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A Horatio Alger Story Economic education has become quite sophisticated. States mandate it, organizations facilitate it, and large corporations underwrite it. We use multi-media packages, slide-tape presentations, videocassettes, audiocassettes, and a host of other innavations to teach students how the American economic system functions. But from 1870 to 1920 (give or take a few years), economic education could be summed up in two words - Horatio Alger. Alger gained tremendous popularity as the author of books and stories that purported to teach American boys how to attain prosperity and respectability. The following article takes a brief look at the Horatio Alger phenomenon . (Please note that the use of the word "boys" in this article is not intended as a slight against girls or women. Alger wrote primarily for schoolboys, and he wrote during a period in history when women were pretty much excluded from public life. That's something to keep in mind the next time you get nostalgic for "the good old days.") You don't hear very much about Horatio Alger anymore. Today's journalists seldom invoke his name, and literary critics scorn his work. Present-day readers rarely, if ever, spend money for his books; adventurous souls who try to read his stories usually give up after a few pages. Yet Horatio Alger (1832-1899) was once one of America's most popular and influential writers. Born the son of a Massachusetts Unitarian minister, Alger followed in his father's footsteps, earned a degree from Harvard Divinity School, and accepted a pulpit in Brewster, Massachusetts. He soon abandoned the ministry, however, to pursue a literary career in New York, and before long he won considerable fame as a writer of boys' His stories were a mixture of fable, how-to-do-it book, and economic education, and each story generally followed the same formula. Almost invariably, a poor boy eager for financial success had to: 1) overcome a particular weakness or form of temptation, and 2) triumph over a villainous rich man and/or the villainous rich man's malign son. There was never any doubt, however, that the hero would prevail through hard work, courage, strength of character, and good fortune. (Good fortune usually came in the form of a helpful businessman.) Alger's first major triumph, Rag- ged Dick, chronicles the transforma- Ragged Dick fiction . His books sold millions of copies, and his philosophy profoundly influenced popular American thought during the fifty-year period following the Civil War. One reason for Alger's tremendous popularity is that he wrote what Americans of the late 19th century wanted to read. His stories stated and restated the widely-held belief that poverty was no barrier to success in America's fluid society. His words reinforced the popular notion that any American boy, no matter how poor, could rise in the world and achieve success . In short, Horatio Alger wrote rags-toriches fables with a distinctly American twist. tion of a New York street waif from "Ragged Dick" to "Richard Hunter, esq.," and it typifies the author's message and style. At the story's outset, Dick Hunter works as a bootblack, frequents gambling establishments, lives by his wits, and sleeps on the street in "a wooden box half full of straw." As the story progresses, he encounters a series of characters who, for better or worse, have a major impact on his life. One such character is Mr. Whitney, a benevolent businessman who gives Dick a piece of advice that expresses a basic tenet of Horatio Alger's philosophy. "I hope my lad," Mr. Whitney said, "you will prosper and rise in the world. You know in this free country poverty is no bar to a man's advancement." By the time the story closes, Dick Hunter is well on his way to respectability and financial success. Subsequent stories followed the same basic formula , but Alger's readers never seemed to mind. Many seemed to believe that his stories offered a prescription for success, and they eagerly awaited each new release. Schoolboys, in particu- Federal Reserve Sank of Boston Vol. 13, No. 2 - June 1987 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis lar, felt that success would be theirs if they lived according to the philosophy set forth in such stories as Rag- ged Dick. Adding to Alger's popularity was the simplicity of his message. Material prosperity was the clearest measure of success. His heroes aspired to own property and enjoy "the finer things," and most of his readers had similar aspirations. Wealth, however, was never the sole measure of success. Character and compassion usually differentiated a successful hero from a wealthy villain. This earned Alger the wholehearted approval of clergymen, educators, and other adults eager to instill the "proper values" in America's young people. Few American writers have been more influential than Horatio Alger, but by the 1920s his influence and popularity had begun to wain. The public seemed to tire of his message and his writing style. In t;he words of Alger biographer Edwin Hoyt: The Alger books are strong medicine; they cannot be taken too often or too many at a time. The reader who can get through three of them without stopping has his head awhirl with wicked squires; wicked squires' sons; evil poorhouse managers; street boys; sweet and ineffectual mothers; dying fathers; strong, manly, robust heroes; delicate flowers of girls; evil roisterers and other bad companions; friendly, firm, helpful businessmen; and the rich, rich, rich. Nowadays, it's pretty easy to belittle Alger's style and dismiss him as a minor writer. The cliches and the melodrama seem so unsophisticated and so old-fashioned . But changes in literary style and taste don't completely explain Horatio Alger's fall from favor. Perhaps a more compelling explanation is that Alger's message seems particularly ill-suited to modem times. He wrote about "selfmade men" who "pulled themselves up by their bootstraps" and "struggled their way up from the streets." Over the 7ears, however, the emergence o big government, big business, big labor, and big universities has made the "self-made man" something of an anachronism. A "safety net'' of government p rograms now aids the poor, researchers in university laboratopage2 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ries have all but replaced independent inventors, big government and big business provide safe havens for bureaucrats and managers, and labor unions offer their members a ce.rtain degree of job security. With all the changes that have taken place and with all the options now open to people, being a "self-made man" just isn't as appealing as it used to be. Nevertheless, some observers claim the "self-made man" is making a comeback in the guise of that 1980s hero, the entrepreneur. And to a certain extent they are right. Today's entrepreneurs possess quite a few of the qualities exhibited by Horatio Alger's heroes. Many display independence, courage, dedication to hard work, and strength of character. Some even owe their success to being in the right place at the right time. (Remember! Good fortune always figured prominently in a Horatio Alger story.) But make no mistake about it, a 1980s entrepreneur is not the same as an 1880s selfmade man. Whereas most of Alger's self-made men struggled their way up from streets of poverty-stricken neighborhoods, many entrepreneurs have "struggled" their way up from the streets of middle-class suburbs. More than a few have even gone to college. You'd have to look long and hard to find an Alger hero who had done that! Then, too, the world is a less innocent place than it was when Horatio Alger wrote his stories. (Not that it was all that innocent back then.) It's difficult to imagine today's preadolescent boys and girls believing in heroes who succeed through "luck, pluck, and courage." One even wonders how many young people still believe that "in this free ~ountry poverty is no bar to a man's advancement." (If you're a teacher, ask your students what they think.) Yet for all the changes that have taken place, there's still no escaping Horatio Alger's influence . Think about it for a minute. Maybe you are a student about to begin your first summer job, or perhaps you are about to embark on your chosen career. In either case, you may be thinking to yourself, "If I work hard, if I meet the right people, if I'm lucky .. .. " That's Horatio Alger's influence still at work. The world may have changed, but the dream hasn't died. Multi-Media Striking Gold and Silver, pamphlet, published by the Federal Reserve Bank of Boston, six pages. Coin buffs, collectors, and investors can learn more about the American Eagle gold and silver bullion coins from a Federal Reserve Bank of Boston publication, Striking Gold and Silver. The six-page pamphlet describes the coins and explains how the U.S. Mint is marketing them. For free copies of Striking Gold and Silver, please write to: Publications, Public Services Department, Federal Reserve Bank of Boston, Boston, MA 02106; or call (617) 973-3459. The Basics of Interest Rates, booklet, published by the Federal Reserve Bank of New York, 24pages. The fundamentals of interest rates and their effect on production, employment, income, and prices are described in The Basics of Interest Rates, a recent publication from the Federal Reserve Bank of New York. Basic theory is explained through practical examples that follow the movement of funds from savers or investors to borrowers. Woven into the discussion is the role of banks and other financial intermediaries. In addition, tables and charts help to illustrate the effects of such interest rate determinants as maturity, risk of default, economic uncertainty, inflationary expectations, taxes, and monetary policy. Single copies of The Basics of Interest Rates are free of charge; additional copies cost 65 cents each. Write to: Publications Section, Public Information Department, Federal Reserve Bank of New York, 33 Liberty Street, New York, NY 10045; or call (212) 720-6134. Consumer Credit Protection: Do You Know Your Rights?, booklet, published by the Federal Reserve Bank of Minneapolis, 20 pages. The era of consumer protection began with two very simple ideas: that consumers should have good, reliable information on the cost of credit and that all consumers should be treated fairly. These two ideas have led to hundreds of pages of laws, regulations, and interpretations . Consumer Credit Protection: Do You Know Your Rights? is designed as a brief, informal overview of the five major federal laws that apply to consumer credit: 1) Truth in Lending, 2) Equal Credit Opportunity Act, 3) Fair Credit Reporting Act, 4) Fair Credit Billing Act, and 5) Fair Debt Collection Practices Act . This new booklet from the Federal Reserve Bank of Minneapolis is readable and interesting, and it doesn't provide more information than the average consumer ever wanted to know. For free copies of Consumer Credit Protection: Do You Know Your Rights?, please write to: Public Affairs, Federal Reserve Bank of Minneapolis, 250 Marquette Avenue, Minneapolis, MN 55480; or call (612) 3402446. Understanding Taxes, curriculum unit, developed by the Internal Revenue Service. tracks, illustrated script booklets, student worksheets, and teaching guides to he! p students better understand the workings of the American economic system. Four individual units focus on profits, competition and productivity,ยท world trade, and investment in business. PROFITS explains how the opportunity to earn a profit continued 0 11 page 4 Innovative Classroom In the last issue of Ledger, we announced a coin design competition to commemorate the 200th anniversary of the U.S. Constitution. The inspiration for our competition came from the U.S. Treasury's limited competition, in which the Treasury invited eleven well-known artists to submit designs for a $5 gold piece and a silver dollar. Well, the Treasury has chosen the winning entries in its competition, and we have chosen the winning entries in ours. Of course, the winning entries in our competition will not appear on a coin, but we thought you might like the chance to see them and to compare them to the Treasury's winning entries. We received a number of imaginative, well-executed designs. Unfortunately, we don't have the space to run all of them, but we thank all of you for taking the time and the effort to send us your designs. Finally, we offer special thanks to the teachers who worked with their students and encouraged them to submit designs. We appreciate your efforts, and we're sure your students do too . Changes in the federal tax code have made life a little more complicated for just about everyone, including teachers and students who study taxation. Fortunately, the Internal Revenue Service offers educators a curriculum unit called Understanding Taxes. Designed for use in secondary schools and adult basic education programs, Understanding Taxes provides training to help students prepa re accurate tax returns and understand the role of taxes in our society. The material is divided into nine modules, each of which covers a separate topic and can stand alone as a lesson. Topics range from "How to Prepare an Income Tax Return" to "Economics of Taxation." Five Dollar Gold Coin Designed by Marcel Jovine For more information, please contact the Understanding Taxes Coordinator at the IRS district office nearest you. Enterprise Is ... America, multimedia economic education program, developed by the U.S. Chamber of Commerce. The U.S. Chamber of Commerce recently introduced a new economic education program called Enterprise Is .. . America. Designed for use in junior and senior high schools, the multi-media package employs color filmstrips, cassette-tape sound- https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis One Dollar Silver Coin Designed by Patricia Lewis Verani co11ti11ucd page3 motivates individuals to start small businesses and work hard to make them prosper. COMPETITION AND PRODUCTIVIIY takes a look at how _competition and productivity help to keep prices down and force companies to be efficient. WORLD TRADE discusses the impact of foreign influences on the U.S. economy. Finally, INVESTMENT IN BUSINESS explores how each individual, through his or her savings and investment program, contributes to the ability of businesses to expand and grow. Each unit centers on a filmstrip (with an accompanying audiocassette cued for automatic picture advance), and each filmstrip gives a broad overview of the topic subject. Since each unit is designed to be independent of the others, teachers have the option to use one unit or all four. Enterprise Is .. . America is the successor to the award-winning Economics for Young Americans program, a U.S. Chamber of Commerce project instituted ten years ago to increase economics understanding among America's young people. The four-unit, multi-media kit costs $150. For more information, please contact: Sally A. Ulrich, Special Projects Division, U.S. Chamber of Commerce, 1615 H Street, N.W., Washington, D.C. 200629967; phone (202) 463-5755. Innovative Classroom Winning Entries in the Coin Design Competition Wilson Middle School Grade 7 Steve Couture R. Lamphere, Art Teacher Natick, Massachusetts Grade 6 Danny O'Neil Providence, Rhode Island Henry Barnard School B. Ruggeiro,Teacher Grade 5 Peter Makros Beverly, Massachusetts Ayers School Katherine Barnico, Teacher Elm Park School Grade 4 Shawna Parker-Tate Virginia Coulter, Teacher Worcester, Massachusetts the LEDGER Editor: Robert Jabaily Graphics Arts Designer: Ernie Norville Honorable Mention Michael Ruggiero page4 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Grade 3 Rehoboth, Massachusetts
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