Many reading the Wall Street Journal on May 13, 2005, must have rubbed their eyes in disbelief, looked back and then rubbed them again. A front page story headlined “As Rich-Poor Gap Widens in the U.S., Class Mobility Stalls” informed the largely business readership of that paper that the old Benjamin Franklin-Horatio Alger myth of the United States as a country of infinite social mobility had been proven wrong. So universal has this false view of the United States been, the Wall Street Journal claimed, that “even Karl Marx accepted the image of America as a land of boundless opportunity. . . . ‘The position of wage laborer,’ he wrote in 1865, ‘is for a very large part of the American people but a probational state, which they are sure to leave within a longer or shorter term.'”
“Although Americans,” the article observed, “still think of their land as a place of exceptional opportunity — in contrast to class-bound Europe — the evidence suggests otherwise. . . . As recently as the late 1980s, economists argued that not much advantage passed from parent to child, perhaps as little as 20%. By that measure, a rich man’s grandchild would have barely an edge over a poor man’s grandchild.” But more complete statistical studies have since shown that such conclusions were wide of the mark. “A substantial body of research finds that at least 45% of parents’ advantage in income is passed along to their children, and perhaps as much as 60%. With the higher estimate, it’s not only how much money your parents have that matters — even your great-great grandfather’s wealth might give you a noticeable edge today.” This makes class mobility in the United States, the supposed “classless” opportunity society, worse than Europe’s supposedly more “class-bound” society: “Despite the widespread belief that the U.S. remains a more mobile society than Europe . . . the typical child starting in poverty in continental Europe (or in Canada) has had a better chance of prosperity.”
But if the United States is now incontrovertibly shown to be a class-bound society, the actual reasons for this, according to the Wall Street Journal article, remain a mystery. It certainly should not be seen as offering support for the critics of capitalism since even Karl Marx, who thought capitalist class society would polarize between rich and poor, ironically got it wrong when it came to the United States, believing that for very large numbers of Americans the “‘position of wage laborer is . . . but a probational state.'”
But is this really correct? Did the author of Das Kapital believe, as the aforementioned article claims, in the “boundless opportunity” available to U.S wage laborers? The quote from Marx in the Wall Street Journal is taken from Value, Price and Profit, an address that Marx delivered in English to the General Council of the First International over two days in June 1865. In the larger passage to which that sentence belongs Marx said:
In colonial countries the law of supply and demand favors the working man. Hence the relatively high standard of wages in the United States. Capital may there try its utmost. It cannot prevent the labor market from being continuously emptied by the continuous conversion of wage laborers into independent, self-sustaining peasants. The function of a wages labourer is for a very large part of the American people but a probational state, which they are sure to leave within a longer or a shorter term. To mend this colonial state of things, the paternal British government accepted for some time what is called the modern colonization theory, which consists in putting an artificial high price upon colonial land, in order to prevent the too quick conversion of the wages labourer into the independent peasant. (From the text of original published version of 1898, edited by Marxís daughter Eleanor Marx.)
Here Marx was addressing the reality that large numbers of wage workers in the United States–as in other white settler colonies such as Canada and Australia–frequently fled the shops and factories of the nascent industrial-capitalist society to obtain plots of land that they then worked as subsistence farmers. This meant that wages had to be relatively high when compared to Europe to keep workers in the workshops at all. Capitalism could not function properly without primitive accumulation (or what Marx preferred to call “original expropriation”) that separated the vast majority of the population from the land, leaving them with no option other than wage labor. Given the abundance of cheap land in the United States (and in some other colonized countries) the only way this tendency of wage workers to exit capitalist industry and turn themselves into small farmers could be arrested, as nineteenth century political economists understood, was through policies that artificially inflated the price of land and promoted concentrated land ownership.
By quoting a sentence of this paragraph out of context, the Wall Street Journal was able to suggest that Karl Marx too supported the proposition that wage workers in the United States in his day were in very large numbers climbing straight up the class ladder of American capitalism. In truth he was explaining the consequences that followed when workers in colonies or former colonies, where land was still readily available, voted against capitalist proletarianization with their feet. For Marx as for Frederick Jackson Turner this situation was to change when the frontier was closed — if not before.
“Boundless opportunity,” whether in the United States or elsewhere, was in Marx’s view incompatible with capitalism, which systematically restricted opportunity for the vast majority. In the final paragraphs of his talk, coming two pages after the passage referred to by the Wall Street Journal, he declared to his working-class audience that no answer to class exploitation could be found within the confines of capitalist society. “Instead of the conservative motto ‘A fair day’s wages for a fair day’s work!’ they [the rebelling workers] ought [therefore] to inscribe on their banner the revolutionary watchword: ‘Abolition of the wages system!’“
If the Wall Street Journal wanted a statement from Marx relevant to the issue of a class-bound society it could have found it in this line — at the end of the speech from which it quoted.