A Short History of American Capitalism
 Copyright 2002 by Meyer Weinberg. All Rights Reserved.  

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Chapter 4


At the outbreak of the Revolution in 1775, America was already a slave society. On the eve of the Civil War, eighty-six years later, the United States had become one of the leading slave powers in world history.

In 1860, the market value of all enslaved workers in the United States was slightly over three billion dollars.1 The return on investment was greater than that of any alternative field.2  Apart from direct exploitation of enslaved workers, "slave trading was one of the planters' most profitable and widely practiced enterprises."3 Between 1802 and 1860, the value of crops produced by a slave rose from $14.68 to $101.09.4 To raise the productivity of enslaved workers, especially on larger plantations, the gang system was used "to speed up the pace of labor, to increase its intensity per hour."5 Violence against the enslaved workers was another means of promoting productivity or discipline. Slavery became "a relationship that ultimately rested on the whip."6 As Oakes writes: "In theory, whipping was a last resort; in practice, it was the disciplinary centerpiece of plantation slavery."7

Cotton brought great prosperity to the slaveowners of the South. In fact, writes Fogel, "the South was more prosperous than France, Germany, Denmark, or any of the countries of Europe except England."8 It is no wonder, since the enslaved workers' share was pressed to an irreducible minimum. During the last decade before the Civil War, a largely prosperous period, "if anything, slavery became more oppressive. …"9 Robert Margo declares that "there is no evidence that slaves shared in pre-Civil War southern economic growth."10

During the 70 years after 1790, cotton planters drove some 835,000 enslaved workers into new cotton areas of the then-Southwest (Alabama to Texas).11 This great boon to cotton profits was a disaster for the enslaved workers. According to Charles Sellers, some 600,000 slave families were destroyed by this movement during 1820-1860.12 Younger men, especially, were shifted westward with the customary disregard for the family unit. At the same time, many Indian people were compelled to move westward into present-day Oklahoma and elsewhere. This pattern of wealthy profit and worker deprivation permeated the society, including, for example, education. Planters' sons attended Yale College in the U.S. or universities in England while their fathers passed laws in southern state legislatures making it illegal to teach enslaved workers to read or write.13

Cotton exports were of critical national importance during the years 1815-1843. Foreign exchange poured into the United States and financed the import of machinery and other manufactured goods. In the years after 1843, American exports of manufactured goods and grains lessened the relative importance of cotton exports. Meanwhile, however, cotton production continued to stimulate various industries in the United States. Referring to the northern center of shoe manufacture in Lynn, Massachusetts, Paul Faler observes that "many a fortune was made in the Southern trade during the years before the Civil War."14 The flow of cotton northwards and then overseas stimulated the development of financial and shipping services that could not be provided by southern firms.15

Those who gained most from the cotton boom were the more than 45,000 planters who in 1860 owned 20 or more slaves and thus were regarded as "very rich."16 Persons in this ranking were in the top five percent of white families in the South.17 During the 1850s, "the real wealth of the typical gang-system planter increased by 70 percent."18 The right to extract such enormous profits from the labor of enslaved workers lay at the core of what planters regarded as a sacred property right. Less than a year before the Civil War, President James Buchanan, Abraham Lincoln's predecessor, referred to the ownership of human beings as deserving to be protected "precisely in the same manner with any other property."19

Enslaved workers labored in mining, manufacturing, crafts, and on canals and railroads. Around 1820, in the present West Virginia, rented enslaved workers worked along with Englishmen and Welshmen.20 In the eastern part of Virginia, most ironworkers were enslaved laborers. At the Tredegar Iron Works in Richmond about half the work force was made up of enslaved workers. Seventeen pig-iron establishments in Tennessee were staffed with about 1,000 enslaved workers.21 Bradford notes that "at the furnaces and forges slaves… did everything but manage the establishments. …"22 "The elite among them," he continues, "were the refiners, molders, and blacksmiths, and because a skilled slave was as valuable as two ordinary hands, many ironmasters owned a few skilled [enslaved] workers."23

Early on, when railroads were first built, planters frequently invested in the enterprises by contributing the labor of enslaved workers who worked on the roadbed.24 As time went on, they became more important. As Licht points out:

In the antebellum period, hired slaves formed the backbone of the South's railway labor force of track repairmen, station helpers, brakemen, firemen, and sometimes even enginemen. The southern railroads … faced strong competition for slave labor from the agricultural sector. As a result, southern rail companies were forced in many cases to purchase slaves directly and provide for their upkeep.25

By 1860, the Nashville, Chattanooga, and St. Louis railroad had spent $128,773.29 for enslaved workers.26 (After the Civil War, when racial segregation of the work force was brought about by the railway unions, free blacks were denied access to some of the same jobs they had worked while enslaved.) Throughout Southern Appalachia "trained slaves … operated boats to inland regional markets, like Richmond, Lynchburg, Augusta, Savannah, or Columbia."27

In one degree or another, all slave law was commercial law since the enslaved worker was highly valued property who frequently entered into commercial transactions. Principles derived from the sale, purchase, and other exchanges of farm animals were applied to transactions involving enslaved workers. Even when an enslaved worker was tried for murder and found guilty, his or her punishment did not end the matter. In Virginia, between 1705 and 1865 for example, a master was compensated by the state when his or her enslaved worker was executed.28 The master's property right was recognized even after the "property" no longer existed. The solicitous Virginia state legislature chartered an insurance company in 1835 to insure masters against loss due to an escaped enslaved worker.29

Southern courts and legislatures regularly afforded slave masters consumer protection in their purchases of enslaved workers. As Schafer observes: "Slaves … legally were considered defective merchandise in a sale if they were diseased."30 An enslaved worker who was an habitual runaway was found to have a "vice of character" and the sale was void.31 In 1853, Jacob, an enslaved worker , was found by a court to have escaped "without provocation."32 (Apparently, simply being enslaved was not provocation enough.) In South Carolina half the state's sales of enslaved workers were conducted by courts; most frequently, such sales arose from credit transactions masters had entered into with enslaved workers serving as collateral.33 In Georgia, a purchaser complained to a court that an enslaved worker's children were unsound because their mother had been found to be tubercular; the court, however, held that since they were born before their mother contracted tuberculosis they had been born of sound condition.34

Wahl, who reviewed 10,989 cases regarding slavery, concluded that "all the appellate court cases involving slave sales show … that judges typically came to verdicts that facilitated the smooth operation of the domestic slave trade and, thus, the institution of slavery itself."35 Not only were all southern judges defenders of slavery; many were themselves slave masters.36 Magistrates of Kentucky county courts were far more frequently slave owners than were the general population.37 Fogel sums up the matter with concision: "The power of the masters arose from the fact that the state invested them with virtually unconstrained authority to deal with slaves and provided the judicial backing and physical force required by that authority."38 Slave criminal law also reflected the same relationship.39

During the Civil War, the production of cotton fell sharply, from 4,500,000 bales in 1861 to 300,000 bales in 1864; prices rose significantly during 1860-1861 to 1864-1865, from 13 cents a pound to over 83 cents.40 Well-to-do planters were easily able to purchase a substitute to serve in their place in the Confederate army and overseers on plantations with twenty or more enslaved workers were exempt altogether from military service. Enslaved workers were not subject to the draft. While some of the wartime cotton output was sold, much of it was secreted away, held for sale after the war. Both governments looked the other way when cotton was traded over the lines since it was a necessary element in much war production. These planters as well as many of the larger-scale merchants in the South at war's end "could command the cash and credit needed for economic reconstruction."41 Meanwhile, the southern ruling class successfully pursued its economic interests, despite presiding over a losing war. When the Confederate government pressed planters to switch to food production, the planters refused. They did likewise when urged to lend or hire out their enslaved workers to relieve labor shortages.42 Koistinen characterizes the southern ruling class as follows:

Its cotton, its slaves, and its privileges appeared more important than the survival of the society to which it was dedicated. … The failure of leadership … was that of an entire ruling class, not just of the president leading the region during its most critical ordeal.43

Enslaved workers viewed this scene with hope.

To enslaved workers, the armed conflict was not truly a civil war since blacks were found on only one of the two sides. Wholesale flight from plantations was their first opening to freedom, especially in parts of the South where Union army troops could be found. Enslaved workers generally fought for the Union side, and did not encounter relatives who fought for the Confederates. They were not concerned with maintaining the Union, however, since they had never been part of it. Liberation was their only concern, and warfare against the slave masters was the opportunity of a lifetime.

"By the fall of 1862" — barely a year after war's outbreak — "the Union war effort rested in large measure upon the labor of former slaves."44 They worked as soldiers, laborers, and workers on Union-government-occupied plantations. On the latter they rejected any practices that smacked of slavery. "When black men and women accepted employment on plantations, they demanded not only wages but also control over the pace of work, access to land and other resources for independent production, and recognition of their right to keep poultry and hogs."45 As a result they were able to lessen their dependence on wages by selling eggs and other products. Unlike many northern abolitionists who seemed to adore the transition from slavery to wages, most newly-freed blacks preferred economic independence in the form of land ownership. They were, after all, well-acquainted with the meager opportunities offered free blacks before the war. Most important, they experienced serious discrimination during the war years while in the employ of federal and private employers. At the same time, free workers proved able to use the physical presence of Union troops to strengthen their bargaining power vis--vis their old masters. Many were attracted to armed service: "Eventually, 57 percent of Kentucky's black men of military age served in the army, as did 39 percent of those in Missouri and in Tennessee and 28 percent of those in Maryland."46

Here and there, new workers obtained land and entered peacetime on favorable terms. Many more, however, were compelled to take their chances. A year before war's end, abolitionist leader Wendell Phillips told the American Anti-Slavery Society: "If I was a negro and a slave, I should pray God that this war might last twenty years. …"47 Five months later, he told a similar audience in Boston: "War, war, forever, oh God! Until this nation acknowledges the manhood of the Negro!"48 Five months of peacetime, however, proved that Phillips's fears were well-founded. All too many federal policies demonstrated the lack of readiness of government to use its full powers on behalf of economic justice for the freedman. In September 1865, abolitionist leader Gerrit Smith wrote to Phillips and William Lloyd Garrison. Referring to slavery, Smith declared:

Some of its technicalities may disappear; but its substance will all remain. A peonage, or serfdom, or some other form of bondage … is to be the condition of that people. …49

Garrison's publication of this somber letter in the early days of Reconstruction was an effort to underscore the urgency of a solution to the economic plight of the freed people.

Free Labor

Between 1790 and 1860, the United States developed its first capitalist industry — textile manufacture. At the same time, a full-scale working class was formed. Neither development was seriously slowed by the existence of enslavement. On the eve of the Civil War, neither among the bourgeoisie nor the free working class could there be heard urgent calls for an end to slavery. Enslaved workers were the only sizable social group in the country that favored the immediate and complete abolition of slavery.

Aside from farming and artisan work, little in early America was produced for sale. As Degler reminds us: "The census of 1810 reported that the value of cloth manufactured in the home was ten times greater than that produced outside the home."50 During the War of 1812, however, commercial production, both inside and outside the home, increased significantly. Household manufacture, the dominant form in 1815, thrived so long as transport difficulties precluded any wider market than the home or neighborhood. (In 1813, a magazine hailed the feat by a 3-horse "waggon", loaded with $3,000 worth of merchandise, of traveling from Boston to Philadelphia in only two weeks.)51 Basically, the household system of production was in part simply an expression of the subsistence economy: family workers made goods for their own use or at times for general sale. But the form also lent itself to a kind of quasi-capitalist system. Under this system the worker still owned his own tools while a merchant provided raw materials and sold the finished product. By 1825, a growing class of "outworkers", as they came to be known, were in evidence in a number of towns.

For the most part, the earlier outworkers tended to be part-time workers, fitting sparse commercial production into slack times of farm work. In industries such as shoe manufacturing, however, outworkers seemed to become full-time fixtures. In 1845, there were shoe outworkers on the Penobscot Indian reservation in Maine.52 Shoe manufacturers "used the cheaper labor of the outworker in the countryside to keep down the wages of the Lynn shoemakers."53 The continuing availability of outworkers was another aspect of the fact that "in 1850 … [part-time farmers] constituted at least one-fourth or perhaps half, of all farms in the older settled areas."54

Simultaneously with outworking, a first large step towards modern factories was the creation of "manufactories", that is, centralized work places operated by artisans who labored without any power source other than the human hand wielding manipulable tools. The buildings in which manufactories were located in early days tended to be "sheds and barns that had been recently converted from agricultural uses."55 Probably most manufactories were situated in towns and cities since this was where artisans were concentrated. Despite the absence of machines in these relatively large shops, productivity rose over that achieved in the older-style individual-artisan shop.56 The division of labor was extended in the manufactory and the pace of labor intensified. Very likely unskilled workers were needed to move about the comparatively heavy raw materials and goods in process.

The earliest factories emerged late in the 18th century when water power was made available for productive purposes. By the War of 1812, the countryside in New England was punctuated by many of these operating units. Location of the water source was a paramount consideration and so most of these new factories were necessarily to be found in rural areas. The factory quickly replaced many putting-out operations as it facilitated employer control of production. All the raw materials could be centralized in one place; close supervision of workers resulted in a more uniform quality of product; the availability of greatly heightened power made it all the easier to push the pace of work (speed-up) and increase the number of operations a single worker must perform (stretch-out).

It was not until the late 1840s and the 1850s, however, that the factory system began to be the norm in American industry. This development was crucially facilitated by the use of the steam engine which freed industry from its rural water-power moorings. The new power source was completely mobile and factories could now be located in cities and towns with a labor force and customers nearby. In conjunction with newly-built railroads, frozen waterways, an historic impediment to long-distance shipments, were no longer to be feared. Industrial production could be a year-round activity. The market for manufactured goods expanded as transportation improved.

Leaders in factory production by 1850 were the flour, cotton, textiles, and lumber industries.57 By 1860, 41 percent of the national labor force worked outside agriculture.58 Just 20 years earlier, most workers in manufacturing jobs had been employed "in shop and mill establishments, not `factories'."59 The proportion of the labor force employed in agriculture dropped sharply in the industrializing state of Massachusetts, as follows:60

1820 57.5%
1840 40.2%
1850 15.3%
1855 13.7%
1860 13.8%
1865 13.3%

The Census of 1860 showed a great stream of farm workers leaving the farms for industrial jobs in the cities of Massachusetts: "Net immigration from the five other New England states and New York was of the same order of magnitude as that from Ireland."61

Women were an indispensable part of the manufacturing labor force in antebellum times. In the early 1830s, two of every five workers in manufacturing of the Northeast were women.62 In cotton textile mills of the Northeast around 1832, over four of five workers were women or children. Women workers in that region were paid only 40 percent of men's wages.63 It is thus not difficult to understand why, "despite protective tariffs and transport cost differentials, American textile manufacturing was not price-competitive with British imports until women and children had entered American textile factories."64 American adaptations of British textile machinery facilitated the employment of women and children.

Owners and managers in the textile industry did not hesitate to press their workers for increased output. As Dublin reports:

Between 1840 and 1854 the workload of spinners and weavers at the Hamilton Company … more than doubled. The average number of spindles per operative in the spinning department rose from 129 to 294, while the number of looms per weaver increased from 1.3 to 2.9. Over the same period, wages remained basically unchanged.65

Another study of four mills in Waltham-Lowell found that "output per worker rose by almost 49 percent between 1836 and 1850, while daily wages increased only 4 percent."66 In 1850, General C.T. James, a prominent engineer and specialist in the construction of textile factories, reported that while since 1835 textile workers produced more, "they derive no advantage from it, and their wages, as a general thing, are not enhanced by it."67 Freeman Hunt, statistician and editor, calculated that in the decade 1840-1850 output per worker in Lowell textile plants had increased 30 percent.68 General James also noted that during 1835-1850 the cost of living for factory workers had not been materially reduced. An economist a century later found that daily wages of cotton textile workers during 1832-1850 had risen by one cent.69 Shoe workers in Lynn, Massachusetts experienced deterioration of employment conditions between 1830 and 1860.70 Their machine-led work routines left many of them with an ill-defined sense of prolonged fatigue.71


During the late 1840s and the 1850s, immigrants came in large numbers from Ireland, Germany, and England. The Irish were poorest and fared least favorably in the job market, but "the dominant tendency among new arrivals was downward occupational mobility."72 Within a decade or so, the Germans and English made greater vocational advances. Recruiting of immigrant workers by employers was centralized in New York where a state employment agency contacted employers seeking unskilled laborers. In time, branch offices of the agency were established in seven states. Immigrant remittances back home continued apace. During 1853-1854 alone, Irish immigrants sent $21.7 million, a goodly part of which paid for their families' later steamship tickets to America.73 The average wealth possessed by the immigrants was quite modest. Among Germans who settled in Michigan, for example, the average holding was from $90 to $150.74 This was the high group of all three. "The Irish who arrived as laborers," writes Ferrie, "had a one-in-three chance of moving up upon arrival, while those odds improved only to three-in-eight ten years after arrival."75 On the other hand, "two-thirds of the British laborers and three-quarters of the German laborers … had left the laboring class by 1860."76 Fogel points out that by the late 1840s, "large factories began substituting the relatively cheap labor of foreign-born workers for that of native-born workers, which led to substantial reductions in unit labor costs and to increases in profits—developments that fueled the rapid expansion of manufacturing during 1844-1854."77 In Lowell, Massachusetts, for example, the percent of the work force at the Hamilton Manufacturing Company represented by Irish immigrants rose as follows:78

1836 3.7%
1850 38.6%
1860 61.8%

Male Irish workers were so poor that they began accepting factory jobs even though the wage levels were established for lower-paid women.

The availability of so many poor immigrants gave employers a much enhanced bargaining position in relation to labor. As Wright has written about the Lyman textile mills in Massachusetts:

During a labor shortage in 1852, a recruiter was dispatched to Glasgow, [Scotland] returning with 67 women for whom the company advanced the passage money; funds for shoes, dry goods, postage, board, and cash were also advanced. High turnover plagued the firm, but rather than raise wages the company's response repeatedly was to send more recruiters, who always filled their quotas. It is not difficult to see why wages did not rise during the 1850s since firms were actively using immigrants as a "reserve army" whenever vacancies occurred.79

Indeed, U.S. employers were among the prime beneficiaries of the knowledge and skills possessed by their immigrant employees which employers did not have to purchase or support. As Uselding puts it: "It is not too far off the mark to state that the single year estimates of human capital flows to the U.S. in current prices of the year of immigration are from one-half to three-fourths the order of magnitude of single year estimates of total gross physical capital formation over the period 1839-1859."80

By no means, however, did the poor of other countries have a standing invitation to come to the United States. During the economic depression that began in 1819, editor Hezekiah Niles addressed the issue of limiting further immigration of poor Irishmen:

We much doubt whether the accession of such a population is at this time desirable, seeing that there is a real want of profitable employment for our own people - but we would not shut the door against the oppressed. Let them come and share with us.81

Niles's sense of generosity was not widely shared. In fact, American government officials feared that European countries were deliberately ridding themselves of the poorest of their people. Formal diplomatic protests were made. State governments entered the fray. In 1820, Massachusetts passed a law requiring masters of vessels to deposit a security payment to cover passengers who later became paupers.82 This measure was not aimed solely at immigrants but at all paupers. The Articles of Confederation (1781-1788) had guaranteed all citizens the right to travel from one colony to another, but excepted paupers. Neuman observes that while the Constitution does not mention the right to travel between the states, "the courts continued to assume that paupers had no right to travel."83


In 1850 fewer than one-half of all white males aged 20 years or over owned some land. In a country where land was the principal form of capital and the most widely owned means of production, being landless meant owning little of commercial value at all. Soltow emphasizes that in 1850 public land was selling for $1.25 an acre; yet, so many owned none.84 He points to the role of urbanization: "Two-thirds of the poor lived in cities, three-sevenths of the poor were foreign-born, and half of the urban poor were foreign born."85 The propertyless had almost no alternative but to seek work in the expanding industrial sectors of the economy. In a report to a Massachusetts official body in 1833, Joseph Tuckerman described the pauper situation in the sixty-eight towns of the state he had visited. Nearly five percent of the towns' 264,327 population were being supported by Overseers of the Poor. The total aided was 12,331 which were divided as follows: 6,063 were from the towns visited and 5,967 from other states or countries; many of the latter were located in Boston.86 (It should be noted that Tuckerman's survey occurred in a period of upswing of the business cycle.)

The amount of relief for paupers was exceedingly slim. In 1830, for example, the amount in Philadelphia was under forty-seven cents a week.87 Sellers writes that "many of the landless poor simply drifted from town to town, never finding a stable maintenance."88 In New York, "the period from the 1820s through the 1850s," according to Joan Hannon, "stands out as a period of perhaps unique stinginess in the public relief system."89 Measured by the amount of relief in relation to the average common labor wage in New York City between 1800 and 1823, the percentages ranged from 20% to 27%.90 In 1823, when the New York City figure was almost 16%, the percentages in the following places were:

South Salem 9.88%
New Windsor 25.82%
Troy  14.37%

During these years, of course, industrialization was growing rapidly in the Northeast.

At the same time, thousands of Americans and Europeans moved west to establish farms. Very few of these, however, were paupers. Whether the target area was forested or grassland, clearing it and completing it as a fully productive farm took typical settlers about five years.91 Danhof estimates that during the 1850s about $1,000 in capital would be needed.92 For many fully employed factory workers, let alone paupers, such a sum was completely out of reach. (Here and there, exceptions could be found.)93 Farm-making required a family labor force of wife, husband, and working-age children. Indispensable also were experience and knowledge about farming that extended beyond garden-keeping. Especially during the years of more commercialized agriculture during the 1840s-1860s, capital requirements were high and rising. Credit was scarce on the commercial frontier, particularly for impecunious settlers without collateral. For shoe workers in Lynn, Massachusetts, whose real wages declined during 1830-1860, the ancient prospect of setting aside life savings as a "competency" for retirement "was becoming impossible."94

Labor Movement

Free workers were free to work for wages, with the accompanying expectation that they would be discharged when they were no longer needed. Their relations with employers were regulated by a body of statutes, court rulings, and traditional practices that originated in the economic interest of employers. Peculiarly, this body of law was known as "labor law" although it was clearly "employer law." Labor was the target of the restrictions and obligations imposed in law, with employers the beneficiaries. As industrialization proceeded, employer power became increasingly dominant in the society as a whole and was written into law. Early in the nineteenth century, American courts applied a British legal doctrine to the U.S. and held that workers combining for common economic purpose constituted an illegal conspiracy. During the same period, however, employers were free to combine in defense of their own economic interests. In the 1830s, leather dealers in Newark combined with their colleagues in New York City and Brooklyn, drew up a blacklist of striking workers, and advertised for strikebreakers from the country at large.95 In 1854, the first blacklist of striking workers was circulated by the Erie Railroad; a year later a group of railroads contracted with a private detective agency to spy on the roads' workers.96 (During the winter of 1850-1851 railroad managers and directors in New England met to regulate competition on passenger and freight rates; they published the proceedings, so they clearly did not have to worry about the act of combining for common economic purpose.97

Strikebreaking was widespread in antebellum times. In the large textile mills of New England, the decade before the Civil War saw several strikes. In 1852, in Amesbury and Salisbury, Massachusetts, employers brought in Irish strikebreakers against Yankee women. Seven years later, management used Yankee strikebreakers against a strike by Irish women.98 As pointed out in Chapter 1, manipulation of racial and ethnic differences inured to the economic advantage of employers however it might injure the larger society. In the South, police were called upon to break strikes, often by Irish laborers.99 The great shoemakers' strike of 1860, put down by the use of police from Boston and South Danvers, occurred in plants stretching from Lynn nearly to Worcester, Massachusetts. When, in 1843, a bitter armed struggle broke out between Irish weavers and their Irish employers, three militia companies were called in; a barely tolerable wage agreement followed "which left hundreds of families living on less than three dollars a week."100 In all of these instances employers combined their policies without objection by legal authorities. Employer combination not only operated in strike situations but, more significantly, in normal, everyday business affairs. Writing of the giant textile plants in Lowell, Dublin states: "They made repeated efforts to ensure that various establishments did not compete with one another in wages or working conditions."101

In fourteenth-century England, Parliament passed Statutes of Labourers (1349 and 1351) which compelled laborers and servants to seek work whether they wished it or not and circumscribed their freedom in many significant respects. Almost three centuries later (1644), in the English jurist Sir Edward Coke's Third Institute, it was laid down that "an insurrection against the Statute of Labourers for the enhancing of salaries and wages, was a levying of war against the King."102 Commenting on this principle, Thomas Morris writes:

Class struggles and insurrection were linked in English legal thought. … Insurrection by workers to raise wages against the king … was high treason, insurrection was a form of high treason.103

During the first half of the nineteenth century, U.S. labor law still reflected the royal command for obedience and the penalty to be suffered by challenging it. Class struggles waged by workers were still regarded as improper challenges by inferiors to the social order. At the same time, American courts began to depart from the ancient terminology and adopted the language of contracts entered into by equals such as employers and employees. But a mere glance at the realities of the workplace of antebellum industry showed all too clearly that the balance of power by far weighed in favor of the employer class.104 Nevertheless, the reality of unequal power relations was ignored while courts, especially, continued to rule against combinations of workers.

Bondage of the Free

The shadow of slavery was cast over both free blacks and whites in the South. Free blacks lived a precarious existence. Manumission— freeing of individual slaves by masters—was rare in the American South and did not bear out the bounty it first suggested: "Manumission did not involve citizenship or any rights of freedom— it just released him or her from master's dominion."105 (The great German poet Heinrich Heine, who in the 1830s was casting about for a new homeland, momentarily considered going to America but was put off by the hypocrisy of a "freedom" for the free Negro which he regarded as little more than slavery.)106 Although technically free, Negroes in Maryland who were not enslaved could nevertheless be sold for specific periods of time if they were unlucky enough to be convicts in overcrowded prisons.107 Free black Marylanders who were not working for whites and thus were classed as "vagrants" could be bound out or sold for renewable terms.108

Poor whites in the South could also be subjected to legal bondage, although less severely so. White vagrants who were guilty of bastardy or were absconding seamen could be sentenced to compulsory labor.109 In South Carolina, according to Richard Morris:

The position of white labor … steadily deteriorated in the ante-bellum period. As labor controls [over enslaved workers] tightened, many white workers suffered in fact a loss of their freedom of occupational choice and their mobility, and suffered at law a denial of their right to take concerted action. …110

Compulsory road service was the lot of the poor; wealthy whites were exempted. In Delaware, a slave state, peonage was widespread. This system of compulsory labor service to discharge a debt had begun in the colonial years. Both black and white children in antebellum years were subjected to "disguised indentured servitude"111 under color of an apprenticeship agreement. When the Civil War ended, compulsory servitude for free Negro convicts in Delaware was still in effect.

American Indians were also subjected to legal bondage just short of slavery. In Southern California, after the secularization of the Mexican religious missions in the 1830s, most of the Indian workers became employees of private owners of mission lands. When California became a state, the ranches continued to operate, increasingly under American ownership. Indians were compelled to be employed and when seeking a new job had to show a pass book filled out by their last employer. Indians were treated with the utmost contempt. During the 1850s in Los Angeles County, "bodies of dead, usually murdered and mutilated, Indians were a common sight in the streets."112 Sufficient numbers of Indians remained alive, however, to produce large quantities of farm products: "In 1859 approximately 300,000 pounds of grapes and 150,000 gallons of wine, valued at $36,641 and $113,180 respectively, were exported."113 During the 1850s, vintners could bid for Indian convict labor for terms of up to four months. Phillips, the historian of these events, comments sardonically: "Since forced labor was cheaper than free, it was in the best, albeit short-term, interests of the growers to see that there were always Indians available for auction."114

Racial-Ethnic Conflicts

In the South, the increasing use of rented (hired) enslaved workers constituted a major grievance of free white labor.115 Regarding enslaved labor as direct competition, the white laborers opposed not only slavery but the slaves as well. A deep personal racial hatred developed among the white laborers even though it was clear to all that the enslaved workers had little or no control over their work assignments. Instead of focusing their opposition on the slave masters, white laborers blamed enslaved workers. The southern ruling class, eager to demonstrate to the white lower classes their superior status over enslaved workers without, however, actually ceding high-cost concessions, conserved the system of racism however they could manage. Indeed, at times this proved most difficult. For example, many of the white laborers in towns and cities were immigrants who did not respect the "niceties" of racial relations in the South.116 During wartime, foreign iron workers at the Confederacy's large iron works in Selma, Alabama left their jobs thus substantiating a common impression that immigrant workers did not identify with the Southern cause.117

In the North, during the 1850s few free Negroes were found among the Abolitionist leadership. Nevertheless, reports Sellers, "everywhere mechanics were the most numerous signers of abolitionist petitions."118 Most politically active northern workers identified with the Free Soil demand for exclusion of slavery from western territories thus reserving for themselves ultimately free land as well as indulging their racist sentiments toward African-Americans. In industrial cities like Lynn, not a single free black worked as a cordwainer (shoemaker). In the city as a whole anti-black racism was rife.

Blacks in the North faced severe discrimination in employment. To help remedy this, abolitionists put forward proposals for affirmative action. Thus, in 1838, at the annual meeting of the Middlesex County Anti-Slavery Society, a resolution was adopted: "Resolved, that it is the duty of abolitionists to give encouragement to colored youths in obtaining knowledge of trades and professions, in preference to the whites."119 Yet, a quarter-century later, in the middle of the Civil War, Frederick Douglass declared:

Our children are not admitted to be apprentices, clerks, journeymen, and they grow up without ambition or aspiration. There is much prejudice and injustice against us yet remaining.120

In 1842, a report from Philadelphia spoke of rising prospects among the city's blacks:

Eight years ago, there were only two colored tailors . … Now there are thirty or forty, and many of them are first-rate workmen. So of carpenters, blacksmiths, shoemakers, etc. the same might be said.121

By 1860, the picture had changed: A black man "is a hotel-waiter, a vendor of peanuts and cakes, or a mere beast of burden."122 In 1848, Douglass announced: "In the Northern States, we are not slaves to individuals, not personal slaves, yet in many respects we are the slaves of the community."123

Neither the war nor war's end changed the economic expectations of blacks in the North. The repeated failure of the Union government to divide the plantations among former enslaved workers portended great failures to come. As the black author and abolitionist William Wells Brown stated several months after the close of the Civil War: "The prospect is, that the black man is to be ground to powder . … We have been fighting for almost nothing."124 This was declared at a July 4 celebration in Framingham, Massachusetts.

By 1860, two working classes co-existed in the United States. One was overwhelmingly white, located primarily in the North and West, the other overwhelmingly black and enslaved, and concentrated in the South. Typically, workplaces were racially segregated. Where they were not segregated, whites generally occupied the skilled positions. Employers manipulated the racial composition of workplaces, especially when workers organized or engaged in strikes: if whites struck, employers threatened to employ blacks in their stead and if blacks struck, whites became the threatened replacements. Free blacks were viewed by most white workers as blacks rather than fellow-workers. Enslaved workers were seen as blacks and as mere appendages of slave-masters. No evidence has been discovered to suggest that organized white workers ever threatened employers with developing a bi-racial movement with enslaved workers for better working standards and conditions.

American racism was nearly two centuries old by the time of the Civil War. One of its foundation stones was the provision that the least white was socially ranked above the most successful black person. The Virginia planters who had installed this system in the 1680s and afterward did not intend to equalize the condition of all whites, including themselves. Instead, they succeeded in distracting the attention of poorer whites from the oppressive conditions under which they lived and worked. However slight the privileges they won, poorer whites learned to value them highly and congratulate themselves on their superior status over the blacks. Writ large, racism became a system whereby American workers could seek extremely limited economic and political objectives which their employers might grant. It also denied white workers the added strength cooperation with blacks would have brought. Thus, racism immensely empowered the developing capitalist class by assuring it a weak and disunited labor force. No other capitalist class in the modern world had this great an advantage over its workers.

Industrialization proceeded rapidly once it set in motion. By 1830, the United States was the sixth largest industrial producer in the world; forty years later, one-third of the U.S. labor force worked in manufacturing. All this was accomplished with a minimum of worker participation and a virtual absence of union organization. As a result, workers, who bore the heaviest burdens of industrialization, saw significant sectors of their living standards fall as did the already-heavily burdened enslaved worker from indirect effects of industrialization. (See Chapter 6 for a further discussion of standards of living before the Civil War.)



On the eve of the Civil War two working classes had developed: one African American and enslaved, the other white and free. In addition a smaller number of blacks were also free workers.

Enslaved workers labored in mining, manufacturing, crafts, and on canals and railroads besides agriculture. As consumers of slave labor, planters were protected from being defrauded by the purchase of "defective merchandise", such as enslaved workers who escaped. During the Civil War, planters resisted Confederate attempts to use enslaved workers in war duties. Escapes to nearby Union army ranks were common.

Textile manufacture was the country's first capitalist industry and its workers were drawn overwhelmingly from the free white working class. At first, many were part-time workers but over time they became full-time workers. By the 1840s and 1850s steam-engine-powered factories, located in population centers, were becoming the rule. During the 1840s, the proportion of the Massachusetts labor force employed in agriculture dropped sharply, from 40.2 percent to 15.3 percent. Women workers in the factories of the Northeast received only 40 percent of wages paid male workers. Women and men alike were subjected to speed-up and stretch-out with almost no benefit to their wages or working conditions. During these same years, the percentage of factory workers who were immigrants from Ireland rose very rapidly.

The rise of poverty during the years of industrial expansion enlarged the supply of factory workers. Very few paupers could afford to move to the West to become landowning farmers. Increasingly, among workers in skilled crafts as well as occasionally among factory workers, unions were formed. Employers resorted to strike-breaking, private detective agencies, and blacklisting to oppose worker efforts to organize. In the South, free laborers were subjected to severe limitations on their capacity to engage in unionization and labor protest. American Indians were treated as degraded labor. Free black labor in the North was not exempt from discrimination. To some extent, Abolitionists spoke out in favor of equal job opportunities for free blacks. Racism also was a vital force in the North



1. Roger L. Ransom and Richard Sutch, "Who Pays for Slavery?" p. 39 in Richard F. America, ed., The Wealth of Races. The Present Value of Benefits from Past Injustices (Greenwood, 1990).

2. Ibid., p. 31 and Richard Vedder and others, "Black Exploitation and White Benefits: The Civil War Income Revolution," p. 128 in ibid, . See, also, Robert W. Fogel, Without Consent or Contract. The Rise and Fall of American Slavery (Norton, 1989), p. 410.

3. James Oakes, The Ruling Race. A History of American Slaveholders (Knopf, 1982), p. 12.

4. Douglass North, The Economic Growth of the United States from 1790 to 1860 (1961).

5. Fogel, Without Consent or Contract, p. 78. See, also, R. Keith Aufhauser, "Slavery and Scientific Management," Journal of Economic History, 33 (December 1973) 811-824 and Frederick L. Olmsted, A Journey in the Back Country, I, pp. 64-65.

6. Thomas D. Morris, Southern Slavery and the Law, 1619-1860 (University of North Carolina Press, 1996), p. 247.

7. Oakes, The Ruling Race, p. 167. See, also, Fogel, Without Consent or Contract, p. 37.

8. Fogel, Without Consent or Contract, p. 87.

9. Oakes, The Ruling Race, p. 136.

10. Robert A. Margo, "The South as an Economic Problem: Fact or Fiction?" p. 167 in Larry J. Griffin and Don H. Doyle, eds., The South as an American Problem (University of Georgia Press, 1995). For an enslaved worker's perspective on the matter, see Charles Ball, Slavery in the United States: A Narrative of the Life and Adventures of Charles Ball, A Black Man (Lewiston, Pennsylvania: John W. Shugert, 1836), pp. 6-7.

11. Fogel, Without Consent or Contract, p. 65.

12. Charles Sellers, The Market Revolution. Jacksonian American, 1815-1846 (Oxford University Press, 1991), p. 397. Peculiarly, Christopher Morris entirely ignores this utterly disastrous movement in his article, "The Articulation of Two Worlds: The Master-Slave Relationship Reconsidered," Journal of American History, 85 (December 1998), pp. 982-1007. Thomas Morris found that barely one percent of a group of 600 testators stipulated in their wills that slaves should be kept together. Southern Slavery and the Law, p. 101.

13. See Meyer Weinberg A Chance to Learn. A History of Race and Education in the United States, enlarged edition (California State University Press, Long Beach, 1995), p.13.

14. Paul G. Faler, Mechanics and Manufacturers in the Early Industrial Revolution. Lynn Massachusetts 1780-1860 (State University of New York Press, 1981), p. 18.

15. Alexander Saxton, The Rise and Fall of the White Republic. Class Politics and Mass Culture in Nineteenth-Century America (Verso, 1990), p. 247.

16. Lee Soltow, "Economic Inequality in the United States in the Period from 1790 to 1860," Journal of Economic History, 31 (December 1971), p. 824.

17. Oakes, The Ruling Race, p. 52.

18. Fogel, Without Consent or Contract, p. 84.

19. Speech of President Buchanan on the Evening of Monday, July 9, 1860 (Washington City: Issued by the National Democratic Executive Committee, 1860) Breckenridge and Lane Campaign Documents, No. 4), p. 7.

20. Clement Eaton, The Growth of Southern Civilization, 1790-1860 (Harper and Row, 1961), p. 231.

21. Ibid., p. 235.

22. S. Sydney Bradford, "The Negro Ironworker in Antebellum Virginia," Journal of Southern History, 25 (1959), p. 197.

23. Ibid., p. 198.

24. Ibid., p. 208.

25. Walter Licht, Working for the Railroad. The Organization of Work in the Nineteenth Century (Princeton University Press, 1983), p. 67.

26. Ibid., p. 68.

27. Wilma A. Dunaway, The First American Frontier. Transition to Capitalism in Southern Appalachia, 1700-1860 (University of North Carolina Press, 1996), p. 214.

28. Philip J. Schwarz, Slave Law in Virginia (University of Georgia Press, 1996), p. 86.

29. Ibid., p. 134.

30. Judith K. Schafer, "`Guaranteed Against the Vices and Maladies Prescribed by Law': Consumer Protection, the Law of Slave Sales, and the Supreme Court in Antebellum Louisiana," American Journal of Legal History, 40 (July 1996), p. 361.

31. Ibid., p. 314.

32. Ibid., p. 316.

33. Thomas D. Russell, "The Antebellum Courthouse as Creditors' Domain: Trial-Court Activity in South Carolina and the Concomitance of Lending and Litigation," American Journal of Legal History, 40 (July 1996), p. 361.

34. Jenny B. Wahl, "The Jurisprudence of American Slave Sales," Journal of Economic History, 56 (March 1996), p. 149.

35. Ibid., p. 166.

36. Mark V. Tushnet, "The American Law of Slavery, 1810-1860: A Study in the Persistence of Legal Autonomy," Law and Society, (Fall 1975), p. 176.

37. Oakes, The Ruling Race, p. 144. See, also, Andrew Fede, People Without Rights. An Interpretation of the Fundamentals of the Law of Slavery in the U.S. South (Garland, 1992), pp. 55 and 60.

38. Fogel, Without Consent or Contract, p. 186.

39. See Thomas Morris, Southern Slavery and the Law, 1619-1860, passim. A dissenter from this interpretation is Robert J. Cottroll, "Liberalism and Paternalism: Ideology, Economic Interest and the Business Law of Slavery," American Journal of Legal History, 31 (October 1987), pp. 359-373.

40. Harold D. Woodman, King Cotton and His Retainers. Financing and Marketing the Cotton Crop of the South, 1800-1925 (University of Kentucky Press, 1968), pp. 209 and 227.

41. Ibid., p. 241.

42. Paul A.C. Koistinen, Beating Plowshares Into Swords: The Political Economy of American Warfare, 1606-1865 (University Press of Kansas, 1996), p. 213.

43. Ibid., p. 277.

44. Ira Berlin and others, eds., Freedom. A Documentary History of Emancipation 1861-1867, Series I, Volume II, The Wartime Genesis of Free Labor: The Upper South (Cambridge University Press, 1993), p. 19.

45. Ira Berlin and others, eds., Freedom. A Documentary History of Emancipation 1861-1867, Series I, Volume III, The Wartime Genesis of Free Labor: The Lower South (Cambridge University Press, 1990), p. 367.

46. Berlin and others, eds., The Upper South, p. 62.

47. Wendell Phillips in Liberator, May 24, 1864.

48. Wendell Phillips in Liberator, October 20, 1864.

49. Gerrit Smith to Phillips and Garrison, letter of September 12, 1865, reprinted in Liberator, September 22, 1865.

50. Carl N. Degler, "Women," p. 989 in Encyclopedia of American Economic History, III.

51. Niles' Weekly Register, March 13, 1813, p. 32.

52. Paul G. Faler, Mechanics and Manufacturers in the Early Industrial Revolution. Lynn, Massachusetts 1780-1860 (State University of New York Press, 1981), p. 92. On outworking in general, see Thomas Dublin, "Rural Putting-Out Work in Early Nineteenth-Century New England: Women and the Transition to Capitalism in the Countryside," New England Quarterly, 64 (1991), pp. 531-573.

53. Ibid., p. 174.

54. Clarence H. Danhof, "Agriculture in the North and West," p. 364 in Encyclopedia of American Economic History, I.

55. Paul Uselding, "Manufacturing," p. 402 in Encyclopedia of American Economic History, I.

56. See Kenneth L. Sokoloff, "Was the Transition from the Artisanal Shop to the Nonmechanized Factory Associated With Gains in Efficiency?: Evidence from the U.S. Manufacturing Censuses," Explorations in Economic History, 21 (1984) pp. 351-382 and Kenneth L. Sokoloff and David Dollar, "Agricultural Seasonality and the Organization of Manufacturing in Early Industrial Economies: The Contrast Between England and the United States," Journal of Economic History, 57 (June 1997), p. 291.

57. Jeremy Atack, "Industrial Structure and the Emergence of the Modern Industrial Corporation," Explorations in Economic History, 22 (1985) p. 33.

58. Thomas Dublin, Women at Work. The Transformation of Work and Community in Lowell, Massachusetts, 1826-1860 (Columbia University Press, 1979), p. 5.

59. Eric E. Lampard, "Urbanization," p. 1042 in Encyclopedia of American Economic History, III.

60. Alexander J. Field, "Sectoral Shift in Antebellum Massachusetts: A Reconsideration," Explorations in Economic History, 15 (1978), p. 153.

61. Ibid., p. 160.

62. Maurine Greenwald, "Women and Pennsylvania Working-Class History," Pennsylvania History, 63 (1996), p. 7.

63. Fogel, Without Consent or Contract, p. 111.

64. Uselding, "Manufacturing," p. 403 in Encyclopedia of American Economic History, I.

65. Dublin, Women at Work, p. 111.

66. Ibid., p. 137.

67. C.T. James, Hunt's Merchants' Magazine, March 1850, p. 307. The following year, James became a U.S. senator from Rhode Island.

68. Hunt's Merchants' Magazine, June 1850, p. 646.

69. Stanley Lebergott, Wage Trends, 1800-1900 (National Bureau of Economic Research, 1957), p. 56.

70. Faler, Mechanics and Manufacturers, p. 99.

71. Ibid., p. 173. See J.O. Green, The Factory System and Its Hygienic Relations, 1846, pp. 21-22 (Goldsmith-Kress Collection, Item 34822, reel 3184).

72. Joseph P. Ferrie, "We Are Yankeys Now": The Economic Mobility of Two Thousand Antebellum Immigrants to the U.S., doctoral dissertation, University of Chicago, 1992, p. 12.

73. Ibid., p. 73.

74. Ibid., pp. 101-102.

75. Ibid., p. 132.

76. Ibid., p. 149.

77. Fogel, Without Consent or Contract, p. 111.

78. Dublin, Women at Work, p. 138.

79. Gavin Wright, "Cheap Labor and Southern Textiles Before 1860," Journal of Economic History, 39 (September 1979), p. 677.

80. Paul Uselding, "Conjectural Estimates of Gross Human Capital Inflows to the American Economy: 1790-1860," Explorations in Economic History, 9 (Fall 1971), p. 59.

81. Niles' Weekly Register, November 22, 1823, pp. 179-180.

82. Gerald L. Neuman, "The Lost Century of American Immigration Law (1776-1875)," Columbia Law Review, 93 (December 1993), p. 1849. See also the same author's Strangers to the Constitution: Immigrants, Borders, and Fundamental Law (Princeton University Press, 1996).

83. Ibid, p. 1847.

84. Lee Soltow, Men and Wealth in the United States 1850-1870 (Yale University Press, 1975), p. 175.

85. Ibid., p. 25.

86. Jonathan A. Glickstein, "Pressures from Below: Pauperism, Chattel Slavery, and the Ideological Construction of Free Market Labor Incentives in Antebellum America," Radical History Review, 69 (Fall 1997), footnote 21, p. 148.

87. Ibid., footnote 37, p. 150.

88. Sellers, The Market Revolution, p. 18.

89. Joan Hannon, "The Generosity of Antebellum Poor Relief," Journal of Economic History, 44 (September 1984), p. 811.

90. Ibid., p. 812.

91. "Agriculture in the North and West," p. 362 in Encyclopedia of American Economic History, I.

92. Clarence H. Danhof, "Economic Validity of the Safety-Valve Doctrine," Journal of Economic History, 1 (December 1941), Supplement, p. 102.

93. One source suggests industrial workers in the Brandywine region during 1802-1860 could have saved a year's earnings of $350 without interest in a little more than six years, ending with a declaration that "workers … shared generously in processes of economic growth and development in the antebellum years": Donald R. Adams, Jr., "The Standard of Living during American Industrialization: Evidence from the Brandywine Region, 1800-1860," Journal of Economic History, 42 (December 1982), p. 915. This was far from the experience of most workers outside Brandywine.

94. Faler, Mechanics and Manufacturers, p. 173.

95. Susan E. Hirsch, Roots of the American Working Class. The Industrialization of Crafts in Newark, 1800-1860 (University of Pennsylvania Press, 1978), p. 87.

96. Licht, Working for the Railroad, p. 122.

97. Proceedings of the Convention of the Northern Lines of Railway, Held at Boston, December 1850 and January 1851 (Boston: J.B. Yerrington & Sons, 1851).

98. Dublin, Women at Work, p. 204.

99. Eaton, The Growth of Southern Civilization, p. 166.

100. David Montgomery, "The Shuttle and the Cross: Weavers and Artisans in the Kensington Riots of 1844," Journal of Social History, 5 (Summer 1972), p. 418.

101. Dublin, Women at Work, p. 10.

102. Quoted in Morris, Southern Slavery and the Law, p. 266.

103. Ibid.,

104. See Christopher L. Tomlins, "The Ties That Bind: Master and Servant in Massachusetts, 1800-1850," Labor History, 30 (1989), p. 196.

105. Thomas D. Morris, Southern Slavery and the Law, p. 372.

106. See Heinrich Heine letter of July 1, 1830 in F. Ewen, ed., The Poetry and Prose of Heinrich Heine (Citadel Press, 1948), pp. 392-393.

107. Barbara J. Fields, Slavery and Freedom on the Middle Ground. Maryland during the Nineteenth Century (Yale University Press, 1985), p. 61.

108. Ibid., p. 35.

109. Eaton, The Growth of Southern Civilization, p. 166.

110. Richard B. Morris, "White Bondage in Ante-Bellum South Carolina," South Carolina Historical and Genealogical Magazine, , p. 195.

111. Richard B. Morris, "The Course of Peonage in a Slave State," Political Science Quarterly, 65 (1950), p. 240.

112. George H. Phillips, "Indians in Los Angeles, 1781-1875: Economic Integration, Social Disintegration," Pacific Historical Review, 49 (1980), p. 440.

113. Ibid., p. 442.

114. Ibid., p. 451.

115. Ira Berlin and Herbert G. Gutman, "Natives and Immigrants, Free Men and Slaves: Urban Workingmen in the Antebellum American South," American Historical Review, 88 (1983), p. 1195.

116. Ibid., p. 1196.

117. Ibid., p. 1199-1200.

118. Sellers, The Market Revolution, p. 405.

119. Resolution of October 17, 1838, reprinted in Liberator, November 23, 1838. >

120. Liberator, June 5, 1863.

121. Liberator, September 2, 1842.

122. Liberator, September 21, 1860. Reprinted from the Philadelphia Press.

123. Liberator, October 27, 1848. Reprinted from North Star, September 22, 1848.

124. Liberator, July 14, 1865.