[An address with this title was given by W. M. Daniels, then professor of political economy in Princeton University, before the Scottish Society of Economists in 1906, and printed in The Accountants' Magazine, for May, 1907. It is here somewhat abbreviated and edited, with the approval of the author.]

Before 1820 the custom had grown up for British travelers to the United States to make a book out of their transatlantic impressions. Despite their curiously varied verdicts, there was one aspect of contemporary life upon which they were in singular accord. This was the all-important influence exerted by an almost boundless unoccupied domain beyond the line of actual settlement. The vivacious Miss Martineau, in her "Travels in America," published in 1837, has recorded that "the possession of land is the aim of all action, generally speaking, and the cure for all social ills among men in the United States. If a man is disappointed in politics or love, he goes and buys land. If he disgraces himself, he betakes himself to a lot in the West. If the demand for any article slackens, the operatives drop into the unsettled lands. If a citizen's neighbors rise above him in the towns, he betakes himself where he can be monarch of all he surveys. An artisan works that he may die on land of his own. He is frugal that he may enable his son to be a landowner."

Miss Martineau and her colleagues were quite correct in their insistence upon the dominant role that an imperial abundance of unoccupied territory was to play. The first period of our national development, economic and political, corresponded roughly with the duration of a free public domain, which challenged the pioneer and settler to the further conquest of physical nature. The second period began about 1880 with the exhaustion of our free lands and the vanishing of the frontier. The first era was one of expansion and settlement; the second, in which we still live, is one of readjustment and recoil.

In treating of the economic causes which have affected the political history of the United States, I shall speak first of the manner in which free land reacted upon our constitutional system; second, of the clash of slavery and free labor; and lastly, of the power of concentrated financial control.

I. Free land and democracy. The process of westward expansion and settlement has too often been described in its external aspect, in the baldness of its objective statistical detail. But without some apprehension of the economic society which that expansion into new lands called for a time into being, the most thorough-going political transformation in our history cannot be grasped.

The notion may be dismissed at the outset that the winning of the Western wilderness was largely an automatic process, due merely to the growth and spread of population into vacant, contiguous territory. The instinct for successful migration and colonization is a rare endowment, found only among a few peoples, and exercised by them only intermittently.

The tide of Anglo-Saxon settlement was for two centuries held in by mountains near the Atlantic shore-line, and then swept to the base of the Rocky Mountains in much less than half that period." Not until the tenuous girdle of French trading-posts along the great lakes and the Mississippi was snapped, did the pent-up spirit of colonization find a second outlet.

How very imperfectly this westward trend of settlement was then grasped, even in the United States, may be gathered from the locating in 1790 of Washington, the national capital, at what is practically the middle of the Atlantic seaboard. Supposed originally to be centrally situated for all time to come, it is to-day hundreds of miles from the center of population, and three thousand miles from the States on the Northern Pacific. Since 1800 the center of population has moved regularly with each decade towards the west, in some decennial periods as much as eighty miles, and rather curiously has always closely hugged the 39th parallel of north latitude. The lure of free land has been the steady magnet, while industrial depression in the East has by a process of repulsion occasionally reinforced the steady pull westward.

The founders of the new Western States were from the native Eastern stock, but sifted out of it by a self-chosen career of adventure in confronting and vanquishing primeval nature.

The pioneer class could not be recruited from an exploited fringe of an early proletariat, or from raw immigrants. De Tocqueville had noticed in 1835 that immigrants to America did not push west, and had explained that "the desert cannot be explored without capital or credit, and the body must be accustomed to the rigors of a new climate before it can be exposed to the chances of forest life. "In later decades free transportation has often been furnished to induce the immigrant to locate at a distance from his port of entry. But the pioneer was seldom an immigrant, and the early settler was seldom a peasant. "Everything about him," testifies De Tocqueville, "is primitive and unformed, but he is himself the result of the labor and the experience of eighteen centuries. He wears the dress and speaks the language of cities, and penetrates into the wilds of the New World with the Bible, an ax, and a file of newspapers."

I have dwelt upon the origin and character of the early Western settlers because it was the central West that was destined to transform the political habit of the United States. That influence, however, we shall seek in vain in the shifting ebb and flow of early political conflicts. The fairly whimsical way in which not only the West but the other sections,

New England and the South, shifted their political preferences until slavery had become the one imperious issue reminds one of Talleyrand's cynical remark, that a man who aims to be true to his party must be ready for frequent change of his principles.

But while no decipherable progress can be conjured out of alternating party triumphs in the central West, the unprecedented economic opportunities long enjoyed by all the inhabitants of the new commonwealths in approximate equality were destined to transform the whole political fabric. The abundance and fertility of the soil yielded to the unflagging energy of the new settlers a crude but very bountiful subsistence. The hired laborer was able to wrest from his employer a wage commensurate with that which the worker could command for himself by resorting to fertile and unappropriated land. The standard of wages and of comfort was high, and divergences in incomes and even in possessions were small and unimportant. From this fundamental economic equality there resulted in these frontier communities, unused to social distinctions, and untrained in the notion of class subordination, a fierce equalitarian spirit which found its earliest expression in their local politics. "Every age," says Burke, "has its own manners and its politics dependent upon them." The manners and customs of the early West were the product of approximately equal earnings and possessions. These first found expression politically, in the newer States, in manhood suffrage (negroes alone excepted), and in the practice of making almost all official positions elective, with a short, fixed term of service. By contagion these forces were destined to invade the older States, and eventually to prevail throughout the Union. It was through these innovations that a serious dislocation of the older constitutional system was to be effected. . . .