (Cambridge, Eng., 2011).

On the Volcker Recession, see Paul Volcker and Toyoo Ghohten, Changing Fortunes (New York, 1992); William Silber, Volker: The Triumph of Persistence (New York, 2012); and Michael Bordo et al., “Three Great American Disinflations,” cfs Working Paper, no. 2007/05, http://www.econstor.eu/bitstream/10419/25506/1/527622915.PDF .

Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (1944; Boston, 1971).

Sellers, Market Revolution , 407. Karl Marx, Capital: A Critique of Political Economy , vol. III: The Process of Capitalist Production as a Whole , trans. David Fernbach (New York, 1981), 392–93.

See, for example, David Hancock, Citizens of the World: London Merchants and the Integration of the British Atlantic Community, 1735–1785 (New York, 1995); and Robin Blackburn, The Making of New World Slavery: From the Baroque to the Modern, 1492–1800 (New York, 2010).

Maurice Dobbs, Studies in the Development of Capitalism (New York, 1963). This is a revised version of Maurice Dobb's book, originally published in 1947. T. H. Aston and C. H. E. Philpin, eds., The Brenner Debate: Agrarian Class Structure and Economic Development in Pre-industrial Europe (New York, 1985). James Henretta, The Origins of American Capitalism: Collected Essays (Boston, 1991); Allan Kulikoff, The Agrarian Origins of American Capitalism (Charlottesville, 1992).

For example, see Stuart Hall, “Gramsci's Relevance for the Study of Race and Ethnicity,” Journal of Communication Inquiry , 10 (June 1986), 5–27; and Stuart Hall, “Race, Articulation, and Societies Structured in Dominance,” in Sociological Theories: Race and Colonialism , ed. unesco (Paris, 1980), 306–45. Nell Irvin Painter, Standing at Armageddon: The United States, 1877–1919 (New York, 1989); Robin D. G. Kelley, “‘But a Local Phase of a World Problem’: Black History's Global Vision, 1883–1950,” Journal of American History , 86 (Dec. 1999), 1045–77; Cedric Robinson, Black Marxism: The Making of the Black Radical Tradition (London, 1983); Walter Johnson, River of Dark Dreams: Slavery and Empire in the Cotton Kingdom (Cambridge, Mass., 2003); Walter Rodney, How Europe Underdeveloped Africa (London, 1972); Eric Williams, Capitalism and Slavery (Chapel Hill, 1944); C. L. R. James, The Black Jacobins: Toussaint L'Ouverture and the San Domingo Revolution (New York, 1938); W. E. Burghardt Du Bois, Black Reconstruction: An Essay toward the History of the Parts Which Black Folk Played in the Attempt to Reconstruct Democracy in America, 1860–1880 (New York, 1935); W. E. Burghardt Du Bois, The Suppression of the African Slave-Trade to the United States of America, 1638–1870 (New York, 1896).

David Harvey, The Limits to Capital (Chicago, 1982); David Harvey, The Condition of Postmodernity: An Enquiry into the Origins of Cultural Change (London, 1990); Neil Smith, Uneven Development: Nature Capital, and the Production of Space (New York, 1984); Neil Smith, American Empire: Roosevelt's Geographer and the Prelude to Globalization (Berkeley, 2003).

Sylvia Federici, Caliban and the Witch: Women, the Body, and Primitive Accumulation (New York, 2004).

Robert B. Townsend, “What's in a Label? Changing Patterns of Faculty Specialization since 1975,” Perspectives in History , 45 (Jan. 2007), 7–10. Robert W. Fogel and Stanley L. Engerman, Time on the Cross: The Economics of American Negro Slavery (Boston, 1974). Thomas G. Rawski, et al., Economics and the Historian (Berkeley, 1996). Peter Temin, “The Rise and Fall of Economics History at mit ,” mit Working Paper 13-11, June 5, 2013, p. 15, available online at Social Science Research Network Paper Collection.

Karl Marx, Capital: A Critique of Political Economy , vol. II: The Process of Circulation of Capital , trans. Ernest Untermann (Chicago, 1909); Karl Marx, Capital: A Critique of Political Economy , vol. III, The Process of Capitalist Production as a Whole , trans. Ernest Untermann (Chicago, 1909).

The books most influential to me at that point were Robert S. DuPlessis, Transitions to Capitalism in Early Modern Europe (New York, 1997); Eugene D. Genovese, Roll, Jordan, Roll: The World the Slaves Made (New York, 1976); Elizabeth Fox-Genovese and Eugene D. Genovese, Fruits of Merchant Capital: Slavery and Bourgeois Property in the Rise and Expansion of Capitalism (New York, 1983); Williams, Capitalism and Slavery; and Fernand Braudel, Civilisation matérielle et capitalisme: XVe-XVIIIe siècle (Material civilization and capitalism: The 15th–18th centuries) (Paris, 1967).

Davis, Women, Race, and Class; White, Ar'n't I a Woman?; Jones, Labor of Love, Labor of Sorrow; Morgan, Laboring Women .

Nell Irvin Painter, “Soul Murder and Slavery: Toward a Fully Loaded Cost Accounting,” in Southern History across the Color Line , by Nell Irvin Painter (Chapel Hill, 2002), 15–39. Walter Johnson, “On Agency,” Journal of Social History , 37 (Fall 2003), 113–24.

Robert Fogel, Without Consent or Contract: The Rise and Fall of American Slavery (New York, 1989), 64. A succinct, reliable guide to the demographics of southern slavery is Peter Kolchin, American Slavery, 1619–1877 (New York, 2003).

David Northrup, ed., The Atlantic Slave Trade (Lexington, Mass., 1994); Joseph Calder Miller, Way of Death: Merchant Capitalism and the Angolan Slave Trade, 1730–1830 (Madison, 1997).

Williams, Slavery and Capitalism ; Kenneth Pomeranz, The Great Divergence: China, Europe, and the Making of the Modern World Economy (Princeton, 2001).

Caitlin Rosenthal, “From Memory to Mastery: Accounting for Control in America, 1750–1880” (Ph.D. diss., Harvard University, 2012).

Fogel and Engerman, Time on the Cross; Robert W. Fogel and Stanley L. Engermann, Time on the Cross: Evidence and Methods; A Supplement (Boston, 1974); Richard H. Steckel, “Demography and Slavery,” in Oxford Handbook of Slavery in the Americas , ed. Robert L. Paquette and Mark M. Smith (New York, 2010), 643–63; Richard H. Steckel, “A Pernicious Side of Capitalism: The Care and Feeding of Slave Children” (2007) http://web.econ.ohio-state.edu/rsteckel/VITA/2007%20Pernicious.pdf .

The publication that resulted from the MacArthur Foundation project is Joseph Henrich et al., Foundations of Human Sociality: Economic Experiments and Ethnographic Evidence from Fifteen Small-Scale Societies (New York, 2004). Joseph Patrick Henrich, “Cultural Evolutionary Approaches to Adaptation, Rationality, Evolutionary Psychology, and Economic Behavior” (Ph.D. diss., University of California, Los Angeles, 1999). But see also Joseph Henrich, “Does Culture Matter in Economic Behavior? Ultimatum Game Bargaining among the Machiguenga of the Peruvian Amazon,” American Economic Review , 90 (Sept. 2000), 973–79.

See especially Hamilton, Trucking Country .

Richard White, Railroaded: The Transcontinentals and the Making of Modern America (New York, 2012).

Jonathan Levy, Freaks of Fortune: The Emerging World of Capitalism and Risk in America (Cambridge, Mass., 2012); Angus Burgin, The Great Persuasion: Reinventing Free Markets since the Depression (Cambridge, Mass., 2012). Jeffrey Sklansky, The Soul's Economy: Market Society and Selfhood in American Thought, 1820–1920 (Chapel Hill, 2002). Michael Zakim, Ready-Made Democracy: A History of Men's Dress in the American Republic, 1760–1860 (Chicago, 2003). Andrew Wender Cohen, The Racketeer's Progress: Chicago and the Struggle for the Modern American Economy, 1900–1940 (New York, 2004); David Witwer, Shadow of the Racketeer: Scandal in Organized Labor (Urbana, 2009).

Levy, Freaks of Fortune; White, Railroaded; Dan Bouk, How Our Days Became Numbered (Chicago, forthcoming); Jessica M. Lepler, The Many Panics of 1837: People, Politics, and the Creation of a Transatlantic Financial Class (Cambridge, Eng., 2013); Sharon Ann Murphy, Investing in Life: Insurance in Antebellum America (Baltimore, 2010); Scott Reynolds Nelson, A Nation of Deadbeats: An Uncommon History of America's Financial Disasters (New York, 2012).

Nelson, Nation of Deadbeats . Bryant Simon, Everything but the Coffee: Learning about America from Starbucks (Berkeley, 2009). Alfred D. Chandler Jr., Visible Hand: The Managerial Revolution in American Business (Cambridge, Mass., 1977). Ronald Schatz, “‘Industrial Peace through Arbitration’: George Taylor and the Genius of the War Labor Board,” Labor , 11 (Winter 2014).

Thomas Byrne Edsall with Mary D. Edsall, Chain Reaction: The Impact of Race, Rights, and Taxes on American Politics (New York, 1991), 129–31. Robert O. Self, American Babylon: Race and the Struggle for Postwar Oakland (Princeton, 2003), 291–327; D. A. Smith, “Howard Jarvis, Populist Entrepreneur: Reevaluating the Causes of Proposition 13,” Social Science History , 23 (Summer 1999), 173–210; Ballard C. Campbell, “Tax Revolts and Political Change,” Journal of Policy History , 10 (Jan. 1998), 153–78. Edsall with Edsall, Chain Reaction , 116–36. Kevin M. Kruse, White Flight: Atlanta and the Making of Modern Conservatism (Princeton, 2007). Patricia Cohen, “Interpreting Some Overlooked Stories from the South,” New York Times , May 1, 2007, http://query.nytimes.com/gst/fullpage.html?res=9D04EED9133EF932A35756C0A9619C8B63 ; Matthew D. Lassiter, Silent Majority: Suburban Politics in the Sunbelt South (Princeton, 2006); Joseph Crespino, In Search of Another Country: Mississippi and the Conservative Counterrevolution (Princeton, 2007).

Robert Johnston, Radical Middle Class: Populist Democracy and the Question of Capitalism in Progressive Era Portland, Oregon (Princeton, 2003); Charles Postel, Populist Vision (New York, 2007). There are signs of new work on the American liberal Left—led by Michael Kazin, Doug Rossinow, Jon Bell, and soon Leon Fink. Michael Kazin, American Dreamers: How the Left Changed a Nation (New York, 2011); Jonathan Bell, California Crucible: The Forging of Modern American Liberalism (Philadelphia, 2012); Doug Rossinow, Visions of Progress: The Left-Liberal Tradition in America (Philadelphia, 2008); Leon Fink, The Long Gilded Age: American Capitalism and the Lessons of a New World Order, 1880–1920 (Philadelphia, forthcoming).

Matthew D. Lassiter and Joseph Crespino, eds., The Myth of Southern Exceptionalism (New York, 2010).

Karl Marx, “The Eighteenth Brumaire of Louis Napoleon,” in Surveys from Exile: Political Writings , vol. II, ed. and trans. David Fernbach (New York, 1974), 146.

Philip Scranton, Proprietary Capitalism: The Textile Manufacture at Philadelphia, 1800–1885 (Cambridge, Eng., 1983).

Anthony Giddens, The Constitution of Society: Outline of the Theory of Structuration (Berkeley, 1986); Anthony Giddens, The Consequences of Modernity (Stanford, 1991); Anthony Giddens, Europe in the Global Age (Cambridge, Eng., 2006).

F. W. Taussig, The Tariff History in the United States: A Series of Essays (New York, 1888); Edward Stanwood, American Tariff Controversies in the Nineteenth Century (2 vols., Boston, 1903).

David Kinley, The History, Organization and Influence of the Independent Treasury of the United States (New York, 1893).

Richard Holcombe Kilbourne Jr., Slave Agriculture and Financial Markets in Antebellum America: The Bank of the United States in Mississippi, 1831–1852 (London, 2006), 2.

Richard R. John, Network Nation: Inventing American Telecommunications (Cambridge, Mass., 2010); White, Railroaded .

“History of Capitalism Summer Camp, Cornell University,” http://hoc.ilr.cornell.edu/ .

The data referred to is from “Historical Statistics of the World Economy, 1–2008 ad ,” http://www.ggdc.net/maddison/Historical_Statistics/horizontal-file_02-2010.xls . Angus Maddison, Contours of the World Economy, 1–2030 ad : Essays in Macro-economic History (New York, 2007). Thomas Malthus, An Essay on the Principle of Population (London, 1798).

Timothy W. Guinnane, “The Historical Fertility Transition: A Guide for Economists,” Journal of Economic Literature , 49 (Sept. 2011), 589–614.

This work includes Carol Boyce Davies, Left of Marx: The Politics of Black Communist Claudia Jones (Durham, N.C., 2008); Erik S. McDuffie, Sojourning for Freedom: Black Women, American Communism, and the Making of Black Left Feminism (Durham, N.C., 2011); Hakim Adi, Pan-Africanism and Communism: The Communist International, Africa and the Diaspora, 1919–1939 (Trenton, 2013); Barbara Ransby, Eslanda: The Large and Unconventional Life of Mrs. Paul Robeson (New Haven, 2013); Minkah Makalani, In the Cause of Freedom: Radical Black Internationalism, from Harlem to London, 1917–1939 (Chapel Hill, 2011); and Jonathan Derrick, Africa's ‘Agitators’: Militant Anti-colonialism in Africa and the West, 1918–1939 (New York, 2008).

Guy Pierre, Gustie-Klara Gaillard-Pourchet, and Nathalie Lamaute-Brisson, eds., Histoire économique de la Caraïbe (1880–1950): Economies sucrières, systèmes bancaires et dette extérieure, modèles de developpement et rivalités imperialistes (Economic history of the Caribbean [1880–1950]: Sugar economies, banking systems and foreign debt, models of development and imperial rivalries) (Port-au-Prince, 2010). Inés Roldán de Montaud, “El Banco Español de la isla de Cuba, de la independencia a la crisis de 1920” (The Bank of Spain of Cuba, from independence to the crisis of 1920), ibid. Inés Roldán de Montaud, “El Banco Español de la Habana (1856–1881)” (The Bank of Spain of Havana [1856–1881]), Revista de Historia Económica , 13 (no. 2, 1995), 281–310; Inés Roldán de Montaud, La banca de emisión en Cuba, 1856–1898 (The issuing bank in Cuba, 1856–1898) (Madrid, 2004); Inés Roldán de Montaud, “De banco de gobierno a banco comercial: El Banco Español de la isla de Cuba de la colonia a la república” (Government bank to commercial bank: The Bank of Spain of Cuba, from colony to republic), in Regards croisés. Cuba/Espagne (XIXe–XXes.), Travaux et Documents (Viewpoints. Cuba/Spain [nineteenth–twentieth centuries]), ed. François Moulin Civil (Paris, 2005), 61–82; Inés Roldán de Montaud, Francisco Comín, and Angel Pascual Martínez Soto, Las Cajas de Ahorros en las provincias de Ultramar, 1840–1898: Cuba y Puerto Rico (The savings banks in the overseas provinces, 1840–1898: Cuba and Puerto Rico) (Madrid, 2010). B. W. Higman and Kathleen E. A. Monteith, eds., West Indian Business History: Enterprise and Entrepreneurship (Kingston, 2010). Kathleen E. A. Monteith, Depression to Decolonization: Barclays Bank ( dco ) in the West Indies, 1926–1962 (Kingston, 2008). Jemima Pierre, The Predicament of Blackness: Postcolonial Ghana and the Politics of Race (Chicago, 2012). Stephanie Decker, “Postcolonial Transitions in Africa: Decolonization in West Africa and Present Day South Africa,” Journal of Management Studies , 47 (July 2010), 791–813. Stephanie Decker, “Decolonizing Barclays Bank dco ? Corporate Africanisation in Nigeria, 1945–69,” Journal of Imperial and Commonwealth History , 33 (Sept. 2005), 419–40. Stephanie Decker, “Does Africa Need Business History?,” NEP-HIS Blog , http://nephist.wordpress.com/2013/05/15/the-state-of-business-and-economic-history-in-africa/ .

Shane White et al., Playing the Numbers: Gambling in Harlem between the Wars (Cambridge, Mass., 2010).

Nathan Connolly, A World More Concrete: Real Estate and the Remaking of Jim Crow South Florida (Chicago, 2014).

Nicholas Draper, The Price of Emancipation: Slave-Ownership, Compensation, and British Society at the End of Slavery (Cambridge, Eng., 2010). See also Catherine Hall's project at the University College of London, Legacies of British Slave-Ownership , http://www.ucl.ac.uk/lbs/ . Hilary McD. Beckles, Britain's Black Debt: Reparations for Caribbean Slavery and Native Genocide (Kingston, 2013). Alfred C. Chandler Jr., “Editor's Introduction,” in Citibank, 1812–1970 , by Harold van B. Cleveland and Thomas F. Huertas (Cambridge, Mass., 1985), vi.

Cuban Public Works Financing: Memorandum of Facts Submitted to a Commission Appointed by the Cuban Government Under the Decree-Law Dated April 16, 1934 (New York, 1934). See also the letters in archive of the Pecora Commission Hearings (1932–1934), Records of the Committee on Banking and Currency, 1913–1946, Records of the U.S. Senate, rg 46 (National Archives, Washington, D.C.). U.S. Congress, Senate, Committee on Banking and Currency, Stock Exchange Practices: Hearings before the Committee on Banking and Currency Pursuant to S. Res. 84 … and S. Res. 56 and S. Res. 97 (Washington, 1934).

“Teaching the History of Capitalism,” Program on the Study of Capitalism at Harvard University , http://studyofcapitalism.harvard.edu/teaching-resources ; “Seminars and Conferences,” Harvard Business School , http://www.hbs.edu/businesshistory/seminars/Pages/default.aspx .

William Cronon, Nature's Metropolis: Chicago and the Great West (New York, 1991); Greta R. Krippner, Capitalizing on Crisis: The Political Origins of the Rise of Finance (Cambridge, Mass., 2011).

Adam Smith, The Wealth of Nations , ed. Andrew Skinner (1776; New York, 1986), 22.

Emily S. Rosenberg, Financial Missionaries to the World: The Politics and Culture of Dollar Diplomacy, 1900–1930 (Durham, N.C., 2003); Yousseff Cassis, Capitals of Capital: The Rise and Fall of International Financial Centres, 1780–2009 (New York, 2010); James Weldon Johnson, Self-Determining Haiti (New York, 1920); Vincent P. Carrosso, The Morgans: Private International Bankers, 1854–1913 (Cambridge, Mass., 1987).

Economic Policy Institute, http://www.epi.org/ ; Schwartz Center for Economic Policy Analysis, http://www.economicpolicyresearch.org/ .

Peter Temin, The Jacksonian Economy (New York, 1969).

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history of capitalism in america essay

The Power of Independent Thinking

history of capitalism in america essay

This article will be published in the Spring 2022 issue of The Independent Review .

The term polemic is derived from the Greek noun polemos , meaning “war,” and the Greek adjective polemikos , meaning “warlike” or “hostile.” A polemic is conventionally viewed as contentious, disputative, or combative rhetoric, the intent of which is to espouse or support a particular position and, in so doing, undermine another, via bold, categorical, often overstated claims. Some of the most famous works in Western literature are polemical: Luther’s Ninety-five Theses, Swift’s Modest Proposal , and Marx and Engels’s Communist Manifesto come to mind in this regard, although it should be noted that some would consider Swift’s work rather more a burlesque or satire than a polemic per se.

I do not wish to diminish these works by linking them too closely to The 1619 Project, created by Nikole Hannah-Jones and underwritten by the New York Times , but, in formal terms, the project, considered in toto, is clearly a polemic ( New York Times Magazine 2019). The intent of this polemic, on one level, is to dislodge the standard chronology and narrative scaffolding of U.S. history by elevating the importance of racial slavery and what some call racial capitalism in explaining both America’s past and our predicament today. On another level, somewhat shrouded, the project aspires to make the case, if not clinch the deal, for reparations to African Americans, reparations due them not only because of slavery, but also because of Jim Crow and decades of state-sponsored discrimination afterward. Indeed, in many ways, The 1619 Project can be seen as an anguished, over-the-top extension of and elaboration on Ta-Nehisi Coates’s essay “The Case for Reparations,” which appeared in The Atlantic in 2014 (Coates 2014).

Lest I be considered ungenerous, let me compliment the New York Times on the graphic design of the August 18, 2019, issue of its Sunday Magazine , and for including the usual puzzles and posers in the back. The rollout of the project was also impressive, particularly in its magnitude. Regarding the content: As the great historian of slavery Eugene Genovese might have put it, it is così così (so-so) at best. The pictures and illustrations work well, and the poetry and literary essays are often moving. Some of the essays devoted to historical themes ably summarize and synthesize specialist literature for general audiences. Others are curios—at times interesting but minor—a few are deeply flawed, and one is a train wreck.

To cut to the chase, the principal problems with the most objectionable historical pieces–the introductory essay by Hannah-Jones and the essay by Matthew Desmond —are linked inextricably to, indeed, grow inexorably out of, the motivation for and animating spirit behind the project. Bluntly put, despite the project’s historical trappings, it is decidedly, even aggressively, presentist in orientation. It is the work largely of journalists and “engaged” scholars, hoping both to help to operationalize New York Times editor Dean Baquet’s “secret” 2019 directive to double down on race with the 2020 election in sight, and, as a derivative dividend, to provide support for the growing movement for reparations, as Hannah-Jones, the majordomo of the project, has made clear (Feinberg 2019; Rockett 2019). To me and to other scholars of a nonactivist bent, the “spirit” behind the project is as chilling as it is brazen, suggesting nothing so much as the famous Party slogan in Orwell’s 1984 : Who controls the past controls the future: who controls the present controls the past.

The same spirit informs the project’s research design. Said design, not surprisingly, focuses almost solely on one variable, race, assuming erroneously that, in so doing, the “integument” shrouding American history will be “burst asunder”—I’m using Marxian phraseology intentionally here—exposing at long last America’s seamy underside. Hence the jettisoning of the year 1776 in favor of 1619—a year of little historical moment, but one, it is true, in which a small cargo of African indentured servants or slaves was deposited near Port Comfort in the English colony of Virginia (Coclanis 2019). In the modest words of the New York Times , the focus on race and the epiphanic year 1619 will “finally” allow us “to tell our story truthfully” ( New York Times Magazine 2019, front cover).

Really? I think not. For in viewing the complex tapestry of America through one lens and one lens only, that of race, or, to be more specific, the racial exploitation of blacks by whites, one misses a lot—even about race, slavery, and exploitation. For example, as Philip D. Morgan’s work has demonstrated, there were many more white slaves in Europe in the first half of the seventeenth century than there were African slaves in Virginia or in English North America as a whole (Morgan 2019, 89–91). Morgan’s findings may not mean much to those involved in The 1619 Project, but they are consonant with the rich work of scholars as different as Orlando Patterson and Thomas Sowell, who have documented the presence of slavery in virtually every society all over the world until relatively recently (Patterson 1982; Sowell 2019, 219–23). Then there is the work of historian Kevin Bales, who argues that there are more slaves living in the world today than there were during the heyday of the Atlantic slave trade (Bales 2012). And not to belabor the point, but what about Native American slaves, Native American slaveholders, and African American slaveholders in the United States, the last group numbering more than 3,700 in 1830? Regarding that group, many, to be sure, were slaveholders in name only, “masters” of freed family members in order to keep those free individuals in the South. But others were “enslavers” root and branch, including owners of large numbers of slaves, such as the now famous Ellisons of Sumter County, South Carolina, and John C. Stanly of New Bern in Craven County, North Carolina, who in the 1820s owned three plantations and 163 slaves (Johnson and Roark 1984; Schweninger 1990, 104–12). Even the slavery portion of the tapestry, then, is more complicated than The 1619 Project would have us believe.

The distorted and reductionistic interpretations both of slavery and of American history more generally are related as well to the project’s personnel and deployment thereof. Here, I am not questioning the talent and ability of the team assembled, which on the whole is great, but the manner in which the personnel were employed and the uses to which the knowledge and insights on offer were put, or, in some cases, not put. The roster includes many notable academics, artists, and journalists, and editors at the New York Times contend that other highly respected scholars served as consultants for the project. Points taken, but the most glaring interpretive problems with The 1619 Project grow out of the fact that two of the anchor essays—one laying out the interpretive core of the project and one on the era of slavery—were written by people with suspect domain expertise. In at least one case, sound, accurate advice from one of the historical consultants brought in, Leslie M. Harris of Northwestern University, was rejected or disregarded (Harris 2020). As a result, The 1619 Project, pace Hannah-Jones’s contention, does not afford us the opportunity for the first time to read about the American story “truthfully,” but rather in a deformed and distorted way, defined rather more by the moral failing of 1619 than the promise of 1776.

Matthew Desmond and the New History of American Capitalism

Slavery figures prominently in a number of essays and mini-essays in The 1619 Project As previously suggested, several of these essays have come under strong fire, mostly notably, Hannah-Jones’s framing essay and Matthew Desmond’s essay on the economic role and legacy of slavery (Hannah-Jones 2019; Desmond 2019). Thus far, Hannah-Jones’s piece has drawn the most flak, particularly for her dubious contention that “one of the primary reasons the colonists decided to declare their independence from Britain was because they wanted to protect the institution of slavery” (Hannah-Jones 2019, 18). Several distinguished senior scholars quickly and effectively pushed back against this position, while others called for less insistent versions of Hannah-Jones’s claim. Eventually, the New York Times begrudgingly qualified the claim, restating it to read “among the various motivations that drove the patriots toward independence was a concern that the British would seek or were already seeking to disrupt in various ways the entrenched system of American slavery” (Silverstein 2020). Since then, the Gray Lady has qualified other statements, albeit rather surreptitiously (Stephens 2020; Wood 2020).

Hannah-Jones’s claim regarding the motivation for revolution, however wrongheaded, was at least plausible. And numerous scholars of various political perspectives would actually agree with another controversial claim in her essay, to wit, that Lincoln’s positions on racial questions were not particularly enlightened (Magness 2020a, 113–24). Desmond’s argument, however, is implausible, and few scholars of slavery, other than those deeply invested in the New History of American Capitalism (NHAC) narrative, could possibly find it convincing. This, despite the fact that Desmond is a prolific, highly celebrated and lauded scholar, recipient, seemingly inevitably, of a MacArthur “genius” grant—bestowed, as the foundation puts it, on “creative” people “committed to building a more just, verdant, and peaceful world.” He pursues such commitments while firmly ensconced at a prestigious Ivy League school.

At first glance, Desmond, despite the résumé, seems an odd choice for the main essay in The 1619 Project. He is a sociologist rather than a historian, and his principal area of specialization is contemporary urban America. He writes in particular on such themes as poverty, housing, inequality, and social justice (Desmond 2016). Early in his career, he also wrote a well-received ethnographic account of wildland firefighters in Arizona (Desmond 2007).

To be fair, Desmond has in fact written on race and race relations as well, having coauthored two related books with his University of Wisconsin dissertation adviser, the well-known sociologist Mustafa Emirbayer, one an award-winning scholarly study attempting to lay out a new theoretical framework for the concept of race, and the other an undergraduate text on race relations, out in a second edition in 2020. The scholarly study, The Racial Order , is not directly concerned with slavery, and, not surprisingly, contains only a few scattered references to the institution. Both editions of the undergraduate text, Race in America , include a brief section—much the same in each—devoted mostly to U.S. slavery. The synthetic discussion therein is, for the most part, unobjectionable, commonplace stuff, but one line late in the section is at once illuminating and suggestive: “American slavery emerged to meet the needs of colonial exploitation and capitalist expansion” (Desmond and Emirbayer 2016, 69). For it is the conjunction of slavery, exploitation, and capitalism that both the NHAC and Desmond’s essay in The 1619 Project are all about.

Indeed, because Desmond relies almost exclusively on NHAC personnel and the NHAC playbook in his essay, it behooves us to touch briefly on this influential movement before turning to Desmond’s essay itself. I have weighed in elsewhere on both the state of economic history qua field and the NHAC movement and its origins, and so I won’t tarry here (Coclanis 2018). Suffice it to say that the field of economic history, which in the 1960s and 1970s ranked among the hottest fields in history, crashed and burned in the 1980s and 1990s, particularly in history departments, but to a lesser extent in economics departments as well. The reasons for the collapse differed in the two disciplines. In economics, an increasing mathematization and formal elegance, a growing concern for explanatory parsimony and analytical rigor, and a soaring interest in contemporary problems and forecasting severely damaged messy, nonaxiomatic, difficult-to-model subfields, such as the history of economic thought and economic history—in the case of the history of economic thought rendering it nearly moribund. In history, the decline of economic history had other causes, ranging from the ascent of cultural history in the 1980s to historians’ infatuation with postmodernism in the 1980s and 1990s to the changing demographics of the profession. There were deeper reasons as well, however, including historians’ discomfort with economic theory and formal methods—subjects that have been sine qua nons in economic history ever since the rise of the so-called new economic history in the 1960s—their growing disdain for quantification, and, frankly, their frequent uneasiness with economists themselves (Coclanis and Carlton 2001; Coclanis 2010a).

Surprisingly, though, several developments came together in the aughts to pump new life into economic history. In history departments, interest in postmodern approaches and in cultural history more generally declined in a relative sense at least, creating openings for other fields, including economic history. At the same time, growing anxiety in the United States over matters economic—wage stagnation, and increasing income and wealth inequality in particular—and, toward the end of the decade, problems relating to the Great Recession, spurred both historians and economists to think more about our economic history, and, more broadly, about capitalism qua system not only in the present but also in the past (Schuessler 2013).

Most economists doing so proceeded with the assumption that the ills already mentioned—even those associated with the Great Recession—were episodic and in principle correctible within the framework of the capitalist economic system via more realistic theory, better data, and policy reform. The origins of the new interest in economic history in history departments differed dramatically, led as it was for the most part by scholars with very different assumptions about capitalism, taking as priors its pernicious nature, bloody origins, illiberal operations, exploitative trajectory, and incapacity for reform. These scholars, associated early on primarily with Ivy League history departments, such as those at Harvard, Cornell, and Brown, constituted the vanguard, spearheading the development of NHAC. Matthew Desmond, author of a celebrated book titled Evicted , has sought shelter and found himself a home in this movement (Clegg 2015; Hilt 2017; Coclanis 2018; Oakes 2020; Magness 2020b).

As I have already suggested, then, devotees of the NHAC approach capitalism far differently—and far more disapprovingly—than do most mainstream (neoclassically oriented) economists interested in the past or previous generations of historians doing economic history. Whereas the latter groups legitimately can be criticized for paying insufficient attention at times to the history of capitalism, proceeding, as they often did, as though the system were transhistorical, an outgrowth of what Adam Smith referred to as people’s “natural propensity to truck, barter, and trade,” and leaving it at that , NHAC scholars purport to do otherwise, by contextualizing it, that is to say, situating capitalism in time, locating it in space, and tying it to specific cultures.

In so doing, they generally view capitalism as an illiberal rather than liberal development, inspired and dominated by Europeans and European Americans, and dependent on power asymmetries, brute force, exploitation, and expropriation from the get-go. In the view of Sven Beckert of Harvard, among the most theoretically sophisticated of NHACers, capitalism emerged in the West simultaneously with, and largely dependent upon, slavery and other forms of unfree labor during the early modern period. Most economic historians have traditionally viewed this period in the West as the age of mercantilism, characterized by considerable state intervention in economic life and the extensive use of political power to facilitate and shape market processes and outcomes. Many Marxist and Marxisant scholars focus on the same characteristics, referring to the period variously as early capitalism, the transition to capitalism, or the era of primitive accumulation. Beckert himself emphasizes the state-sponsored violence, employing the term “war capitalism” as the “covering idea” for the entire era between c. 1500 and c. 1800. In his view—and in the view of most other scholars in the NAHC tradition—slavery was central to capitalism’s rise and early expansion. In fact, slavery was one of the defining characteristics of capitalism, putting the lie to interpretations viewing capitalism as a liberal process in which land, labor, and capital were increasingly being specified and individuated, and constraints on the same eased (Beckert 2014).

Not surprisingly, most conventional economic historians view the rise of capitalism as a positive development. Marxists obviously are more ambivalent, but, following Marx himself, have traditionally accepted the possibility that capitalism could at once be progressive and liberal and lead for a time in some areas to an increased dependence on “archaic” labor systems, whether in the form of the second serfdom in Eastern Europe or slavery in the Americas. NHACers, however, are far less comfortable than their colleagues on the left with the messy ambiguity that is history, and seem to deny this possibility, preferring more dichotomous, categorical formulations: a system is either liberal or illiberal. And in their view, capitalism is illiberal —from its onset right down to the present day—with the mechanisms by which illiberalism is made manifest changing with capitalism’s evolving needs, but characterized and punctuated by power asymmetries, brute force, exploitation, and expropriation wherever it rules and reigns.

To NHACers, then, capitalism and slavery go hand in glove, with the latter in many ways at once an enabler and a signifier of the former. Hence the natural affinity between principals in The 1619 Project and the NHACers, both of whom tether American history and slavery together. Capitalism may or may not have come to America in the first ships, as Carl Degler famously wrote in 1959, but to NHACers its arrival is difficult to deny after the English privateer the White Lion dropped off twenty or so Africans—whether intended as servants or, more likely, as slaves—at Port Comfort, Virginia, in August 1619 (Degler 1959, 1; Beckert and Rockman 2016, 1–27).

Although scholars working in the NHAC vein can in principle write on many topics and themes, thus far the study of slavery, which is viewed as “indispensable to the economic development of the United States” in the period between the Revolution and the Civil War, has attracted most of their attention, with aspects of the financial history of the country running a distant second (Beckert and Rockman 2016, 1). One of the striking and strikingly disturbing features of Matthew Desmond’s procrustean essay for The 1619 Project is that he combines the two themes.

As mentioned earlier, the New History of American Capitalism emerged, fully grown and fully armed, not out of Zeus’s head, but out of the Ivies, Harvard in particular, which provided much of the early institutional support. Among the most well-known members of the constellation are the aforementioned Sven Beckert, author of an important book on the global history of cotton; Edward Baptist of Cornell, author of a high-profile and highly controversial 2014 book on slavery; Seth Rockman of Brown, co-editor with Beckert of the NHAC’s urtext on slavery, Slavery’s Capitalism: A New History of American Economic Development ; Caitlin Rosenthal, Beckert’s former student, now a professor at Berkeley; Walter Johnson, another celebrated scholar at Harvard, who doesn’t consider himself officially part of the movement, but travels nearby; and historians such as Josh Rothman, Bonnie Martin, and Calvin Schermerhorn (Johnson 2013; Beckert 2014; Baptist 2014; Rothman 2014; Schermerhorn 2015; Martin 2016; Beckert and Rockman 2016; Rosenthal 2018).

Close critical analysis of the NHAC, let alone the constitutive parts thereof, lies beyond the scope of this essay. Fortunately, both the movement and individual works within it have already engendered considerable critical literature, and I myself have contributed to it (Clegg 2015; Olmstead and Rhode 2015; Hilt 2017; Coclanis 2018; Olmstead and Rhode 2018; Wright 2020; Oakes 2020; Magness 2020a; Magness 2020b). Suffice it to say that the criticism of the NHAC position on slavery is in part factual, in part interpretive, and in part formal. Many challenge the basic historical facts arrayed by NHAC scholars, particularly when the facts in question involve numbers or even rudimentary quantitative manipulation. Economists have been especially critical of NHACers’ use of numbers, which is understandable in light of the fact that with a few notable exceptions—Rosenthal and Louis Hyman, the latter of whom doesn’t study slavery, come to mind—NHACers are, in a scholarly sense, essentially innumerate.

Other critics zero in on interpretive matters. Exhibit A: The NHAC scholars elevate the importance of slavery in explaining not only early American economic development but also, as in The 1619 Project, the main contours of American history. In some cases, this critical path aligns closely with the path discussed in the previous paragraph. The basic numbers on slavery and on cotton, the South’s most important staple in the nineteenth century, just don’t support the interpretive weight NHACers bestow on the same. And Exhibit B: For all their concern about capitalism, few NHAC scholars have attempted to define it, which renders their work squishy and suspect, not to mention makes many of their assertions about capitalism unfalsifiable.

Still other critics focus on the ungracious and ungenerous tendency of NHAC scholars to pronounce that they “rediscovered” slavery as a topic of inquiry, recovering it from the dustbin of history, as it were; to proceed as though they were among the first to study the relationship between capitalism and slavery, a relationship with which both mainstream and Marxist/Marxisant scholars have been wrestling for generations; and in many cases to decline to engage with, to stonewall, or to even attempt to cancel their critics (Coclanis 2018). These critical foci are not necessarily exclusive, with some scholars reproving NHAC work on more than one of these grounds—or other grounds.

After this brief introduction to the NHAC approach and personnel, it is time to consider Desmond, who is not a historian, let alone a historian of slavery, much less a historian of slavery who has spent time in the archives. His work on and understanding of slavery is thus derivative, subject to and dependent largely on scholarly intermediation. His coauthored text on race relations suggests, however, that he has long been comfortable with an NHAC take on North American slavery, and his essay for The 1619 Project at once supports and reflects this proposition. Indeed, he has not merely leaned on NHAC personnel and the NHAC playbook, but, seemingly channeling Sheryl Sandberg, has leaned in with a vengeance. How else can one characterize an author who, invoking NHAC claims, attempts to establish direct links between Southern planters in the antebellum period and the Great Recession, union-busting, gig jobs, and even Martin Shkreli!

To Desmond, the conceptual link between and among all of this is “low-road capitalism”—Wisconsin sociologist Joel Rogers’s term—a contemptible form of capitalism purportedly pioneered by preternatural Southern planters on their antebellum plantations, the first “big businesses” in America (Wright and Rogers 2015, 216–44). When a capitalist society “goes low,” according to Desmond, “wages are depressed as businesses compete over the price, not the quality of goods; so-called unskilled workers are typically incentivized through punishments, not promotions; inequality reigns and poverty spreads” (Desmond 2019, 32). For evidence that the South’s so-called enslavers not merely fit, but cast the mold for, “low-road capitalism,” Desmond relies almost exclusively on NHAC concepts, claims, errors, and misconceptions.

To summarize his position: Enslavers, along with their enablers in banking and finance, created large modern “slave-labor camps,” aka plantations in the South. These “camps” were central to the American economy, particularly those whose enslaved workforce grew cotton for export, as cotton constituted the lifeblood of the antebellum American economy. To maximize returns, the enslavers, along with the middle managers in the camps, aka overseers, worked slaves mercilessly and overspecialized in cotton. In so doing, they consistently pushed enslaved workers to labor harder, to pick more cotton, and so on. Utilizing management tools ranging from surveillance to the lash, enslavers tried “to squeeze as much as possible out of enslaved workers” (Desmond 2019).

Desmond, following the NHAC position again, believes that the enslavers consistently demonstrated their managerial bona fides via closely calibrated coercion and, even more, through the meticulous accounts they kept and accounting methods and tools they employed, including relatively sophisticated accounting concepts, most notably, the concept of depreciation. Enslavers’ fixation on accounting was of a piece with their involvement in the most advanced precincts of banking and finance at the time. Indeed, processes and procedures developed in the course of financing slave sales and especially the cotton export trade led to innovations that at once anticipated and helped to bring about modern banking and finance. Such innovations clearly helped to enrich enslavers and the Southern economy and ipso facto helped the U.S. economy to grow, but they also rendered the South and the nation susceptible to bouts of overspeculation and financial peculation, leading to routine bank failures and intermittent financial panics and collapses, as of course is also true today. In his essay, Desmond focuses on the Panic of 1837, which in his (and the NHACer) view was nothing if not analogous to our own Great Recession, both caused in large part by “low-road” financial chicanery, lack of regulation or oversight, and the like (Desmond 2019).

The Problems with Desmond’s Essay and NHAC’s Interpretation of Slavery

Desmond’s melodramatic narrative, like that of The 1619 Project generally, is as tendentious as it is thinly sourced. Except for a one-off nod in the direction of the distinguished economic historian of slavery Stanley Engerman, virtually every authority invoked and assertion made in Desmond’s piece is associated with the NHAC movement and its take on slavery and capitalism (Engerman 2000, 480). Indeed, although the piece is not footnoted, most of it seems to have been drawn from a single text— Slavery’s Capitalism , edited by Beckert and Rockman—supplemented by a sideways glance at Johnson’s River of Dark Dreams . To be sure, an author has the right to his or her own path, but in a publication intended for a broad, nonspecialist audience, doesn’t every author also have an obligation to point out that there are other paths and that the path depicted has its critics and detractors? Had Desmond opted for complete transparency, he might even have pointed out that almost every serious economic historian of slavery has rejected—in most instances to devastating effect—the basic NHAC positions he lays out in his essay.

Numerous critics of the NHAC narrative have written convincing rebuttals to various parts of their narrative. But two highly respected economic historians of agriculture, Alan Olmstead of the University of California, Davis, and Paul Rhode of the University of Michigan, should be singled out for the breadth, analytical rigor, and degree of empirical support behind their dismantlement—some would say evisceration—of the NHAC line on the Cotton South. It would be in fact difficult to overstate how convincingly Olmstead and Rhode made the economic case against NHAC assertions in their widely read 2018 essay in Explorations in Economic History . Aiming their critical fire at the primi inter pares behind (or at least associated with) the movement—Beckert, Johnson, and especially Baptist—Olmstead and Rhode methodically destroy the principal economic contentions of each (Olmstead and Rhode 2018).

Concerning the NHAC talking points integral to Desmond’s The 1619 Project piece, Olmstead and Rhode, backed by other economic historians, counter with a much less extreme and much more balanced picture. The South, relatively speaking, was a wealthy region in the antebellum period, and its economy was both dynamic and growing at the time of the Civil War. Slave plantations were central to the region’s economy and important to the U.S. economy as a whole. Large plantations, which constituted a small share of the region’s total stock of agricultural units, grew a number of staples for export, the most important of which was cotton. The importance of export staples notwithstanding, most parts of the region were self-sufficient in the production of foodstuffs, and corn, not cotton, was the most valuable crop grown in the region. Although cotton was the leading U.S. export throughout the antebellum period, it was nowhere near as important to the U.S. economy as NHACers, basing their position on Baptist, assert, actually constituting “less than 5 percent” of GDP over most of the antebellum period, and never more than 7 percent (Hansen 2014; Olmstead and Rhode 2018, 12; Magness 2020a, 7–14, 31–36, 55–67; Wright 2020, 373–78).

Slave-based agriculture was profitable and viable for most slave owners, but did not necessarily benefit nonslaveholders living in the region or promote the long-term development of the region as a whole. Whether slavery did or did not reflect a “low-road” form of capitalism, it is clear that slave labor was not cheap, but expensive, much more so than labor in other cotton-producing areas in the nineteenth century, such as India. Slavery was a moral enormity and was based on unconscionable exploitation, but there is little evidence for what Baptist refers to as the “pushing system” in cotton picking. Although daily picking rates, generally speaking, rose dramatically over the course of the antebellum period, the principal reason was not due to the systematic “ratcheting up” of labor requirements, much less to the creation of a labor regime “whose bottom gear was torture,” but to westward movement onto better cotton lands and to a series of mechanical, organizational, and, most important, biological innovations in cotton cultivation that together over time increased the total cotton in each boll and on each plant, the total cotton output, and the output per worker (Olmstead and Rhode 2008; Hansen 2014; Olmstead and Rhode 2018; Magness 2020a; Wright 2020).

However important cotton was to the South and to the United States in the antebellum period—and it was important—it was neither indispensable to American economic development nor served as the model or prototype for American capitalism as it developed after slavery’s demise. Indeed, the type of agricultural regime that came to characterize the South in the post-slavery era—low-wage, low-skill, and labor-intensive—differed significantly from both the much more capital-intensive, scientific agricultural system emerging in other parts of the country and, obviously, from the nation’s growing industrial economy, particularly in the manufacturing belt (Coclanis 2000; Coclanis 2020). One additional reason for the NHAC mischaracterization: Its proponents make the mistake, as Gavin Wright has recently noted, of equating the role, nature, and economic importance of cotton in the United States in the antebellum period with that of sugar in the small islands in the British Caribbean in the eighteenth century, a monumental interpretive error (Wright 2020, 367–73).

Much of the preceding discussion relates to the NHAC/Desmond position on slavery and agriculture. In his piece, however, Desmond also adopts and extends the NHAC position on finance and banking, linking slavery not just to American financial and banking innovation in the nineteenth century, but well beyond, even to present-day neoliberal policies, financialization, and, as we have seen, even to infamous incarcerated pharmaceutical executive Martin Shkreli.

With such concerns in mind, a few words on Desmond’s over-the-top take on slavery, banking, and finance are in order. As was the case with agriculture, Desmond depends almost solely on NHAC claims in making the absurd links already mentioned. The work of five NHAC scholars in particular—Bonnie Martin, Edward Baptist, Calvin Schermerhorn, Josh Rothman, and Caitlin Rosenthal—is relied upon. Martin’s work and Baptist’s work are used to demonstrate the importance of slaves as collateral for mortgages of one type or another in the antebellum South and in international finance; Schermerhorn’s on the importance of the slave trade in the development of U.S. debt and financial instruments; Rothman’s to illustrate the “speculatory fever” that gripped the South intermittently, never more so than in the mid-1830s in Mississippi; Rosenthal’s to document planters’ accounts, or, more to the point, the advanced and sophisticated nature of the same. Let us take up these purported harbingers of financialization one by one.

First, Desmond argues that utilizing slaves—a legal class of assets constituting almost half of Southern wealth and 19 percent of U.S. wealth in 1860—as collateral for securing debt is somehow prima facie evidence that the financialization of the U.S. economy began neither in the “reckless speculation of the 1920s,” nor with Bretton Woods, nor even with the gutting of the Glass-Steagall Act late in the twentieth century, but in the antebellum South. To Desmond, “the story begins with slavery” (Wright 2006, 60; Desmond 2019, 37; Williamson and Cain 2020).

Had Desmond bothered to explore more carefully the history of mortgages (including chattel mortgages), the use of collateral, hypothecation, and so on, over time and across space, he would soon have found that mortgages have been around since classical times and there was nothing new or particularly innovative about the use of the same in the antebellum South. Throughout American history, items of value—particularly items that retained value, were easy to liquidate, and were fungible—were used as collateral to secure loans and debts. Among the items employed in the United States in the antebellum period were land (especially when cleared), crops, livestock, trade merchandise, tools and fixed capital, urban real estate, household goods, stock certificates, life-insurance policies, and slaves (Murphy 2005, 619–20; Kilbourne 2006; Murphy 2017, 6).

The last category of assets was used with great frequency in the South, as one would expect of an asset constituting so large a portion of regional wealth, but slave collateral did have certain disadvantages from the creditor’s point of view: the value of slaves fluctuated; slaves did not retain value over time; and their fungibility was not unlimited. At one point in his piece Desmond deigns to admit that “[e]nslavers were not the first ones to securitize assets and debts in America,” but he nonetheless tries to tether slaveholders to collateralized debt obligations, financial engineering, and financial chicanery on Wall Street today. Post hoc ergo propter hoc , anyone? (Desmond 2019, 37).

And talk about straining credulity: Don’t slavery and slaveholders have enough to answer for without tracing the genealogy of Dick Fuld, Hank Greenberg, and Angelo Mozilo directly back to antebellum Alabama? How about spending a little time looking at the more obvious case of Northern financiers during the Gilded Age, maybe by reviewing the complicated financial scams and schemes, mainly the work of non-Southerners, treated at length in works by Richard White, such as Railroaded and The Republic for Which It Stands (White 2011; White 2017)? It’s okay to do so, by the way, for White has been published in NHACer collections. And what about Wall Street during the 1920s? None of this will do, however, for, in the words of Beckert and Rockman (words Desmond quotes approvingly), “American slavery is necessarily imprinted on the DNA of American capitalism,” establishing the genetic markers that purportedly explain the subprime crisis (Beckert and Rockman 2016, 3; Desmond 2019, 33). Who knew?

Closely related to the argument regarding the purported importance of slavery in creating U.S. mortgage markets is Desmond’s contention, based in large part on Schermerhorn’s work, that slavery was central to the development of debt instruments of various kinds (including bills of exchange), international credit chains, and banking in the United States. The problem with this line of reasoning is that slavery or, more precisely, financing and investing in slaves and the slave trade were subsets of much broader sets: financing and investing in production, infrastructure (particularly transportation infrastructure), and trade in British North America and later the United States. Merchants and the investment community—supported by evolving law, legal protocols, and practices—developed a wide variety of tools, instruments, and institutions over time that rendered short-term lending and long-term investment more efficient, and often, but not always, safer. These tools, instruments, and institutions ranged from promissory notes to bills of exchange, from bills of credit to paper currency and stocks and bonds, and from private commercial banks to state banks to U.S. banks (Lamoreaux 1991; Bodenhorn 2000; Wright 2001; Wright 2002; Sylla 2002; Kilbourne 2006).

To be sure, the South was involved in international trade, especially in cotton, and thus was deeply enmeshed in this financial and credit system as it evolved. But few of the practices and institutions regarding debt targeted by Schermerhorn and thus Desmond were particular to the South, much less originated there, a notable exception being the introduction of short-lived plantation banks in the Lower South in the late 1820s and 1830s (Schermerhorn 2015, 95–123; Murphy 2017). Generally speaking, much of the same debt and credit practices and institutions employed in cotton characterized the trade of flaxseed from colonial New York to England, of Pennsylvania wheat destined for Southern Europe, and of U.S. imports of delftware, Chinese goods, and chinoiserie. Similarly, long-term international investment in U.S. infrastructure, canals and railroads especially, in the antebellum period looked much the same whether in the North or the South. And crucially, bills of credit, paper money, the discounting of bills of exchange, commercial banks, life insurance, credit reporting, and so on, were all developed earlier and in more sophisticated ways in the North than in the South (Doerflinger 1986; Wright 2001; Wright 2002; Sylla 2002; Murphy 2010; Olegario 2006). Indeed, financial innovations such as these—and others—help to explain how and why the economy of the North came to surpass that of the South in the antebellum period.

A third part of Desmond’s financialization thesis centers on speculation, or, more to the point, a precocious South’s purported ability to corner the market on speculation, as it were. Desmond is basing his assertions here largely on work by NHACer Josh Rothman, both an article by Rothman in Slavery’s Capitalism and, to a lesser extent, an earlier monograph by Rothman, Flush Times and Fever Dreams: A History of Capitalism and Slavery in the Age of Jackson (Rothman 2014). According to Desmond, Southern planters—“arrogant, strutting, quarrelsome kinglets,” W. E. B. Du Bois called them-—thinking themselves “invincible,” and “able to bend the laws of finance to their will,” were shameless profiteers, prone to speculation, and oblivious to risk (Desmond 2019, 38). Such (group) character traits rendered the Southern economy inherently unstable, subject to booms and busts, no bust more calamitous than that beginning in the mid-1830s, generally known as the Panic of 1837. Desmond sees this panic as being strikingly similar to the 2008 financial crisis, and readily accepts Rothman’s proclamation that during slavery “Americans built a culture of speculation unique in its abandon” (Rothman 2016, 126; Desmond 2019, 40). Really? Desmond then goes on to link this culture to, among other things, union-busting and gig jobs today, but rather than speculate about these rather tenuous claims, let’s spend a little time on the concept of speculation and on the antebellum period itself.

Neither Rothman nor Desmond, it is clear, much like capitalism or at least the culture thereof. They go out of their way to try to meld together capitalism, speculation, gambling, and even criminality into one combustible mix. In order to make their position seem plausible, they focus on one economic phenomenon—the Panic of 1837—and imply that it was standard or normative of slavery, the South, and capitalism. The problem is that it wasn’t.

To be sure, capitalism, including Southern capitalism, historically has been subject to periodic bouts of instability—shocks, recessions, panics, and, less frequently, depressions—but over time has always bounced back and generally facilitated sustained economic growth wherever it has been planted and nurtured, including in the antebellum American South. The Southern economy, as suggested earlier, was one of the most dynamic economies in the world in the period between 1800 and 1860, enjoying a growth rate that few other societies at the time experienced. The standard of living of the free population on balance was also very high, and improving pretty much across the board, as Robert A. Margo’s work has demonstrated. According to Margo, between 1820 and 1860 the annual growth rate of real wages of common laborers was 0.97 percent in the South Atlantic census region and 0.85 percent in the South Central census region. The rates for artisans were somewhat lower and for white-collar workers somewhat higher, but annual growth of 0.90 percent, when compounded over forty years, results in an increase of 43 percent, extremely rapid for the time (Margo 2000, 51, table 3.3). This, despite the rough patch during part of the 1830s—and a few other rough patches as well. To focus solely on and then extrapolate from one atypical subperiod—the Panic of 1837—to the history of the South between 1800 and 1860 is shoddy methodologically, an instance at the very least of confirmation bias writ large.

One more point: Desmond’s loose and inaccurate use of the concept of speculation . Desmond (and his scholarly alter ego, Rothman) both misuse the term and demonstrate little sense that they understand it in economic terms. Contrary to the insinuations in Desmond’s essay, speculation and speculators are neither good nor bad, but efficient or inefficient, for both the practice and the practitioners play necessary roles in markets of all types—including financial markets and markets for art, wine, land, slaves, and so on.

Briefly, speculators buy or sell assets, hoping to gain from changes in their prices. Speculators often have short-term time horizons, but some prefer holding assets for medium- and long-term periods. In efficient financial markets, their role is to at once absorb excess risk and to provide liquidity when necessary, while other participants—hedgers, arbitrageurs, and normal investors—perform other functions. In a sense, speculators, if effective, help to render more efficient the intertemporal distribution of resources under conditions of uncertainty, as no one knows what the future will hold. They can err, and when they do, both individual speculators and, in some cases, society as a whole can pay the price. But, like scholars and journalists, they perform certain necessary social functions. In America, and not just the South, some individuals have stepped up to perform such speculatory functions from the get-go (Coclanis 2015). And I for one am glad that many were successful in doing so.

The fourth part of Desmond’s argument regarding slavery and financialization rests almost entirely on the work of Caitlin Rosenthal, one NHACer who is in fact comfortable with numbers and familiar with the tools, methods, and practices of economics (Rosenthal 2016; Rosenthal 2018). Rosenthal is particularly interested in the management practices of large cotton planters in the antebellum period, offering the provocative argument that the practices of such planters were marked, even characterized, by a striking concern for systematic measurement and surveillance. In her view, their business practices were extremely advanced for the time, rivaling those of the railroads, and certainly far more sophisticated than their agricultural peers in the North.

Rosenthal’s single most talked-about finding relates to planters’ bookkeeping practices. Basing her argument largely on cotton planters’ use of the blank plantation record and account books prepared, published, and distributed by Thomas Affleck of Mississippi during the antebellum period, Rosenthal contends that cotton planters were avid measurers, whose “scientific” managerial and bookkeeping practices incorporated the concept of depreciation and approached modern cost accounting. In so doing, they were quite innovative, anticipating much later developments normally associated in America with scientific management, F. W. Taylor, and so on. Rosenthal’s principal evidence, again, is the Affleck blank accounts, which commonly included fifteen blank forms for cotton planters (forms A through O), some of which, if filled out completely and properly, would allow for calculation of income and expenses, and the calculation of capital appreciation and depreciation regarding slaves, livestock, tools, and the like. To Rosenthal, the availability and use of Affleck’s record and account books demonstrate, among other things, planters’ interest in agricultural improvement and business innovation, as well as their capitalist mentalité . Desmond, as is his wont, goes much further, employing Rosenthal’s findings to link slavery’s capitalism to the financialization of the U.S. economy in recent decades and to various and sundry forms of worker exploitation, surveillance tools, and financial chicanery said to embody capitalism today (Rosenthal 2016; Rosenthal 2018).

Although in general I am a fan of Rosenthal’s and appreciate her overall body of work, her use of Affleck is questionable, and Desmond’s is completely off the mark. Rosenthal herself in fact offers sotto voce some cautionary notes regarding both Affleck and his record and account books. Affleck was not a native Southerner but a Scot. He was in fact a bookkeeper for the Bank of Scotland before immigrating to the United States in 1832. During his first decade in the United States he worked as a clerk, a merchant, and an agricultural editor in New York City, Pennsylvania, Ohio, and Indiana, before showing up in Mississippi in 1842. Regarding his record and account books, Rosenthal points out that only a tiny minority of Southern cotton farmers possessed Affleck’s books and, when used, the books were used “unevenly” and only “partially completed” (Rosenthal 2018, 91–92, 94, 101). Olmstead and Rhode made the same points earlier in an excellent 2015 essay, wherein they punctured the notion that Southern plantations were “factories in the fields.” Furthermore, in her well-regarded book Every Farm a Factory: The Industrial Ideal in American Agriculture , Deborah Fitzgerald pointed out in 2003 that, as late as World War I, few farmers anywhere in the United States kept systematic accounts, much less practiced cost accounting (Fitzgerald 2003, 33–57; Olmstead and Rhode 2015, 269–72).

A recent study by a young scholar teaching at the University of Louisiana at Lafayette, Ian Beamish, qualifies the use of the Affleck books even more. In an impressive paper in the journal Agricultural History , Beamish subjected to close textual analysis all sixty-five of the filled-in Affleck account books known to exist for cotton plantations. The principal takeaway from Beamish’s study is that the filled-in Affleck books were used almost exclusively as conventional agricultural record books, in a manner similar to records kept in the eighteenth-century South. Virtually no user (whether an owner or overseer) filled in forms M and N—those needed for cost accounting—and few were interested systematically in appreciation or depreciation. Rather, the books, which were often filled in incompletely, haphazardly, or incorrectly, were generally concerned with recording daily numbers and events—cotton picked by day and by slave, other labor performed, slave births and deaths, and so on. In his view, the books in and of themselves tell us little about the relationship between slavery and capitalism (Beamish 2021). Or, I might add, slavery in the antebellum South and “financialization” in the United States today.

Moreover, it is unfortunate that Desmond, in his haste to look forward, didn’t spend at least a bit of time looking back, not merely or even necessarily on agriculture in the eighteenth-century South, but on the genealogy of capitalism itself. Instead of pressing to link slavery with present-day financialization, he would have been better served by telling us what he means by capitalism and why he places the antebellum South in the context of the evolution of this economic system in the West.

Desmond’s reluctance to do so is not altogether surprising. As stated previously, scholars working under the NHAC umbrella are loathe to get into specifics about capitalism, old or new. For example, in their introduction to the important NHAC collection Slavery’s Capitalism , Beckert and Rockman manage to resist the temptation to define precisely what they mean by capitalism—a point mentioned by many critics—and Desmond follows suit. In this, the NHACers may be following the example set by Louis Armstrong, who, when asked about the definition of jazz, famously retorted, “If you gotta ask, you’ll never know.”

To be fair, NHACers, however reluctant to define capitalism, have suggested that the system or concept needs to be approached more broadly than “it” (whatever “it” is) has been until now. Thus they have tended to emphasize topics sometimes given relatively short shrift by earlier scholars—war, violence, race, the law, and so on—in their analyses. Note that I say sometimes , because it is in fact possible (if one at all tries) to find plenty of earlier scholars of capitalism who have looked at each of these topics in detail. Be that as it may, we have recently seen the publication by an NHAC-related scholar, the aforementioned Caitlin Rosenthal, which includes a real definition of capitalism, or at least an explanation of how the author is using the term. In this piece, Rosenthal offers a succinct definition of capitalism, based, as she puts it, on “(1) the commodification of labor, as it results from, (2) the accumulation of capital” (Rosenthal 2020, 301). She doesn’t historicize the development of said features, or go into the motive forces behind their development, but it’s a start.

It would be nice, however, if at some point NHAC scholars weighed in on these issues as well as others, such as the question of whether capitalism evolved slowly over centuries or emerged relatively rapidly; whether we should emphasize changes in production or in exchange or changes in other realms; where it emerged first and how it spread; the features necessary and sufficient in order to classify an economy as capitalist, and so on. It might take a while before we see this, however, because first the NHAC group would have to “rediscover” the fact that countless scholars thought about such matters rigorously before NHAC came onto the scene (Coclanis 2018; Clegg 2020).

An Alternative View of Capitalism and Slavery

To put my money where my mouth is, so to speak, I have long viewed the development of capitalism in evolutionary terms, as part of a long-term socioeconomic and cultural process relating to the proper, prescribed, sanctioned manner of organizing production and material life more generally, which process began in parts of Europe in the medieval period. The process “expressed” itself at different rates and unevenly in geographic terms over time, and was characterized, broadly speaking, by a growing sense among some individuals and groups of what today we conventionally call factors of production—land, labor, capital, and sometimes entrepreneurship (distinct from capital)—and the progressive, if often distinctive, paths toward individuation, articulation, and commercialization of each.

This process cannot be assessed and evaluated solely on the basis of one consideration—for example, the presence or absence of free labor and wage relations as the dominant means of organizing and directing labor—but on an intricate axis involving other considerations as well, to wit, the degree of commercialization of other productive factors; a reasonable degree of competition; the alienability and transferability of property and credible state commitments regarding the protection of property rights; commodity production; the development and employment of increasingly sophisticated instruments and institutions relating to trade and exchange; rationality of spirit/market mentalité ; and accumulation. This approach, which perforce entails a prominent role for verstehen , or interpretive understanding, is hardly parsimonious, but, at the end of the day, I am a historian, not an economist (Coclanis 1989, 48–63).

When judged by the preceding criteria, parts of the American South—and various other parts of British America—can be said to have been informed relatively early on by principles and institutions necessary and sufficient to be labeled capitalist economies and market-based societies. This was the case well before the antebellum period, the purported market revolution and all that. This label, despite or perhaps because of the prominence of slavery in some of these areas—the Chesapeake colonies, the Lower South, and the British West Indies. Slavery’s capitalism then works for me, but a good bit earlier than is the case with NHAC.

If the forced link between antebellum slavery and financialization, not to mention with Martin Shkreli, is spurious, what can we say about slavery’s role in the antebellum South, indeed in the antebellum United States more generally? Plenty, I would submit. First, regarding broad patterns: Only about a quarter of free families in the South held slaves. Of such families, the modal number of slaves held c. 1850 was one. Only about one of eight slaveholding families—or a little over 3 percent of free families in toto—would be considered “planter” families under what is arguably the most common definition, i.e., holding twenty or more slaves (Wright 1978, 24–37; Oakes 1982, 37–68, 245–50; Bourne 2008; Olmstead and Rhode 2018). If we use another common definition for denoting planter status—holding twenty or more working hands—the proportion of planter families in the antebellum South shrinks accordingly.

Second, I would stress, with William H. Freehling, Lacy K. Ford, and others, that there was no one South, but many Souths, in some of which slavery was economically unimportant, in others by 1860 dying out (Freehling 1990, 9–36; Ford 2009). I would also point out that one of the most eminent experts on slavery and the slave trade, the late Philip D. Curtin, felt slavery was not important enough in North America to include the South in either edition of his classic The Rise and Fall of the Plantation Complex . In Curtin’s view, the U.S. South as a region was rather more a society with slaves than a true slave society, much less a plantation society (Curtin 1998, 108–10).

After offering the preceding points, I would be quick to add that I don’t buy Curtin’s argument regarding the South, and believe that the region, despite the small percentage of planters, should be considered a slave society controlled largely by planters (and their commercial and legal allies). Power, in other words, cannot be reduced to numbers and percentages alone.

Moreover, I would argue, as we saw just a bit earlier, that the Southern economy was organized for the most part along capitalist lines, and that the presence of slavery should not be viewed as evidence that the South was precapitalist. Rather, the institution, like the second serfdom in Eastern Europe, should be seen as an expression of an emerging capitalism, related to the mentalité of powerful interests and to the discrete labor conditions and needs in certain areas. The same “liberal” dimensions of early capitalism that led to freer and freer labor forms in some areas led elsewhere in some cases.

In parts of British America in the early modern period, especially the West Indies, the Chesapeake, and the Lower South (South Carolina and Georgia primarily), the market-driven desire of those Europeans and European Americans that sought to organize production of staple crops for export—sugar, tobacco, rice, and indigo primarily—led them in many, if not most, cases to favor enslaved African or African American laborers, and to establish and defend the self-serving institutional structure needed to sustain this labor system. Why? For several reasons. It was difficult in the Western Hemisphere, which was abundant in land and scarce in labor, to secure labor and retain it in place, particularly for onerous jobs in unhealthy climates. After various trials and experiments with other groups, European and European American agricultural entrepreneurs (settler capitalists?) and their commercial allies found that African and African American laborers constituted the best fit for their labor needs. Africans were in many cases already familiar with routinized agricultural work and in some cases may have possessed useful proprietary knowledge about certain crops (especially rice); they had some natural and inherited immunities to certain mosquito-borne diseases (malaria and yellow fever, most notably) that struck down greater proportions of other groups working in these areas; they were “others,” ethnically, racially, religiously, culturally, and so on, and as such were assumed to possess fewer natural rights, privileges, and immunities.

Slavery, however immoral from our point of view, was thus seen by powerful groups as the labor form that made the most economic sense in some areas, provided the supply of African slaves was sufficient to meet labor needs and their prices were sufficiently reasonable. For the most part, these requirements were met. Note though that the price of slaves, generally speaking, was not low but relatively high. Acquiring and deploying slaves was not based mainly on low-cost premises, then, but based, as Gavin Wright among others has shown, on the bundle of property rights associated with slavery, which allowed those who “owned” slaves to position them wherever they wanted to (even in unhealthy places); work them hard and long, even mercilessly; and retain them (and their progeny) as long as desired, even for life. These rights did not obtain to anywhere near the same degree with other labor forms, even with indentured or bonded labor, the closest analogues. These power dynamics explain the emergence of slavery in various capitalist societies in British America, and its prevalence in some (Wright 2006, 48–122; Olmstead and Rhode 2018, 5). The fact that the slave template or pattern for labor relations endured even after some of the early reasons for its preference were no longer so relevant—most areas of the South were healthier than the low country of South Carolina or Georgia or the sugar parishes of southeastern Louisiana, whites could and did grow cotton without slaves, and so on—suggests a case for path dependence, or less insistently, path inflection or influence.

I would go on to argue that many deemed slavery vital to the South’s growth, from the period between the late seventeenth century—not, mind you, from 1619 or even 1650 or 1660—until the time of the Civil War. Slaves were deployed throughout the economy but were especially important as agricultural laborers producing subsistence crops as well as staples for export. The most important of such staples in the antebellum period was cotton. Again, though, remember that corn rather than cotton was the most valuable Southern crop, and that cotton, the leading export in the United States by far, nonetheless still composed a small share of GDP, usually around 5 or 6 percent (Olmstead and Rhode 2018; Wright 2020, 373–78).

The NHAC view, which assumes cotton totally dominated the U.S. economy in the antebellum period, composing as much as 40 percent or even more of U.S. GDP, is grossly exaggerated, based largely on NHAC compatriot Edward Baptist’s unfamiliarity with standard national-income-accounting methods, particularly regarding the manner in which estimates of GDP are constructed. Such unfamiliarity led Baptist to double and sometimes triple count in estimating the size of the cotton economy by adding to the value of cotton production the value of all inputs used in its production, when, according to national-income-accounting protocols, these inputs are already subsumed into the sale price of cotton. This grievous measurement error would earn an undergraduate economics student a failing grade. This error, however, has not been admitted by Baptist and has gone unremarked upon by NHACers, who continue to use Baptist’s figures, despite their repudiation by measurement experts (Olmstead and Rhode 2018).

Continuing on, I would point out that in relative terms the Southern economy performed well in many ways in the antebellum period, and that the South, if severed from the rest of the United States and considered a stand-alone economy, would have been one of the wealthiest parts of the world in 1860 (Fogel and Engerman 1974, 1: 247–57). The region’s wealth was based largely on its agricultural economy, particularly upon that part of the sector deploying slave labor to produce staples for export, either internationally or extra-regionally. The region’s manufacturing sector was not inconsequential, particularly for the age, but the South was clearly not urbanizing or industrializing nearly as rapidly as the North, preferring to pursue policies predicated on the continued push westward of its staple export economy, in so doing, expanding, as Drew McCoy put it long ago, across space rather than through time (McCoy 1980). The planters, merchants, bankers, and politicians who led the push westward were more or less forward-looking and “modern” in their thinking, but they hardly represented the capitalist vanguard in the Western world at the time.

If mean income and wealth of the free population in the South rose significantly in the course of the period, the region was home to many poor people and was marked by considerable inequality, even excluding the 35–40 percent of the population that was enslaved. With this point in mind, logic would seem to dictate that we ask, who benefited from slavery? (Coclanis 2010b, 495–502). Not the slaves themselves, obviously, and much of the free population in the region probably didn’t gain much either, although certainly some did via economic links and connections to the slave-labor-based agricultural economy. How about the region qua region?

This is a difficult question to answer because the trajectory of the Southern economy was first disrupted and then irrevocably changed with the Civil War, but I have argued at length elsewhere, along with many other scholars, that, although the Southern economy was growing in the antebellum period, the growth path taken was not necessarily conducive to long-term economic development. Like other plantation economies around the world, that of the South was unbalanced and overly specialized, marked by relatively low levels of urbanization (especially in the interior), a rudimentary “conveyor-belt” transportation system designed to facilitate exporting and importing rather than knitting together the region as a whole, and low levels of investment in human capital. Few plantation economies anywhere in the world have ever developed into modern high-performance economies—none based primarily upon slave labor have—and numerous studies have demonstrated the long-term negative effects of plantation-based slavery on those parts of the South where it took firm hold. So slavery or slavery’s capitalism almost certainly did not promote the economic well-being of the region over the long run (Genovese 1965, 13–39; Wright 1978, 107–27; Coclanis 1989, 111–58; Sokoloff and Engerman 2000; Mitchener and McLean 2003; Nunn, 2008; Majewski 2016; Wright 2017; Coclanis 2020).

Consumers of agricultural products produced by Southern slaves likely paid a bit less—whether in the South, the North, or Europe—than they would have had said products been produced by free labor. But because cotton composed only about 5 percent of U.S. output, this gain would have been fairly small, especially because free labor was able to produce it at a low cost, as shown after emancipation. Similarly, residents of nonslave states probably paid a little less in taxes than they would have because a good part of the U.S. government’s revenue came from duties on imported goods, financed directly or indirectly by exports of slave-produced cotton, rice, and so on. Again, though, the gain would be small because taxes were only about 2 percent of GDP. To be sure, it is true that some merchants, bankers, and manufacturers within and without the South benefited in various ways from their involvement in the slave system as well. Assessing the degree to which discrete individuals and individual firms benefited is difficult, however, because little as yet is known regarding the opportunity costs they would have incurred by forgoing involvement in the slave economy (DeLong 2007; Coclanis 2010b, 495–502).

One thing seems clear though. The U.S. economy—unlike the Southern economy—was not based on slavery in the nineteenth century. Although cotton produced in the South was important early on to the textile industry in the Northeast, in the larger scheme of things, the most important economic developments of the century—urbanization and industrialization in the northeastern quadrant of the United States (the area north of the Ohio River and east of the Mississippi) and the creation of the dynamic agro-industrial complex in the Middle West—owed relatively little (if anything) to slavery (Page and Walker 1991). Cotton, one recalls, became much more important in the South after the Civil War, emancipation, and the demise of slavery than it ever was before the war—cotton production in the region did not peak until the late 1920s—and cotton’s importance to the American textiles industry followed the same pattern.

Indeed, it is more accurate to say that slavery distorted rather than directed capitalist development in America. Slavery constituted an illiberal expression of early capitalism in certain contexts in labor-scarce, land-abundant areas during the so-called primitive accumulation. The principal thrust, the major theme, as it were, of capitalism was liberal and progressive, resulting in greater economic freedom. The forces unleashed by capitalism that brought slavery to British America and sustained slavery for a period thereafter later led to the rise among some, then among many, of what Thomas Haskell has famously called a “humanitarian sensibility” that led Great Britain and the United States to abolish slavery relatively early in the modern period, far earlier than in many other parts of the world, particularly in Africa and the Middle East.

Slavery in the American South was an abomination, but Matthew Desmond, taking his cues from the NHAC, grossly misrepresents it in order to render financialization its lineal descendent. Clearly, Desmond would do well to look elsewhere for the answer to who or what begat Martin Shkreli.

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The author would like to thank Alan L. Olmstead, the anonymous referees, and TIR co-editor Robert M. Whaples for their very helpful criticism.

history of capitalism in america essay

“Capitalism in America: The History” by Alan Greenspan and Adrian Wooldridge Essay (Book Review)

Economics has now become an invisible tool that manipulates the world. In order to find a way to control it, people have come up with many books on economic algorithms. By creating them, researchers aim at establishing the way, in which the world works. Such books are now divided into the synchronic and diachronic ones, where the latter ones examine the economics in the context of history, and the first focus on modern development.

When people study the economy as a major, their primary goal is to pay enough attention to science emergence, as world history often tends to repeat itself. Thus, in the course of this review, the attention will be focused on the diachronic book Capitalism in America: The History , written by Alan Greenspan and Adrian Wooldridge.

To begin with, it is necessary to provide a brief inquiry into the biography of the book’s authors. Alan Greenspan is a former Chair of Federal Reserve of the United States, who had the chance to become the economic counsellor of the several US presidents. Adrian Wooldridge, in his turn, is a leading editor of the US’ The Economist . Hence, although their competence on the subject may be controversial, it is definitely indisputable. The book itself was published in 2018, which makes it relevant in the context of today’s world despite the work’s historical profile.

One can understand from the title that the authors have to focus on the development of the capitalistic relations within the country throughout its history. Although it is true, the notion of capitalism in their interpretation is rather subjective, which makes the book even more interesting for the potential reader. Greenspan and Wooldridge aim at describing the patterns of American economic development through the concepts of Schumpeterian Creative Destruction and Great Men Theory.

The first theory is based on the findings of Austrian scholar Joseph Schumpeter, and it claims that every economic stage emerges because of the destruction of the previous structure (Evangelista). Another theory states that the world’s economy is developed as a result of the actions of several influential people who are called the Great Men. Hence, the major value of the book lies in the fact that it requires a critical analysis of the information.

According to the information provided on the authors’ biography, they are the ones who should know the American economy better than any other scholar should. However, the statements in the book are rather controversial and require some further research on the topic instead of being taken as a priori. Unlike non-fiction books on the economy, conquering the market today, Capitalism in America does not provide the reader with already processed information. Instead, it gives the recipient the opportunity to analyze data in order to form a substantial opinion.

In my opinion, besides the invaluable impact on the history of economics, the book also contains some assets and insights on further US economic development. The last two chapters of the book are aimed at describing America’s biggest challenges and opportunities in terms of the economy. The challenges include draining regulations, demanding labor markets, reduced mobility, the dissonance between the cost and the quality of education, and productivity suppression (Greenspan and Wooldridge).

Another important insight concerns the driving force of the future American economy, which is focused primarily on entrepreneurs. Such assumption perfectly matches with the main idea of Schumpeterian Creative Destruction, as the entrepreneurs will be able to commence the new age of the country’s economic development.

When taking the book for the first time, it seems to be describing the patterns of the US economic structures and their modifications throughout the country’s existence directly. However, there is little on the subject of economy proper. In my opinion, the authors try to convey the idea that the economy as a science cannot exist on its own. Hence, Greenspan and Wooldridge dwell upon the US political, social, and business aspects in order to expose how they have shaped the country’s economy. Eventually, their interrelation explains major America’s financial crises and hardships. Thus, the book is crucial for both economists and entrepreneurs, as it will help them realize how even minor events happening in the country influence its economic growth.

Taking everything into consideration, it may be concluded that Greenspan and Wooldridge’s Capitalism in America: A history is a true asset not only for people related to economics. Being easy to perceive, the book is nothing like today’s average “self-help” book, which is aimed at helping people become top economists in a matter of weeks. While at first, it may seem that the book is manifest for capitalism, this notion is rather subjectified by the authors.

Creating the impression of modern American economy founders, Greenspan and Wooldridge has a significant advantage in the field. However, when reading the book, it is important to remember that any information obtained in the 21st century has to be processed several times, along with being reconfirmed in other sources. Thus, this book is a must for people who want to learn how to handle the information critically in order to make a change in the future.

Works Cited

Evangelista, Rinaldo. “Technology and Economic Development: The Schumpeterian Legacy.” Review of Radical Political Economics , vol. 50, no. 1, 2017, pp. 136–153.

Greenspan, Alan and Adrian Wooldridge. Capitalism in America: A History . Penguin, 2018.

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1. IvyPanda . ""Capitalism in America: The History" by Alan Greenspan and Adrian Wooldridge." February 11, 2022. https://ivypanda.com/essays/capitalism-in-america-the-history-by-alan-greenspan-and-adrian-wooldridge/.


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Guest Essay

It’s Time for America to Go Back to Afghanistan

Concrete walls are decorated with Arabic writing and the outline of a map of Afghanistan. A watchtower stands behind the walls.

By Kathy Gannon

Ms. Gannon is a Canadian journalist who covered Afghanistan and Pakistan for 34 years for The Associated Press.

It’s striking how much Afghanistan, which has the unfortunate legacy of being the site of America’s longest war, has all but disappeared from public discussion in the United States. But perhaps it’s understandable. After all, there always seems to be another conflict, another war — which, as it happens, is also Afghanistan’s history.

Since 1979, Afghans have lived in almost perpetual conflict. Millions of people have been forced to flee their homes or their country. Foreign interventions have come and gone, ending in failure, leaving Afghans and their neighbors to live with the consequences.

Today, America’s longest war is over. The U.S. Embassy in Kabul sits empty, a daily reminder of how America has sought to isolate Afghanistan since the U.S. military's withdrawal in 2021. Washington has done so in an effort to pressure the ruling Taliban to moderate its views, including committing to women’s rights, expanding the government to non-Taliban members and addressing human rights abuses.

That tactic backfired the first time the group was in power. And vacant Western embassies aren’t going to get girls back to school or increase women’s participation in the work force. Instead, isolating the Taliban has served only to isolate Afghans, leaving many of them feeling alone and, worse, helpless.

It’s time to accept that past policies have failed and that the United States and its allies must change course and commit to greater engagement, which would in turn bring a better understanding of the realities in Afghanistan. Along with the large amount of humanitarian aid Washington provides, it’s time for America to return to Afghanistan and the 40 million people who live there. Washington should reopen its embassy in Kabul and commit to engaging with Afghans across society. Afghans need to know that the United States and others are there and that they can be depended upon.

As a journalist who worked in Afghanistan for decades, I have seen the country through its many wars and witnessed the results of successive failed policies. I watched as so many nations and international organizations scrambled to evacuate some of the country’s brightest and best-educated people. I watched the last U.S. aircraft fly out of the Kabul airport in 2021, bringing a frantic end to the war and ushering in the Taliban’s return to power.

I wondered then whether the world would ever be able to see Afghanistan for the striking country it is and to see Afghans — not just the Kabul elite and expatriates but also those in villages and cities, on farms that stretch for miles or in the rugged mountains — not as a problem to solve but as the very answer to lasting peace in their country.

When the Taliban previously controlled Afghanistan, from 1996 to 2001, Washington, the United Nations and others came down hard on Taliban leaders with conditions they were instructed to meet if they could hope to gain recognition by the United States and other nations. The Taliban were told to educate girls, end drug production and expel Osama bin Laden, who had lived there since the spring of 1996, before the Taliban took power.

But U.S. and U.N. sanctions closed off Afghanistan and undercut those among the Taliban who wanted to engage with the world and had a vision for their country that — while it might not have matched the conception in Western capitals — included having girls and boys attend school.

Most significantly, some of those Taliban members open to engagement did not support foreign fighters taking up residence in their country. As I reported at the time, the Taliban’s then deputy interior minister, Mohammad Khaksar, told me that in the years before the Sept. 11, 2001, terrorist strike on the United States, he had reached out to a U.S. diplomat and a C.I.A. official in neighboring Pakistan for help in expelling foreign fighters but was rebuffed. Gregory Marchese, at the time the vice consul at the U.S. Consulate in Pakistan’s northwestern city of Peshawar, later corroborated to me that he’d had that meeting with Mr. Khaksar and a C.I.A. official, Peter McIllwain. Mr. McIllwain later confirmed what Mr. Khaksar had said about it.

America did not focus on Afghanistan in the years after the Soviet withdrawal in 1989, when it closed its embassy. This left Washington blind to what was taking shape there in the lead-up to Sept. 11. Over the past two years, Washington has pursued a similar policy, shunning a diplomatic return to Kabul and believing it can pressure Taliban leaders into educating girls and easing restrictions on women with the promise of international recognition. And once again, that notion is failing.

In my reporting on the Taliban movement since 2021, I have found that the most restrictive Taliban leaders have grown more assertive, capitalizing on the nation’s isolation to tighten their grip, at the expense of those who advocate international engagement and whose vision for their country does not exclude girls from education or seek to make women invisible.

Financially, America has continued to be generous to Afghanistan, providing significant humanitarian aid since the Taliban’s return to power. In fact, America remains one of the nation’s largest humanitarian donors — having spent about $2 billion on aid since leaving the country. (At the same time, the United States and European nations are holding more than $9 billion in Afghan assets, frozen since the Taliban’s return.) But humanitarian aid alone won’t help Afghanistan move forward.

The public face of the anti-Taliban movement in Afghanistan is composed of some of the same discredited warlords accused of war crimes and former generals who took charge after the U.S.-led invasion in 2001, some of whom have also been accused of — and denied — crimes against Afghan civilians. The United States has been engaged with those leaders, but they are part of the problem, not a solution.

Of course, America talks to the Taliban as well. U.S. officials have met with Taliban leaders in Qatar, where the group maintains a political office and where the U.S. diplomatic mission to Afghanistan is based. Washington’s special envoy, Thomas West, is the public face of America’s Afghanistan policy. He has met with the Taliban in Qatar to discuss topics like education for girls and humanitarian aid, and he holds meetings with the leaders of Afghanistan’s neighbors and those in the Middle East and Europe.

But it is engagement at a distance. That strategy offers a voice to only a few Afghans — the Kabul elite, expatriates and former government officials. That means U.S. officials don’t hear, see or understand what is happening on the ground. The United Nations has maintained a steady presence in the country since the Taliban took power, and nearly 20 nations, including Japan, China, Russia and some Middle Eastern nations, have maintained or established some sort of diplomatic presence there in the past two years. Until the United States and other Western nations do the same, there will be people in Afghanistan who will continue to feel alone and unable to make the changes that only they can make.

It would also be helpful if Western officials’ public statements aided in finding a path forward rather than inflaming sentiments. Speaking to Congress in April about how U.S. funds were being used in Afghanistan, the U.S. special inspector general for Afghanistan reconstruction, John Sopko, said: “I would just say I haven’t seen a starving Taliban fighter on TV. They all seem to be fat, dumb and happy. I see a lot of starving Afghan children on TV. So I am wondering where all this funding is going.”

While Mr. Sopko’s concerns about how U.S. money was being spent may have been legitimate, that kind of caricature is not in anyone’s interest. The Taliban is a movement defined by its religious zeal, whose tribal roots are deeply wedged in Afghanistan’s conservative countryside. Respect goes far in Afghanistan — and a lack of respect goes equally far in unproductive directions.

The Taliban come from within Afghan society. That does not mean all Afghans support the relentless restrictions on girls and women, but it does mean that navigating a way forward requires deeper understanding, less arrogance and more of a homegrown Afghan solution.

And like it or not, that means returning to Afghanistan.

Kathy Gannon is a Canadian journalist and former correspondent and news director of 34 years for The Associated Press, covering Afghanistan, Pakistan, Central Asia and the Middle East. She was seriously injured in 2014 when an Afghan police commander fired on her car, killing an A.P. photographer from Germany, Anja Niedringhaus.

The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips . And here’s our email: [email protected] .

Follow The New York Times Opinion section on Facebook , Instagram , TikTok , X and Threads .

An earlier version of this article misstated the year of the Soviet withdrawal from Afghanistan. It was 1989, not 1979.

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