Capitalism as a dynamic force for social good

As political and social repression of blacks raged across the Jim Crow South of the early 1900s, black merchants and entrepreneurs quietly prospered in business, cracking the door to future civil rights.

It was this aspect of American capitalism, not as just an abstract economic system, but as a dynamic force in shaping the culture, politics, and justice of the country that drew scholars from around the United States to Harvard last week for the “History of Capitalism in North America” graduate student conference.

The three-day forum (Oct. 26-28) at the Barker Center began Friday morning with a panel discussion moderated by Assistant Professor of History Rachel St. John exploring the tensions between individual profit and the public good from the textile mills of the segregated Deep South to the mom-and-pop shops that once lined every Main Street across America.

“Black business ownership represented an important form of resistance against the economic ravages and social discrimination of Jim Crow,” said Shennette Garrett, a doctoral student at the University of Texas, Austin. “The drive for economic liberation, with its undercurrents of self-help and community uplift, confounded the deceptive logic of black inferiority and undermined efforts to consign blacks to the lowest rungs of American society.”

While many whites of the time dug in their heels against political and social freedoms for blacks, Garrett said, they often ignored and, in some cases, invested in black business enterprises if for no other reason than to encourage economic segregation. Meanwhile, prominent black leaders of the day believed political agitation was pointless without a solid economic foundation from which to stage the civil rights struggle.

The result in some cases was seemingly incongruous capitalistic cooperation between blacks and whites against a backdrop of racial oppression. Garrett pointed to the case of the New Century Cotton Mill, which opened in Dallas in 1903.

The mill’s black owners raised additional capital from white industrialists, including Boston businessman Arnold Sanford, president of the American Cotton Exchange, who invested $30,000 in the venture. Skilled black tradesmen built the mill, and all the factory workers except the manager and foreman were black, she said.

Around the same time in another part of Texas, ethnic Mexicans living in the lower Rio Grande Valley were also embracing American capitalism, noted Trinidad Gonzales, a graduate student at the University of Houston.

While researching civil court records from the 1900s for cases involving adultery as a means of examining gender relations and sexual morality, his scholarly interest was piqued by hundreds of business disputes filed by Mexican-Americans of the region. The stacks and stacks of lawsuits indicated a large and thriving community of Hispanic businesses.

“I realized a lot of things I grew up with started to make sense: why my dad had a small company, why my mom had a small company, and why I was cutting yards as a small kid to make money,” Gonzales said.

Gonzales’ research focuses on the south Texas disputed zone claimed by both the United States and Mexico in the late 19th century. By the 1920s, the former Mexican citizens of south Texas had begun to see themselves as Americans, he said.

“The community has very similar views on capitalism as the ethnic whites who come into the area,” Gonzales said, noting that the Mexican residents of the area long had been major players in the ranching business. “There’s a long history of this type of business activity among the people.”

The final presenter of the panel, Yale University graduate student Miriam Posner, focused on a national public relations campaign mounted in the 1920s by emerging retail chains. The PR blitz was aimed at overcoming popular opposition to the spread of chain stores as well as undercutting hundreds of anti-chain store bills drawn up by state legislatures.

Posner showed the audience a Little Rascals sketch from 1931 in which the impish children try to scare off two dark-suit-wearing chain store executives sniffing around their grandma’s general store.

“We can see the Little Rascals had some pretty profound concerns about chain stores, but they weren’t the only ones,” Posner quipped.

The National Chain Store Association’s fliers and advertisements, which Posner happened across in a box at a Yale library, argued variously that national retailers weren’t a threat to small businesses, were good for communities, saved people money, and promoted economic efficiency. They also maintained that chain stores had been around since ancient China.

“In the 1940 book, ‘The Chain Store Tells Its Story,’ John Nichols traces the chain store back even further, writing, ‘Our Stone Age forefather, for example, employed the chain store principle by looking for a second cave to use when a saber-toothed tiger was in the neighborhood,’ ” Posner said to guffaws from the audience.

The other four panels of the conference included discussions of the threat to American values posed by industrial capitalism, the role of industry as a political force, and how property disputes shape the economic organization of communities.

The forum was supported by the David S. Howe Fund for the Study of Economic and Business History, Baker Library, the Charles Warren Center for Studies in American History, the Radcliffe Institute for Advanced Study, the Committee on Ethnic Studies, the Graduate Program in the History of American Civilization, and the History Department.