Olivia Alphonsine Zivot

The legacy of slavery in America is a complicated and contentious one. From a social perspective, the consequences of slavery continue to unfold, and American society continues to grapple with modern echoes of the racial schism upon which the country was built. From an economic and historical perspective, there is still much debate among scholars regarding slavery’s economic legacy, particularly in the 18th and 19th century. This paper will explore the economic realities of slavery in the United States, and address the commonly circulated claim that slavery was, in the words of a 2018 article on History.com, “the Economic Engine of the South” (Timmons). Across economic and social disciplines there has been a persistent narrative that slavery itself was the source of this economic boom. Over the past decade, several historians, among them Edward E. Baptist, Sven Beckert, Walter Johnson and Calvin Schermerhorn, posited that slavery was integral in the development of American capitalism. As early as 1846, Karl Marx himself stated in his work “The Poverty of Philosophy” that “without slavery there would be no cotton, without cotton there would be no modern industry” (Bellamy et. al 2020). During the 1800s, the United States did indeed undergo previously unseen economic growth. In the words of economic historian Gavin Wright (2022):

“The United States was never poor by world standards, but in the 1780s, the country was fragmented, underdeveloped, and nearly stagnant economically. By 1860, per capita growth had accelerated to 1.7 percent per year, and the US economy was a formidable player, on its way to world leadership by the turn of the twentieth century,” (123).

In his most recent publication, “Slavery and the Rise of the Nineteenth-Century Economy” (2022) Wright asks a provocative question: “did slavery play a primary and indispensable role in the rise of the US economy to world preeminence?” (123). Modern discussions and interpretations of this issue have become intermingled with the national conversations on racial disparities, thus making the answer more complex. Throughout time, it has been claimed by so-called “pro-slavery apologists” (Wright 123) that slavery itself was a key factor in this economic boom, but in fact, there is substantial evidence to counter this claim; Wright has argued that, “neither slavery nor cotton were instrumental in the American growth acceleration of the nineteenth century” (142).

In 1995, the economic scholar Robert Whaples conducted an anonymous survey of 178 members of the Economic History Association, to determine where there was consensus or disagreement among scholars. The survey found that out of the group of 40 propositions put forward, the ones most disputed by economic historians and economists were those about the postbellum economy of the American South. The only exception was the proposition initially put forward by Gavin Wright in his 1987 essay, “The Economic Revolution in the American South.” The survey showed that 62 percent of economists and 73 percent of historians agreed with Wright’s proposition that the “modern period of the South’s economic convergence to the level of the North only began in earnest when the institutional foundations of the southern regional labor market were undermined, largely by federal farm and labor legislation dating from the 1930s.” In other words, Wright claims that the South did not truly enter a prosperous economic position until the institution of slavery was fully abolished, and industrial production adapted to the modern system. The true sources of long-term economic success in the United States were, according to Wright, “improvements in technology, internal transportation, finance, and education, and the slave-owning South lagged in all of these areas.” He summarizes these trends succinctly, stating that “slavery enriched slave-owners, but impoverished the southern region and did little to boost the US economy as a whole. (124). Early “economic interpretations” of the Civil War, such as those made by Charles and Mary Beard in their book “The Rise of American Civilization (originally published in 1927), made what Wright refers to as, “the mistake of minimizing the importance of slavery itself as a root cause of regional conflict: these arguments held that slavery was a hot-button moral debate, but the “real” issues were economic” (141).

In order to fully understand these points made by Wright, it is necessary to understand the economic context of slavery and how it changed over time. As early as the 16th century, slavery was legal in all the British colonies, but it was practiced on a larger and more organized scale in what became the US South and the British Islands of the Caribbean. African slavery in the Southern states was largely a response to the growing demand for labor: tobacco, rice, and indigo plantations were growing exponentially and required more labor than was available among the colonists and their families. In his 1966 book “The Negro in Colonial New England, 1620-1776,” historian Lorenzo Greene stated that “On the eve of the American Revolution [the slave trade] formed the very basis of the economic life of New England. The vast sugar, molasses, and rum trade, shipbuilding, the distilleries, a great many of the fisheries, the employment of artisans and seamen, even agriculture—all were dependent upon the slave traffic” (68-69). Farms and agriculture in the Northern settlements were generally smaller, family-sized plots of land with the family supplying most of the labor. Before the American Revolution (1775-1783) there was little to no support for the abolition of slavery, but by the early 1800s most Northern states had passed laws in favor of a gradual movement away from slave labor (Williamson & Cain 2020). On the other hand, slavery in the Southern states remained an integrated part of the economic, legal, and social landscape. Slaves and their offspring were the official property of an owner, and ownership lasted for life. They could be bought and sold, and the contract of a sale was a legal document, “even to the extent that a buyer could sue the seller if a slave was sold under false pretenses” (Williamson & Cain 2020).

In the earliest days of the newly independent United States, slavery was not absent from the North, but it was less profitable, because the marginal revenue made from farm labor was not high enough to warrant the cost of African slaves. The following table illustrates the stark contrast in population demographics of the United States in 1790 (taken from Wright, 2022).

Furthermore, it has been shown that a very small percentage of white Southerners actually owned most of the wealth in the region, rather than wealth being evenly distributed among the population. According to the Census of 1860, there were 393,975 slave owners in the slave states out of a population of 12,240,293, meaning that only 3.22 percent of the population of the fifteen slave states were actually slave owners. To further understand the starkness of the North-South economic disparities, the following graphic from Wright (2022) demonstrates the disparities in farm value in the year 1860.

An important note in this discussion is that slave-owners were in fact, very wealthy individuals, not just compared to Southern whites who didn’t own slaves, but compared to most people in the North as well. In their 2020 article “Measuring Slavery in 2020 Dollars,” Williamson and Cain consider and discuss the economic parameters of owning slaves during the 18th and 19th century. Their article asks several questions, including “what is the motivation for owning a slave?” and “what determines the price of a slave at a given point in time?”

On the surface, the answers are obvious: the value of slavery would have been driven by market demand, and more specifically, market demand on the products that slave labor produced. In the authors’ words, “the value of a slave is the value of the expected output or services the slave can generate minus the costs of maintaining that person (i.e., food, clothing, shelter, etc.) over his or her lifetime.” Williamson and Cain also address the question, “What is the comparable ‘value’ of a slave in today’s price?” From their calculations, they estimate that “at the time the South seceded from the Union, the purchase of a single slave represented as much as $180,000 and more in today’s prices.” The relevant demographic data to be considered in determining the value of a slave’s expected revenue would include “sex, age, location, how much he or she is likely to produce (a factor that included a slave’s health and physical condition), and the price of the output in the market.” For a female slave, an additional value would be placed on her ability to bear children, which a slave-owner could keep or choose to sell at their whim.

The economic and political power of owning slaves increased as demands for cotton soared during the the 19th century. In 1794, the American inventor Eli Whitney patented his revolutionary machine, the cotton gin, which separated cotton fibers from their seeds at a much more expedient rate than when done by hand. As rising British production of cotton goods put pressure on traditional supply sources, global prices for raw cotton surged in the 1780s and 1790s (Broadberry & Gupta 2009). During these latter decades of the 18th century, Southern plantation owners were actively searching for an alternative to tobacco, grains and indigo, whose global demand and prices were falling. After much experimentation, “they found a likely answer in upland cotton, a discovery that in turn created the production bottleneck addressed by the introduction of the cotton gin” (Wright 133). While the rise of cotton breathed new economic life into slavery, it was not obvious at the outset that the crop was especially compatible with slave labor. Cotton became a slave crop because the farmers looking for alternatives were already slave-owners, not because of technological advancements. As historian Joyce Chaplin wrote in 1991: “Early cotton cultivators used cotton to preserve a world already shaped by commercial agriculture and slavery” (199).

Although the Southern economy did grow markedly during the first half of the nineteenth-century, the geography of that expansion was significantly different than that of the free states. Farmers and industrialists from the Northern states steadily and enthusiastically expanded westward, and in the process created the need for transportation infrastructure to bridge the gap between newly-settled and existing towns. On the other hand, slave-owners in the south simply “leapfrogged to the rich cotton lands of the southwest” (Wright 132). Slave owners had no little to no incentive to expand because their labor force did not need to be coerced with the financial promises of new settlements. For this reason, the South had significantly slower growth in terms of transportation infrastructure, such as railroads and canals. Socially, there was a growing divide between Northern and Southern sentiments towards industrialization. Journalists from free states visited the South and openly reported on the “economic backwardness” of this “peculiar institution,” (Wright 135), but those who owned slaves had no economic reason to regret their choice; free states, while abandoning slavery in their own territories, were still buying and importing the goods produced with slave labor in the South. In fact, it can be argued that the aforementioned delays in infrastructure development were complimentary to the slave-owning South’s political agenda. As Confederate politician Louis Wigfall told a British correspondent in 1861 (Quoted in King, 1970):

“We are a peculiar people, sir! … We are an agricultural people; we are a primitive but civilized people. We have no cities—we don’t want them. We have no literature—we don’t need any yet … We want no manufactures: we desire no trading, no mechanical or manufacturing classes … As long as we have our rice, our sugar, our tobacco, and our cotton, we can command wealth to purchase all we want from those nations with which we are in amity, and to lay up money besides.” (126)

From this quote, it is clear that the political and economic interests of the South were in direct conflict with those of the rest of the Union. The growing divide between Southern and Northern interests became the crux of the American Civil War, and slavery was the main institution holding the South together. In the 1850s, the Republican Party emerged in the midwest with the primary goal of opposing the extension of slavery into the northern territories. “The new party also advanced an activist, pro-growth agenda for the federal government, one that had been taking shape for decades” (Wright 141). One part of the program, supported by north-eastern manufacturers and opposed by the South, was the protective tariff. Another major item was an ambitious federal infrastructure plan, to foster agricultural development and improve access to markets. However, the South opposed such proposals on the grounds that they would mainly benefit other regions and not their own. Wright (2022) summarizes these sentiments:

“Thus by the 1850s, the slave South stood in opposition to a long agenda: a Homestead Act; infrastructure investments including the Pacific Railroad; currency and banking reform; and federal support for agricultural research and education. Much of this program was in fact enacted with Lincoln’s election in 1860, and the departure of southern representatives from Congress.” (141)

On November 6, 1860, Abraham Lincoln was elected the sixteenth president of the United States, as the first Republican president in the nation who represented a party that opposed the spread of slavery in the territories of the United States. In his 1858 “House Divided” speech, Lincoln said:

“Either the opponents of slavery, will arrest the further spread of it, and place it where the public mind shall rest in the belief that it is in the course of ultimate extinction; or its advocates will push it forward, till it shall become alike lawful in all the States, old as well as new, North as well as South.”

Lincoln’s Republican platform demonstrates the realities of this national ideological conflict at the time. However, the debate over slavery was more than just a moral one – it represented the uncertainty of the future of the American economy.

According to Wright (2022), “New York City was both the nation’s leading port city and financial center before cotton became economically significant. Because the city is one of the world’s largest natural harbors, it is more accurate to say that ‘New York attracted cotton’ than that ‘cotton made New York’” (139). Just before the Southern secession in December of 1860, the writer J.D.B. DeBow wrote that New York was “almost as dependent upon Southern slavery as Charleston itself” (Quigley 283). These words may be taken at face value if one considers that the largest market for cotton at the time was in New York City. In his 2020 book “The Kidnapping Club: Wall Street, Slavery, and Resistance on the Eve of the Civil War,” the historian Jonathan Wells comments on the attitudes of New York City elites towards slavery in the South: “New Yorkers knew that they were dependent on southern cotton and the slave system that planted, picked and packaged it” (13). Furthermore, when the South seceded from the Union, Fernando Wood, who served as the Mayor of New York City for three non-consecutive terms, even proposed that New York should secede as well and establish itself as a free city. Beckert (2014) points out that although there was a small group of elites who wanted to accommodate the slave system for the sake of personal interests, there was also growing movement in New York City who opposed the institution:

The political power of southern slaveholders over the federal government was nothing less than a threat to the United States and to their own economic well being … Moreover, the political power of these southern slaveholders, these businessmen began to argue, prevented necessary reforms in the banking, currency, credit and transportation systems. (90-91).

These viewpoints from New York City, the center of American financial capitalism, illustrate the views of a growing community of economic interest in the Northern states, in which the slave South not only had no appropriate place, but also stood in the way of economic growth.

In this analysis it becomes clear that the institution of slavery only served the economic interest of very few, and certainly did not directly contribute to the United States becoming an economic world leader. Yet, there is a persistent narrative that slavery itself was the secret ingredient in America’s economic success. This misattribution is the result of many complex factors, not least of which is the power of narrative in the retelling of history. In his highly influential book “Capitalism and Slavery” (1944) Eric Williams, who later became the prime minister of Trinidad and Tobago, asserted that the institution of slavery “was the engine that propelled Europe’s rise to global economic dominance” (Mintz). The economic success of America, he insisted, “came at the expense of black slaves whose labor built the foundations of modern capitalism.” Furthermore, Williams contended that it was not moral convictions that led to the abolition of slavery, but rather economic self-interest and greed. At the time of its original publishing, the ideas put forth by Williams were equal parts provocative and convincing, and it’s clear that the narrative has persisted, given the enduring popularity of the claim.

In summation, scholars who seek to study the economic history of early America are faced the additional challenge of putting slavery in a context which agrees with modern attitude towards racial injustice. In all cases, but especially in the United States, the study of economic history is crucial for understanding the modern political and social systems in which the modern economy exists. In this analysis, one major point has become clear: slavery played an inconsequential role in America’s development as an economic world leader, but the sociocultural ramifications of slavery are still being calculated.

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