As your financial advisor, I’m wired to view the world through a distinct (and some might say – boring) financial lens. This often leads me down paths that uncover unique economic insights in places where others might not think to look.
With Thanksgiving around the corner, it’s the perfect time to revisit a familiar story of faith, resolve and thankfulness – but from a different perspective. Today, I’d like to tell you a story about the original economic experiment of William Bradford and the Plymouth Colony and the system that replaced it.
The traditional version of the first Thanksgiving that may come to mind is the picture of abundance – a cornucopia filled with colorful Fall foods (think yams, squash, corn and turkey) around a table of grateful Pilgrims and Native Americans. But hidden behind this image is a backdrop of early American economics and an experiment into an economic system that has been tried all around the world for generations – only to end in failure.
Before the economy that we know today made America the greatest, most productive, and generous country in the world, the Plymouth colony, under the leadership of William Bradford formed the new colony as a socialist experiment where everything that was produced by the settlers was pooled and distributed equally among each other (the word “socialism” would not enter the vernacular for many years after, but the principles were similar then as they are today).
Bradford soon realized that his idealistic experiment led to practical challenges. In his manuscript “Of Plymouth Plantation”, Bradford wrote,
“For this community (so far as it was) was found to breed much confusion and discontent and retard much employment that would have been to their benefit and comfort.”
– William Bradford
Bradford saw that the strongest and hardest workers were unhappy because they felt they were doing more than their fair share, supporting others who weren’t working as hard. The young folks, especially the women who were tasked to serve the older men, thought this system was “like a type of slavery”. All this frustration and inefficiency became so bad that it forced Bradford to rethink the way that they were doing things.
In 1623, Bradford implemented a significant policy shift. He gave up on the socialist model and gave individual plots of land to each family and allowed them to decide which crops were to be grown. The new system would also allow each family to keep their own profits.
This move from socialism to a system that more closely resembles our current market economy didn’t make the Colony less productive, generous, or caring. In fact, this radical idea led to dramatic improvements in productivity and morale.
It encouraged the colonists to work harder because they knew that the fruits of their labor would benefit their own families. The abundance could then be shared in generous proportion with others as an extension of their faith in God. It also encouraged the settlers to think entrepreneurially, leading to the beginnings of trade and barter within the colony, among the native Americans, and across the ocean.
This market economy was an equalizer of sorts because success was no longer arbitrarily distributed but was instead tied to the efforts and abilities of each person or family. Everyone had an equal opportunity to improve their circumstances based on their own hard work and ingenuity.
As a financial advisor, I see Bradford’s decision as a pivotal moment in economic history, both in America and around the world. It underscores the power of personal incentive when ownership is part of the equation. When people see the direct fruits of their labor, they are naturally motivated to work harder and smarter, leading to prosperity and growth, as it did in the Plymouth Colony.
Bradford’s experiment is a classic illustration of economic principles that resonate in my profession: the importance of individual incentive, the impact of well-defined property rights, and the concept that our labor is the asset of the individual. As we navigate today’s complex financial landscape, these principles remain as relevant as ever.
This Thanksgiving, as we reflect on the journey of faith of the Pilgrims, let’s also appreciate the economic wisdom embedded in their story. The Plymouth Colony’s transition from socialism to capitalism offers insights into human behavior and an economic system that continues to inform and guide financial strategies for the United States.
I wish God’s blessing on you, your family and our amazing country!