The articles on ideology are doubly relevant here to explaining this huge, surprisingly long-lasting US lead: in particular, they're part and parcel of an institutional and cultural approach that underpins the overall argument of the series on the US economy's innovative powers. Note: doubly relevant. How so?
- The US lacks a statist-conservatism of the sort that is rife on the Continent of West Europe and in Japan . . . the dominant political parties there, for generations now, suspicious of free markets and capitalist competition of the sort Americans take for granted.
True, the British Conservative Party is an exception to this rule in Europe, but only in part: the Tory patrician wing, which extends back to the pre-democratic, pre-industrial period of the 17th century --- and was dominated by land-owning aristocrats right down to the start of the 20th century, decades after the vote was extended to the middle classes and the working classes --- had no trouble accommodating itself to the advanced welfare-and-regulatory state that the Labour Party created in Britain after 1945. That accommodation persisted until the 1980s. It helped, in the patrician and paternalistic circles of the Conservative Party, to stabilize British society and guarantee law-and-order . . . their major concerns historically (along with expanding British power and influence abroad). At that point, the party and Britain were turned topsy-turvy. Margaret Thatcher unleashed a 12 year free-market revolution in British life that earned her the enmity of not just the British radical left, but the Tory right in the Conservative Party as well.
Note that roughly similar observations apply to the Australian Liberal Party, that country's major right-wing party, in the era of John Howard . . . Prime Minister now since 1996 and recently re-elected about the same time as George Bush was here. Of course, the Liberal Party there had no patrician aristocratic wing. Australians had fled an aristocratic-dominated Britain in the 19th and early 20th centuries. Still, the Liberal Party had little trouble accommodating itself to the large welfare-and-regulatory state that the Australian left created after 1945 --- at any rate, until the 1980s.
- The US also lacks, on the left, a socialist or Marxist tradition that marks deeply the history of all the dominant left-wing parties in West Europe and Japan . . . to the extent one can even find an organized Japanese opposition party since the 1960s. The American left can draw on some radical and populist traditions, stretching back to Jefferson and in various trade union movements (especially the CIO and the miners, both organizing mass industrial workers and badly exploited mine workers early in the 20th century), but never a socialist heritage, let alone one marked by Marxist views of capitalism.
The nature and causes of the Republican Party's anti-statist ideology will be the subject of future articles in this mini-series. Right now, our task is to continue the analysis ---- started a couple of weeks ago --- that probes the various reasons for the unique nature of the American political left and its general indifference, historical and in the present, to a socialist, heavily statist way of organizing the US economy of the sort found West Europe today . . . despite some pro-market reforms in Germany and elsewhere to make the economies there more competitive.
And so, down to business
The nature and causes of the Republican Party's anti-statist ideology will be the subject of future articles in this mini-series. Right now, our task is to continue the analysis ---- started a couple of weeks ago --- that focuses on the US left: specifically, in order to sift out and explain the various reasons for its general indifference, historical and in the present, to a socialist, heavily statist way of organizing the US economy in the sense that prevails in West Europe or Japan. Yes even today . . . despite some pro-market reforms in Germany and elsewhere, it needs to be added, to make the economies there more competitive and vigorous.
ECONOMIC REASONS WHY THERE IS NO SOCIALIST HERITAGE IN THE US: CONTINUED
A Brief Refresher of Where the Argument Was Left Hanging Fire: The First Two Influences Summarized
In a previous buggy article published on December 16th, 2004, two major economic influences that shaped the American ideological spectrum on the left were discussed at length:
- An unusually high standard of living, with the US the richest country in the world in per capita income for well over a century now.
- And, more to the point, an unusually high real wage in the US early on, compared even to Britain when that country, the industrial pioneer, was much richer in per capita income. More specifically, the average wage earned by unskilled labor in the US was double the British wage in 1830, and still almost 60% higher in 1914 despite a mass outflow of poor people from Britain and Europe in the interval, nearly 40 million people, most of it to the US itself.
Note that the startling American lead in living standards hasn't been fully closed by the EU or Japan in the 90 years that have elapsed since then. On the contrary, it is still huge, with the US now enjoying about a 55% higher per capita income than the EU or Japan at the end of 2004.
You want more evidence?
Here's some that is especially vivid. Two Swedish economists study noted recently that if any of the four big EU countries --- Britain, France, Germany, or Italy --- were suddenly to join the U.S. federation, each would be the fifth poorest of the existing 50 states, ranking just ahead of Mississippi, West Virginia, Arkansas, and Montana, and tied with Oklahoma: all five of these, note with care, overwhelmingly rural states and far below average American per capita income. Tiny Sweden itself (9 million people) would be the 7th poorest state. The second richest EU country --- tiny Denmark (4 million) --- would be the 10th poorest, and Ireland with 4 million people too and the highest EU living standard would rank 14th among the poorest U.S. states.
A Third Economic Influence:
Unusual Land Ownership in the 19th Century
Huge as the gap between West Europe and the US happened to be in living standards and wages, what stands out even more strikingly, is the difference in land ownership. In 1830 --- at a time when the US was overwhelmingly an agricultural country --- 80% of the American population owned and worked the land for their livelihood. Nothing like it had ever been seen before in history.
Just how great the differences in land ownership were on the two sides of the Atlantic are brought more vividly in the following table.
|% OF POPULATION THAT OWNED ALL AGRICULTURAL LAND AVAILABLE|