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Also known as milwaukee socialism, the term sewer socialism derives from the policies and practices of Socialists who ran the City of Milwaukee, Wisconsin, in the late 1800s and early 1900s. The term is now broadly used for political leadership that focuses on programs of reform and development that accomplish positive changes in infrastructure, educational systems, or other aspects of urban life.

The Socialists who won election to Milwaukee's city government rejected the ideas of Progressivism as appropriate for reforming the activities of industry and its socio-economic consequences. The Social Democrats, led by Victor Berger, an Austrian immigrant, sought to reform the political culture and the environment of Milwaukee that had developed in the era of laissez-faire capitalism. Berger was editor and publisher of Wisconsin newspapers such as the Social Democrat and the Milwaukee Leader. He used these German language newspapers to spread his ideas of socialist reform, distributing free copies of papers to all Milwaukee homes before elections.

The ideas that Berger advocated appealed to the large German immigrant population in Milwaukee and catapulted him into leadership of the Socialists, although the group was more focused on honest government and reform than on ideology.

In 1910, Berger was elected to the Milwaukee city council and then later that year to the U.S. Congress as its first Socialist. That same year Socialists were elected to most of the seats on the Milwaukee city council and to its country board. Emil Seidel was elected mayor of Milwaukee, making him the first Socialist mayor of an American city. He and other Socialists sought to stop the corrupt political machines, led by urban bosses, that were in control. The boss-led machines viewed the public purse as a way to enrich themselves and their supporters at public expense.

In the election of 1912, both Berger and Seidel were defeated by Progressives; in the election of 1916 Daniel Hoan was elected mayor of Milwaukee as a Socialist. He continued to be re-elected until 1940. In 1918 Victor Berger was again elected to the House of Representatives, but he was denied permission to take his seat because his statements at a Socialist convention in St. Louis had expressed opposition to World War I. This was viewed by the majority of the representatives as a violation of the Espionage Act.

While the Progressives and Socialists often sought the same things, their methods were different. The Progressives preferred regulation of capitalist business and industry; the Socialists sought a planned economy of state-owned industries. With state ownership Socialists believed that abuses of workers that occurred in private industry would be eliminated.

While engaging in political campaigns that viewed class warfare as a reality, the Socialists were opposed to revolutionary violence. They instead sought an incremental set of political victories at the ballot box that would inevitably lead to gaining complete control of the means of production. Then they would change society according to their political vision. By patient application of political action, they foresaw gaining the ultimate victory of control of society. However, in the meantime, they would improve the living conditions of the working class with more efficient administration of government.

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