Born Losers: A History of Failure in America

Published by EH.NET (October 2006)

Scott A. Sandage, Born Losers: A History of Failure in America. Cambridge, MA: Harvard University Press, 2005. x + 362 pp. $17 (paperback), ISBN: 0-674-02107-X.

Reviewed for EH.NET by Susan Nance, Department of History, University of Guelph.

Scott A. Sandage, Associate Professor at Carnegie Mellon University, has given us a valuable new addition to the cultural history of business. Born Losers: A History of Failure in America was winner of the 2003 Thomas J. Wilson Prize for the best first manuscript of the year at Harvard University Press, and it is easy to see why the book has drawn such favor. In this engagingly written account, Sandage explains how generations of Americans internalized ideologies of the self-made man even when so many failed financially and seemed to be victims of the economic system. In these stories of famous and forgotten men who struggled with capitalism, the author reveals how the uncertainties of the Market Revolution created cultural change in the U.S. Beginning with the panic of 1819, and accelerating as the panics, bank collapses and bankruptcies continued with regularity though the century, he shows how Americans came increasingly to see one’s credit rating as a representation of one’s morality and power in society. Sandage uses noted nineteenth-century “failures” like Henry Thoreau to make his point. In Thoreau’s day many American men evaluated one another by way of easily measurable factors — bank account balances, credit ratings, work histories — rather than artistic output, community service or stable family lives. Sandage discusses the inhumanity of such attitudes through many case studies. Take for instance William Brisbane, who today would seem to stand out as a hero of history. After he went bankrupt in the late 1830s, the Tappan credit agency of New York warned he was no longer to be trusted with loans and had not amounted to anything. In fact, Brisbane had fallen on hard times after a change of heart inspired him to spend his family fortune in freeing his slaves. Sandage rightly calls him a character who “magnified contemporary tensions between prosperity and integrity” (p. 139).

Indeed, during the nineteenth century, Sandage tells us, economic failure by way of bankruptcy became more than a financial issue, it became an identity for many men, whose status as individuals became tied to their status as business owners. Failing changed from being “incident” to “identity,” he says (p. 11). Part of the blame for this tradition of self-doubt in American life he lays with the rise of credit networks, and the ensuing ubiquity of debt and bankruptcy. For many, Sandage wisely observes, the hidden causes of bankruptcy “were harder to see than a broken man” (p. 58), whose problems destroyed marriages or put families at the mercy of charitable relatives. And this cultural attitude was highly gendered, such that by mid-century many held the belief that among white men, “it was not indolence but impotence that caused failure” (p. 97).

The most profound evidence Sandage marshals for his argument comes from the Tappan Mercantile Agency of New York, established in 1841. As the earliest American credit bureau, the Tappan company used postmasters, lawyers and other prominent citizens to collect data on thousands of men, their businesses, debts, family situations, and any other information that might shed light on that individual’s ability to repay loans or conclude business agreements. The details of what information they chose to collect and the stories that this information told about American men are truly fascinating in their own right. “More than a bank balance or character reference,” he writes, “a credit reference folded morals, talents, finances, past performance and future potential into one summary judgment” (p. 103). Sandage goes on to assert that when the Tappan company began selling this information, one’s financial identity also became a commodity. This was a serious turning point, in which those with economic resources could consolidate their position further by purchasing information that helped them limit risk and weather the ups and downs of the economy even better. Yet, for those being evaluated by the agency, mistaken reports could become self-fulfilling prophesies of a sort if Tappan’s customers began avoiding a man accused in his credit report of fraud or foolishness, regardless of the truth of the allegations.

Sandage does document many Americans who had their doubts about capitalism. Among these was the National Bankruptcy Association, a group of debtors, who lobbied for a workable bankruptcy law that might give all men a second chance since they knew capitalism did not always provide a meritocracy in which the most virtuous triumphed. Ultimately, they were drowned out by all the business manual writers and other boosters of entrepreneurial individualism and speculation who sold the myth of guaranteed success, while a series of bankruptcy acts came and went over the nineteenth century (1800, 1841, 1867) without ultimately solving the problems capitalism created. For bankrupts this was especially galling in the context of the crises of the 1850s and the Civil War. As the Federal government was working through how ex-slaves might be given a way to start over as full, free citizens, debtors viewed their own plight as a kind of “white slavery,” in which honorable white men were refused the same consideration because of their inability to weather the panics and downturns of the period.

Still, the continuing puzzle here is why so many have internalized capitalist ideologies that insist success or failure results from one’s character, rather than problems inherent in the economic system. Why have so many people felt guilty when they did not measure up, as did Henry Hill who admitted in 1853, “I wish I could feel more like work — toil hard and unremitting, but I do not and I may as well own up” (pp. 62-63). Why have so many committed suicide after repeated failures or bankruptcy? This may be a difficult question to answer, and though Sandage does not state it explicitly, perhaps the life histories he provides do show that there were enough people apparently succeeding at any given time to perpetuate these myths. Certainly powerful men like those running the Tappan credit bureau had reason to perpetuate the idea that success resided “in the man,” in order to give their information on individual American men value, information which in fact kept its value in spite of the economic climate at any given moment, Sandage tells us.

Yet, the ‘why’ behind the broad internalization of these beliefs in the face of the failings of capitalism and many critics is an important question that is not fully answered. The author has clearly considered this question it seems, especially when he wonders aloud what might have been had Americans chosen another way. Indeed, in some self-revelatory moments Sandage reveals a deep uneasiness for what he sees as the triumph of entrepreneurial individualism in the U.S. Since his tone assumes the reader also views capitalism and its identities as ultimately destructive, some may find these passages to be unnecessarily pessimistic and wonder if he overemphasizes their prevalence in society.

Nonetheless, this work of cultural history provides an indispensable contribution to the literature on American capitalism. By exposing the day-to-day cultural work Americans did to develop identities of entrepreneurial individualism, Sandage’s work provides crucial detail for scholars seeking to understand why and how capitalism has persisted in the United States.

Susan Nance is Assistant Professor of History at the University of Guelph, in Guelph, Ontario.