There is one main reason the U.S. doesn't have the social democratic traditions and programs enjoyed by most Western democracies -- we are the only such nation without some kind of universal healthcare -- and that reason is our history of ethnic, racial and class strife. (The bounty of the eternal frontier and American exceptionalism fit in there too, but I'd pick our fractious and well-manipulated heterogeneity as the top reason.)
The history of the 19th century and early 20th century is the history of labor and political coalitions splintered by divisions between Northern Europeans and Southern Europeans, between middle-class Germans and less well off German Jews, between the Irish and everyone else, and, increasingly after blacks won something akin to freedom, between all white ethnic groups and African-Americans. Latinos and Asians came with their own demands and baggage and relations got more complicated still. Barriers of language, culture, class and skin color thwarted many efforts to grow labor unions and build a social-democratic majority.
This is The Great Divide in American politics today. Not that some people think we should have “social democratic traditions and programs” like universal health care and some think we shouldn’t. No, The Great Divide is that some people think the fact that we do not have such traditions and program is, ipso facto, a failure. Walsh clearly believes that if we were a normal nation, a healthy nation, a decent nation, we would have been able “to grow labor unions and build a social-democratic majority.” To her, the fact that our history prevented us from doing so is a tragedy.
On the other side are people who think our lack of social democracy is a largely desirable result of our unique history and a vital source of our strength. I come down primarily on this side. I have never understood either Americans or foreigners who admire, respect, envy, desire, or seek to make use of America’s wealth, America’s power, and America’s products while simultaneously decrying the shape of our social structures; our lack of full government involvement in all good things from art to daycare; and our messy, contentious, and often unkind intersection of government, politics, morality, religion, economic interests, ethnic groups, racial groups, economic groups, high-minded ideals, personal ambition, straightforward greed, and astonishing generosity. It seems never to have occurred to them that it is the very characteristics they disdain that have created the money, might, and merchandise they seek to emulate, own, profit from, or employ for their own purposes.