Barrett on existentialism and pragmatism

I've been reading some mid-twentieth-century social criticism in preparation for a graduate course next semester and just finished William Barrett's classic account of existentialism, Irrational Man (1958). Throughout I was struck by the lucidity of Barrett's exposition, never more so than in his very brief treatment of William James. I assign James's Pragmatism to my graduate seminar but students often struggle not just with James's argument but with his general philosophical perspective. And, truth be told, try though I do to explain James as a pragmatist, his book on the subject often doesn't seem that pragmatic to me, at least as I understand the philosophical import of the term. James's book seems too weirdly individual and confessional, strangely abstracted from the public concerns that motivated the later Dewey (who, I'll confess, seems to provide my basic understanding of pragmatism). I'm often especially stymied by James's seeming rejection of God in the first part of the book but then his apparent retraction of that atheistic impulse at the end, in effect, bringing him back in because we need him.

Barrett provides a way of understanding James. He explains:

"Of all the non-European philosophers, William James probably best deserves to be labeled an Existentialist. Indeed, at this late date, we may very well wonder whether it would not be more accurate to call James an Existentialist than a Pragmatist. What remains of American Pragmatism today [note: he was writing this in 1958, long before Richard Rorty came to prominence] is forced to think of him as the black sheep of the movement. Pragmatists nowadays acknowledge James's genius but are embarrassed by his extremes: by the unashamedly personal tone of his philosophizing, his willingness to give psychology the final voice over logic where the two seem to conflict, and his belief in the revelatory value of religious experience. There are pages in James that could have been written by Kierkegaard, and the Epilogue to Varieties of Religious Experience puts the case for the primacy of personal experience over abstraction as strongly as any of the Existentialists has ever done. James's vituperation of rationalism is so passionate that latter-day Pragmatists see their own residual rationalism of scientific method put into question. And it is not merely a matter of tone, but of principle: he plumped for a world which contained contingency, discontinuity, and in which the centers of experience were irreducibly plural and personal, as against a 'block' universe that could be enclosed in a single rational system."

I've not read the large literature devoted to James, but this is a new thought for me. Is it one that others have developed? And maybe more importantly, does the argument have merit?