“I cannot help fearing that men may reach a point where they look on every new theory as a danger, every innovation as a toilsome trouble, every social advance as a first step toward revolution, and that they may absolutely refuse to move at all,” he wrote.

Sound familiar? It should.

“We have two mortal threats,” former Republican Speaker of the House Newt Gingrich told the Financial Times a month ago, “First is radical Islam. The other is a secular socialist model of government dominating and defining life that would be fundamentally alien to historical American experience.”

It’s an interesting and tragically common argument that American liberalism is a harbinger for socialism, collectivism, communism or whatever the hyperbolic flavor-of-the-day happens to be. This is not to say that collectivism is good (conservatives and liberals today agree that it is not), but that American liberalism is not synonymous with, and does not lead to, socialism.

The first thing to keep in mind is that the market — in any modern sense — is not organic. It is made possible by and depends greatly on government. Who would start a business in the absence of political authority, police protection and a functioning legal system? What incentive would there be to sell when one could steal? Moreover, the kind of trust between consumer and producer that is necessary for a functioning economy is made possible by contract law, the ability of a third party to enforce agreements.

Yet, the market has erred even in the presence of these basic protections. “Historical American experience,” as Gingrich terms it, is not only the story of material wealth unknown by any other nation, but also inevitable excesses and abuses of unrestrained capitalism. The tragic working conditions of America at the close of the 19th century, such as child labor, exhaustive hours, lethal workplaces and nearly slave-wages, are the legacy of the right. Conversely, America’s policies of trust-busting, strong workers’ rights and minimum wages are the legacy of liberalism and have nothing to do with socialism. Liberals created Social Security, Medicare, Medicaid, unemployment insurance, public housing, environmental and consumer protection and recently, universal health care. And what has been the legacy of the American right? Standing in the way each time, crying, “No!”

Did any of these changes so damage our market economy that it now looks like socialism? Of course not. Each reform has benefited capitalism, enlightened it and made it more just. When risky financial practices plunged the U.S. into a deep economic crisis in 1929, it took trillions of dollars of government spending, new regulations and deficits dwarfing our current one to correct the Great Depression and prevent future crises. Did the U.S. plunge into a collectivist nightmare? No. It experienced unprecedented economic growth and
stability.

It was only after the right’s signature policy achievements of deregulating the banking industry and lowering income tax rates, which allowed for unprecedented inequality of wealth, that we plunged again into a massive financial crisis. And now, the right — specifically the blissfully ignorant and indignant Tea Party — says again that it is liberalism (or socialism, their rhetoric makes no distinction) that threatens our way of life.

History has not shown that American capitalism should fear liberal policy, which are the ideas that have moved capitalism forward. Rather it should fear, as Tocqueville did, the very real threat of those who view social advance as a harbinger of revolution and refuse to move at all.