Born Losers: A History of Failure in America (review)

Building on recent histories of business failure in the United States, Scott Sandage probes the cultural underside of the American Dream in the nineteenth century—or, to be less anachronistic, the efforts of the era's middle class to make sense of all the financial wreckage in its midst, wreckage largely strewn by its own relentless embrace of speculation, entrepreneurial drive, and general "Go-Aheadism." Sandage is concerned equally with the meanings of pecuniary failure for prominent Americans like P. T. Barnum, Lydia Maria Child, and Ralph Waldo Emerson, and for the mass of ordinary "strivers." Focusing mostly on the period from the Panic of 1819 through the emergence of large-scale industrial corporations, he adds a brief epilogue that considers understandings of failure in the twentieth century.

Methodologically innovative and superbly written, Born Losers engages an impressive array of nineteenth-century conversations about bankruptcy. The obvious domains of political debate, periodical commentary, fiction, and private introspection receive attention, but so too do commercially inspired slang and particularly modern forms of commercial communication, such as the credit report and the begging letter. Throughout the book, Sandage emphasizes—and in the end, overemphasizes—a key transformation in the American meaning of failure: a "shift from ordeal to identity" (4), from seeing bankruptcy as a traumatic event to viewing it as an enduring social identity associated with marginality and worthlessness.

Sandage sets up this argument by exploring the social and cultural elevation of risk-taking and the search for profitable innovation in antebellum America, which increasingly became badges of manhood and honor within middle-class culture. The depth of commitment to this entrepreneurial ethos, he shows, went hand in hand with high rates of insolvency. Contemporaries were well aware of this connection and even tended to exaggerate its impact, widely circulating estimates that ninety-seven percent of business ventures left their proprietors "flat broke," "gone to smash," "wiped out," or "up a tree," in the era's rich vocabulary for depicting commercial detritus (25). The ubiquity of failure, Sandage notes, only intensified the inclination to worship at the altar of success. To make it in a world where more than nineteen business owners in twenty eventually found themselves on the unpleasant side of a sheriff's sale was truly to demonstrate one's talent, perserverance, and economic superiority.

At the same time, Sandage contends that nineteenth-century Americans largely remained convinced that bankruptcy was "a moral sieve" (17), and that in cases of failure, one could generally find, in Emerson's words, "a reason, in the man" (46). From the pulpit, on the editorial pages, and, after the 1840s, in the ledgers of credit reporting agencies, opinion makers perpetuated a series of moral "master plots" (50) that explained the descent into bankruptcy. The "reason" for failure was sometimes outright skullduggery, as when unscrupulous scamsters simply pretended to be insolvent as a means of plundering creditors. More frequently, it lay in a variant of excessive ambition, such as improvident extravagance, imprudent speculation, unwise expansion of business beyond the safe confines of one's capital (a practice then known as "overtrading"), or the flunky's plunge into a competitive and unforgiving marketplace.

Born Losers skillfully tracks the impact of such master plots on the evolution of credit reporting, a new form of bureaucratic surveillance that increasingly fixed commercial identity through time and space, as agencies like R. G. Dun & Co managed to keep tabs on even the most migratory business owners. The book further traces the legitimation of credit reporting as an economic and social practice, with initial complaints about an unaccountable and invasive commercial spy system giving way to extensive acceptance of private surveillance as a necessary element of trust-making in a national marketplace.

Sandage observes that many nineteenth-century bankrupts and their family members, along with an occasional reformer, insisted that business failure in a modern capitalist economy did not necessarily reflect individual culpability, but the book pivots...