XLIV. EASTERN EUROPE
=543. Great size and small commerce of the Russian Empire.=—The attention and imagination of men have long been impressed by the size of the Russian empire, which included an area greater than that presented by the moon at the full. Combining the characteristics both of Europe and of Asia, Russia was almost a world in herself, and, indeed, was called by one of her rulers “a sixth part of the world,” worthy to rank as a continent. Yet this great state took a place in modern commerce below petty countries like the Netherlands and Belgium. A country of such vast size might, of course, secure by internal trade many of the advantages which smaller countries must seek in international exchange. The United States presents an example of a territory so large and so richly endowed that it can afford, in considerable degree, to renounce commerce with the rest of the world, and can still maintain from its own resources a high industrial civilization. Russia has not enjoyed a similar success. It had a comparatively sluggish internal trade; and it lacked industrial civilization. We must seek in the history of commerce an explanation of these facts.
=544. Historical reasons for backward development.=—The few paragraphs devoted to Russia in a previous chapter suggested the main reason for the country’s backwardness. During many centuries, while the peoples of the West were advancing in civilization, the people of Russia were facing away from Europe, occupied in defending themselves against Asiatic princes. Russia shared in none of the great movements of early European history: feudalism, chivalry, crusades, rise of towns, Reformation, Renaissance. It was devoted entirely to the struggle for self-preservation. When it became part of the European world, therefore, about 1700, it brought with it into modern times many characteristics of an unformed, half-developed organization; and since that date it has been trying, and it is now still trying, to catch up with the rest of Europe.
=545. Russian commerce about 1800.=—The movement toward progress, initiated by Peter the Great about 1700, continued, with various fluctuations, during the century. In so far as it found expression in commerce we can regard the last fifty years before 1800 as a time of rapid advance; commerce grew to nine fold the volume which it showed in 1750. So slight, however, had been the beginnings of Russian trade, that it amounted in 1802 only to about fifty million dollars.
Russia was still practically in the position which it had occupied in the time of the Hansa, dependent on the West for all its finer manufactures, and supplying raw materials in exchange. Hemp and flax, crops which rapidly exhaust the soil, and for the cultivation of which the great tracts of fresh land in Russia offered an advantage, were the chief exports. Among others on the list were wood, grain, tallow, hides, furs, feathers, etc. The Russian nobles exported a certain amount of linen, which they forced their serfs to make for them that they might have the means of purchasing foreign luxuries, and manufactured also iron for sale abroad. The appearance among the exports of this metal, which we are used to associate with advanced industrial countries, is explained by the fact that charcoal was still an important source of fuel for the iron manufacture, and of this the boundless Russian forests offered an abundant supply.
=546. Means of transportation.=—Almost nothing had been done as yet to unite by means of transportation the vast stretches of territory in Russia. Roads were practically non-existent, and goods were transported by land only in winter, when they could be sledged over the rough ground on the snow. The waterways, with which the country is so abundantly provided, had been connected by a few important canals, and were the chief means of transportation. Goods were brought to them on sledges in winter, to await the high water of the spring freshets. They were laden on flat-boats, holding sometimes several hundred tons, but built to draw only two or three feet of water, and were floated down with the current when the ice melted. The boats were rudely constructed, and were broken up for timber or fire-wood at the end of the trip. The inconvenience and uncertainty of such a system of transportation are obvious, but it was, nevertheless, remarkably cheap; rates on some water routes were only one or two cents per ton-mile.
=547. Chief ports.=—The conditions of transportation confined almost all the foreign trade of Russia to the sea, and the commerce across the western frontier was insignificant. Archangel, situated on the river Dwina, a few miles from the coast of the White Sea, and the leading port of Russia before the time of Peter the Great, still retained a respectable share of commerce, and was visited every year by ships from England and the Netherlands. In relative importance, however, it had declined greatly after the foundation of St. Petersburg, which soon became the most important outlet for the country’s trade. A rival was at this time, however, growing up in the South, where Russia had only recently secured the territory on the shore of the Black Sea. Odessa, which was founded in 1793, rose rapidly in commercial importance, especially during the Napoleonic wars, when the Baltic trade suffered a severe check.
=548. Development up to the Crimean War (1854-1856).=—During the first half of the nineteenth century Russian commerce grew steadily but slowly; the rate of increase was much behind that of the preceding fifty years. A partial explanation of this check to progress can be found in the adoption, in 1822, of a prohibitive tariff; the importation of many foreign manufactures (clocks, textiles, porcelain, glassware, etc.), was absolutely forbidden. Shortly after the middle of the century, however, came a turning-point. The Crimean War, in which England and other states were engaged with Russia, is generally admitted to have yielded to neither of the chief combatants advantages proportional to the costs which it involved. It was in one way, however, of immense benefit to Russia. It awakened the country to a realization of its backwardness. It raised a demand for reform of antiquated conditions in economic and political life, which the Czar himself was the first to heed.
=549. Reforms; growth of the railroad system.=—The reform movement bore fruit in many lines to which we can pay but scant attention. It led to the emancipation of the serfs in 1861, by which a considerable part of the Russian people were liberated from a condition resembling medieval bondage, and became free land-holders. It secured at least a partial improvement in the system of government. It was, finally, to name the result of the greatest influence on commerce, the occasion for the introduction of the modern railroad system in Russia. The government had found itself so hampered in carrying on the war by the lack of transportation facilities, that it now bent every energy to remedying the defects. The railroads of Russia measured at the outbreak of the war only about 600 miles. In the ten years following the railroad system grew to over 2,000 miles, and in the next decade to about 10,000. Though the first lines were built mainly to serve military purposes, those constructed later were designed to develop the economic resources of the country; and it is hard to overestimate the importance of this development of the means of modern transportation, to a country which stood in such sore need of it as Russia.
=550. Development of commerce.=—The results of the reforms can be followed in the growth of Russian commerce after the middle of the century. In the decade 1860-1870 the foreign commerce of the country increased to more than double what it had been, and was growing at this time faster than the commerce of any other country in Europe, except that of a neighboring state, Austria-Hungary. Some significant changes, moreover, appeared in the direction and character of Russian trade. The great gains of the period were made by southern Russia, where the wheat fields of the rich “black-earth” district were brought within reach of a market. It was about this time that wheat won the first place among the exports away from flax and its products. Commerce by way of the Black Sea increased very rapidly, while the Baltic did not keep its proportional share in the commerce of the country, and the proportion of trade finding its outlet by the Arctic Ocean had sunk to insignificance. Commerce with the west of Europe across the land frontier, which formerly had been restricted by the difficulty of transportation, grew even faster than the Black Sea commerce, and gave an entirely new importance to trade relations with neighboring states. England had enjoyed the largest share of Russia’s commerce during the first part of the century, but could not hold her own henceforth in competition with Germany. This last-named country, then in course of rapid industrial development, was enabled by the railroads to win her way rapidly in Russian commerce, and soon was the largest sharer in it.
=551. Character of industries and commerce.=—Russia, like many other of the European states, enjoyed the greatest freedom of trade in the period following closely after the middle of the century. The customs duties levied in Russia at this time would have been considered high in western Europe, but they were much lower than the rates ruling in the first half of the century, and much lower than the rates in force at the century’s close.
Russia at this time was still almost exclusively agricultural. The serfs had learned to supply their simple needs for clothing and implements by domestic industries, but nothing like the western factory organization, with its extensive use of power machinery, had as yet appeared. Attempts to stimulate such an organization, by privileges and protection, had resulted in failure. The Russians are not a people with a gift for mechanism. It has been said of them that their only invention is the samovar, their apparatus for making tea. The world exposition of 1867 displayed samples of Russian industry, but most of these were the products of village craftsmen, and the few samples of modern manufacture came from factories owned for the most part by Germans. The exports of the country were still almost entirely raw products, and the manufactured wares which the country contributed to the commerce of the world were of the most simple description: yarn of flax and hemp, cordage, string, and sacking.
=552. Recent history of the tariff.=—In spite of these conditions the government pursued since about 1870 a policy of protection, which grew constantly more strict with the passage of time, and which furnished at the end of the century the most extreme example of protection to be found among civilized states. Comparing the tariff of 1868, which was comparatively liberal, with the tariff of 1891, we find that duties on some important manufactures rose in the following measure: on cotton goods and glassware, to double; on rails and locomotives to quadruple or more. Even more striking and more serious was the increase on partly manufactured wares. Duties rose on leather and yarns to twofold or more; on petroleum and wrought iron to threefold; on sulphuric acid to four or seven fold; on cast iron to tenfold. This is the period in which Germany was seeking commercial advantage by bargaining in tariff rates with other countries, and in which occurred the tariff war with Germany that has been noted above. At this time and again later Germany was able to bring her eastern neighbor to terms by financial pressure; Russia was a great borrower and needed the support of the Berlin money market. Russia raised still more, however, the rates of the tariff in a revision in 1903, and even after these had been reduced by treaty bargains they left the general level higher than before.
=553. Development and cost of manufactures.=—The protectionist policy in Russia gained its object, an increase in the manufacturing industry of the country. The product of home manufactures rose greatly in value, and the importation of foreign manufactures declined in proportion. This object, however, was attained at a great cost. Russia was even less suited to the modern system of manufactures than Italy or other states which we have considered. It lacked capital, technical knowledge, leaders, laborers of steadiness and intelligence—practically everything except raw materials, which were present in abundance. Manufactures, therefore, were conducted at an expense far above that common in other countries, and could be maintained only by forcing the people to pay far higher prices for their wares. A person could not get so much as a sewing needle without contributing an extra sum to the support of the home manufactures. The policy was the more questionable, as the profits of these manufactures went in large part to foreign stock holders, who utilized an opportunity for which the native Russians were still unprepared. Even from the political standpoint the policy of protection in Russia was attended with danger; many events indicated that the factory laborers would be the first to turn against the autocracy which had brought them into being.
=554. Effect of the tariff on agriculture.=—The most serious aspect, however, of the Russian tariff was its effect upon agriculture. The great plains of the country were peculiarly adapted to the use of modern cultivating and harvesting machinery, such as contributed so much to the progress of agriculture in America. The tariff made such machinery so costly, whether it were imported or manufactured in Russia, that it was introduced to only a slight extent. A Russian estimated that the farmers of the United States found it profitable to spend nearly twenty times as much for agricultural implements and machinery as the Russians. The peasants could not afford even plows, harrows, or scythes of a modern type, and still used antiquated makeshifts. The mass of the people, at best, were ignorant and bound by custom, showing still the bad effects of the servile condition from which they had so recently emerged; and needed every encouragement to be induced to advance to better methods of cultivation. Even artificial fertilizers, however (superphosphates, etc.), were burdened with a duty, because there seemed a chance to manufacture them in the country; the result, naturally, was an increase in price, and a restriction in the use of this important aid to production.
=555. Effect on railroads.=—We must note further the effect of the tariff on the railroad system. Russia has never gone through the period of transportation by highroads. It passed from conditions described above as existing during the first part of the century, to the use of the railroad, without the transition such as was marked by the use of turnpikes in England. Even in 1914 the highroads of the country were of the crudest character, and internal trade depended mainly upon the waterways and railroads, contributing nearly the same tonnage to each. The railroads, therefore, had peculiarly important functions to perform in Russia. They served agriculture, moreover, to an unusual degree; the cereals supplied in 1897 more tonnage than any other ware carried on Russian railroads. Yet if we measure the development of railroads by comparing their length with the area or population of the country, we find that even at the close of the century the Russians had made but a beginning, and took the lowest rank among all important peoples. Taking merely Russia in Europe, and contrasting it with the United States, a country which also has a vast area and great vacant spaces, the Russian railway system in 1913 had not reached one ninth the development of the American in comparison with population, not one tenth in comparison with area. An important reason for this backwardness was the increased expense of the construction, equipment, and operation of railroads due to the high tariff on railroad supplies. Iron may be said, roughly, to cost double or more of what it cost in other countries. The government has not always been blind to these facts, and has made concessions from time to time, but the general tendency of its policy has been made only more glaring by these occasional exceptions.
=556. Commercial reasons for Russia’s eastern movement.=—Preceding sections have sketched some of the historical influences which prevented Russia from taking a part in world commerce commensurate with the space she covered on the map. This great state, which in the sixties took only sixth place in commerce among European countries, rose above Belgium and the Netherlands in the early part of the seventies, and secured fourth place, only to be passed again by these little states and for a time even by Austria-Hungary. In 1912 Russia still ranked sixth among European countries, eighth among all countries of the world, in the value of foreign trade.
This decline in commercial importance was due largely to the conscious and voluntary action of the government, which restricted commerce between its people and the people of the West. No government, however, regards all commerce as injurious, and the Russian government endeavored to atone for losses in the West by expansion in the East. In that direction Russia met people who were her industrial inferiors. By trade with them she hoped to secure imports which would not compete with her own products, and sought to win a market for her newly founded factories. The manufactured products which were too high in price to compete in European markets could be sold in the East so long as the cheaper wares of western Europe did not reach the field. As commerce extended, however, in the last decades of the century, Russia saw that her eastern markets were threatened unless she could apply to them the same policy of protection which she had established in the West; and the government was forced into the policy of military and political expansion, designed to close the doors of eastern markets to other powers, which received its check in the the war with Japan.
=557. Course of the Asiatic trade.=—In no period of the nineteenth century has Russian commerce across her Asiatic frontier formed any important fraction of her total foreign trade. At the beginning and end of the century it was about one tenth of the total; in the intervening time it was rather less. The difficulty of transportation over the great stretches of almost trackless territory confined the trade with the Far East to objects comprising great value in small bulk (tea, cloth, etc.), and directed Russian commerce rather to the Asiatic countries on her southeastern frontier (Persia, etc.). In the second half of the century, for reasons noted above, the government showed an increased interest in this branch of trade, and lent liberal aid in furthering Russian interests in the East. The most striking evidence of the determination of the Russian government to extend its influence toward the Pacific Ocean was the construction of the Siberian Railway (1891). This was rather a political than an economic undertaking; it was enormously expensive, and failed to develop sufficient traffic to pay its way as a commercial enterprise. Its failure also in the field of international politics was signalized by the victory of Japan in the war with Russia in 1905, which checked definitely Russia’s ambitions to play a dominant part in the Far East and put in her place an Asiatic power.
=558. States of the Balkan Peninsula.=—If the reader will examine a map of Europe about 1800 he will find that at that date the state of Turkey occupied the whole of the Balkan Peninsula, and included considerable territories even to the north of the Danube. The nineteenth century has witnessed the liberation of most of this land from Turkish rule; and some half dozen independent states have emerged and taken their place in the European system. These states, however, have neither in their political nor in their economic organization reached maturity. Like the Russians, the peoples of southeastern Europe belonged for centuries to Asia rather than to Europe, and the period of Turkish misrule, lasting down into very recent times, has effectually checked their development. Their states were still in the making, constantly disturbed by racial, religious, and dynastic quarrels. Their economic organization was still, in large part, medieval. Roads were scarce, and good roads were almost unknown. The implements and methods of agriculture were of the most primitive description. Some cultivators still used for a plow a crooked piece of wood with a single handle, and threshed their grain on the open ground by driving horses over it. Manufactures were still in the stage of the handicrafts, and were, in some cases, exercised by gilds like those of the Middle Ages.
=559. Commerce of the Balkan States.=—Conditions have been rapidly changing, as railroads and steamers have reached the peoples of the Balkans, and have brought them in touch with the advanced civilization of the West. The commerce of the Balkans, however, has been as yet important rather by its promise than by its performance. The total commerce between the contiguous states Servia and Bulgaria amounted in 1882 to less than a million dollars. The aggregate commerce of the four Balkan countries, Roumania, Bulgaria, Servia and Greece, in 1910-11, amounted to considerably less than one per cent of the total trade of the world, and was exceeded by the commerce of Sweden or Spain or even of the little country Denmark. The foreign commerce of the kingdom of Greece depended almost entirely on one product, the so-called Zante currant, a seedless raisin which got the name of currant from Corinth, whence it was carried to the island of Zante. The pig took in Servia a position almost equal in importance to that of the currant in Greece; great herds of swine were kept in the oak forests, and contributed largely to the chief export, that of animal products. On the plains of Roumania wheat was grown for export by a wretched population of tenants and laborers, who were still serfs until 1864. The governments of some of the states have endeavored by protective tariffs and various privileges to stimulate the growth of a mining and manufacturing industry; but the countries of the Balkan Peninsula will find in agriculture their chief resource for a long time to come, and will develop their commerce most rapidly by exchanging their surplus of raw products for the manufactures of central and western Europe.
QUESTIONS AND TOPICS
1. Character of internal trade in Russia. [Wallace, chap. 12; Palmer, chaps. 10-12; Schierbrand, chap. 9.]
2. The period of Mongol rule and its effects. [Wallace, chap. 14; Rambaud, History of Russia, N. Y., Burt, $2, vol. 1, chap. 10; Thompson, chap. 2; Noble, chap. 3.]
3. Condition of people and production in the time of serfdom. [Wallace, chap. 28; Palmer, chap. 5.]
4. Traveling by roads and rivers in modern Russia [Wallace, chap. 1.]
5. The Crimean War. [Seignobos, chap. 27, first part.]
6. The period of reforms. [Wallace, chap. 27.]
7. Faults of the Russian administration. [Wallace, chap. 24, Schierbrand, chap. 11; Thompson.]
8. Emancipation of the serfs. [Wallace, chap. 29; Thompson, chap. 4; Noble, chap. 7.]
9. What were the chief exports and imports of Russia; with what countries was the most important commerce of Russia conducted? [Statesman’s Year-Book.]
10. Character and significance of the foreign trade of modern Russia. [Hourwich in Journal of Polit. Econ., 1892-3, 2: 284-290.]
11. Domestic manufactures. [Palmer, chap. 20.]
12. Recent fiscal policy and protection. [Wallace, chap. 36; Schierbrand, chap. 3.]
13. Manufactures in modern Russia. [Palmer, chap. 19; Schierbrand, chap. 4; Oseroff, The industrial development of Russia, Forum, 1899, 27: 129-144.]
14. Condition of the agricultural population after emancipation. [Wallace, chap. 31; Palmer, chap. 8; Schierbrand, chaps. 5, 6; Thompson, chap. 4; Noble, chap. 7.]
15. Political, social, and economic life of the rural population. [Palmer, chap. 4; Wallace, chaps. 6-9.]
16. Famines in modern Russia. [Articles by various authors in Fortnightly Review, 1891, 56: 636-652; Forum, 1892, 13: 575-582: Nineteenth Century, 1892, 31: 1-6; Century, 1893, 46: 560 ff., etc.]
17. Faults of the modern system of agriculture. [Hourwich in Yale Review, 1892-3, 1: 411-433; in greater detail, in Columbia Studies, vol. 2, N. Y., 1892.]
18. Russian trade in China. [Calderon in Contemporary Review, 1900, 78: 389-396.]
19. Russia’s hold on Persia. [Forum, 1900, 29: 147-153.]
20. Russian railway policy in Asia. [Long in Fortnightly Review, 1899, 72: 914-925, with map.]
21. Territorial expansion in the East. [Wallace, chap. 38; Noble, chap. 10; Schierbrand, chap. 1.]
22. The Siberian railroad. [See A. L. A. Catalogue, or use one of the following periodical articles: Norman in Scribner’s, 1900, 28: 515-541; Davidson in Century, 1904, 67: 940 ff.; Kinloch in Monthly Review, 1901, 2: 60-71, with map, and with special reference to trade possibilities; Mikhailoff, in North Amer. Rev., 1900, 170: 593-608; Colquhoun in Monthly Review, 1900, 1: Nov., 40-55, with two maps.]
23. Choose one of the more important states (Turkey, Roumania, Bulgaria, Servia, Greece) and
(a) Trace its political history during the century. [Seignobos, chaps. 20, 21.]
(b) Study its recent commerce. [Statesman’s Year-Book.]
BIBLIOGRAPHY
Though no history of Russian commerce has appeared in English, there are many good books on the history and conditions of the Russian Empire; and a considerable number have been published within a few years. For bibliography see the A. L. A. Catalogue and recent issues of the American Historical Review; a more complete bibliography, with chronological classification, will be found in Skrine, pp. 347-358. Compare, also, A. L. Morse, Reading list on Russia, Univ. of State of N. Y., State Library Bulletin, Jan., 1899, Bibliography, nos. 15-17. References to articles on Russian commerce in the first half of the century, in English and American periodicals, will be found in Homans, Cyclopedia, p. 1659.
Mavor, *Economic History of Russia, London, 1914, 2 vol., is a monumental work, particularly valuable for its study of institutional development. The history of Russia in the nineteenth century is treated by Seignobos, adequately for most purposes; more fully by Skrine, Expansion of Russia, London, 1900 (N. Y., Macmillan), in the Cambridge Historical Series.
The most useful books for our purposes are the descriptive works, most of which contain considerable historical material. First of these should be mentioned D. M. Wallace, **Russia, N. Y., Holt, 1877, 1905; references in the topics are to the revised edition, 1905. Anatole Leroy-Beaulieu, ** The empire of the tsars, N. Y., Putnam, 1893, has the rank of a classic, but a large part of its three volumes treats topics removed from our direct interest. Among the smaller books the most useful are the following: Francis H. E. Palmer, *Russian life, N. Y., Putnam, 1901, W. von Schierbrand, *Russia, N. Y., Putnam, 1904, Edmund Noble, Russia, Boston, Houghton, 1900, H. M. Thompson, Russian politics, N. Y., Holt, 1896.
A work deserving special mention is **Industries of Russia, published for the World’s Columbian Exposition at Chicago, and edited in the English translation by John M. Crawford, St. Petersburg, 1893, 5 vols. with maps and charts. Volumes 1 and 2, paged continuously, cover Manufactures (with historical surveys) and Trade (brief on foreign commerce); volume 3 covers Agriculture and Forestry; 4, Mining; 5, Siberia and the Trans-Siberian Railroad. I cannot cover here the mass of literature on Russia’s eastern policy, and refer for that to the bibliographical aids mentioned above. The U. S. Monthly Summary, Commerce and Finance, April, 1899, contained a compilation of various material on the Russian Empire and the Trans-Siberian railroad, with a map; another monograph, on European Russia, appeared in this series in 1904.
On Finland, a distinct part of Russia for the treatment of which the text offers no space, see N. C. Frederiksen, **Finland, London, 1902, with bibliography; this is an excellent book, especially full on economic matters.
The Balkan States have attracted more attention from writers than accords with their recent commercial importance; for a general survey see Laveleye, *The Balkan Peninsula, N. Y., Putnam, 1887. On the conditions of commerce in the peninsula just before the World War see Day, The pre-war commerce and the commercial approaches of the Balkan Peninsula, Geographical Rev., N. Y., May, 1920, 9: 277-298.
TOPICS FOR REVIEW
Among topics suitable for general review of the recent period, (1800-1900), the following may be suggested: (a) shipping; (b) transportation by canals; (c) transportation by railroads; (d) production and exchange of raw textiles; (e) finished textiles; (f) coal; (g) iron and steel; (h) introduction of steam and power machinery in manufactures; (i) commercial policy.
Chapter XLV
THE ORGANIZATION OF PRODUCTION, 1789
=560. Comparison of conditions in 1789 and in 1914.=—The United States was in 1914 recognized as one of the greatest countries of the world in area, in population, in wealth, in efficiency of the organization of production and business, and in the volume of internal trade and foreign commerce. Little more than a century before, when it began its career as an independent state, it was an aspirant struggling merely for a respectable position among the minor powers. Its population, which in 1914 was nearly one hundred million, was in 1790 less than four million, placing it in this respect far below the great states of Europe, and not far above such little states as the Netherlands, Portugal, or Sweden. The whole settled area, comprising a strip along the Atlantic coast, and the mere beginnings of settlement beyond the Appalachian Mountains, was less than the area of the present state of Texas. The people were poor, and backward in industrial development. The amount of internal trade was small, even in proportion to the scanty population. The people were forced into foreign commerce by the necessities of their condition. They were as yet unable to supply the needs of civilization by wares of their own production. They had as yet developed no resources which assured their economic position in commerce with European powers, and in their political and military position they were so weak that they must beg as favors rather than demand as rights the opening of markets which were essential to their commercial growth.
The sharp contrast between 1789 and 1914 indicates clearly the importance of the subject which will be treated in the following chapters of the book, the history of the commerce of the United States. The student is asked to give his attention first to a detailed study of conditions existing about the year 1789. A survey of conditions at that date will furnish a summary of the development of the colonial period, and a basis for appreciating the national progress of more recent times.
=561. Chief exports in 1790.=—Following the plan pursued in earlier chapters we shall attend first to the exports of the country, composed of those wares which could be produced to such advantage that the people could sell a surplus of them abroad, and so secure the imports of which they stood in need. The following table gives the chief items for the first year of our national existence:
EXPORTS, 1790, IN MILLIONS OF DOLLARS
Northern products.—Flour 4.5 Wheat 1.3 Lumber 1.2 Corn 1.0 Fish .9 Potash .8 Southern products.—Tobacco 4.3 Rice 1.7 Indigo .5 ---- Total (including decimals omitted) 16.6 Total exports, including items omitted 20.2
One characteristic of this table is noteworthy because it has marked the exports of the country from this early time to the present. The exports of the United States have always consisted not of a great many articles sold in small quantities, but of a few great staples sold in large quantities. Nine items, it will be observed, comprised over three fourths of the total value, and the two items, breadstuffs and tobacco, made up over half.
=562. Predominance of agriculture; experiments with crops.=—The table shows clearly that the strength of the United States at this time lay in what the economists call extractive industries, devoted to the production of raw materials. Some of the wares, it is true, had undergone the first stages of manufacture (flour, lumber, potash, indigo), but their chief value consisted still in the original material. In contrast with present conditions it was estimated at this time that nine tenths of the people were engaged in agricultural pursuits, and that even in New England, where industrial pursuits were most diversified, only one eighth were employed in manufactures, trade, or other occupations besides agriculture. Of twenty-one presidents of the United States (to 1880) fifteen were farmers or the sons of farmers.
The agricultural products of the table above represent the results of nearly two centuries of experiment in the search for profitable crops. It is not easy to determine what cultures will pay under the conditions of a new country. Early settlers had extravagant hopes of supplying the European market with silk, wine, olive oil, drugs, dyes, etc., and learned only by bitter experience that the conditions of nature and man destined America to a commercial career different from that of southern Europe or Asia. Most of the important crops and grasses were introduced to this country from other continents, Indian corn being, of course, the notable exception; and so thoroughly had the process of experiment been carried out that in the hundred years following the Revolution only one species of cultivated plant (sorghum) was introduced, of sufficient importance to be enumerated in the census.
=563. Breadstuffs.=—The crop of greatest importance to the people of the American colonies was, without question, maize or Indian corn. This crop, of native origin, flourished in all parts of the colonies, and yielded, under the conditions of a primitive agriculture, far richer returns than could be secured from any of the European grains. To the domestic food supply it was indispensable. For export purposes, however, it was less desirable, and though moderate quantities were shipped abroad every year, the demand of foreign markets, as appears in the table, was chiefly for wheat and wheat flour. Wheat was at this time a costly luxury in New England, but it could be grown to advantage in the middle colonies and in Virginia; and in the particular period which we are studying it assumed a leading position among the exports. European countries had formerly been unwilling to receive a product which competed with their own agriculture, but the failure of crops in Europe, the outbreak of the French Revolution (1789), and the long wars following, caused a great increase in the demand for our food products, and gave rich returns to the wheat farmers who had been suffering from the lack of a market.
=564. Other products of northern agriculture.=—Aside from the cereals the agricultural exports of the middle and northern colonies were unimportant. Many attempts had been made to grow flax and hemp, to sell in competition with the produce of Russia and other Baltic countries. The seed of the flax was exported, but the preparation of the fiber was too troublesome to pay the producer, and though coarse fabrics for home wear were made of it and it was used for sewing shoes until the invention of the wooden shoe peg, the export of flax and hemp fiber remained insignificant.
The second place among exports of northern agriculture, after breadstuffs, was taken by stock and meat products. The abundance of pasture land encouraged farmers to raise a surplus of live stock for sale, though as yet they paid but little attention to breeding or to the proper care and fattening of the animals. Horses were shipped to Canada and to the West Indies, while salt beef and salt pork had a ready sale for provisioning ships, and for export to the West Indies. The export of live animals and provisions amounted, however, to less than one million dollars.
=565. Southern staples; tobacco.=—Many of the export products above mentioned could be raised in the southern colonies, and all of them were, in fact, produced there to some extent. The people of the South, however, were fortunate in finding conditions suited to the production of some special crops, which, unlike those of the North, could not be produced to advantage in Europe, and which therefore were more readily taken in trade. The Southerners followed their interests, therefore, by raising of foodstuffs only what they absolutely needed, and by applying themselves to their special staples. Of these tobacco was by far the most important throughout the colonial period. It was asserted at one time that a man could provide grain for five men and clothes for two, by the sale of the tobacco which he could grow unassisted. Until the rise of the cotton culture tobacco was king among the southern staples, and had no rival export at the North of equal importance; through the eighteenth century it formed about half of the total exports of the colonies to England, and only just before the close of the century did it yield the leading place to wheat. Disadvantages of a one-crop system, entailing sharp fluctuations in price and periods of dearth, the rapid exhaustion of the soil under tobacco, and the encouragement of negro slavery,—all these evils could not turn the planters of Maryland and Virginia from a crop which, on the whole, yielded rich returns.
=566. Rice and indigo.=—In Carolina rice took the position held by tobacco in other southern colonies. Its cultivation became of practical importance only toward 1700, starting, it is said, from the gift of a small parcel of rough rice by the captain of a ship bound from Madagascar to Liverpool, who was forced to put into Charleston for repairs. The grain found a ready market in southern Europe and in the West Indies, and became soon an important article of export, though the modern method of water culture was not introduced until nearly 1800.
The only other item of southern produce deserving special mention in this place is indigo. This plant, the reader will remember, was the source of a blue dye which at the time was highly prized and which, indeed, has only recently been displaced by anilin colors. Attempts had been made in the early colonial period to raise indigo, but no success attended them until about 1750. After that date the culture flourished in South Carolina and Georgia; aided by a bounty from the British government the planters exported large quantities and secured handsome returns. The preparation of indigo was, however, an unwholesome occupation, as the plant, after being soaked in water, was left to rot, giving out an offensive odor and drawing innumerable flies. It was an indication of progress, therefore, that indigo culture declined rapidly after 1790; planters gladly took up the cotton culture, and the United States soon secured by importation from abroad the ware of which it had formerly produced a surplus.
=567. Methods of agriculture.=—Though agriculture as a source of wealth overshadowed all other industries in the colonies, it was conducted with methods which we should now consider extremely inefficient and wasteful. Washington wrote to an agricultural specialist in England: “An English farmer must have a very indifferent opinion of our American soil when he hears that an acre of it produces no more than from 8 to 10 bushels of wheat; but he must not forget that in all countries where land is cheap and labor is dear the people prefer cultivating much to cultivating well.”
The plow, the most important implement of agriculture, was still at the time of the Revolution substantially unchanged from the models of ancient times. The mould-board, of wood as the name implies, was sometimes plated with sheet iron or with strips made out of old horseshoes. President Jefferson improved the shape of the mould-board, and about the end of the century the cast-iron plow began to come into common use. The sickle gave place to the scythe and cradle, but threshing was still done with a flail or by driving horses over the grain. There was a marked increase in the interest in agricultural science and methods about the time when the national government began, agricultural societies were founded in many states, and progress thenceforth was more rapid.
=568. Forest products; potash.=—If the reader, after this review of the agricultural exports of the country at the beginning of its national existence, will refer again to the table above, he will find that export products of considerable importance were derived also from the fisheries and the forests.
The eastern slope of the country was so heavily wooded that trees were regarded rather as a hindrance than a help by the colonists. It was good philosophy, however, to make the best of them; and the British government, during the colonial period, encouraged the export of forest products, to avoid depending on the Baltic countries for the supply of wood and naval stores. The most spectacular export of this description was that of the great masts and spars, which formerly had been reserved for the government by the mark of the broad arrow, and which were hauled out of the woods in winter by fifty yoke or more of oxen. Most of the wood, however, left the country in smaller form: staves and heading, which were sent to the West Indies and there set up into casks and hogsheads for the carriage of sugar products; boards, shingles, etc.
When wood ashes are leached, and the water evaporated, the product is potash; if this be refined by heating it is termed pearlash. It is an impure carbonate of potassium, and at this early stage of chemical industry it had an immense importance in the arts, being used in bleaching, the manufacture of glass, soap, etc. Besides enjoying a ready sale potash had another peculiar advantage in this period; it was, besides the naval stores (pitch, tar, turpentine, rosin), the only wood product which could be readily transported on land. It was, therefore, a great resource when land was cleared; and practically every new settlement, in the northern colonies at least, had its potash works, in which useless wood was converted into a valuable export product.
=569. Fisheries.=—“The fisheries first and mainly placed New England on its legs.” The people of the northern shore were driven to the sea by the difficulties of life on land; and used the proceeds of the fishing industry as the means of purchasing their imports from abroad, and part even of their food supply from other colonies. They had advantages over European competitors in their nearness to the great fishing grounds and in their skill in building and navigating boats; and though the proportion of the total population engaged in fisheries was never large (about one thousandth at this time), the product was sufficiently important to take a respectable rank among the exports of the country. Every year more than five hundred boats left the towns of the Massachusetts coast, especially Gloucester and Marblehead, for the banks of Newfoundland, while Nantucket and New Bedford became the source of whaling voyages that reached from the Arctic to the Antarctic oceans.
In comparison with the fisheries the fur trade had become of little importance; the European demand for furs was met at this time by territory lying to the north of the limits of the United States.
=570. Chief imports, 1791.=—The method, or rather the lack of method, followed by the government in keeping its commercial statistics in early days, renders it impossible, unfortunately, to present here a table of imports in 1790 comparable in accuracy and in detail to the table of exports given above. We must content ourselves with the following estimates for the year 1791.
IMPORTS, 1791, IN MILLIONS OF DOLLARS
Articles paying duties ad valorem 17.0 Wines, spirits, malt liquors 2.6 Colonial wares.—Sugar 1.6 Molasses 1.4 Coffee .5 Tea .3 ---- Total, Colonial, including minor 4.0 Total, including minor items omitted 25.0
=571. Classes of wares imported; manufactures.=—The table shows, on its face, only one thing with clearness, that the people used already a considerable part of their surplus to purchase articles of food, of the nature rather of luxuries than of necessaries, which could not be produced to advantage at home. This feature has ever since characterized the import trade of the country. In the recent commerce of the United States we find, beside the class of colonial products, two other classes comprising the bulk of the remaining imports, manufactures and material for manufacturing. Were articles of these two classes masked behind that large item of the table which classifies the imports only with reference to tariff schedules? The answer can be given, without hesitation, in the affirmative. Raw materials for manufacturing were still, however, comparatively unimportant; most of the imports to this country, at the beginning of its national existence, were finished manufactures. The statement made by a writer in 1818 held true at this time: “Our imports consist chiefly of articles which habit and fashion have made necessary for our consumption: but a very small proportion of them is subservient to our arts and manufactures.”
To describe the character of these imported manufactures in detail would be an arduous task, for they included the products of practically all the handicrafts and factories of Europe. In contrast with the exports of the country, which have been restricted always to a few great staples, the imports, from earliest times to the present, have been extraordinarily diversified. The imports included, besides the items specified in the table above, a large part or the whole of the metals used in the country (tin, copper, lead, pewter, brass, and iron), and manufactures of metal. They comprised, further, a great quantity of the various textiles, of woolen, cotton, linen, and silk; and miscellaneous manufactures such as glass and earthen ware, paper, leather wares, etc.
=572. Significance of the import of manufactures.=—Accepting now as the most important characteristic of the imports of this period the preponderance of manufactured articles, we must seek to realize why this was so, and what it signified. Anticipating the substance of following sections it may be said, in summary, that the people of the United States supplied their need for manufactured articles by their own handiwork, so far as possible, but that they found it unprofitable to attempt to make wares the manufacture of which required high technical skill, the use of machinery, and an advanced organization of business. They depended on Europe, therefore, for all the finer manufactures. The total amount of manufactures imported annually was not large in proportion to the population, being less than $5 per head; yet this amount comprised most of the comforts and luxuries as well as many of the necessaries, which the people enjoyed. Even at the end of the colonial period the average American led a life of struggling and privation, and could think himself fortunate if he won by his toil on land or at sea a surplus sufficient to provide him with a few articles beyond the bounds of his absolute necessities.
=573. Household self-sufficiency.=—In contrast with the modern scale of living the simplicity of the standard of life at this period can scarcely be exaggerated. Most of the articles consumed in a family were produced at home. The house was begun with the help of neighbors, and was finished, perhaps long afterwards, by the inmates themselves. Domestic utensils, household furniture, and farm implements were still made, to a large extent, on the farm where they were used. The every-day clothing of the people, made from linen or wool or from a combination of the two (“linsy-woolsey”), was spun and woven, cut out and made into clothes, with comparatively little professional help. Carpets were made from woolen yarn spun in the family, sent away only to be dyed, and then woven either at home or in the neighborhood. The self-sufficiency of the family group was not so complete in 1800 as it had been in 1700, but it continued still to be the dominant feature in economic life, and in some districts lasted for decades to come.
=574. Town self-sufficiency.=—Articles which were not made in the household were, as a rule, made in the town, and did not contribute to the volume of distant trade or of foreign commerce. The important unit in the economic organization of the United States at this period was the rural group of perhaps a few hundred inhabitants. Most of the people were farmers, as has been said above, and very few were entirely independent of farming. Some, however, had the skill and implements which enabled them to supply the needs which could hardly be met by household production. Nearly every village had a gristmill, and, if conditions favored, a sawmill. The village blacksmith was to be found in almost every settlement, and performed an astonishing variety of work for the people. Toward 1800, moreover, a tannery had become a common though not a universal feature of village life, and most towns could now boast of a shoemaker. Some still depended, however, on the itinerant cobbler, and few were large enough at this time to furnish paying custom to special artisans; and relied on traveling tinkers, glaziers, coopers, curriers, etc., to perform the services proper to their trades.
=575. Development of household manufactures.=—Only in a few lines of manufacture had the organization developed beyond the simple lines sketched above. The making of cloth is an operation requiring much time, considerable technical skill, and, for some processes, machinery such as few households would possess. By 1700 it had become customary to rely upon professionals for fulling, the process which compacts the fibers of the cloth, and fulling mills were widely distributed in 1800. Carding machines, for straightening the fibers of wool before spinning, were to be found in many towns, and it was more and more common, also, to have the weaving done out of the house, though this process was ordinarily attended to in the immediate neighborhood. With outside aid of this character the people of some parts of the country were able to produce cloth in excess of their needs, and could use the surplus in trade.
Nearly every town, moreover, in the northern and central colonies, had some industry which utilized the spare time of the inhabitants, and gave them the means of exchange with people in the colonies or abroad. For a characteristic description take the following of Raynham, Mass., 1793, when the town had a population of about 1,000: “Besides the usual business of husbandry, numbers are here employed in the manufactories of bar iron, hollow ware, nails, irons for vessels, iron shovels, potash, shingles, &c.”
=576. Appreciation and criticism of American manufactures at this time.=—It would be tedious and unprofitable to study in detail the petty manufactures which cropped up in the various towns of this period. Let us accept as a summary the following statement, applying to the decade ending in 1800: “The domestic manufactures best established are those of leather, iron, flax, potters’ wares, including bricks, ardent spirits, malt liquors, cider, paper of all kinds, hats, stuff and silk shoes, refined sugars, spermaceti and tallow candles, copper, brass and tin wares, carriages, cabinet wares, snuff, gunpowder and salt.”
In studying this description the reader should bear certain facts in mind. First, the list, however long it seems, is far from including all the wares required for the satisfaction of ordinary wants. Second, though these manufactures are stated to be the ones best established, there was, among them all only one sufficiently strong to produce a considerable surplus for sale outside the country; this was the rum manufacture. The people still relied largely on importations from foreign countries for many of the wares enumerated. Third, many of these manufactures (bricks, cider, snuff, and salt, for example; flour and sawmill products might properly be included) were of a very simple character, requiring no great technical skill or elaborate machinery. Water power was used widely, but steam power had not yet been applied, and improved machinery had not yet been introduced from Europe. The factory system, with its extensive use of machinery and its strict organization of labor, was first permanently established in the United States in 1790, at Pawtucket, R. I.; and the American factories did not, for many years, reach the English standard of efficiency. An English committee reported in 1791 that the American cotton manufactures were of a coarse grade, of worse quality and of higher price than those produced at Manchester.
QUESTIONS AND TOPICS
1. How do the population and settled area of the United States in 1790 compare with those of the State in which you live now?
2. Has any country ever enjoyed such growth as that of the United States in the nineteenth century? What country or countries come near us in rapidity of progress?
3. Prepare a chart, in the way previously suggested, and preserve it for comparison with the exports in later periods.
4. What is the proportion of persons now occupied in agriculture in your State? in the State where the proportion is highest? [Abstract of Census.]
5. What are the comparative advantages and disadvantages of corn and wheat as commercial crops? Which crop occupies the greater acreage in your vicinity, and why?
6. Write a report on one of the following crops, its preparation, uses, and history in the United States:
(a) Flax. [Encyclopedias; E. A. Whitman, Flax culture, Boston, 1888, Barker in Quarterly Jour. Econ., 1917, 31: 500-529.]
(b) Hemp. [Encyclopedias; C. R. Dodge, Report no. 8, U. S. office of fiber investigations.]
7. Profits and losses in the colonial tobacco culture. [Bruce.]
8. Do you know of any region which suffers from the evils of the single-crop system now?
9. Advantages and disadvantages of rice as a crop; where is it chiefly grown now? [Encyc.; commercial geographies.]
10. Experience of a woman as an indigo planter. [Earle, Colonial dames, Boston, Houghton, 1895, $1.50, pp. 76-83.]
11. What is the average crop of wheat per acre now, in the U. S., and in your vicinity? [Census.]
12. Details of colonial agriculture. [Coman, 47-62.]
13. The lumber industry in New England. [Lord, Indust. exper., part 3, chap. 1; Wright, 71-79.]
14. History of the American fisheries. [Coman, index; Van Metre in Carnegie Hist., vol. 2, part 2.]
15. The whale fishery. [Weeden, chap. 11; McMaster, Hist., 1: 63, with references.]
16. Manufactures imported by Virginia in the colonial period. [Bruce, chaps. 15, 16.]
17. What parts of the United States are now in a position like that of the colonies, devoting their labor to the production of raw materials and importing manufactures from the regions of advanced industry? What foreign countries are still in this position?
18. Write a report on the household industries of the colonial period. [Books by Alice M. Earle.]
19. What household industries are declining now? [The preserving of fruit may suggest other examples.]
20. A typical New England town. [See the description of Braintree, Mass., in C. F. Adams, Three episodes, Boston, 1892.]
21. The textile industry in the colonial period. [Wright, Ind. ev., 43-60.]
22. The rise of manufactures and the attitude of Great Britain. [Lord, Indust. exper., part 3, chap. 2; Coman, 62-76.]
23. The iron industry. [Wright, Ind. ev., 80-103.]
BIBLIOGRAPHY
GENERAL BIBLIOGRAPHY.—Channing, Hart and Turner, Guide, revised ed., Boston, 1914, (general); Bogart, Lippincott, Emery in Cambridge Mod. Hist., 7: 825-829, (classified); Coman, (alphabetical); E. R. Johnson, (railways); Dewey, Financial History, N. Y., Longmans, (fiscal); A. L. A. Catalogue, (popular books in print). The Literature of American History, ed. J. N. Larned, Boston, 1902, has been continued (for most years, to and including 1917), by annual lists, Writings on American history, published since 1912 by the Yale University Press.
GENERAL.—The most important single works are the **Contributions to American economic history from the Department of economics and sociology of the Carnegie Institution of Washington: History of domestic and foreign commerce of the U. S., by E. R. Johnson, T. W. Van Metre, G. G. Huebner and D. S. Hanchett, 2 volumes (cited hereafter as Carnegie History); History of transportation in the U. S., before 1860, under direction of B. H. Meyer; History of Manufactures in the U. S., 1607-1860, by Victor S. Clark. Foreign trade is treated in connection with other topics in N. S. Shaler, ed., *The U. S., N. Y., Appleton, 1894; C. M. Depew, ed., *Amer. commerce; T. D. Woolsey, ed., First century of the Republic, N. Y., Harper, 1876; McMaster, *Hist. (general narrative); Bogart, *Econ. hist., (manual); Lippincott, *Econ. development (manual); Wright, Ind. ev. (manual); Coman, *Ind. hist. (manual). On special branches of foreign trade see S. J. Chapman, History of trade between United Kingdom and U. S., Lond. and N. Y., 1899; F. R. Rutter, The South American trade of Baltimore, Baltimore, 1897; J. M. Callahan, American relations in the Pacific, Baltimore, 1901.
COMMERCIAL POLICY.—On tariff history **Taussig is by far the best guide; of the many other books on the subject (see bibliographies above) most are too prejudiced to be put in the hands of immature students. On the merchant marine and shipping policy see **W. L. Marvin, **J. R. Spears, and *W. J. Abbot. For defence of protection and subsidies, W. W. Bates, American marine, Boston, 1893, American Navigation, Boston, 1902; for criticism, D. A. Wells, Our merchant marine, N. Y., 1890.
SPECIAL TOPICS.—Readers should consult the bibliographies listed above for references on particular industries. The histories of Ringwalt, Hammond, and Swank are likely to prove especially useful.
SOURCES.—The chief source is the annual report on commerce and navigation, which is cited hereafter by abbreviation, Com. & Nav. Reports for the years from 1789 to 1823 are in the collected set of American State Papers; later reports must be sought in the set of Congressional documents. The Check-list of Public Documents, Washington, 3d. ed., 1911, is an indispensable aid in using government publications.
EARLY AMERICAN COMMERCE
COLONIAL.—**Weeden, **Bruce, **Beer. More general in character are the various writings (see A. L. A. Catalogue) of *John Fiske, *C. M. Andrews, *Alice Morse Earle, *Sydney G. Fisher. On commercial policy of the colonies see (besides Beer, and Hill cited below) A. A. Giesecke, American commercial legislation before 1789, Univ. of Penn., N. Y., 1910. On manufactures see Rolla M. Tryon, *Household manufactures in the U. S., 1640-1860, Univ. of Chicago Press; on shipping, R. D. Paine, *Ships and Sailors of old Salem, N. Y., 1909, and R. E. Peabody, *Merchant venturers of old Salem, Boston, 1912.
EARLY NATIONAL PERIOD.—Mahan, **War of 1812, vol. 1; Fiske, **Critical period, Boston, Houghton, 1899, $2; McMaster, **History, and **Chapter 9 of Cambridge Mod. Hist., vol. 7. On the development of the commercial organization, S. E. Baldwin, American business corporations before 1789, Amer. Hist. Review, April, 1903, 8: 449-465; G. S. Callender, **Early transportation and banking enterprises, Quarterly Jour. of Econ., Boston, Nov., 1902, 17: 111-162. On commercial policy, William Hill, **First stages of tariff policy, Pub. Amer. Econ. Assoc., 1893, 8: 452-614; T. W. Page; **Earlier commercial policy, Journal of Pol. Econ., Chicago, 1901-2, 10: 161-192; Henry C. Adams, *Taxation in U. S., Baltimore, 1884.
Chapter XLVI
INTERNAL TRADE AND FOREIGN COMMERCE, 1789
=577. Development of internal trade 1789-1914.=—It will be impossible, in the later chapters of this book, to describe in detail the development of the internal trade of the United States. This trade has grown to such proportions that, at the present day, it far outranks in volume and importance the foreign commerce of the country. The reader may be trusted to realize this fact, and to have some knowledge of the character and organization of internal trade at the present day. It is not probable, however, that he knows the humble origins from which this trade has risen; and a description of the conditions and character of internal trade about 1789 will enable him to appreciate the progress of the past century, even though the different steps in progress receive but scant mention in the narrative.
=578. Condition of the roads; effect on freight traffic.=—The roads, which furnished the only means of communication and transportation by land, were still the earth roads of the colonial period, thick with dust in summer, and absolute sloughs, with mud a foot or more deep, during the thaws of winter and spring. During the greater part of the colonial period wagons were a rarity, because there was so little opportunity to use them. Men used mere sledges on the farm, and traveled or carried their produce from one farm to another on horseback. In the northern States the facilities for land carriage were good in only one season, winter, when the periods of sleighing enabled the people to make the market trips and visits which were impracticable at other times. Even near the large towns laden carts had to be drawn by two to six oxen, when there was no snow on the ground.
When there was no other means of transportation, as in the case of the settlements west of the Alleghany Mountains, wares were carried over the roads in wagons, sometimes for a distance of hundreds of miles; but such instances of extensive land transport were exceptional, and the freight charges were so high that only articles of the first necessity, as salt and iron, could pay for carriage.
=579. Sparsity of passenger traffic.=—Some men lived and died in the town where they were born, without visiting another town a dozen miles distant. There was so little intercourse between the adjoining towns of Easthampton and Southampton, on Long Island, that each town preserved individual peculiarities of pronunciation down even to 1800. Throughout the colonial period, and even in the days of the early Federal government, it was very difficult to collect delegates at a political gathering; and it was not uncommon for men to make their wills before starting to a State convention in Pennsylvania. Travel by stage-coach did not become of importance until well into the nineteenth century. In 1783 two stage-coaches, consuming a week or ten days on the trip, sufficed for the travel between Boston and New York; though a few years later (1794) twenty stages were employed. Postage rates for a single letter ranged from 8 to 25 cents, according to the distance, and mails were infrequent.
=580. Relatively great importance of waterways.=—Like the people of the Middle Ages, the inhabitants of the United States at this period were driven to the use of water transport by the difficulty of transportation on land. Rivers which are used now only by canoes and pleasure boats were then important means of communication and transportation. The Connecticut River has now a scant traffic as far as Hartford, about forty miles from its mouth; in 1816 we read, “The Connecticut River is navigable 200 miles above Hartford, for Boats, of 15 tons, and 50 miles higher, for Floats and Pine Timber”; large quantities of potash were carried down the river even from the Canada line. The Hudson and other rivers were the channels through which export products were collected and brought to the sea, and the farmers of central and western New York sent their wares to market by rafts and “arks” on the Delaware and Susquehanna. Waterways were of especial importance in the southern States, where the means of land transportation were even less developed than in the North; tobacco was brought to the wharves on inlets and rivers by “rolling-roads,” rough tracks over which the hogsheads were rolled with the assistance of a horse.
=581. Importance of the country store.=—The great institution of trade at this period was the country store, which collected the surplus products of the townspeople and gave them in exchange the wares imported from abroad. Every town of any size had one of these stores, and only the largest towns had distinct shops for the sale of special articles. The stock in trade of one of the typical country stores included all of the articles which have been mentioned among the imports of the country: sugar, molasses, tea, coffee, metals, and hardware, cloth, thread, books, glass, earthenware, etc. The list on the other side of the store-keeper’s books would be as long, for it included all the export products of the country, and some wares which were sent to market in the large towns or in other States. The merchant must always be prepared to receive in pay for his goods “Grain of all kinds, beef, pork, poultry, cheese, butter, eggs, nuts, berries, hides, tallow, candles, lard, domestic flannels, feathers, quills, braided straw hats, potatoes, apples and other fruits, both green and dried, home-made brooms, flax and flax seed, cider and domestic wines, etc.” At the period which we are studying, well past the close of the colonial period, barter was still the usual form of exchange, and money rarely passed at the transactions in the store or in the trade between the townspeople and the village artisans.
=582. Benefits and disadvantages of the country store.=—The country store was the focus of the village, not only in economic but in political and social life as well. There was no better training school in the world for the study of human nature and the development of business sense. Practically all of the business life of the times was concentrated in these stores, and it is, therefore, not surprising, that few men rose to eminence later in the mercantile world who had not passed a period of apprenticeship in one of them. Charles Tiffany, Levi P. Morton, E. D. Morgan, H. B. Claflin; of a later period Marshall Field, Pullman, Pillsbury, Armour, J. D. Rockefeller, J. J. Hill, and many others; all these rose from the position of clerk in a general store to the place which they attained in later life.
From the standpoint of the villagers, however, it was a great disadvantage to have the market for their produce restricted to the store in their immediate vicinity. The store-keeper in the smaller towns had no competitors, and enjoyed a practical monopoly of trade of which he took full advantage in driving his bargains. In the northern colonies, where the difficulties of transportation were leveled by the snows of winter, the people could attain a certain measure of independence of the country store by making market trips to one of the larger towns. Neighbors would agree upon a date and set off, sometimes in a troop of fifty or sixty. They loaded their sleighs with a supply of food for the journey, and with the produce of the farm and household, and sought out the nearest large town, Portland, Newburyport, Boston, Providence, Springfield, Hartford, etc. In one of these market centers they could make much better bargains than at home.
=583. Relative smallness of interstate trade.=—When the products of the country had been collected at the large coast towns by the farmers and store-keepers, they were, for the most part, exported to foreign countries. Interstate commerce was as yet comparatively small. There was, it is true, an active coasting trade, but this was employed chiefly in the collection and distribution of goods along short stretches of coast. Small vessels plied frequently from the large ports like Boston, New York, Philadelphia, and Charleston, to the country districts on either side, but rarely made extensive trips, as from Boston to Charleston, for instance.
Commerce between States as distant even as Massachusetts and South Carolina existed and was by no means insignificant in absolute amount. The northern colonies sent a part of their surplus of rum, live stock, dairy products, and home-made cloth to the South, and brought back tobacco or bills on England which they could cash. Still, comparing this trade with other elements of internal trade, with the foreign commerce of the time, or with interstate commerce of later times, the striking thing about it is not that it was so large, but that it was so small.
=584. Share of different States in foreign commerce.=—The relative contributions of different parts of the country to its foreign commerce can be shown by the following summary, giving the exports by localities in the year 1791. The chief States ranked as follows, giving values in millions of dollars and indicating the leading ports in parenthesis: Pennsylvania, 3.4 (Philadelphia); Virginia, 3.1 (Bermuda Hundred, Norfolk); South Carolina, 2.6 (Charleston); Massachusetts, 2.5 (Boston); New York, 2.5 (New York); Maryland, 2.2 (Baltimore). No other State or port exported as much as one million; and exports from all the other States together amounted to little over one tenth of the total of nineteen millions.
The striking feature of the table is the relative importance of the southern States in foreign commerce, an importance which they were destined to hold for a long time to come, as the cotton industry was developed. It must be remembered, however, that the figures refer only to the export trade, and that there would be considerable changes in rank if we could include the import trade. Taking as a rough means of measuring imports the amount of duties collected, we find, for example, in the first year of the national government, that though Pennsylvania again headed the list, the second and third in rank were New York and Massachusetts respectively, while the southern States ranked lower by very considerable amounts. This period which we are studying was, moreover, one of rapid change, marked especially by the development of the central and northern colonies. Taking the year 1795, when these colonies were profiting by a great increase in their food exports, and when the cotton trade was still undeveloped, New York had risen to the second place in exports and Massachusetts to the third.
=585. Development of the chief seaports into cities.=—The seaports named in the preceding section had gained from trade an amount of wealth and population, which, however small it may seem from the modern standpoint, put them in a class above the ordinary towns, and made them the representatives of a more advanced business organization. The most populous of these places had in 1790 a population of only about 30,000 (in thousands, New York 33, Philadelphia 28, Boston 18, etc.); and the total number of people living in towns of over 8,000 inhabitants was still only about 130,000. In other words, only one person in thirty lived in a large town or city. The budding cities retained many of the rural characteristics of the towns from which they had grown. A mere beginning had been made in paving the streets, and many people still kept kitchen gardens. The price of provisions, however, was rising rapidly, and the cities had become dependent on trade with the country districts for most of their supply. Cattle were fattened in the Connecticut valley for the New York and Philadelphia markets, and wood for heating and building was brought by coasting vessels from considerable distances.
The large towns could boast of a diversified industrial population, in which many special branches of manufacture were represented, and of numerous shops; Boston was credited with 366 stores in the enumeration of 1789. The first commercial bank of discount and deposit in the United States began operations in Philadelphia in 1782, and about 1800 there were 33 banks of this kind in the country.
=586. Foreign countries of the greatest commercial importance to the United States.=—An indication of the direction of commerce is furnished by the following table, showing the chief countries to and from which the United States shipped wares in 1790. Figures give the values in millions of dollars.
Exports Imports Great Britain and her dominions 9.3 15.2 Including British West Indies 2.0 France and her dominions 4.6 2.0 Including French West Indies 3.2 Spain and her dominions 2.0 .3 Including Spanish West Indies .1 The Netherlands and her dominions 1.9 1.1 Including Dutch West Indies .6 Portugal and her dominions 1.2 .5
The figures of imports are based on estimates, and no sum is given for the total amount of the year; the total exports were but slightly above twenty million, and countries the names of which do not appear received but insignificant amounts of our goods.
=587. Insignificance of direct trade with Asia and Africa.=—Some reasons for the direction of American commerce at this period will appear in the next chapter, in which the commercial policy of European countries will be discussed. I propose here merely to point out some of the striking facts shown by the table, and to indicate their connection with the development of American commerce in the colonial period.
Attention may be drawn, first of all, to the significance of omissions from the table. In the year in question the United States sent to the two great continents of Africa and Asia less than one third of a million dollars of exports. The imports, especially from Asia, were probably somewhat larger, for American vessels had begun to frequent the ports of East India and China, and to bring direct from them the rich cargoes which formerly had reached America through the hands of English middlemen. Still, any reasonable estimate of the trade with distant continents would leave it insignificant in comparison with the European trade, which formed the mainstay of American commerce.
=588. Unique position of England in trade with the United States=.—Of the European countries there was one which occupied a position of commanding prominence. Great Britain received of our goods more than all the rest of Europe together, and sent us of her own far more than all the other European states could supply. It is noteworthy, and was so regarded at the time, that this country, after a bitter struggle for political and commercial independence, and after having broken the bonds which were supposed to hold her in subjection to the English market, should voluntarily resume the trade relations which had formerly been considered so oppressive. The great amount of our trade with England is the more remarkable, as it covered a considerable amount of trade with other countries. England felt as yet no great need for our export products, and forwarded to other countries a considerable part of what she received. Of the imports which we received from England, on the other hand, while the greater part was doubtless the product of English manufacturing industry, there were many wares which came from other countries, but which we found could be purchased more conveniently in England than at the original place of production.
=589. Commerce with the rest of Europe.=—It was but natural that the United States should have a commerce of some importance with states like France and the Netherlands, which were still among the leaders; and it can only be regarded as surprising that this commerce was so small in comparison with that with England. Our trade with eastern Europe was carried on so largely through England that Germany and the Baltic countries would make but an insignificant showing if they were included in the table. Our trade with southern Europe, however, was evidently governed by other conditions. Portugal and Spain could furnish few desirable wares of their own production, except wine; the table shows that the imports from those countries were small. They offered, however, what we sought in vain in northern Europe, a ready market for our fish, cereals, and other foodstuffs, and were hence of great importance to our export trade. Commerce with the Mediterranean countries, which had been interrupted during the Revolution, had not since then been developed to any considerable proportions, because of the ravages of the Algerine pirates. These countries had formerly taken a quarter of our fish exports, and about one sixth of our wheat and flour shipments; and trade with them revived later when our navy had brought the pirates to terms.
=590. Importance of the West Indies as an outlet for wares excluded from Europe.=—A place of very peculiar importance in the commercial economy of the American people, in the colonial period and well past the time which we are now studying, was taken by the West Indian islands. Of the chief products of the United States those coming from the South, especially tobacco, were sure of a good market in Europe, and were a ready means of purchasing the manufactures which the people needed to import. The chief products of the North, however, including breadstuffs, provisions, and fish, enjoyed no such favorable reception. The statesmen of England and other countries clung still to the plan of protecting domestic agriculture by assuring it the home market, and desired to encourage domestic fisheries as a means of supporting the navy. In the colonial period, therefore, the staple products of the central and northern colonies were kept out of England and other states by heavy duties or by prohibitions. The people of those colonies, therefore, were at a great disadvantage in their trade with the mother country: they found it difficult to secure the means of paying for the English manufactures which they imported, and were forced to rely in some measure on the crude products of their own domestic manufactures, as described in a previous chapter.
=591. Character of commerce with the West Indies; triangular trade.=—The very products, however, which were rejected in Europe, were keenly desired in the West Indies. The islands had become the great source of the world’s sugar supply, and the advantages of sugar production, under the system of slave labor, were so great that planters neglected all other crops and did not produce even a sufficient amount of food for their laborers. They were eager to purchase food either by the direct exchange of sugar and molasses, or, what amounts to the same thing, by giving the seller bills on Europe drawn against sugar products shipped thither. They offered a ready market, therefore, for the wheat, flour, corn, meat, and fish of the mainland, and purchased also large quantities of lumber and shingles for building, staves for hogsheads, etc. The colonies of the mainland took in pay considerable amounts of sugar and molasses for their own use, and took molasses also for the manufacture of rum, of which part was exported. On the whole, however, the mainland exported to the islands more than it received from them, and had thus a credit balance with which it could liquidate its debts for European manufactures. The conditions thus gave rise to a triangular trade: the mainland shipped food and lumber to the West Indian islands; the islands shipped sugar products to Europe; and Europe shipped manufactures to the American mainland, thus closing the transaction. So strong was the economic demand for a trade of this description, that the attempts of European governments to check it had proved entirely unsuccessful in the colonial period; restrictions were evaded by smugglers or were openly defied. The problems of policy relating to this and other parts of the American trade after 1789 will be treated in the next chapter.
=592. Development of ship-building in the colonial period.=—A resource of the United States which deserves to be mentioned, before we close this survey of the conditions of commerce about 1789, was the building and sailing of ships. The colonies were at first dependent on the mother country for the vessels which they used. Most of the raw materials for ship-building were, however, abundant in America; and the construction of ships, unlike other manufacturing industries, was rather helped than hindered by British colonial policy, which put colonial vessels on the same footing as those which were built at home, and protected them from the competition of the ships of other countries. An active ship-building industry grew up, therefore, especially in New England, where ship timber of the finest quality was abundant, and where the difficulties of life and the discouragement of staple exports forced the people to make the most of every resource. A petition of Boston citizens in 1746 calls ship-building “the ancient and almost the only Manufacture the Town of Boston ever had.” In the Massachusetts towns a ship could be built of oak for $24 a ton, while in England, France, or the Netherlands an oak vessel cost $50 to $60 a ton, and even the fir vessels, built on the Baltic, inferior in strength and durability, cost $35 a ton. The colonies, therefore, could supply not only their own wants, but also could sell ships abroad; before the Revolution more than a third of British tonnage, it is said, was American built.
=593. Extension of American shipping.=—The colonists were as proficient in the sailing as in the building of ships, and carried on a large part of the ocean traffic which served the needs of American commerce. In the first year of the national government considerably more than half of the tonnage entering the ports of the United States from foreign countries was American, and English ships were the only serious competitors. The bulk of American shipping was engaged in the West India trade, but American ships carried also nearly half of the commerce between the United States and Europe, in spite of the adverse policy of European states, designed to exclude American ships from commerce with them and with their colonies. Driven further afield by this policy, American skippers began to seek commercial connections with more distant countries, from which wares had reached them hitherto only through middlemen. An American ship sailed for the first time to China in 1784; in 1788 two ships were advertised as loading at Boston for the Isle of France (Mauritius) and India, and “anybody wishing to adventure to that part of the world may have an opportunity of sending goods on freight”; soon afterward a Philadelphia ship made the round voyage to China in less than a year. A vivid impression of the boldness and skill of American mariners of this period is given by the voyage of the Experiment to China. This boat, a sloop of eighty tons, no larger and no more seaworthy than the sloops which now bring bricks down the Hudson River to New York, carried her crew of fifteen men and boys safely to Canton and back, despite the perils of the sea and of pirates.
QUESTIONS AND TOPICS
1. Name another country in which transportation was easier in winter than in summer, before the introduction of railroads.
2. History of the navigation of the Connecticut River. [W. D. Love, Proc. Amer. Antiq. Society, April, 1903, reprinted Worcester, 1903.]
3. Write an essay on the economic, social, and political importance of the country store, in the past and present.
4. Write a biographical sketch of one of the business men named in section 582. [Poole’s Index and continuations; current biographical dictionaries.]
5. What is now the interstate commerce of the State in which you live? To what States does it export its products, what products of other States does it import? How does its commerce with other States compare with its foreign commerce in bulk and value? [Ask questions of railroad and steamship men; visit freight yards.]
6. Comparing the figures of sect. 584 with the figures for total exports, sect. 561, what do you guess formed the bulk of the exports from each State or port?
7. Write a brief commercial history of one of the cities named. [Local histories; Encyc.; commercial cyclopedias.]
8. Episodes of Boston commerce. [M. A. D. Howe, Atlantic Monthly, 1903, 91: 175-184.]
9. Prepare and study a graphic chart, sect. 586, and preserve it for comparison with later conditions.
10. The African slave trade. [Weeden, chap. 12; Abbot, chap. 3.]
11. What reasons occur to you why the Americans should have traded with England so much more than with other states of Europe?
12. History of the commerce of the colonies with the West Indies. [Pitman; Weeden or Bruce, Index, West Indies.]
13. Character of production and commerce in the West Indies at this time. [Pitman; Fiske.]
14. History of ship-building in the colonies. [Weeden, 252-267, 573-581; Wright, 23-42; Marvin, chaps. 1, 2.]
15. Pirates and privateers of the colonial period. [Weeden, chap. 9, 559-565; Abbot, chap. 5, Howard Pyle, The buccaneers.]
BIBLIOGRAPHY
See preceding chapter.
XLVII. COMMERCE AND POLICY, 1789-1815
=594. Importance of commercial policy in this period.=—The two preceding chapters have described the conditions of commerce in the United States about 1789, with but an occasional reference to the influence which governments exercised in directing and restricting the movement of wares. In every period governments interfere with the free exchange of commodities, that the interests of the people as a whole may not suffer from the selfishness of individual merchants. In the period under consideration, lasting through the second war with England, the influence of governments on the fortunes of our foreign trade was more pronounced than it has ever been in later times; and the topic of commercial policy must occupy the leading place in this present chapter.
=595. Questions of policy.=—The Revolution of 1776, by which a group of English colonies was transformed into an independent state, claiming to rank as England’s equal, shocked the ideas of European statesmen to an extent which we can hardly conceive. There was no place in the political system of the time for an independent American state. For centuries the states of Europe had been the sole source of active political and commercial power; in other continents were to be found only semi-civilized states, subject to European influence, and colonies, under the complete control of the mother countries. Each European state had regulated as it pleased the commercial relations of its colonies with the mother country, with other European countries, and with their colonies. Now that the United States had won its political independence, was it to be treated by England as though it was still an English colony, and given its former privileges though it was no longer subject to the former restrictions? Were other European states to welcome its commerce, now that England could no longer prevent, or were they to treat it like a European state, and restrict its trade with themselves and with their colonies? Finally, what attitude was the United States itself to adopt, now that it could frame its policy as it pleased? These were among the serious problems that perplexed the statesmen of the Old and New Worlds, as the success of the American Revolution became assured.
=596. Policy of England.=—Reference has been made in a previous paragraph to the striking fact that the colonists had no sooner won the war of independence than they returned to an active commerce with the country against which they had been fighting. Comparing the six years preceding the Revolution with the six years following the treaty of peace (1783), we find that the volume of trade between the United States and England was substantially the same. The American people suffered during the war for lack of the manufactures which they had been accustomed to purchase from England, and which they found then could be purchased to such advantage nowhere else; and as soon as peace permitted they began eagerly to buy English products again. For a moment it appeared that England was ready to welcome this trade; the English statesman, Pitt, introduced a bill which aimed to encourage the American trade not only with England but also with her colonies. Such a policy implied too serious a breach in the old system, and was not carried into effect. The Americans were, indeed, permitted and encouraged to trade still with England; that country could not afford to give up the growing market for its manufactures which the United States afforded. The ports of the West Indies, however, were closed to American merchants; the Americans were to be punished for their insubordination by exclusion from a branch of commerce which was to them of the first importance.
=597. Policy of France and other states.=—The Americans learned, not only from England but also from other European powers, that an independent state must shift for itself and could hope for no commercial favors. They might fairly suppose that the countries which had joined in their war against England (France, Spain, the Netherlands) would take advantage of the successful issue of the conflict to seek to secure the American trade which England had hitherto monopolized. They found, indeed, that these and other countries were willing to sell their goods to the United States; but still these countries were reluctant to take in exchange American wares for which they felt no special need, and were most reluctant to open the trade of their colonies to people of any nationality but their own. John Adams might say of France in 1780, “All the world will allow the flourishing state of her marine and commerce, and the decisive influence of her councils and negotiations, to be owing to her new connections with the United States”; whatever truth there might be in the statement, France certainly refused to express her gratitude by the grant of commercial privileges. France found, actually, that after the return of peace the Americans ceased to buy her manufactures, and flocked for trade to the English markets. French merchants complained that none of them ever gained in commerce with the United States: when all the best part of the American custom went to English merchants, why should France or any other country on the Continent relax the restrictions which were designed to protect the home market and the colonial market for the benefit of natives?
=598. Conditions of American trade with Europe in 1789.=—In spite of the unfavorable attitude of the powers which controlled the great markets of the world, the United States maintained a considerable commerce, as was shown by the descriptions of previous chapters. This commerce was, however, carried on under serious disadvantages. Reviewing the staple exports of the country we find that breadstuffs were generally subject to prohibitory duties in England, and that fish and salt provisions were actually prohibited in England, and were heavily dutied in France. The southern staples fared little better, for they competed with the products of European colonies even though they did not threaten European industries. Tobacco and rice were subject either to actual prohibitions or to heavy duties in most of the important European markets.
=599. Conditions of trade with the West Indies.=—Conditions of trade with the West Indies were even worse. Spain and Portugal absolutely forbade all direct intercourse with their colonial possessions; and wares destined for their colonies had either to be carried by smugglers or else exported to Europe and then re-exported in ships of the mother country. England closed her possessions on the American mainland completely, and while, as a temporary favor, she admitted some wares to her West India colonies, by proclamations renewed from year to year, she prohibited salt provisions and fish, and excluded American ships from the trade. Her vessels alone could take our produce and bring back the molasses, sugar, etc., which formed the objects of the return trade. The French West Indies, also, were open to us only as a temporary concession, and in them and in the colonial possessions of other powers the trade was burdened with duties.
=600. Weakness of the United States at this time.=—These were by no means all the hardships under which American commerce labored at this time. The government was too young and weak to furnish adequate protection to ships flying the American flag in foreign waters and on the high seas, and it had as yet obtained no guarantee that American fishermen would be allowed to pursue their calling as before the Revolution. Furthermore, the attention of American statesmen was distracted by the need of getting the machinery of the new government in running order, and by the serious fiscal difficulties which pressed for settlement. These were the dark days of American commerce. From the lofty position which the United States has reached to-day, courted for its commerce and its political influence by other great powers of the world, it is hard to realize how humble was our national position in 1789, and how precarious seemed our commercial future.
=601. Survey of American commerce, 1789-1815.=—Starting from these beginnings we have now to trace the course of our commerce through the period. So sharp were the fluctuations in this early stage that I give the annual statistics, and, for reasons which will be apparent later, call particular attention to the distinction between domestic exports, of articles produced in the United States, and foreign exports, of articles brought from some other country and re-exported. No exact figures for the imports of this period can be given, but it is safe to say that the value of the imports did not diverge greatly from the value of the exports.
EXPORTS OF THE UNITED STATES, IN MILLIONS OF DOLLARS (Fiscal years, ending Sept. 30 of the date given)
=====+==========+=========+======= | Domestic | Foreign | Total -----+----------+---------+------- 1790 | ---- | ---- | 20.4 1791 | ---- | ---- | 19.0 1792 | ---- | ---- | 20.7 1793 | ---- | ---- | 26.1 1794 | ---- | ---- | 33.0 1795 | ---- | ---- | 47.9 1796 | 40.7 | 26.3 | 67.0 1797 | 29.8 | 27.0 | 56.8 1798 | 28.5 | 33.0 | 61.5 1799 | 33.1 | 45.5 | 78.6 1800 | 31.8 | 39.1 | 70.9 1801 | 47.4 | 46.6 | 94.1 1802 | 36.7 | 35.7 | 72.4 1803 | 42.2 | 13.5 | 55.8 1804 | 41.4 | 36.2 | 77.6 1805 | 42.3 | 53.1 | 95.5 1806 | 41.2 | 60.2 | 101.5 1807 | 48.6 | 59.6 | 108.3 1808 | 9.4 | 12.9 | 22.4 1809 | 31.4 | 20.7 | 52.2 1810 | 42.3 | 24.3 | 66.7 1811 | 45.2 | 16.0 | 61.3 1812 | 30.0 | 8.4 | 38.5 1813 | 25.0 | 2.8 | 27.8 1814 | 6.7 | 0.1 | 6.9 1815 | 45.9 | 6.5 | 52.5 1816 | 64.7 | 17.1 | 81.9 1817 | 68.3 | 19.3 | 87.6 =====+==========+=========+=======
=602. Fluctuations in the export trade; share of domestic and of foreign exports.=—If the reader will cast his eye down the column of totals he will appreciate at once the unsteadiness of our trade during the period under consideration. For a few years the figure of exports was almost constant. Then, in 1793, began a rapid rise; the export trade doubled, tripled, more than quadrupled. A check to this growth was apparent in the few years after 1801, but it began again, and the figures of exports reached their highest point in the years 1806 and 1807. They had grown more than fivefold in fifteen years. The year of 1808 showed a precipitous decline, and, after an interval of partial recovery, the figures reached their lowest point in 1814. At the close of the period prospects seemed brighter.
Returning to the table, to analyze the part borne in the changes by domestic and by foreign exports respectively, we find that the foreign exports were chiefly responsible for the great fluctuations. No figures can be given for the earlier years, but it can be stated with assurance that of the total exports in 1790 only an insignificant fraction, probably much less than one million, was composed of the products of other countries. There had been a tremendous gain, therefore, in this branch of our trade, before 1796, and it proved capable of great expansion afterwards, while, on the other hand, it declined in one year almost to nothing. Domestic exports, also, showed a great increase in the early years of the table, but they soon came near to the limit of their expansion, and hovered generally about the figure of forty millions; the table shows, moreover, that they resisted depressing influences better than the foreign exports.
=603. Varying fortunes of foreign trade not explained by conditions at home.=—The reasons for the growth of American trade after 1790 are to be sought mainly in conditions abroad. There was no development of resources at home sufficient to account for the great expansion of trade. The United States, it is true, gained a new export product in cotton, which was shipped in rapidly increasing quantities after the invention of the cotton-gin in 1793. Cotton took the first place among southern exports after 1800, and the extension of the cotton culture helps to explain the growth of domestic exports. Still cotton did not rise to the position of king among exports until the following period, and the description of the rise of the cotton trade will be referred to a later chapter.
We cannot give American statesmen the credit for removing the restrictions on our commerce, described above, and so enabling it to expand uncramped. In spite of all their persistence and ingenuity they secured only slight and partial concessions. The treaty with England, negotiated by John Jay in 1794, removed some of our grievances, but proposed to open the West India trade on such humiliating conditions that the offer was indignantly refused. A treaty with Spain gave us merely the right to navigate the lower Mississippi River, without other commercial privileges; and even the acquisition of Louisiana, in 1803, had but an inconsiderable effect on our commerce at the time.
=604. Conditions abroad; effect of the European wars on domestic exports.=—We owed our rapid commercial growth not to our own strength, and not to the favor of European states; we owed it to the necessities of the position in which the countries of Europe found themselves after the outbreak of the wars following the French Revolution. These wars were of decisive importance to our commerce in two ways. In the first place they caused an immense increase in the demand for our foodstuffs. When the states of Europe were fighting for their very existence they could not afford to uphold the principles of their former protective policy, and welcomed the means of subsistence, from whatever source they might come. The withdrawal of men from agriculture to serve in the armies diminished the supply of food in Europe and called for large exports from the United States, for which high prices were paid. Taking for illustration the little country of Portugal, we find that our exports to that country increased about ten-fold in the course of the period, being especially large in the years from 1810 to 1813. These years mark the time when the Peninsular War was at its height, and when the large armies quartered in the country demanded a supply of food which could not possibly be met from native sources.
=605. Effect on foreign exports and the carrying trade.=—The European wars were not only responsible for a great gain in our domestic exports; they were the sole cause of the tremendous increase in the foreign exports, which figured so largely in our commerce at this period. The wars involved most of the important states of Europe. A ship flying the flag of France or of any of her allies was constantly exposed to capture by British cruisers; a ship flying the flag of Great Britain or of one of her allies was a fair prize for the French privateers which swarmed over the seas. In the great conflict there was but one country, with an extensive merchant marine, which managed to maintain neutrality, and this was the United States. The carrying trade of the world fell into our hands. The countries of Europe, forced by the exigencies of war, gave up the cherished principles of their colonial policy, and threw open the trade with their colonies and themselves. The rights of neutral states in time of war were, it is true, still unsettled. American ship captains and merchants were subject to arbitrary and humiliating interference on the part of the belligerents. In the early part of the war, however, the results of this interference were of sentimental rather than of practical importance, and means were found to evade the restrictions which the belligerents imposed. When England forbade all trade between her enemies (France, Spain, the Netherlands) and their colonies, American skippers did not sail direct from the West Indies to Europe, but touched at some port of the United States, entered the cargo for import, and sometimes actually landed it. It was not meant for consumption in this country and was soon withdrawn and exported to its destination in Europe, as though it were composed of domestic products.
=606. Prosperity of American commerce and shipping.=—The European wars, therefore, introduced American commerce to a new era of prosperity. “No one was limited to any one branch of trade; the same individual was concerned in voyages to Asia, South America, the West Indies, and Europe.” Our ships gathered the products of distant countries, coffee, sugar, tea, pepper, etc., and purveyed them to the people of Europe. In many years the value of foreign exports exceeded that of domestic exports; in 1806 it was half as large again. The reader will better appreciate the contrast with present conditions when he learns that in 1914 the foreign exports of the country amounted only to one sixty-seventh part of the domestic.
The merchant marine of the United States grew rapidly under these favoring conditions, and in spite of complaints that former conditions had been reversed, and that ships could be built cheaper abroad than at home. The national tonnage engaged in foreign trade, which in 1789 appeared to be not much in excess of 100,000, exceeded 500,000 in 1795, and 900,000 in 1810. The proportion of American ships in the total of those entering the ports of the United States grew correspondingly; and the merchant tonnage of the United States was second only to that of Great Britain and superior to that of any other country in the world.
=607. Checks to prosperity after 1800.=—The check on the growth of our commerce apparent in the figures for the few years after 1801 is explained by the conclusion of a peace between the states of Europe, which lasted from 1801 to 1803. Had the peace proved permanent there would have been, without doubt, a further decline in American commerce, as the European countries resumed their former commercial relations. With the reopening of war, however, the Americans enjoyed the advantages of their previous position; the exports of 1806 and 1807 exceeded a hundred millions in value, and marked a height which exports did not again reach for nearly twenty years. Our commercial prosperity at this time was very precarious. It was the period in which Napoleon and England were waging war over the Continental System, as described in a previous chapter. Each belligerent looked on the neutral carrier now not as a source of gain to itself so much as a source of help to the enemy, and determined to restrict neutral trade, even though it were necessary to destroy it. In the period between 1803 and 1812 some 1,500 American ships were seized in Europe, and the greater part of them condemned, for violating the restrictions then carried into effect. The best sailors were impressed from American ships to fight the battles of England. American shipping was involved in an unequal struggle.
=608. Decline of commerce; embargo and war.=—The United States was not prepared to enforce by arms the rights which it claimed for its merchants and sailors. The government shrank from war, and adopted instead the policy of commercial restriction, hoping to bring the European powers to terms by refusing to trade with them until they reformed their conduct. A short trial was made with an act forbidding the importation of English manufactures, and in December, 1807, a general embargo was laid on all vessels, forbidding them to leave port for a foreign country. The embargo was evaded in various ways, but its effect on our foreign commerce and export industries was disastrous, and forced the substitution of milder measures in February, 1809. Our commerce, now suffering both from the attacks of its enemies abroad and the restrictions of its friends at home, could not recover the position which it had reached before the embargo, and declined still further after the declaration of war with England, to which we were finally forced in June, 1812.
=609. Effect of the decline of commerce on the development of American manufactures.=—While the people maintained an active commerce with Europe they obtained most of their manufactured wares from that source, as they had done in colonial times. The interruptions of commerce due to acts like the embargo and to the war with England cut them off from this source of supply, and home manufactures grew up as commerce declined. The letters of Jefferson, written at this period, contain many references to the growth of manufactures in his State, Virginia, and in other parts of the country, especially in New England, the development of a native manufacturing industry was even more marked. American manufactures began, in this period, to outgrow the simple forms of domestic industry, and to attract the capital necessary for the establishment of regular factories. Many companies were incorporated to manufacture goods by means of power machinery, and industrial methods which had long been practised in England were now first introduced in this country on an extensive scale. The development of the textile industries was especially rapid. It was estimated that in 1800 the cotton factories of the country had consumed only 500 bales of raw material, while in 1810 the number had risen to 10,000 and in 1815 to 90,000. A cotton factory established by Francis C. Lowell at Waltham, Mass., in 1814, is said to have been the first in the world in which all the processes involved in the manufacture of goods, from the raw material to the finished product, were carried on in one establishment, under a carefully studied system.
=610. Considerations determining early tariff policy.=—The development of manufactures at this time gave rise, in the following period, to a demand for protection which marks a turning-point in the tariff history of the country. When the first national tariff was adopted, at the founding of the Federal government in 1789, the legislators had a difficult problem of policy to solve. They found the commerce of the country fenced in by foreign tariffs composed of high duties and of some actual prohibitions. They desired the reduction of these duties that American commerce might expand. Many of them expressed their belief in a policy of retaliation, if no other means availed to secure the reduction. At this time, however, the commercial position of the country was not strong enough to permit the tariff to be used as a weapon with which to menace foreign states. Other countries showed but a languid desire for the products which were then our staple exports, and we had great need of the foreign wares composing our imports. We could not afford even to discriminate against the importation of manufactured goods, with an idea of protecting native manufactures; our manufactures were then so weak that a policy of high protection, to exclude foreign wares, would have caused serious distress to the consumers at home.
=611. Survey of tariff policy.=—Barred by these considerations from a tariff of high duties, the legislators framed the first tariff mainly as a revenue measure. Comparatively few articles were placed upon the free list, duties being levied on articles like tea and coffee as well as on manufactured wares, which might possibly be produced at home. The general scale of duties was much lower than in foreign countries at the time, or in the United States later; it was estimated that an assorted cargo paid about 7-1/2 per cent. Of the results of the first tariff a recent investigator says: “The most careful examination fails to show that it affected the volume, variety, or direction of our foreign trade in the slightest degree.” In the course of the period the tariff was frequently amended, and rates were raised considerably; but the tariff continued to be used chiefly as a source of revenue, and was not seriously affected by protectionist ideas until after 1815.
QUESTIONS AND TOPICS
1. Prepare yourself for studying the policy of this period by mentally reviewing the present commercial policy. Does the government now encourage or discourage exports or imports? Does it grant favors to one foreign country over another? Do foreign countries prohibit or restrict trade with their dependencies? What is the present policy of this and other countries with respect to shipping?
2. When England excluded the United States from trade with the West Indies, what classes would be hurt, what classes would be helped, in England, in the West Indies, and in the United States?
3. Indicate on a rough sketch map the markets wholly or partially closed to American commerce about 1789.
4. Financial, military, and naval weakness of the United States in 1789. [Manuals and standard works on U. S. History.]
5. Make a chart first of the figures of total exports in sect. 601; then indicate the relative share of foreign and domestic exports. Leave room at the top or bottom, where the dates are written, to write in the chief historical events affecting the course of commerce in the period.
6. It has been generally believed that the adoption of the Federal Constitution led to a great growth in business and prosperity. Prof. G. S. Callender has suggested that the growth of prosperity, due to influences acting from outside America, caused, on the contrary, the Constitution to be popular and successful. What facts support this latter view?
7. Prepare a list of the dates showing the beginning and spread of the European wars, and insert on the chart as suggested above.
8. Study the relative importance of foreign exports to total exports in the last half of the century, as a contrast to conditions about 1800. [U. S. Statistical Abstract, Index, Exports, merchandise, total values.]
9. Expansion of the merchant marine, 1789-1800. [Marvin, chap. 4.]
10. Grievances of neutral carriers, leading to the second war with England. [Marvin, chap. 7; Coman, 171-180; McMaster, Hist.]
11. The Embargo. [Manuals of U. S. history; references in Channing and Hart.]
12. Rise of manufacturing industry. [Coman, 180-193; Wright, 117-131.]
13. Considerations determining the earlier commercial policy. [Page; see above, chap. xlv.]
BIBLIOGRAPHY
See chapter xlv for general works; Henry Adams, *History, N. Y., 1889-91, covering the period 1800-1817 in nine volumes, is the most complete general narrative. Mahan, **War of 1812, Boston, Little, 2 vols., is now by far the best special account. Ralph D. Paine, The fight for a free sea, New Haven, 1920, is an interesting description. The commercial statistics of the period may be found elaborated in Adam Seybert, *Statistical annals, Phila., 1818, or in Timothy Pitkin, *Statistical view, New Haven, 1817, 2d ed., 1835.
XLVIII. NATIONAL EXPANSION, 1815-1860
=612. Survey of commerce, 1815-1860.=—In contrast with the period ending in 1815, the next period which we study, extending from 1815 to 1860, was marked by the slowness and the comparative steadiness in the growth of foreign commerce. An indication of the course of trade in this period is given by the following table, in which the figures represent millions of dollars.
Imports Exports Total
1820 74 69 144 1830 62 71 134 1840 98 123 221 1850 173 144 317 1860 353 333 687
Though the statistics of selected years can give only a rough picture of commercial development, the figures here given suggest the striking features of our trade in this period with sufficient accuracy. For about twenty years after 1815 the foreign commerce of the country was nearly stationary, or actually declined. Not until 1835 did our exports reach again the mark attained in the year 1807. Towards the end of the period, however, they showed increasing strength; the figures for 1860 show the upper limit which they attained, but for some years previously they had been approaching the sum of three hundred millions.
=613. Reasons for slowness of growth.=—The reasons for these changes in our foreign trade must be sought both abroad and at home. Our prosperity in the preceding period had been due mainly to the European wars. With the return of peace the states of Europe escaped from their commercial dependence on the United States. Our domestic exports of breadstuffs and provisions declined as Europe returned to the policy of protecting the domestic food supply; and our foreign exports declined even more rapidly when we lost our privileged position of the great neutral carrier, and our merchants had to face not only the active competition but also the adverse legislation of other countries. Through most of the period the annual foreign exports of the country were about twenty million dollars in value. Not until near the end of the period did conditions change to our advantage. The repeal of the English Corn Laws in 1846, as was noted in a previous chapter, marked a departure in commercial policy, which offered new openings to American export industries.
=614. Absorption of the national energy in territorial expansion.=—At home, moreover, the people of the United States were occupied in this period with tasks which turned their thoughts and interests to a large extent away from foreign trade. It was a period of great territorial expansion. A comparison of maps indicating the distribution of population shows that extraordinary changes occurred in the interval between 1810 and 1860. At the former date the people were still gathered mainly along the Atlantic seaboard, face to face with Europe; and most of the territory west of the Appalachian mountains was still left to the Indians. The center of population was not far from Washington, D. C. In 1860, on the other hand, the center of population was near Chillicothe, Ohio. This change indicates an enormous movement of population westward. The country extending west to the Mississippi river had, by 1860, been covered almost continuously with settlements; many people had spread out on the great plains facing the Rocky Mountains; and the population on the Pacific Coast was sufficient to entitle that district to the two States California and Oregon.
=615. Relative decline in the importance of foreign trade.=—The expansion of population, necessary as it was to the development of the country, proved in its early stages to contribute comparatively little to the growth of foreign commerce. The growth of our trade did not keep pace with the growth of population. While the share of the average inhabitant in foreign trade was over $30 in 1800, it was little over $20 in 1860, and ranged between $10 and $15 through much of the intervening period.
It seems as if the people of the country, after the close of the war of 1812, had turned their gaze away from Europe, the continent which they had for centuries regarded as the source of civilization, and had fixed their attention on their own continent, with the determination to make its resources satisfy their needs, so far as they were able. Many of the settlers in the western country led lives of extreme simplicity, unable to find a market for the surplus which the fertile soil returned to them, and consequently forced to restrict their purchases of foreign goods to the bare minimum.
=616. Importance of the problem of transportation in this period.=—As the American people expanded and occupied territory far beyond the limits of their original settlements, the question of transportation became one of increasing importance. The early colonists had evaded rather than solved the problem of transportation, by choosing for settlement districts connected with the sea by short water routes, and by renouncing, in large part, the attempt at intercommunication by land. The problem could no longer be set aside, as the people spread out in the great interior valley. The resources of the West could be of no advantage to the people of the East, and could contribute nothing to the foreign commerce of the country, unless means were found to bring the wares to market with a profit.
In the remaining sections of this chapter, therefore, we shall study the development of the means of transportation in this period, that we may be better able to appreciate the details of the export and import trade, described in following chapters.
=617. The turnpike era.=—Even in the earlier period, following 1789, the condition of the common roads was felt to be intolerable, and a movement for their reform set in. Stock companies were chartered, to improve the more important roads, and were allowed to secure a return on their investment by charging toll on traffic—so much for a one-horse cart, so much for a two-horse wagon, etc. Hundreds of turnpike companies were chartered in the different States, and in Pennsylvania alone over 2,000 miles of improved roads had been constructed by them at the close of the first quarter of the century.
Until better means of transportation were provided the turnpikes were important channels of trade. They united the districts of the interior with the coast and with navigable rivers, and made possible throughout the year a freight traffic which formerly had been restricted to the sleighing season. A great highway, like the Mohawk and Hudson turnpike, running from Schenectady to Albany, was studded so thickly with taverns that the traveler was never out of sight of the swinging sign-boards.
=618. Failure of the turnpikes to meet the country’s demands.=—The success of the turnpikes stimulated the national government to construct a road from Cumberland, on the Potomac River in the western part of Maryland, to Wheeling on the Ohio River. This road was designed to furnish the connection, that was so keenly desired, between the districts lying on either side of the mountains; and was for many years an important route for passenger travel. The expense of wagon transportation, however, prevented a great growth of freight traffic on this or on other land routes of considerable length. The cost of moving freight over the roads of this period has been estimated roughly at ten cents per ton-mile, and this cost prohibited the movement of ordinary freight to a great distance. The turnpike, therefore, did not solve the problem of transportation for the country, and turnpikes declined as better means of transportation were brought into use. About the middle of the century the idea of building roads of wood took strong hold of the minds of men, and plank roads were constructed with great vigor for a few years; but the idea proved impracticable and led to no important results.
=619. Importance of the western waterways.=—Vastly more important in its effects on the internal and foreign commerce of the country was the development of the means of water transportation. It has been said of North America that no other continent, with perhaps the exception of South America, offers such excellent natural facilities for intercommunication as is furnished by the system of rivers and lakes lying east of the Rocky Mountains. Early in the history of our western settlements traders used the rivers flowing into the Mississippi to secure connection with the market at New Orleans, then under Spanish rule; and the Louisiana purchase of 1803 gave the United States control of the river route from source to mouth. A line of packet boats plying between Pittsburg and Cincinnati was started in 1794, and many flatboats were employed to float cargoes down the Mississippi. The swift current of that river, however, made ascending navigation difficult. The crews of the flatboats had to return home by land, going generally on foot through nearly a thousand miles of wilderness, and using about six months on the round trip. The stream could be ascended only in small boats propelled by poles and sails. Though the freight rate down the river was as low as one cent per ton-mile, the charge in the other direction was about six times as much. The need of some better means of propelling boats against the current was strongly felt; and long before the steamboat had been made a practical success the prediction was common that it would be developed to serve the needs of commerce on our western rivers.
=620. Invention and application of the steamboat.=—The steamboat, like many other instruments of technical progress, was not the invention of a single man, but was developed by contributions from several different sources. Before the adoption of the Federal Constitution (1789) Fitch and Rumsey had constructed steamboats which maintained a speed of four to seven miles an hour against the current of the Potomac and Delaware rivers; and these successful experiments were followed by many others in this country and in Europe. Robert Fulton, therefore, scarcely deserves the credit commonly accorded him for invention, but his service was not the less important. He combined the ideas and inventions of others, and transferred the steamboat from the sphere of technical experiment to that of practical business operation. The Clermont, which started from New York August 7, 1807, and arrived in Albany, 150 miles distant, in 32 hours, was the first steamboat in the world which maintained a regular and continuous traffic in the public service.
=621. Development of river transportation.=—Within a few years of Fulton’s success steamboats were introduced on the western rivers, and after an interval of trial proved their capacity for meeting the conditions. In ten years (1817) a steamboat made the trip from New Orleans to Louisville in 25 days instead of the three months consumed by barges; after another ten years (1827) a steamboat made the trip in little over a week. The steamboats did more at first to reduce the time of voyages than to reduce the rates of transportation, but the cost of carriage declined gradually as the means of transportation were improved. The following figures, giving the number of steamboats employed on the rivers of the West, show how rapidly steam navigation increased in importance: 1818, 20; 1829, 200; 1842, 450; 1848, 1,200. Size and carrying capacity were growing also, and it is said that in 1847 the steam tonnage of the Mississippi Valley exceeded that of the whole British Empire. “Pittsburg city, the Pennsylvania great western emporium,” as it was styled in a book published in 1830, grew great by steamer traffic, and other cities, as Cincinnati, Louisville, and St. Louis, flourished under the same influence. The most obvious effect of the extension of steam navigation was the growth of internal trade, especially that between North and South. This trade, however, was indirectly of great importance to our foreign commerce, for it enabled the people of the South to apply themselves almost exclusively to the growth of export products, like cotton, relying on other parts of the country for food and manufactures.
=622. Demand for canals in this period.=—While the river system offered great opportunities for developing the resources of the West, it was necessarily incomplete in the connections it afforded with other parts of the country. It left gaps, to be filled by other means of transportation, between three important sections of country, drained respectively by the Mississippi and its tributaries, by the Great Lakes, and by the rivers flowing into the Atlantic. The need of bridging these gaps in the transportation system was felt acutely in the second quarter of the century, as population spread in the interior of the country, and was first met, with some degree of adequacy, by the construction of canals.
There had been many projects for canals in the colonial period, and some short stretches were constructed before 1800. People contented themselves in general, however, with the natural waterways, and sought merely to regulate their channels and to regulate the flow of water by means of dams. The era of activity in canal construction began after the close of the second war with England, in 1815.
=623. The Erie Canal (1825), and others.=—The easiest route by which a canal might be carried through the Appalachian mountain ridge lay in the State of New York, along the valley of the Mohawk River. The advantages of this route were recognized in the colonial period, and the advisability of utilizing them was felt especially during and after the war of 1812, when the political danger of leaving the country without means of intercommunication became apparent. The construction of a canal along this route was begun in 1817, and in 1825 the first boat passed from Lake Erie to the Hudson River. Other canals were constructed to connect Lake Champlain and Lake Ontario with the Erie Canal, and further south, in New Jersey and Pennsylvania especially, the people entered actively into the work of canal building.
Further west, canals were constructed to unite Lake Erie with the Ohio River, and Lake Michigan with the Mississippi River (1848), and just before the close of the period which we are studying the St. Mary’s Falls Canal (1855) opened the passage from Lake Superior to the other lakes to boats with a draft of twelve feet.
=624. Commercial benefit of the canals.=—The canals effected a reduction in transportation charges which placed trade on an entirely new footing along the lines that they covered. In contrast with the cost of ten cents per ton-mile, on the turnpikes, we find a cost of movement of about one cent, and tolls which brought the total charge to about three cents. The tolls varied on different articles and were not the same on different canals, but the total charges represented a great saving in transportation even in the early days of the canals, and tended to grow less with the passage of time. The crops which grew in abundance on the fertile lands of western New York had gone begging before the construction of the Erie Canal, and the inhabitants had been able to purchase few manufactured or foreign articles. A letter from the Genesee country (east of Buffalo), written in 1799, said that grain was so low in price as to be scarcely worth the raising, while European goods were very dear; it took the produce of one acre to buy a pair of breeches. Conditions had improved somewhat before 1825, with the extension of turnpikes and with the increase in the navigation of the Susquehanna River, but the Erie Canal brought nevertheless a new era of prosperity to this district, and first made its rich resources available for consumption in the New York market and for extensive export.
=625. Canals less important than rivers for distant shipments.=—Important as were the canals, their influence in this period was local rather than national. Managers were slow to adopt the practice of reducing rates on a long haul, to stimulate distant traffic, and the canals served mainly local needs. We read, it is true, of cotton being carried from Alabama to Philadelphia by canal, and of wheat reaching New York over the Erie route from Ohio and Indiana. It is noteworthy, however, that even in 1840 only one seventh of the freight carried on New York canals came from outside the State. The river system of the Mississippi proved still to be the most valuable outlet for the products of the great interior valley, and about 1850 the value of the wares which it carried to the coast was double that reaching the seaboard by the Hudson River and its canals. A line drawn east and west through the center of Ohio marked the commercial watershed between the competing routes; north of that line practically all goods were shipped by lake and canal, while south of it only articles like tobacco, wool, and manufactured wares were sent by that route, and most products were shipped by way of the Mississippi. Indiana and Illinois showed a still more decided tendency to the river route. In the reverse direction, however, the northern route, by canal and lake, had the advantage, and the movement to the interior by this route was double that ascending the Mississippi.
=626. Demand for further improvement met by railroads.=—Reviewing the substance of preceding sections, we find that of the new means of transportation adopted to develop the resources of the country and to make them available in internal trade and foreign commerce, none had yet proved adequate to meet the conditions. Transportation on the turnpikes was too expensive to permit the carriage of bulky freight over great distances. River navigation, valuable as it was in opening the interior to commerce, still was tied fast to channels cut by nature; the rivers must at least be supplemented by feeders and by connections across the country. Canals were of great service as supplements to the rivers, but they too, were restricted in their course by the conditions set by nature, and, like the rivers, could be used in northern districts during only part of the year. What the country needed was a means of transportation available throughout the year, free to follow the paths toward which the interests of merchants most inclined, and cheap enough to encourage the exchange of common articles between points widely separated. The need was met, in the course of time, by the development of railroads.
=627. Early American railroads little used for freight traffic.=—The operation of steam railroads began in this country and in England at almost the same time; the Baltimore and Ohio railroad was in course of construction in 1830, when the Liverpool and Manchester line was opened. In this early period, however, the railroad was a much more valuable instrument in the Old World than in the New. In England and other European countries the railroad found great manufacturing and shipping centers already established, with large volumes of valuable freight to be carried short distances; the task before it was comparatively easy. Conditions were somewhat similar along our eastern seaboard, but in the United States in general the railroad was wanted to develop agricultural districts with a comparatively sparse population, separated from industrial and shipping centers by hundreds of miles. The traffic offered by these districts could not bear the high charges imposed by railroads in their early period; these charges greatly exceeded those paid for canal transportation and seem in some cases to have equaled those paid for carriage on turnpikes. Aside from coal and cotton the early American railroads carried comparatively little freight; and they played but a slight part in the development of commerce.
=628. Extension of the railroad system in the West after 1850.=—In 1850 there were still few railroads west of the Allegheny Mountains. In contrast with nearly seven thousand miles of line in the States along the eastern coast the States of the upper Mississippi Valley could show little over one thousand. Not a mile of railroad had been built in Iowa and Minnesota, and there was no railroad connection with the East in all the country west of the Mississippi and north of the State of Missouri.
Conditions were ready at last for the extension of the railroad system through the interior of the country and the West saw many thousand miles of line constructed in its territory in the decade ending in 1860. The New York Central, the Erie, the Pennsylvania, the Baltimore and Ohio, and other lines united the roads of the interior with the East; many roads were built from Lakes Erie and Michigan to the Ohio and Mississippi rivers; while another set of roads extended north from the Gulf of Mexico, aiming to attract the traffic of the great valley southwards.
=629. Effect of the improvements in transportation, especially marked in the following period.=—The commerce of the country got the full benefit of the railroad system only after 1860, when various improvements led to a great reduction in freight rates, and stimulated an immense increase of traffic. The period before the Civil War must be regarded as one of preparation for the great commercial expansion in the period following; the lines were laid, in large part, but men had not learned to make the best use of them. Even before 1860, however, the railroad had become an indispensable instrument to the commerce of the country. While it did not displace other means of transportation, it forced them to improvement, and gave service in forms which they could not supply. There will be little space in the two following chapters to refer to the development of the means of transportation described here, but the student must bear in mind this factor, as contributing always and in very important measure to the growth of the country’s commerce. We may close this summary of the subject by giving an illustration of the effect of transportation on the value of the resources of Ohio; the price of farm produce in that State rose 50 per cent after the completion of the canals, while the railroads appear to have doubled the price of flour, trebled the price of pork, and quadrupled the price of corn.
=630. Prosperity of the American merchant marine.=—The period from 1815 to 1860, in which the country first grappled successfully with the problem of internal transportation, was also the period in which the American merchant marine reached the pitch of its prosperity. Even after the conclusion of peace in Europe in 1815, which subjected our ships again to the competition of foreign carriers and to the restrictions of other countries, American ship-builders and sailors were able to hold their own; and the period is marked by a great increase in our merchant tonnage. Down to about 1850 the wooden sailing ship was still supreme in its control of the ocean carrying trade. American builders developed the ship to its highest type, the clipper, and led the world in the art of naval construction. Their skill, and the cheapness of good ship timber, more than offset the higher prices which the tariff forced them to pay for materials and equipment such as iron, copper, cordage, and sail-cloth. The officers and crews of American vessels enjoyed an international reputation for their efficiency.
=631. Position and prospects of the merchant marine in 1860.=—In 1855 the tonnage built in the United States was greater than ever before or since; the California gold discoveries had caused a great increase in the demand for transportation to the Pacific Coast, from which the government excluded foreign vessels, and the Crimean War forced European governments to charter many American vessels for transport service. At the close of the period (1861) the tonnage of the United States, including that engaged in domestic trade, was not far from one third of the total tonnage of the world; the British Empire had slightly over one third; and the tonnage of all other countries grouped together was but little more than our own. Our merchant fleet exceeded by half the amount necessary for the carriage of all our exports and imports, and earned a large revenue from the foreign countries which sought its service.
In one important point, however, the prospects of the American merchant marine were not bright. We were not keeping pace with the peoples of Europe in the construction of steamers for ocean service, and of iron vessels in general. American steamers were not able to win a place of any importance in the foreign carrying trade; and before 1860 a slackening of activity in the building of wooden sailing ships was noticeable.
=632. Navigation policy: reforms and restrictions.=—The period was marked by the removal of many of the restrictions on foreign shipping which had been a regular feature of government policy in previous centuries. Our ships were burdened at first by heavy dues or by prohibitions in foreign ports, and it was but natural that our government retaliated by taxing foreign ships entering our ports. The disadvantages of this system became apparent as commerce grew in the nineteenth century, and a series of reciprocity treaties removed the former discrimination, and put the ships of all nations on substantially the same footing. The United States held fast, however, to certain features of the old navigation policy. The coastwise trade, which was interpreted to include the trade to the Pacific coast by way of the Isthmus of Panama or around Cape Horn, was reserved absolutely to American vessels; and no vessel could secure American registry unless it had been built in this country. Ships built abroad could not sail under the American flag even though they had been purchased and were owned by citizens of the United States.
QUESTIONS AND TOPICS
1. Prepare a chart, sect. 612. [Figures of commerce for the intervening years, showing fluctuations, will be found in the U. S. Statistical Abstract.]
2. Review, in previous chapters, the accounts of the commercial policy of European states during this period.
3. The westward movement of population. [Manuals of U. S. history; maps in Atlas of the Census.]
4. The population of the country was as follows, in round millions (counting half a million or over as one): 1790, 4; 1800, 5; 1810, 7; 1820, 10; 1830, 13; 1840, 17; 1850, 23; 1860, 31. Determine the average commerce per capita, and indicate it on the chart.
5. The commercial history of a western town. [Select a town in one of the States of the Mississippi Valley, admitted during this period, and determine, from local histories and biographies, the extent of its trade with other parts of the country and with foreign countries.]
6. What towns of the colonial period were situated at a distance from the sea? What towns grew to considerable size in the interior of the country in this period, and what were their means of land or water transportation? [Consult historical maps, as those in Hart’s Epochs of American History.]
7. (a) Write a report on the history of turnpikes in the State in which you live. [Consult State and local histories, making full use of table of contents and index.]
(b) Development of roads in the U. S. [Hulbert, vol. 11, chap. 1.]
(c) The Pennsylvania State Road in 1796. [Hulbert, vol. 11, chap. 2.]
(d) The Catskill turnpike. [Hulbert, vol. 12, chap. 6.]
8. The Cumberland Road. [Hulbert, vol. 10; see especially chap. 4, stages and freight traffic.]
9. What are the chief river systems of the country; what gaps exist between them? How do the facilities for river transportation in different countries of Europe compare with those of the United States?
10. Development of the boats used for river traffic. [Hulbert, vol. 9, chap. 4.]
11. Character and life of the western river men. [Same, chap. 5.]
12. The invention of the steamboat. [Encyclopedias; U. S. histories; Thurston’s Fulton, N. Y., 1891; S. Bullock in Conn. Magazine, 1905, 9: 440-455, an excellent article with illustrations.]
13. Write a report on the influence of the steamboat in building up one of the cities named. [Local histories.]
14. Early canal projects. [Hulbert, vol. 13, chaps. 2, 3.]
15. The Mohawk River route. [Hulbert, vol. 14, chap. 1.]
16. Early projects for a canal in the Mohawk Valley. [Same, chap. 2.]
17. The Erie Canal. [Same, chap. 4.]
18. Economic effects of the Erie Canal. [Hulbert, vol. 14, chap. 5.]
19. Origin of American railroads. [Johnson, chap. 2.]
20. Did any European country present conditions like those of the U. S., in respect to railroad development? What has been the history of railroads in Russia? [See chap. 44.]
21. Growth of the American railroad system. [Johnson, chap. 3; Hadley, chap. 2; Coman, 234-242.]
22. Because the Ohio farmer received more for his products, does it follow that railroads have raised the price of articles and forced consumers to pay more for them?
23. Development of the merchant marine, 1815-1860. [Marvin, chaps. 9, 11, 12; Abbot, chaps. 1, 2.]
24. American whalers. [Marvin, chap. 8.]
25. Navigation laws of the U. S.: history and criticism. [Wells, Merch. marine; Carnegie History, chap. 39.]
BIBLIOGRAPHY
See chapter xlv for general works.
Special Accounts.—Worthy P. Sterns, **Foreign trade of U. S. from 1820 to 1840, Jour. Pol. Econ., Chicago, Dec., 1899, 8: 34-57, 452-490;
J. McGregor, *Commercial statistics; J. S. Homans, *Cyclopedia; J. D. B. DeBow, *Industrial resources.
SPECIAL TOPICS.—Hulbert, Historic highways, and more briefly in The paths of inland commerce, New Haven, 1920; E. R. Johnson, Amer. railway, (with references); A. T. Hadley, Railroad trans.; C. F. Adams, Jr., Railroads; U. B. Phillips, History of transportation in the eastern cotton belt to 1860, N. Y., 1908. Shipping: Samuel E. Morison, **Maritime history of Massachusetts, 1783-1860, Boston, 1921; R. D. Paine, *The old merchant marine, New Haven, 1920; A. H. Clark, The clipper ship era, 1843-1869, N. Y., 1910; A. T. Verrill, The real story of the whaler, N. Y., 1916; John H. Morison, History of American steam navigation, N. Y., 1903. River navigation: H. W. Dickinson, Robert Fulton, London, 1913; D. L. Buckman, Old steamboat days, N. Y., 1907; W. E. Verplanck and M. W. Collyer, The sloops of the Hudson, N. Y., 1908; H. M. Chittenden, History of early steamboat navigation on the Missouri River, N. Y., 1903. Canals: H. W. Hill, Historical review of waterways and canal construction in New York State, Buffalo, 1908, (Buffalo Hist. Soc., vol. 12); N. E. Whitford, History of the canal system of the State of New York, Albany, 1906, 2 vol., (Supplement to Rep. of State Engineer for 1904-05); E. J. Benton, The Wabash trade route in the development of the Old Northwest, Baltimore, 1903. The West: K. Coman, ** Economic beginnings of the Far West, 2 vol., N. Y., 1912; R. G. Thwaites, The fur trade in Wisconsin, 1812-1825, Madison, Wisc., 1912; I. Lippincott, History of manufactures in the Ohio valley to 1860, N. Y., 1914.
XLIX. EXPORTS, 1815-1860
=633. Chief exports in 1860.=—The following table gives the chief items among the exports of the country in 1860, and corresponding items made up from the annual average of the years 1802-1804, as a basis from which to appreciate the changes.
EXPORTS OF U. S., MILLIONS OF DOLLARS
=================================================+=======+======== |1802-4 | 1860 -------------------------------------------------+-------+-------- Vegetable foods | 13 | 27 Cotton | 6 | 191 Tobacco | 6 | 15 Animal products | 3 | 20 Fish products | 2 | 4 Forest products | 4 | 13 Manufactures | 2 | 37 | -- | --- Total of these items, omitting decimals | 36 | 307
Total domestic exports including items omitted 39 316 Total foreign exports 28 26 Exports of precious metals 56 ==================================================================
=634. Changes since 1800.=—It will be noted, as said above, that the foreign exports of the country did not increase during the period, and were actually less in 1860 than they were about 1800. Comparing the figures for the total exports of domestic merchandise we find that this, the most important branch of our commerce, increased about eightfold in value between the years chosen for comparison. All of the separate classes of wares contributed to the growth of our export trade, but in very different measure, as is apparent when the figures are compared. The export industries which were most prominent in the colonial and early national periods had not kept their place in the movement of progress, and their output for export had merely doubled, roughly, in this period. There is apparent, on the other hand, a great growth in the export of manufactured wares; and the export of cotton, which in 1789 was practically nothing, and about 1800 was less than seven million, had risen to the enormous sum of one hundred and ninety million, considerably more than half in value of the total exports of the country. The history of commerce presents no parallel to the rapid rise of cotton in the commerce of the United States at this period, and the subject demands careful consideration.
=635. Cotton before 1800.=—The word cotton, now applied exclusively to the fibers attached to the seed of a shrub of the mallow family, was formerly a general term used for vegetable fibers coming from several different sources. The fibers acquired from the present cotton shrub, or from a vine or tree, had been used for textile fabrics from ancient times. The manufacture of cotton goods, however, was neglected in Europe until the eighteenth century, and at the beginning of our national existence much of the supply of raw cotton still came from the ancient seat of the cotton industry in Asia. From almost the beginning of the colonial period in American history experiments had been made with cotton culture, but the colonists found no incentive to devote themselves to cotton cultivation on a large scale. The separation of the fiber from the seeds was a tedious process, there was no market for raw cotton in the colonies, and other crops were found to return larger profits to the cultivator. Cotton was grown successfully on some of the islands of semi-tropical America, but the territory now forming the United States counted for nothing as a source of cotton when the national government was established in 1789. So weak, in fact, was the cotton industry at this time, that it was protected by a duty of three cents a pound on imported cotton, included in the first national tariff.
=636. Growth in importance of cotton.=—Various influences, however, combined about 1789 to bring into prominence the possibilities of cotton as a regular crop. The great improvements in textile machinery caused at this time an increased demand for the raw material. The other crops which were then raised in the territory now occupied by cotton were not flourishing. The indigo culture, for reasons which have been noted above, was unpopular; rice culture had declined during the Revolution, as the war had broken up the organization of slave labor in the rice districts; tobacco was giving smaller returns, as the land was exhausted by continuous cropping. A new variety of cotton, moreover, had recently been introduced from the Bahamas, known as sea-island or long-staple; the fibers were long and silky, suited to the manufacture of fine threads and fabrics, and they were more readily separated from the seeds than were the fibers of the ordinary short-staple or upland variety. The cultivation of this variety was an assured success in the narrow strip along the coast where it could be grown; and further inland, where sea-island cotton could not be raised, people began to strive persistently to overcome the difficulties of the cultivation of the upland variety.
=637. Demand for efficient means of cleaning cotton.=—The chief obstacle to the cultivation of upland cotton was now the difficulty of separating the fibers from the seeds. To perform the process by hand-picking was out of the question, as a man in this way could clean only one pound of cotton in a day. Various simple machines had been devised to effect the separation of the seeds, and these were fairly successful when applied to sea-island cotton, enabling a man to clean fifty or sixty pounds. None of them, however, was a success when applied to upland cotton, whose short fibers adhered very tenaciously to the seeds.
The problem was solved by a native of New England, Eli Whitney, who had gone south as a teacher, and who invented the cotton gin (engine) which proved capable of cleaning upland cotton, and so made the cultivation of that crop a commercial possibility. The conditions may be described in Whitney’s own words, used in a memorial to the government, asking for an extension of his patent. He showed “That, being in the state of Georgia in the year 1793, he was informed by the planters that the agriculture of that State was unproductive, especially in the interior, where it produced little or nothing for exportation. That attempts had been made to cultivate cotton, but that the prospect of success was not flattering. That of the various kinds which had been tried in the interior none of them were productive, except the green seed cotton, which was so extremely difficult to clean as to discourage all further attempts to raise it. That it was generally believed this species of cotton might be cultivated with great advantage, if any cheap and expeditious method of separating it from its seeds could be discovered, and that such a discovery would be highly beneficial both to the public and the inventor.”
=638. Invention of the saw gin by Whitney, 1793.=—Encouraged by the terms of the national patent law, on which he relied for a monopoly of his invention, Whitney set to work, and in a short time had devised a form of cotton-gin which, with minor alterations, has remained in use ever since. The raw cotton was fed through a wire grating to a cylinder on the surface of which were wires or saw teeth, that caught the fibers and pulled them through, the seeds being retained by the grating. The gin was a complete success, enabling a man to clean several hundred pounds of cotton in a day. Whitney himself reaped comparatively little benefit from his invention, as he found it impossible to prevent infringements; he said in 1812, with slight exaggeration, that the total amount which he had realized was less than the saving in cost effected in one hour by his machines then in operation. The country, however, was an immense gainer, for the last obstacle to the successful cultivation of cotton was removed.
=639. Extension of cotton cultivation, and increase of exports.=—The exports of cotton, which in 1793, the year of Whitney’s invention, had been only two thousand bales, rose by leaps and bounds. In 1802 they passed one hundred thousand bales, in 1822 five hundred thousand, in 1834 one million, in 1843 two million, in 1858 three million. The States along the Atlantic coast, in which cotton culture first sprang up, continued for many years to be the main seat of the industry. After the war of 1812, however, the cultivation of cotton spread in the Southwest, where rich river bottoms and prairie lands offered soil of exceptional fertility, and where the numerous rivers facilitated transportation. The exports of cotton from New Orleans increased tenfold in the years 1816 to 1830, and at this later date the western States produced the larger part of the cotton supply. At the close of the period which we are studying (1860) over half of the total crop was raised in the three States Alabama, Mississippi, and Louisiana.
=640. King cotton.=—The success of the cotton culture in this country was attended by far-reaching results in economic and political history. We must restrict ourselves here to the commercial aspects of the cotton industry, without discussing such topics as its relations to slavery and its influence in bringing on the Civil War.
Never in the world’s history have producers enjoyed such an exalted position in commerce as that which was held by the planters of the cotton States. The larger part of the world’s supply of an article regarded as of the first necessity came from a comparatively restricted area in the South. The people of Europe and other continents had become used to cotton textiles, great factories had grown up to manufacture them, but it seemed as though people must go unclad and factories must stop work, if the United States should refuse to deliver raw cotton. For years before the Civil War fear of a cotton famine had haunted the minds of European manufacturers.
Cotton took a position in national commerce equal in importance to that which it occupied in international trade. Not only did it furnish directly more than half of the total exports of the United States; it shared its prosperity with other industries, and influenced the development of every part of the country. Northern merchants made fortunes in handling and transporting southern cotton; the manufacturers of every district found in the South a market where people had plenty of money to buy goods which they were too busy to make; the farmers of the Northwest supplied in considerable part the needs of the South for food. The people of the South were not blind to these facts, and tended, indeed, to exaggerate their importance. As a sample of their attitude this extract from a speech by Senator Hammond in 1858 may be taken: “Without firing a gun, without drawing a sword, should they make war on us, we could bring the whole world to our feet. What would happen if no cotton was furnished for three years? I will not stop to depict what every one can imagine, but this is certain, England would topple headlong, and carry the whole civilized world with her. No, you dare not make war on cotton. No Power on the earth dares to make war on it—cotton is king.”
=641. Slight contributions of the South to exports, aside from cotton.=—In the period before the Civil War, when southern plantations were worked by slaves, it was considered to be the best policy to plant cotton continuously, without alternation or diversification of crops, though this policy led necessarily to exhaustion of the soil and required frequent removals to fresh land. Cotton was, therefore, the single product which the South contributed in great quantities to the internal and foreign trade of the country. The rice culture was maintained on the eastern coast and was extended along the Gulf, but there was little increase in the export of rice, as the crop was consumed largely at home. Indigo disappeared from the list of American products. Tobacco production spread in the States of the Ohio valley, and the exports of this ware rose after the middle of the century to double the value which they had about 1800, but a comparison of the figures given at the opening of the chapter shows that tobacco declined still further from the position it had held in colonial times.
=642. Trade between the North, the South, and Europe.=—In 1860 only one third, approximately, of the total exports of the country came from the North. Conditions in this period resembled closely those of colonial times, with the substitution of the southern States for the West Indies in the triangle of trade. The North imported from Europe far more than it could export in return; it shipped South, however, large quantities of foodstuffs and manufactures; and the South gave in exchange bills on Europe which were drawn against the great quantities of cotton sent thither. Cotton from the South to Europe, manufactures from Europe to the North, manufactures and foodstuffs from the North to the South: such were the three sides of the triangle.
=643. Chief exports from the North.=—The North could no longer look to colonial industries, like fisheries and forestry, to provide the means of purchasing the foreign wares which it required. The exports from those industries had increased, it is true, but were still so small that they had become items of slight importance in the total. The exports of manufactures, on the other hand, had grown very rapidly, and formed now a considerable item in our trade. The South contributed to this class some wares (manufactured tobacco, turpentine, cottonseed oil cake), but the products of developed manufacture came almost entirely from the North; manufactures of cotton and of iron were the leading items. The rise of these manufactures will be treated in the next chapter. At the North, however, as at the South, agricultural products held the first place among the exports. Foodstuffs and animal products were exported to the value of about fifty million dollars, and these wares came chiefly from the North. The total is small in comparison with that of the cotton export (one hundred and ninety million), and gave little promise of the remarkable expansion which was to follow after the Civil War; still, foodstuffs and animal products were the mainstay of the Northern export trade.
=644. Gradual increase in the exports of foodstuffs.=—The increase in the exports of northern agriculture was rather less than would be expected from a people rapidly increasing in numbers and provided with an abundance of fertile land. For many years after the close of the war of 1812 commerce in wheat and flour languished, and even toward 1840 the export of those articles was less than it had been at the opening of the century. There was talk, even, of imposing a duty on wheat, to protect the farmers of the Atlantic seaboard from imports. As late as 1835 Ohio was the only grain-exporting district of the West, and the first grain shipment on the Great Lakes, of which there is record, was made about that time. Chicago became of importance as a center of grain shipments only about 1850. In the decade from 1850 to 1860, however, the Chicago shipments increased (roughly) from two to twenty million bushels, and the total exports rose rapidly; canals and railways were at last bringing the cheap grain from the West to the people of Europe, who at last were ready to welcome it. The export of animal products was growing also. Lard and pickled pork were the chief items under this head, for the lack of modern appliances prevented the export of fresh meat; but the price of hogs at Cincinnati doubled in the fifteen years preceding 1860, and western farmers were encouraged to give increased attention to the supply of animal products.
=645. Exports of precious metals; result of the California gold discoveries.=—The last item in the list of exports given at the beginning of the chapter is that of precious metals, which we shipped abroad to the value of more than fifty million dollars. Ordinarily the exports and imports of precious metals are not included in the figures of a country’s trade. Coin and bullion are used to make up the balance of accounts between different countries; they may leave a country one year and may return to it the next year; and they represent, therefore, no contribution to commerce like that of the shipment of merchandise. An exception must be made, however, in the case of the few countries which produce such quantities of gold and silver that they can regularly export a surplus. The mines of precious metals are to these countries as much a commercial resource as are the coal or iron mines to countries like England and Germany. The United States was not at first among these favored countries: it produced little gold and less silver, and needed to import most of the precious metals which it required for use as currency and in the arts. These conditions were suddenly reversed by the discovery of gold in California in 1848. The gold production of the country, which had been formerly less than a million dollars a year, had risen by 1850 to fifty million, and provided the country with a handsome surplus which it could afford to exchange abroad for merchandise.
QUESTIONS AND TOPICS
1. Prepare a graphic chart of the figures, sect. 633, for comparison with earlier and later conditions.
2. Review the distinction between domestic and foreign exports. The principal foreign wares exported from the U. S. in 1860 were as follows, in millions of dollars: coffee 2.2, sugar 2.1, tea 1.9, hides 1.6, tobacco 0.7. From what countries do you think these wares came?
3. Write a report on one of the following topics:
(a) The cotton plant and cotton fibre.
(b) Different varieties of cotton.
(c) History of cotton, outside America, before 1800.
(d) History of cotton in America before 1800.
[Encyclopedias; commercial geographies; Hammond, pp. 3-33, references in bibliography.]
4. Invention of the cotton gin by Whitney, [Hammond; Amer. Hist. Review, Oct., 1897, 3: 90-127.]
5. What changes have been made in the cotton gin since its invention? [Encyclopedia.]
6. How long do you think the world would have had to wait for an efficient gin if Whitney had not supplied the need?
7. Importance of cotton in southern agriculture before the Civil War. [Hammond, 67-119; J. A. B. Scherer, Cotton as a World power, N. Y., 1916.]
8. What other wares have held the position of “king” in the commercial countries. In what period and in what country were the following wares especially important among the exports: tin, silk, wool, spices, silver?
9. Connection of cotton and slavery. [Hammond, 34-66.]
10. The cotton trade, 1815-1860. [Hammond, 243-277.]
11. Rice culture before the Civil War. [Depew, chap. 38 by Talmage; DeBow, vol. 2.]
12. Later history of American fisheries, and international questions to which they have given rise. [Census; McMaster and Moore in Cambridge Mod. hist., vol. 7, 363 ff., 657 ff.; Carnegie History, vol. 2, part 2.]
13. Trade in turpentine and rosin. [Census, 1900, 9: 1001-1012.]
14. The development of the American lumber industry. [Depew, chap. 30, by Fernow.]
15. Development of Cincinnati or Chicago as a market for meat and breadstuffs. [Local histories.]
16. What countries were the chief sources of supply of gold and silver before 1850? [Encyclopedias.]
17. The California gold discovery. [Narrative histories of U. S.]
18. Commerce of California before the discovery of gold. [Read the interesting narrative of a sailor’s life by R. H. Dana, Two years before the mast, Boston, Houghton.]
19. The overland route to California. [Henry Inman, The old Santa Fe trail, N. Y., Macmillan, 1899. Salt Lake trail, N. Y., 1898.]
20. Development of gold and silver mining. [C. H. Shinn, Story of the mine, N. Y., Appleton, 1896.]
BIBLIOGRAPHY
See chapter xlviii.
L. IMPORTS, POLICY, DIRECTION OF COMMERCE, 1815-1860
=646. Chief imports in 1860.=—The imports of the United States have been so varied in character that it is impossible to classify them with any exactness. An attempt will be made in this section, however, to indicate the leading items in our imports in 1860, giving values in round millions of dollars. Of the total of the year, 354, the largest share fell to manufactures. Under this head the chief place was taken by the textiles (wool 38, silk 33, cotton 32, linen 10); nearly one third of the total imports of the country was derived from these four leading branches of the textile manufacture. Most of the other manufactures imported fell below the mark of 5 millions; a noteworthy exception is the item of iron and steel in various forms, amounting to 21 millions. In comparison with the amount of manufactures imported, the class of raw materials, to be used for manufacture in this country, was still small; we purchased abroad considerable amounts of hides and skins, wool, etc., but in general we either manufactured our wares out of materials procured at home or sent abroad for the finished product. The colonial wares had gained both in value and in the proportion which they formed of the total imports; the chief items in this class were sugar 31, coffee 21, tea 8, cigars and tobacco 6, molasses 5, altogether amounting to about one fifth of the imports of the year.
=647. Significance of the import trade at this time.=—The general character of our import trade, evidently, had not changed greatly in the seventy years since the establishment of the national government. The attractions of farming were so great, when fertile land was to be had in abundance and when there was an eager demand for such products as cotton and foodstuffs, that the American people still gave most of its energy to raising raw materials; and found it profitable still to look to other countries for much of its supply of manufactured wares. The policy of protection, which was established in the period under consideration, had not as yet succeeded in building up manufactures capable of supplying the wants of the home market. The comparatively small amount of materials imported for our factories showed that our manufactures were still local in character, without the strength, or else denied the opportunity, to reach out and draw from distant sources the raw materials which they could work up and return to the currents of the world’s trade.
The growth in the imports of colonial products represented the increase of general prosperity, enabling the people to consume luxuries in greater quantity. Dividing the amount of these wares imported by the population of the country, and so securing a rough idea of the share falling to each individual, we find that the per capita consumption rose as follows from 1790 to 1860: coffee from about 1 pound in 1790 to over 5 pounds in 1860, sugar from less than 5 pounds to over 30.
=648. Growth of domestic manufactures.=—Though the imports of manufactured wares increased greatly in the course of this period, it must not be assumed that the United States was as wholly dependent on foreign manufactures in 1860 as it had been in 1790. A population growing rapidly both in numbers and in welfare caused a demand for manufactures which stimulated some producers to choose manufacturing instead of farming for their livelihood, and the government aided these individuals by taxing imported wares, and so giving the domestic producer an advantage in the home market. In the following sections we shall survey the chief branches of manufacture which grew up in the United States at this time, and consider the bearing of the protective tariff on their development.
=649. Increase in the use of coal.=—Some idea of the development of modern forms of manufacture in the United States can be gained by tracing the history of coal, the great source of power for the developed system of factory industry. The demand for coal was still very small in the first quarter of the century; in 1830 the total production was less than half a million tons, and the United States was surpassed in coal output by four of the states of Europe. The second quarter of the century was marked by a great extension in the use of steam power, and the successful application of coal to iron making; by 1850 the United States had reached the second place among the countries of the world in coal production, with an output of over six million tons. Small as this seems in comparison with the output of Great Britain at that time (54 million), or the output of the United States in 1913 (over 500), it marked a tremendous advance over conditions as they were about 1800, and showed that at least the country had passed through the preparatory stage of industrial development.
=650. Sluggish development of the iron industry.=—While the use of coal is perhaps the best index of a country’s development in the modern forms of manufacturing and transportation, the use of iron is also certainly of great significance; iron is the fulcrum through which the power of steam is applied, to repeat Jevons’ figure of speech. Great importance attached, therefore, as has been noted in previous chapters, to the improvements introduced in the English iron manufacture towards 1800, by which it was freed from dependence on charcoal, and was enabled to turn out increased quantities of pig and bar iron at reasonable prices. American iron makers showed a slackness which we find it hard now to forgive in adopting the improved processes. Coal and coke were not used in the American iron manufacture until about 1840, and the new methods of puddling and rolling, which had transformed the English iron industry, were applied in this country only shortly before that date, about half a century after their introduction in England. Some excuse can be found for our delay in the lack of transportation facilities for bringing the iron ore and coke together. The result, at any rate, was unfortunate. A heavy duty was laid on imported iron, to protect the home producer, but did not make up for his inefficiency. It was necessary, therefore, throughout the period, to import a considerable part of the necessary pig and bar iron and steel, paying the higher prices caused by the tariff; and the machine industries could not but suffer from the added expense. Down to 1860 our iron industry was not strong enough to export crude iron in any quantity, though American ingenuity succeeded in finding a market for considerable quantities of iron manufactures.
=651. Success of the cotton manufacture.=—With one of the branches of textile manufacture, that of cotton, the Americans had more success. Thanks to the alertness of the cotton manufacturers in introducing improved machinery, and to the advantages they enjoyed in their supply of raw material, they had soon outgrown the need of protection. The higher wages which they paid to American laborers were more than offset by the quantity of work turned out, and in the manufacture of the common sorts of piece goods they did not fear the competition of any other country. Large manufacturing towns grew up in New England to meet the demand for cloth which formerly had been made in the household of the consumer, and by 1850 there were as many cotton spindles at work in New England as there were inhabitants. American cottons were sold so readily in South America and other foreign markets that English manufacturers condescended to imitate them, and our exports of cotton manufactures in 1860 amounted to over ten million dollars, more than double the export of fish products, and not far below the export of forest products. The strength of the American cotton manufacture lay in the production of plain cloth; the bulk of the imports consisted of finer and fancy products.
=652. Failure to establish a strong woolen manufacture.=—The United States was, of course, peculiarly fortunate in its supply of raw material for the cotton manufacture. It enjoyed no such advantage with respect to wool. The wool fibers from American sheep were comparatively short, and unsuited to the manufacture of the finer woolens and worsteds. Manufacturers were hampered in their use of other wools by a tariff designed to protect the sheep growers, and paid for other raw materials higher prices than their competitors in England, while they could not, as in the cotton industry, make up for the higher wages in this country by the skilful application of machinery. Under these conditions the duties designed to check the importation of woolen manufactures from abroad were only a partial protection to the American producer; and the woolen manufacture did not flourish in this country. We could in large part supply the demand of the home market for coarser fabrics (flannels, blankets, etc.), but we manufactured no wool for export, and we continued to import the finer fabrics.
=653. Other manufactures.=—In the manufacture of other textile products which were imported in considerable amounts, silk and linen, the United States made no important progress during this period. Sewing silk and silk trimmings were made in the country, but the great bulk of silk manufactures were bought in France and England, while there were only the beginnings of a linen manufacture in this country before the Civil War.
Other manufactures existed besides those named, but the most important of them were devoted chiefly to the first processes in working up raw materials, and scarcely correspond to our ideas of manufacturing at the present time. This point is illustrated by the list of domestic manufactures exported from the country in 1860, as given by the government. Of the total of 37 millions, the items cotton 10.9 and iron 5.7 were the product of developed manufacture, and the same may be said, perhaps, of the item copper and brass and their manufactures, 1.6. Among the other items, however, the leading products were of a different character, and showed strength in raw materials rather than in manufacture (manufactured tobacco 3.3, spirits of turpentine 1.9, oil cake 1.6, household furniture 1.0).
=654. Dependence of the South on the North for manufactured wares.=—It is noteworthy that most of the manufactures which grew up in the United States in this period were established in the North. The prevalence of slavery in the South and the attractions of agriculture in that section prevented the rise of any considerable manufacturing industry; and the South manufactured even of its staple product, cotton, less than one fifth as much as the mills of the North. Conditions were thus adapted to the triangular trade, as it has been termed above, by which surplus shipments from the North to the South balanced surplus shipments from the South to Europe. The results were set forth in the following extract from a book published by a Southerner in 1857:
“In one way or another we are more or less subservient to the North every day of our lives. In infancy we are swaddled in Northern muslin; in childhood we are humored with Northern gewgaws; in youth we are instructed out of Northern books; at the age of maturity we sow our ‘wild oats’ on Northern soil; ... in the decline of life we remedy our eyesight with Northern spectacles; in old age we are drugged with Northern physic; and, finally, when we die, our inanimate bodies, shrouded in Northern cambric, are stretched upon the bier, borne to the grave in a Northern carriage, entombed with a Northern spade, and memorized with a Northern slab!”
We shall see in the following sections, reviewing the course of tariff policy, that the North and the South took opposite sides with respect to the protective tariff. The South, which had practically no manufactures, desired free trade, that it might make its purchases in the cheapest market, while the North desired protection for its growing manufactures.
=655. Beginning of the system of protective tariffs, 1816.=—In previous sections (609-611) attention was directed to the fact that the earliest tariffs were but slightly protective. The establishment of manufactures was stimulated much more by the interruption of commerce at the time of the embargo and of the war with England than by any deliberate policy of protection. At the close of the war of 1812, however, the time seemed to have come for the legislators to intervene in favor of American manufacturing industries. The privations of the war period awakened people to the dependence of the United States on Europe, which seemed unworthy of a free state and which seemed unsafe from the military standpoint. The manufactures which had grown up during the war were exposed, at the return of peace, to a flood of imports which threatened to reconquer the American market for the foreign manufacturer. The tariff of 1816, therefore, included a number of duties designed to restrict imports for the benefit of the American producer; the scale of duties was moderate, the highest permanent duty being 20 per cent.
=656. Course of tariff policy, 1816-1860.=—The conflict of interests between different sections of the country led to many changes in the tariff schedules, and occasioned some bitter political contests. Without attempting to recount the details, it may be said in summary that the course of the tendency was toward higher duties till about 1830, when some of the duties amounted to 40 per cent and 50 per cent or more.
The high duties were particularly obnoxious to Southerners, who considered them a tax taken from their pockets for the benefit of the North, and who fought persistently for a reduction. They finally secured a hearing; and duties were steadily reduced in the period from 1833 to 1842 until they stood, at the later date, at a general level of 20 per cent. The tariff remained at this low level only two months, when it gave place to another tariff with higher duties; the average of the duties levied ad valorem was 33 per cent, while some duties rose far above this rate. Finally, from 1846 until the Civil War, the country was under a low tariff; duties were reduced until the maximum protective duty was 24 per cent, while the general level was about 20 per cent.
=657. Effect of the tariff on industrial development.=—What effect did the tariff policy have upon the industries and the commerce of the country? To this question the only safe answer is that the effect of the tariff was much less, for good or for bad, than has commonly been stated by writers on either side of the controversy between protection and free trade. The country has grown rich from the wealth of its natural resources and the character of its people. The tariff diverted into manufacturing more people than would otherwise have chosen that branch of production, but it did not succeed in making them all prosperous. Manufactures which were suited to the conditions of the time, as the cotton manufacture, grew strong under the tariff, and would have grown strong without it; other manufactures, such as those of iron and wool, were still feeble after years of protection. Commerce must have felt the effect of the tariff, for protection could be effective only as it restricted the exchange of wares with foreign countries. We are tempted to ascribe the rapid increase in imports and exports after 1846 to the reduction in duties. Yet, even here, many other influences favored the growth of our foreign trade, and it is impossible to determine which of them all was most effective.
=658. Changes in the relative importance of shipping ports; southern ports and the export trade.=—In the course of this period the development of new land in the West and Southwest, and the rise in importance of the cotton crop, effected some notable changes in the relative rank of the ports of the country. Measuring importance by the value of the domestic exports, we find that New York now held the first place; this port was in 1860 the shipping point for nearly one third of the total export values of the country. A considerable part of the value of exports from New York, however, was formed of precious metals, attracted there by the banks and the facilities for rapid voyages on passenger vessels. If we confine ourselves to the shipment of ordinary merchandise, we find that New York, in spite of the western connections afforded by the railroads and the Erie Canal, took second place, showing but two thirds of the export values leaving the country by way of New Orleans. This port was the natural outlet for the cotton-growing country of the lower Mississippi valley, and its export of the one ware, cotton, exceeded in value all the merchandise shipped from New York. It was cotton, again, that gave standing to the ports next in rank, Mobile, Charleston, and Savannah; the exports from these cities, aside from that single staple, were insignificant. Old ports like Boston and Baltimore had sunk to the sixth and seventh place, while Philadelphia, once the leader, was still lower on the list, and was outranked by San Francisco, if the gold shipments from that port be counted.
=659. Northern ports and the import trade.=—The reader who remembers what has been said above about the triangular course of trade in this period will not be surprised to learn that the figures of imports tell a very different story. New York enjoyed an import trade nearly double that of all the other ports of the country together; it was the great distributing point for European manufactures, from which the various ports of the country secured most of their supply. Second in rank, but separated by an immense interval, was another northern port, Boston; while New Orleans was but a poor third, and Philadelphia and Baltimore followed in the order named. Other southern ports, ranking high in the value of their exports, had only an inconsiderable import trade.
=660. Changes in the direction of trade. New character of the trade with England.=—There had been changes also in the direction of our trade abroad. The following brief table gives figures in round millions, for 1860, which may be compared with the figures for 1790 given in section 586.
It will be noted that our trade with English-speaking people formed still the most important part of our total commerce. A noteworthy change had taken place, however, in our trade with the British possessions. At any earlier period we imported from them far more than we could sell to them in return; the balance of trade was against us, as men said. This condition had been reversed by the rise of the cotton trade, and was to be still further affected by our export of foodstuffs. Great Britain was now dependent on us for the raw material of her most important manufacture, and was seeking from us also increasing supply of food, for her factory population.
=====================================+=========+======== | Exports | Imports -------------------------------------+---------+-------- Great Britain and her dominions | 228 | 177 Including Canada | 11 | 18 British West Indies | 5 | 1 France and her dominions | 57 | 43 Spain and her dominions | 20 | 44 Including Cuba | 11 | 34 =====================================+=========+========
=661. Trade with Canada and the West Indies.=—Our trade with Canada was of comparatively recent growth. Restrictive duties had formerly checked exchange with our northern neighbor, but as population and industries developed on either side of the frontier a demand for greater freedom of exchange made itself felt; duties were reduced, a reciprocity treaty was negotiated (1854), and under it many articles were exchanged free of all duties.
It will be noted that trade with the British West Indies had not developed to a similar degree; and it would be apparent, if other figures were included in the table, that our West India trade in general was far less important than it had been in the earlier period of our history. Trade with the French and the Dutch West Indies was, in fact, less in 1860 than in 1790. Among all the West India islands Cuba alone was a prominent exception to this tendency to decline. Slavery was still maintained in that island; and the sugar industry, which had felt severely in other islands the abolition of slavery, continued to flourish there.
=662. Expansion of American commerce in Europe, South American, and the Far East.=—It may be said, in general, that our commerce had broken through the rather narrow bounds which had formerly directed so much of it to England and to the West Indies. We were building up our trade with the continent of Europe. Our trade with France had increased greatly under the liberal commercial policy of Napoleon III, and we were establishing profitable connections with other European states, as is shown by the following figures for our total trade with them in 1860 (millions of dollars): German states 33, the Netherlands 10, Italian states 9.
Still more noteworthy is the extension of our commerce to the South and to the Far East. During the period under review the states of Central and South America had won their independence from Europe, and were now free to establish such trade relations as they chose. With Mexico and various states of South America (especially Brazil and the Argentine Republic) we had in 1860 a commerce amounting to about sixty million dollars. Our trade with China amounted to about twenty million; and while our trade with Japan (about $150,000) gave no immediate reward for the American enterprise which had opened the ports of that country, it was at least a promise for the future.
QUESTIONS AND TOPICS
1. See sect. 695 for figures of imports which may be charted for comparison with later development.
2. How did the import trade of the U. S. compare with that of England at about this time?
3. Why was it cheaper for the Americans to buy manufactures abroad than to make them at home?
4. What is the effect of a protective tariff, (a) on commerce, (b) on production, (c) on the price of the product?
5. Industrial development, 1790-1860. [Wright, 132-142.]
6. American coal fields. [Nicolls, part 1; commercial geographies.]
7. Early transportations of coal by rivers and canals. [Nicolls, chaps. 17, 18.]
8. Assuming that the protective duty on iron raised its price to purchasers, what must have been the effect on manufactures and transportation? [Compare the sections on Russia, above.]
9. Development of the American iron industry before 1860. [Taussig; Depew, chap. 46 by Huston; Swank.]
10. Difficulties of the woolen manufacturer. [Taussig; North in Depew, p. 482.]
11. Contributions of the U. S. to improvements in machine tools. [Depew, chap. 49 by Sellers.]
12. Cotton manufactures in the South before the war. [DeBow, 1: 233, 2: 101 ff., 3: 24 ff.].
13. Industrial conditions at the close of the War of 1812. [Histories of U. S. by McMaster and Henry Adams.]
14. Tariff of 1816. [Taussig.]
15. Why was the South opposed to protection in this period? [Review the description of the industries and commerce of North and South, and try to see what effect a protective duty on manufactured wares would have on Southerners.]
16. Study in detail the influences, economic and political, determining the character of one of the following tariff acts: 1824, 1828, 1832, 1833, 1842, 1846, 1857. [Tariff histories by Taussig and others; narrative histories of the U. S.]
17. Study the commercial history of one of the ports named, sects. 645-6. [Local histories; Encyclopedias.]
18. Commerce of the South before the War. [Maury in DeBow, vol. 3, 1 ff.]
19. Reviewing the list of ports, which of the following factors seems to have been most important in determining their relative rank in the import trade: nearness to Europe, excellence of harbor, facilities for distributing goods by waterways, railroad facilities? Can you add other factors of importance to the list?
20. Make a chart of the figures, sect. 660, and compare it with the chart for the earlier period.
21. Effect on commerce with Canada of the reciprocity treaty of 1854. [Haynes, Robinson.]
22. History of the commerce between the United States and South America. [Rutter; Curtis in Senate Exec. doc., first session, 51st Cong., vol. 8; check list 2685.]
23. Development of American commerce in the Pacific. [Callahan.]
BIBLIOGRAPHY
See chapter xlviii.
LI. NATIONAL DEVELOPMENT, 1860-1914
=663. Survey of commercial development, 1860-1914.=—In the chapters introductory to the history of commerce in the nineteenth century, attention was directed to the increasing rapidity of movement, which makes the second half of the century a period by itself, distinguished above all others by its wonderful commercial development. That the United States enjoyed a full measure of the world’s progress in commerce is shown by the following table, which gives the figures of imports and exports in millions of dollars.
==========+=======+========+=======+======= | |Domestic|Foreign| Total |Imports| exports|exports|general ----------+-------+--------+-------+------- 1860 | 534 | 316 | 17 | 687 1870 | 436 | 377 | 16 | 829 1880 | 668 | 824 | 12 | 1,504 1890 | 789 | 845 | 13 | 1,647 1900 | 850 | 1,371 | 24 | 2,244 1910 | 1,557 | 1,710 | 35 | 3,302 1913 | 1,813 | 2,429 | 37 | 4,279 ==========+=======+========+=======+=======
Prices were falling in the last quarter of the century, so that the figures in the text, giving the value of imports and exports, do not do justice to the growth in the physical volume of trade. On the other hand prices began to rise just before 1900 and, therefore, the figures exaggerate the increase of trade in the most recent period. Prices of 1913 were, however, only about one-third higher than in the decade 1890-99 so that after allowance is made for their rise the growth of American commerce in this period remains extraordinary.
=664. Internal development of the country.=—During this period the natural growth of population was augmented by a steady stream of immigration, which has increased with time and has made to appear small in comparison all previous movements of people to the country. In spite, however, of this growth, the increase in the value of foreign trade has been even more rapid, and the share contributed by the average person to the commerce of the country was greater at the close of the century than at any previous period. The average inhabitant had in 1913 a share of about $18 in the imports, and of about $25 in the exports.
While the preceding period was called the period of national expansion, the period lasting from the Civil War to the close of the century may fitly be termed that of national development. The population continued, it is true, to spread out within the national frontiers. It occupied the great plains leading up to the Rocky Mountains region, and the strip of fertile land along the Pacific Coast, and penetrated the mountains and semi-arid region in all parts where mineral wealth and agricultural possibilities promised returns to the laborer. The most striking feature, however, in the progress of the last forty years has been not so much the breaking-in of new territory as the improved means adopted for making the most of all resources, in old and new territory alike. Improvements of a technical character have transformed the methods of transportation and manufacture, and new methods of cooperation have changed the aspects of business life completely.
The first subject requiring attention is the development of the transportation system.
=665. Extension of railroads.=—In the recent history of the transportation system of the United States the most noteworthy feature has been, of course, the development of railroads. The railroad mileage of the country in 1860 was divided almost equally between the North, the South, and the West, each section having roughly 10,000 miles. The section which felt most keenly the need of increased railroad facilities was the agricultural West, where the products of rich farm lands were wasted and where corn was not infrequently used for fuel, for lack of means to reach a market. After 1860 the railroads were rapidly extended through the upper Mississippi Valley, and in 1869 the first transcontinental route was completed (Union and Central Pacific). Railroads reaching out like feelers into new regions attracted population and stimulated traffic not only in the new country but also in the older settled districts, where the opportunities for profitable business were multiplied by the increased supply of raw materials and by the widened market for finished products. Old lines were extended and new lines were built until, in 1913, the mileage of the country had risen from about 30,000 as it was in 1860, to over 250,000, showing an average gain of about 40,000 miles in a decade, a greater amount than the total of 1860.
=666. Improvements in the operation of railroads.=—Equal in practical importance to the extension of the railroad system were the improvements effected during the period in the construction and operation of the lines. This was the time in which steel rails and bridges were introduced, which permitted the use of more efficient locomotives, drawing heavier trains, and so reducing the expense of carriage. Lines which had been constructed in short sections under the control of different companies were now merged in great corporations, operating thousands of miles of track. The railroads had previously been so independent of each other that there was not even a standard gage for the track; some lines set the rails 6 or even 7 feet apart, a California law fixed the gage in that State at 5 feet, while the Missouri Pacific had a gage of 5 feet 6 inches. A difference in gage necessitated, of course, the unloading and reloading of wares in passage from one line to another, and prohibited distant freight movements. Soon after 1860 a movement toward the present standard, 4 feet 8-1/2 inches, brought a uniform gage into use, and when the consolidation of railroads was under way there was no longer a thought of varying from the standard. The first consolidation of a through line from Chicago to the sea was effected in 1869 under the management of Cornelius Vanderbilt (Lake Shore and Michigan Southern and New York Central and Hudson River); and the movement soon spread to other lines (Pennsylvania, etc.). The benefits were greater than the reader may be inclined to suppose. The management of railroads was made at the same time more efficient and less expensive; uniformity of policy was established in such matters as the track gage; and, most important, a new policy of freight rates, designed to stimulate distant shipments, became practicable.
=667. Reduction of railroad rates.=—The charges for freight movements before 1860 rarely fell below 2 cents per ton-mile. Railroad managers believed that the lowest rates which they could profitably make were, roughly, 2 cents for heavy agricultural produce, 3 for groceries, 4 for dry goods. The improvements effected in road-bed and rolling stock after 1860 suggested the possibility of reducing rates, and the reorganization of small railroads in large systems made it possible to institute reductions to stimulate distant freight movements. The results exceeded all expectations. The railroads found that a reduction brought such an increase of traffic that the lower rates were not only an advantage to the shippers, but also a benefit to themselves; and rates have fallen almost constantly in the course of the period. In 1914 the average freight rate was only three quarters of a cent per ton-mile, and some of the lines between Chicago and the Atlantic coast had reduced their charges very close to half a cent.
=668. Contribution of the railroads to recent national development.=—The importance of this change in a country of great distances can scarcely be exaggerated. It has transformed the railroad from a luxury for the use of passengers and high-class freight to a necessity for the producers and consumers of the commonest articles. In 1860 even a ware like wheat could not pay the expense of transportation over a distance exceeding many hundred miles, and distant freight traffic was restricted to manufactures and the most valuable of farm products, such as live stock. The reduction in charges has opened a profitable market for the commonest agricultural products of distant western States, and has made accessible the natural resources of all kinds, which otherwise would count for nothing among the economic assets of the country. In 1913 more than half of the tonnage carried on the railways of the United States consisted of ores, coal, and other products of mines, which could scarcely have been carried at all in 1860. The railroads now carry a tonnage far exceeding that transported through other channels (rivers, lakes, canals, and coasting trade); and it may be said in sober earnest that a considerable proportion of the people in the country would starve, without the means of earning a livelihood, if the railroad improvements that have come since 1860 were suddenly swept away.
Some idea of the growth of railroad service in the United States in recent years can be gained from the accompanying brief table, which pictures the contribution of the railroads in their two important activities, the carriage of freight and the carriage of passengers.
RAILROAD SERVICE IN THE U.S., 1890-1910 (Figures in milliards: 000,000,000 omitted)
==============================+======+======+======+======+====== | 1890 | 1895 | 1900 | 1905 | 1910 ------------------------------+------+------+------+------+------ Tons carried one mile. | 77 | 85 | 141 | 186 | 255 Passengers carried one mile. | 11 | 12 | 16 | 23 | 32 ==============================+======+======+======+======+======
=669. Relative decline in transportation by canals and rivers.=—The development of the railroad system has not entirely done away with the previous systems of internal transportation, but it has reduced them to subordinate importance. The decline is especially noticeable in the case of canals. Even in 1880 nearly half of the total canal mileage had been abandoned and a large number of the canals remaining in operation were not paying expenses. The cost of transportation on the canals has been reduced by deepening them to take in larger boats; tolls have been entirely abolished, as in the case of the Erie Canal; and still the superior speed and certainty of transportation by rail have robbed the canals of the bulk of the traffic. Some of the river routes have fared better. The Mississippi River system, notably, is still an important channel of trade, but even in the territory it serves the railroads far outrank it in importance, and most of the inland waterways have lost their previous significance.
=670. Importance of the Great Lakes; St. Mary’s Canal.=—While the country could now renounce, without very serious loss, the rivers and canals which were formerly so important as means of transportation, it could ill afford to dispense with the Great Lakes along its northern boundary. In the first half of the century Lake Erie was a useful means of communication with the growing States of the West, and gained greatly in importance with the construction of canals after 1825. It was not until the second half of the century, however, that the three western lakes showed their possibilities as channels through which the national resources might be conducted to districts where they could be best utilized. Between 1860 and 1900 the tonnage on the Great Lakes grew sixfold, and increased even more in carrying capacity as wooden sailing vessels gave place to large steel steamers. Freight rates have fallen below one tenth of a cent per ton-mile, and immense amounts of ore, coal, grain, and lumber have thus found a cheap means of access to market.
In 1855 a canal was completed to avoid the rapids in St. Mary’s River at the outlet of Lake Superior, and this canal, since deepened and improved, has become one of the great commercial channels of the world. The Lake Superior region has proved to be wonderfully rich in iron, copper, timber, and other products essential to modern industry. In 1913 the tonnage of vessels passing through the St. Mary’s Canal was greater than the tonnage entering the seaports of the United States from all foreign countries, and was more than double the tonnage passing through the Suez Canal.
=671. Decline of American shipping.=—In contrast with the great development of the means of internal transportation we have to note, in this period, a decided decline in the American shipping engaged in foreign trade. The total tonnage of the country was in 1913 nearly double what it had been in 1860, and entitled the United States to a position high up among trading countries. About one third of this total, however, was employed on the Great Lakes, and most of the remainder was engaged in the coasting trade. Both of these branches of navigation could be, and were, protected by law against the competition of foreign ship-owners. The trade of this country with other countries, however, could not be restricted to American vessels without danger of retaliation; and the attempts of the United States to favor its own vessels in foreign trade, by taxing foreign vessels at the port of entry, had been given up before 1860. Now in this branch of shipping, in which the vessels of all countries of the world compete on equal terms, the tonnage of the United States declined from 2.5 million in 1860 to 1.0 in 1913.
=672. Effect of the Civil War on the merchant marine.=—Of this great loss in tonnage the larger part fell in the years immediately following 1860, the period of the Civil War. The southern States, unable to break the blockade which closed their ports and prevented the sale of their cotton, sought to retaliate by loosing swift cruisers to prey on the ships which sailed under the United States flag. The most celebrated of these cruisers, the Alabama, was fitted out in England, and for two years, until its destruction by the Kearsarge in 1864, haunted the chief routes of trade, and captured no less than 69 vessels. Other cruisers were less successful, but altogether 261 Northern vessels were taken. The fear of capture caused a decline in tonnage far greater than the actual losses at sea; American ship-owners found their profits eaten up by heavy insurance charges, and sold their vessels to foreigners, who could navigate them in safety under a neutral flag. Altogether the country came out of the war with about a million tons of shipping less than it had owned at the beginning.
=673. Other causes of decline.=—The American merchant marine would have recovered from the losses of the war but for other difficulties which it faced. This was the period in which steamers began to gain rapidly on sailing ships, and in which iron began to be extensively used in ship-building. The Americans had at this time neither the resources nor the experience to compete with the English in the new forms of naval construction, and even before the war it was apparent that the English were drawing ahead. Moreover, the war had, indirectly, a great influence on the fortunes of American shipping, for it led to a great increase in the tariff and to heavy taxes of all kinds. It cost more both to build and to navigate an American ship than it had cost before the war or than it cost an English owner. Add to these influences the fact that the country was just entering the period of great railroad extension, and that the West now offered wonderful opportunities for the investment both of labor and capital; and it is not surprising that the American people turned from the sea to the land, and resigned the high position which they had formerly held in foreign carrying-trade.
=674. Recent position of the merchant marine.=—Since 1860, therefore, the United States has relied mainly upon foreigners to carry its freight across the seas. Of the tonnage that cleared from ports of the United States for foreign countries in 1913 about one quarter sailed under the American flag. The effective service of American ships did not, however, correspond to this proportion; they carried only about one-tenth in value of the exports that went out by sea. Various attempts have been made to stimulate the construction and navigation of American ships by the grant of subsidies from the national government, but the success has been very moderate, and the people have been in general unwilling to levy taxes for the support of this particular industry. In one respect legislation has become more liberal; the Panama Canal Act of 1912 made it at last possible, under somewhat severe restrictions, to register under the American flag foreign built vessels engaged in foreign trade.
=675. Development of national manufactures.=—Part of the energy diverted from the sea found a fruitful field of labor in the developing manufactures of the country. The period from 1860 to 1914 marked the advance beyond the age of trial and experiment in the history of American manufactures; at the close of this period the United States was the greatest manufacturing country of the world, supplying most of its own requirements for manufactured wares, and producing a large surplus for export to other countries. The development of the transportation system was the indispensable condition of this progress. The railroads have brought all parts of our great national domain so closely together, in a commercial sense, that the choicest natural resources of the continent have been made available at the centers of production. Abundant labor has been supplied both by the growth of the native population and by the increasing flow of immigrants. Leaders have arisen from the people, stimulated to energy by the rapid promotion which has been granted on proof of signal ability; and the necessary capital has been contributed by investors in all parts of the world, who have sought eagerly the opportunity to share in our industrial gains. Finally, our factories have enjoyed an advantage beyond those of any country, in the great market which has stood waiting to receive their products. Within boundaries, each of which measures thousands of miles, lay an area absolutely free to trade, provided with the most efficient instruments of transportation and communication, and settled by a people numbering nearly a hundred million, of prosperous producers and educated consumers.
=676. Coal production and the use of steam power.=—Not until this period did the country realize the full value of its hidden mineral wealth. The coal deposits of the United States are thought to be richer than those of any other whole continent, and the Ohio Valley has coal mines together with iron deposits and rich agricultural resources in a combination which is unmatched. The coal production of 1860 (13 million tons) was considerably larger than in previous decades, but it seems insignificant in comparison with 240 million of 1900, or the 509 million of 1913. Bituminous coal, the kind chiefly used in manufactures, formed only one third of the total output in 1850 and only one half even in 1870, while in 1913 it comprised four fifths of the whole. In coal production the United States now led the world.
The vast increase in the coal product was used in innumerable ways, but it found its chief employment in furnishing motive power to the transportation system, and to the factories of the country. In studying the history of coal production one is inclined to say that the country did not really enter the age of steam until after the Civil War. The total horse-power employed in manufactures in 1869 (2.3 million), was derived from steam and water in almost equal proportion. In the period closing in 1914 the power employed increased about ten-fold (to 22.5 million), and of the increase steam supplied nearly three-quarters.
=677. Machinery.=—That the Civil War really marks a dividing line in our industrial progress is shown by the history of the Patent Office; within a few years after the close of the war the number of patents granted increased greatly, and the new level thus established was steadily maintained. American machine manufacturers made in this period their great contributions to mechanical progress: the system of interchangeable parts, automatic and specialized machines, the utilization of by-products, etc. Brass screws at one time could be produced only at great expense; it is characteristic that some manufacturers would now make them absolutely free of charge, if the customer would furnish the brass rod and would allow them to keep the chips of brass which were cut off in the process.
It is impossible here to trace the history of manufactures in detail, but a single manufacture, that of carpets, may be taken for illustration. In the carpet industry about 1835 modern factory methods were unknown; weavers worked at home with old-fashioned hand looms, producing 7 or 8 yards of inferior carpet per day. Power looms were invented, and were introduced little by little, but even after the Civil War nearly half the carpets were still woven on hand looms. Since that time has come the great advance in the industry, by the introduction of improved power machinery, which has reduced the price of fine tapestries and Brussels to that formerly paid for the rudest ingrain, and which has stimulated an immense increase in consumption.
The rapid development of the national manufactures in this period may be shown by brief statistics, in thousand millions of dollars; the capital invested grew from 1.0 to 22.8 while the value of the product grew from 1.9 to 24.2.
=678. Extension of manufactures in the West and South.=—There had been, moreover, a noteworthy change in the distribution of manufactures throughout the country. The northeastern States had greatly extended their manufacturing plants, and relatively to population no European state rivalled New England in output: but American manufactures had extended also into the West and the South. The southern States, instead of sending their raw cotton to the North or to Europe, began to manufacture it in increasing quantities, and now competed with northern mills for the markets of the Mississippi Valley. The development of iron production in the South was phenomenally rapid. The rich coal and iron fields of the Southern Appalachian range were opened, and contributed now an important share of the total output, while large industrial centers were growing up in Chattanooga, Birmingham, and other Southern cities.
QUESTIONS AND TOPICS
1. Chart the figures as before; if the same scale is used the chart may be pasted to that previously made.
2. Industrial aspects of the Civil War. [Wright, 143-158.]
3. The population of the country was as follows, in round millions: 1860, 31; 1870, 39; 1880, 50; 1890, 63; 1900, 76; 1910, 92. Calculate the commerce per capita, and insert the line on the chart.
4. What has been the gain in population of your own State in this period, compared with earlier periods? [Abstract of the Census.]
5. Write a report on the history of one of the western railroads. [Cy Warman, Story of the railroad, N. Y., Appleton, 1898, $1.50.]
6. Technical improvements in railroads. [See references in chap. xxx, and Johnson, chap. 4.]
7. Development of railroad organization. [Hadley, chap. 5.]
8. Contributions of railroads to industrial development. [Hatfield, Lectures, 81 ff.]
9. Freight service of the modern American railroad. [Johnson, chap. 9.]
10. Present and future of the Erie Canal. [Encyclopedia; Poole’s Index.]
11. Possible future of ship canals in the United States. [Report of the Deep Waterways Commission, House Doc. 192, 54th Cong., 2d. sess.]
12. River transportation in the Mississippi Valley. [Abbot, chap. 8; Census, 1890, Transportation by water, pp. 393-465; Report of Indust. Comm., 1900, 9: clxxxiv-clxxxviii.]
13. Place of the Great Lakes in our modern transportation system. [Tunnell; Marvin, chap. 17; Abbot, chap. 7.]
The St Mary Canal. [Tunnell; Fairlie, Ship canals, p. 67 ff.]
14. What would be the effect on lake traffic of commercial union with Canada?
15. The coasting trade of the United States. [Marvin, chap. 15; Van Metre in Carnegie History, vol. 1, chap. 20, 21.]
16. Effect of the Civil War on shipping. [Marvin, chap. 14; Cambridge Mod. Hist., vol. 7, chap. 17, by Wilson; Rhodes, Hist.]
17. Decline of American shipping since the War. [Marvin, chaps. 16, 18; Wells.]
18. The question of subsidies. [Ringwalt, Briefs.]
19. Ship building in the United States. [Depew, chap. 18 by Cramp; B. Taylor in Fortnightly Rev., 1899, 71: 284-299; John H. Morrison, History of New York ship yards, N. Y., 1909.]
20. Taking the heads suggested (natural resources, labor, capital, means of transportation, market), how would the following countries, in your opinion, compare with the United States as a field for the development of manufactures: Belgium, China, Germany, Russia, France?
21. Industrial development, 1860-1890. [Wright, 159-188.]
22. Transportation of coal by railroads. [Nicolls, chaps. 19, 20, 21.]
23. Geography and organization of the coasting trade in coal. [Nicolls, chap. 22.]
24. Methods employed in American coal mines. [Nicolls, part 2.]
25. Power employed in manufactures. [U. S. Census, Manufactures, General report, Abstract of the census of manufactures.]
26. The New South. [Coman, 292-298.]
BIBLIOGRAPHY
BIBLIOGRAPHY.—See chap. xlv and add: Poole’s Index and its continuations, Annual library index and Readers’ guide to periodical literature; debaters’ handbooks, ed. R. C. Ringwalt, E. R. Nichols, and Debaters’ handbook series.
GENERAL.—Wells, **Rec. econ. changes; Edward Atkinson, *Industrial progress, N. Y., 1890, *Distribution of products., N. Y., 1892; H. R. Hatfield, ed., *Lectures on commerce, Chicago, 1904; J. F. Rhodes. *History of U. S., N. Y., 1893 ff.; R. Mayo-Smith and E. R. A. Seligman, **Commercial policy, 1860-1890, Leipzig, 1892.
SPECIAL.—Railroads: J. Moody, **The railroad builders, New Haven, 1920; Cy Warman, *The story of the railroad, N. Y., 1898; C. F. Adams, Jr., and Henry Adams, Chapters of Erie, Boston, 1871. Lake trade: J. C. Mills, **Our inland seas, Chicago, 1910; G. Tunnell, *Transportation on the Great Lakes, Jour. of Pol. Econ., June, 1896, 4: 332-351; Charles Moore, editor, The Saint Marys Falls canal, Detroit, 1907, S. V. E. Harvey, Jubilee annals of the Lake Superior ship canal, Cleveland, 1906. Industrial: H. Thompson, **The age of invention, New Haven, 1921; J. W. Roe, *English and American tool builders, New Haven, 1916; B. E. Hazard, Organization of the boot and shoe industry before 1875, Cambridge, Harvard Press, 1921; M. T. Copeland, The cotton manufacturing industry, Cambridge, 1912.
SOURCES.—Material in government documents becomes in this period much richer and more varied. Beside the reports on Commerce and Navigation (including many special reports on Internal Commerce) and Commercial Relations, see the Statistical Abstract, Monthly Summary of Commerce and Finance (including current statistics and useful monographs), the Census, Reports and Statistics of the Interstate Commerce Commission, Report of the Industrial Commission, 1900-02, Reports of the Tariff Board and Tariff Commission (including noteworthy reports on cotton and wool manufactures, 1912.) The Bureau of Manufactures, later termed Bureau of Foreign and Domestic Commerce, issued in its Miscellaneous series, a number of reports useful for a survey of commercial conditions just before the outbreak of the World War; no. 11., American manufactures in foreign markets; no. 14, Annual review of the foreign commerce of the U. S., 1913; no. 15, Trade of U. S. with the world, 1912-13; no. 38, do. for 1914-15; no. 23, Trade of the U. S. with other American countries, 1913-14; no. 33, Ports of the U. S. (terminal facilities, commerce, port charges, etc., at 68 selected ports).