Santayana describes America as a country in paradox. He compares the duality of Man/Woman with the Skyscraper/Traditional Colonial Mansion. Here, he uses the term "spheres," indicating an old, traditional concept related to notions of male/female wherein the male worked in the world of industry and commerce while the female stayed in the home. In addition to addressing those gender stereotypes (here, he seems to agree with them), he is commenting on America's dual consciousness of being traditional but also progressive. He also uses the phrases "a wise child, an old head on young shoulders" to describe the American consciousness.
Santayana then traces a philosophical progression moving from the strict theology of Calvinism (the depravity of humanity) to Transcendentalism (the subjective idealism related to Romanticism). Although Transcendentalism was traditional (genteel) in being idealist, the subjective part of it tapped into the revolutionary/free will spirit of America. Emerson is the father of Transcendentalism. Santayana notes that subsequent transcendental thinkers moved from the totally subjective version of Emerson (no system) to favoring a systemic of thinking:
They do not covet truth, but victory and the dispelling of their own doubts. What they defend is some system, that is, some view about the totality of things, of which men are actually ignorant.
Walt Whitman is the first to break from the genteel tradition in America; although Santayana notes that Whitman's breakthrough is nonintellectual, more about poetics and celebrating life in general. Santayana moves on to the man who really broke from this genteel tradition by acknowledging it: William James.
James broke from this tradition of theology and then idealism to a new pragmatism. This was a Hegelian progression: a movement from one thing to its opposite. (This is called sublation - aufheben in German - and it means to preserve but also to take over for; in other words, James' more practical thinking preserved certain elements of the idealism of Emerson and other precursors but also replaced those elements with more practical thinking.)
Santayana thinks that the youthful spirit of America - the drive for industry, invention, and popular culture (we might say low culture) is/was driving away from the genteel (intellectual) tradition of its roots. Again, Santayana presents a dualistic America (fitting, if we compare it with America's current political polarization); in Santayana's argument, America is traditional and progressive - and although the move from traditional to progressive is modern and in touch with daily living, it also escapes from the very idea of intellectual contemplation. Santayana suggests that the thought of William James could combine the tradition of intellectual thinking with the youthful spirit of progress.