The politics of purchasing power: Political economy, consumption politics, and state-building, 1909-1959

In the first half of the twentieth century, a group of labor leaders, consumer reformers, and progressive politicians feared "underconsumption" as the Achilles' heel of American democratic capitalism. To preserve a healthy economy and polity, they sought to create a "consuming public" through government-supported wage and price policies intended to redistribute income to the working classes. Absent a strong Socialist or labor party, consumption politics served as a vehicle for a social democratic agenda. For a generation, the idea of a broadly conceived consumer's interest framed in the language of mass purchasing power enabled both the regrounding of the American labor movement and the institutionalization of collective bargaining at the center of the New Deal state.; The Politics of Purchasing Power moves from the bargain basement to the bargaining tables. The narrative begins by exploring downtown department stores where ideas about working-class purchasing power first crystallized. Then, it shows how a formula of high wages and low prices became politicized and institutionalized in the 1930s and 1940s. In the context of major depression, the idea that the rise of mass consumption required the structural redistribution of income through a nationally organized industrial labor movement gained currency. Finally, the study examines the postwar politics of purchasing power in which this highly mobilizing system competed with more moderate fiscalist alternatives. Only a series of political and policymaking battles led to the defeat of a high-wage strategy and the triumph of Keynesian fiscalism. Key players in the construction of a "consuming public" included Edward Filene, Leon Keyserling, Robert Lynd, and Senator Robert F. Wagner.; This study pays particular attention to the dynamic between state actors who sought to improve working-class living standards and consumers themselves who provided political support for such redistribution. Considering this evolving dialectic advances a theory of state-building from the bottom up. In the twentieth-century United States, we need to consider how public policies constitute and reconstitute social group formations and how those groups in turn condition future state development. Popular cultures and institutional state structures do not evolve autonomously; rather states help to create publics, and consuming publics shape the contours of the state.