n 1800, America was undergoing not one, but two revolutions: one political, the other economic. The forces unleashed by these twin revolutions; democracy, industrialization, and capitalism, developed in tandem and transformed the look and character of the country. There’s a world of difference between the America of Thomas Jefferson and that of Theodore Roosevelt.
In 1801, when Jefferson was inaugurated, the United States was a new, underdeveloped country of just over five million people. Although it was a country shaped by immigration, immigrants from one country, England, made up half the population. Some adventurous pioneers had moved west of the Appalachian Mountains, but America was still a seacoast settlement, hugging the Atlantic shoreline.
It was a prosperous nation, but it lagged far behind England, which was industrializing furiously. And with only 10% of its population living in cities and towns, it was still overwhelmingly agrarian. In 1801, all this was about to change. And the change would be sudden, explosive, and deeply disorientating. In the next century, the nation’s boundaries would expand enormously, the result of a relentless westward push. And as America expanded, immigration, capitalism, and technology would reshape the land, old places as well as the new ones. One aspect of the society would remain constant – religion.
In 1901, when Theodore Roosevelt became President, more than 77 million Americans lived in a continental empire that stretched from sea to sea. And Roosevelt’s America was a veritable nation of nations, a melting pot for over 30 nationalities – all striving to be “American”. Forty percent of Americans still worked on farms in 1900, but an equal number lived in cities. And by this time, America had surpassed England as the leading industrial nation on earth.
The forces responsible for these sweeping transformations were gathering as the 19th Century began. The American Revolution broke the back of state-regulated mercantile capitalism and opened the way for a market revolution that produced the world’s most dynamic economic system.
This was the kind of capitalism that Adam Smith, the famous Scottish economist, had called for in his master work, The Wealth of Nations, which was published, interestingly, in 1776. A child of the Enlightenment, Smith argued that the production of wealth would increase dramatically if individuals were allowed to pursue their enlightened self-interest, with little interference from government. And in serving their own interests, individuals would serve the public interest, unconsciously, as if guided, as he said, by an “invisible hand”. Better the unseen hand than the hand of the State.
Pursue is the key word in Smith’s hypothesis. His meaning was clear – pursue meant to actively labor for ones just desserts – not to wait in anticipation of others’ largesse. Here were radically new ideas; but not to Americans. Smith’s theory coincided with a long-developing American tradition of individualism and opposition to government interference. The sovereign States of America, not Britain, would be the great testing ground of Adam Smith’s ideas.
For the most part, they have held true – including the destructive power of unenlightened selfish interests – better known as favoring government handouts over individual initiative and imagination (a perverse interpretation of “others’ largesse”, since the “other” is not charitable organizations or citizens but the legally bound taxpayer).
Almost everyone recognizes Smith as the founder of laissez-faire economics. Less well known are his ideas about the division of labor. The division of labor, he insisted, would greatly improve the efficiency of workers. To make his point, Smith described the workings of a pin factory.
“One person making a pin could make perhaps one in a day, maybe a few more. But if the job were divided into ten parts and given to ten workers, each performing a specialized function, a small factory could turn out 48,000 pins a day.” This was the assembly line a century and a half before Henry Ford was credited with inventing it.
“Smith’s attack on mercantilism (see below) and his reasoning for “the system of natural liberty” in The Wealth of Nations are usually taken as the beginning of classical political economy. Smith devised a set of concepts that remain strongly associated with capitalism today. His theories regarding the “invisible handi” are commonly interpreted to mean individual pursuit of self-interest unintentionally producing collective good for society.
It was necessary for Smith to be so forceful in his argument in favor of free markets because he had to overcome the popular mercantilist sentiment of the time. He criticized monopolies, tariffs, duties, and other state enforced restrictions of his time and believed that the market is the most fair and efficient arbitrator of resources.
Mercantilism was a nationalist form of early capitalism that came into existence in the late 16th Century. It is characterized by the intertwining of national business interests to state-interest and imperialism, and consequently, the state apparatus is utilized to advance national business interests abroad. An extreme form can be found in Mussolini’s fascism in Italy. It was not the idea of a state interest (national strategy) in the economy that was disturbing to Smith, it was the action of the state in support of the strategy (regulation) that would overwhelm individual initiative, inventiveness and industry.
An example of this was the colonists living in America who were only allowed to trade with and purchase goods from their respective mother countries (e. g. Britain, Portugal, France).
Mercantilism was driven by the belief that the wealth of a nation is increased through a positive balance of trade with other nations; it corresponds to the phase of capitalist development sometimes called the primitive accumulation of capital.”
“At the turn of the 19th Century, America began to change almost precisely in accordance with Smith’s ideas. What we commonly call the American Industrial Revolution was actually two converging revolutions: a technological revolution based on the division of labor, and a commercial revolution powered by a deep faith in economic individualism and the unrestrained competition of a fledgling capitalism. [These were revolutionary and untried ideas that became successful because of the committed courage of the People – something to think about in today’s atmosphere of PLDC fear of economic individualism and competition from the private sector.]
And the concept of competition was key because it prevented the government from limiting the vision, passion, determination, talent, ingenuity, courage and hard work of millions of Americans who were born to succeed through their own wits and wisdom. Here are some thoughts about competition that may provide balance in the PLDC orchestrated public debate that prefers an end to competition in schools because it makes non-winners feel bad.
Firstly, competition for the necessities to sustain life itself – food, shelter, security – is the oldest instinct that human beings have. Competition can be traced back to the beginning of the human species. At first, early humans had to compete with other creatures for food and shelter. Then, they had to compete with their “enemies” for land and other resources. Gradually, they had to compete with their neighbors and other tribal members for higher social ranks and better positions.
Those who excelled at competition survived – those that didn’t, didn’t – they were probably eaten. It is in our DNA and motivates us every day in every way. As the access to these necessities of life has become routine for most, Americans have taken the instinct-to-compete to other core activities – the quest for knowledge, success, family – and in leisure activities. As we shall see below, competition is necessary for mental health as well as for the health of our society.”
“If there is no competition, there will be no social progress. In this sense, human beings are used to competing with each other. Because of this, human beings have attained more [success] than other creatures on this planet. Because of competition, our society becomes more and more developed, and our science and technologies become more and more advanced.
Secondly, if there is no competition, there is no peace. If all human beings were born with the personalities of cooperation, there would be no oppression, no war, or no killing in the world. [But, that is not the case.] Based upon the history of human beings, all peaceful lives [have] been achieved through struggles and competitions. If the Franks had not fought against militant Islam [bad], there would be no Western civilization [good]. If the British and Americans did not fight against Hitler, nobody knows how many years the Second World War would have lasted. If the blacks did not protest the [oppression by some – not all] whites in the United States, nobody knows when they would achieve election rights and vote for their candidates.
[There is an] old saying, “competition and cooperation are twin brothers”. But peaceful cooperation rarely appears if you do not compete first and [stand up to] your rivals. In this world, absolute equality does not exist. If you want your rival to cooperate with you, you must win him over with reality first, then direct him to the better course. Otherwise, your rival will [choose to] compete with you sooner or later – in a manner of his choosing.
Which process is stronger and more important? Which process shall we encourage and which discourage? A competition which makes sure that humans are still going forward, or cooperation which assures that we are still human beings and can solve common problems together. Hence, the dilemma that has always existed, a natural choice with which human beings have been confronted. Fortunately, it was the greatest skill of humans to combine these two paradoxically–contradictory processes to produce the [Western Civilization] we are living in now and to keep improving it.
Competition can be defined as a process where one [side] rivals the other by reaching certain objectives [first]. Long before human beings appeared on earth, other creatures were competing with each other for survival. The advent of humans didn’t change the basic import of competition. They started to compete not only with other animals around them but also with other humans. Competing in this environment allowed humans to take control of it and produced improvements, innovations and modernizations that we humans have enjoyed throughout evolution.
However, competition and cooperation are merely two sides of the same coin. When competition is a rivalry between two or more to reach a certain aim, cooperation is an agreement to reach that aim together. Competition makes sure that only strong competitors survive regardless of the purpose, cooperation insures that that the survival is the purpose. An organization of people [cooperating through competition] for the purpose of reaching a common goal can be loosely described as a society, and society is possible only by cooperation. Cooperation is the force that assured a continuation of progress of human beings.
Competition [therefore], is also a form of social interaction. According to Tischler, “… competition is a form of conflict in which individuals or groups confine their conflict within agreed upon rules. Competition is a common form of interaction in the modern world, in sports, the marketplace, education system and the political system.
When a child starts to grow and interact with other children they start experiencing competition. Parents should not protect their children from competition [but, should project their children into competition]. The child can learn some valuable lessons from healthy competition, such as how to play by the rules, that will serve him or her well as they get older. According to Sara Wilford, the director of the Early Childhood Center and Art of Teaching graduate program at Sara Lawrence College in Bronxville, N.Y; ” … young children are just starting to understand that rules are the basis of any game [- especially the game of life].
When everyone makes up his or her own rules, no one can play together, and the game isn’t enjoyable. The earlier the child learns this lesson, the more fun he/she’ll have playing with other children, as they grow older.
Of course, anything in life taken to an extreme is bad and so is the case with competition. Although it can be valuable learning opportunities, competitive situations can easily get out of control. A good example that competition is getting out of control is when the child thinks winning is more important than playing the game rather than view the two equally.
Competition is a reality of life, so people – beginning as children – must be taught how to compete. Some are naturally competitive, some aren’t but, if they are never exposed to competition as they develop, they will be unprepared for life. A society that does not value competition – because some might not feel good about being on the short end of a competition – does not value its own survival and a government that supports such an attitude is failing in its first duty to its citizens.”
Returning to our consideration of the American Industrial Revolution – it began with an act of economic and industrial espionage. In 1789, an English mechanic named Samuel Slater left his country for America, disguised as a farmer. In his head were the closely guarded secrets of British textile manufacturing. The following year, Slater built a mill from memory at Pawtucket, Rhode Island with the backing of two local capitalists and “Yankee ingenuity” was born.
“It was America’s first factory. Slater’s mill was a place for making textiles, the woven fabrics used for clothing and hundreds of other products. The cotton cloth was manufactured by spinning machines powered by water. Since America had not yet discovered great deposits of coal, as had the British, its embryonic industrial revolution would be a revolution primarily in water-powered, textile production.
Slater’s biggest problem was finding laborers. Unable to induce farmers to work in his mill, he hired orphans and poor children who were wards of the town government, paying them 25 cents a week. This was America’s first industrial work force. A new age had begun, and it was the cause of concern and debate.
When Alexander Hamilton heard about Slater’s mill, he celebrated its birth a year later in his famous Report of Manufacturers,which laid out the advantages of industrial development for the United States. Thomas Jefferson was less sanguine about Slater’s mill.
Jefferson loved science and technology. He experimented with mechanical gadgets and labor-saving devices, and turned his home in Charlottesville, Virginia, Monticello, into a wonder place of technological contrivances. But Jefferson worried about the new factory system that had sprung up in England and was now threatening to make its appearance in America.
Jefferson associated industrialization with Manchester, England, the recklessly expanding city that had become the center of the British cotton industry. It was a city of fabulous wealth and unimaginable wretchedness, a place where factory smoke literally blacked out the sun, where rivers had been turned into black sewers and workers into virtual industrial slaves. On a visit there, the French writer, Alexis de Tocqueville, captured Manchester’s paradoxical combination of economic ingenuity and social backwardness. “From this foul drain,” he wrote, “the greatest stream of human industry flows out to fertilize the whole world…. Here humanity attains its most complete development and its’ most brutish; here civilization works its miracles, and civilized man is turned back almost into a savage.”
Jefferson knew that America couldn’t escape industrialization, but he hoped that American factories could be placed in the countryside and worked by farm families with strong democratic values. That way, we could industrialize without endangering our republican institutions and creating an entrenched urban proletariat. Samuel Slater tried this family system of production in New England after his expanding system of factories ran out of children to employ.
Along with hundreds of other early industrialists, Slater built agricultural villages around his mills to attract displaced farm families. The fathers worked in supervisory and ancillary jobs, and the women and kids in the mill itself. So American industry began in the country, not in the city, and remained there for a long time, for that’s where there was falling water to power the new machines.
The most promising experiment in rural industry was a model town that had been built from scratch in the 1820s on a beautiful spot at the falls of the Merrimack River north of Boston. It was named after another industrial spy, Francis Cabot Lowell. Lowell, a Boston merchant, had gone on a tour of British textile mills, memorized their technological secrets, and on his return to America, began building a textile empire. Lowell became its queen city.
What made Lowell unique was its work force: it was made up almost entirely of young, unmarried women, recruited from local farms. To attract them, a wholesome, handsomely landscaped community was constructed, the American answer to Manchester. For a promising moment, America looked like it would be the Great Exception, the only country to industrialize without savaging the environment or debasing the workers.
The “girls of Lowell” lived in clean, orderly boarding houses supervised by matrons. They worked long hours, but they were farm girls who were used to a seventy-hour work week. What was new, and hard to adjust to, was the tight discipline and the new work routine. The women worked to the pace of their power-driven machinery and to the rhythms of the clock.
The bells in the cupolas over the mills awoke them and called them to their jobs, to meals, and to bed in the evening. And the work was divided into boring, highly specialized tasks. But there were compensations. In their off hours, the women attended uplifting lectures, formed improvement groups, and edited their own magazine, the Lowell Offering.
For the mill owners, the secret to the system was the rotating work force. When workers built up a dowry or helped send a brother through college, they left. This made it easier to handle increasing complaints about pay or the speed-up of the work. There were several strikes in the 1830s, but the agitators weren’t [allowed by the mill operators and their beneficiaries in the local government to remain] there for long.
The Lowell Experiment was killed, not by labor discontent, but by technological change. In the 1830s, steam power began to replace water power in the mills, steam generated by newly-exploited Pennsylvania hard coal, or anthracite. Slater was the first to build large steam driven factories, but soon other cotton mills made the conversion to coal and steam.
Steam power meant bigger mills, faster production runs, closer supervision of the workers, and a greater division of labor in the interest of efficiency. And when this happened, the young Yankee women began to leave the mills. They were replaced by Irish workers fleeing the Potato Famine of the 1840s. The difference was – the Irish women stayed behind. They were too poor to leave.”
It was here also that the nation’s public school systems emerged – not necessarily to educate the masses but, to enable them to read, write and calculate in order to process work-orders for the mills and perform other clerical functions essential for economic progress and profit.
By 1850, Lowell was a squalid mill town, a miniature Manchester, with the industrial slavery Jefferson had warned about. Fortunately, Jefferson was gone by then – dying on the same day as his friend and fellow Founding Father, John Adams – on July 4, 1826 – 50 years to the day after the announcement of the Declaration of Independence.
Most historians have it wrong. It was the end of the Lowell Experiment, not the beginning that marked the advent of full-scale industrial change in America: an age of coal, steam, and immigrant labor. While the factory system was evolving in the Northeast, the entire country experienced a market revolution that tied the expanding nation together with roads, canals and railroads, and created modern capitalism.
“This commercial revolution revolved around an axis that ran from New York on the coast to Chicago in the heartland. It’s in this geographic corridor, and the Ohio and Mississippi Valleys that serviced it, that the commercial revolution of the early 19th century was concentrated. In 1830, when they began to be make contact with one another, New York and Chicago were vastly different places. New York was a thriving commercial center of almost a quarter of a million people.
It had a spectacular gift from nature; a spacious, sheltered, deep-water port that was connected to the interior of the country by the majestic Hudson River. And its aggressive merchants exploited this location to maximum advantage, making New York the country’s leading export and import center, America’s capital of commerce. New York was a city of the sea with an economic empire that was about to get far larger.
In 1825, the Erie Canal had opened for business from Buffalo on Lake Erie, to Albany at the northern end of the navigable portion of the Hudson River. This made New York the only port on the Atlantic coast linked by water to what was then the American West, a thinly settled area across the Appalachians and extending out to a small settlement at the southern end of Lake Michigan – Chicago.
The Erie Canal lowered shipping costs tremendously. Now pioneering farmers in the West could ship their grain, lumber, and salted pork through frontier lake ports like Detroit, all the way to New York. And New York could trans-ship them almost anywhere in the world with its magnificent merchant fleet. The canal that helped make New York the country’s busiest saltwater port would soon make Chicago the country’s busiest freshwater port.
But in 1830, there was no city of Chicago. Chicago then was an isolated fur trading post on the far edge of American settlement, a dismal prairie swamp located on a small river, the Chicago River, that fed into Lake Michigan. The richest man in New York, the visionary Jacob Astor, had extended his fur trading empire out to Chicago, but the destinies of these two places would be more tightly connected in future years.
Nature had paved the way, eons ago, during the last Ice Age. When the glaciers that covered the northern part of the continent began to melt, they created a rushing river that swept south from the Great Lakes and cut a gap through the Appalachian Mountains – the Mohawk Pass. Early, intrepid settlers, the Erie Canal, and later, railroads running between New York and Chicago, passed through this gap.
Because of the Mohawk Pass, there’s no mountain barrier between New York and Chicago, as there is between other eastern ports and Chicago. This gave New York a huge advantage over its rival Eastern cities and united the economic destinies of New York and Chicago.
The completion of the Erie Canal prompted the newly-formed state of Illinois to begin a canal project of its own. It would build a canal from the Chicago River down to the Illinois River, which flows into the Mississippi. This canal would create an all-freshwater highway from New York down to New Orleans, with Chicago situated at one of its key junctions. It was rumors of this canal that first brought New York speculators to Chicago to assess its economic potential.
What they saw didn’t impress them. Because of the drainage problems, most of the place was underwater for a good part of the year. And most of the inhabitants were wild, hard-drinking French Canadians who had married into local tribes. The place had three raucous taverns but no church or schoolhouse.
The only thing Chicago had going for it was its location, but that was enough to interest New York money. Chicago’s river gave it a protected harbor. And that river ran south and would, with the building the new canal, become an open door into the Tallgrass Prairie, the most splendidly endowed agricultural region in the world. With the canal, Chicago could become a jumping-off point for the settlement of a great part of the Thomas Jefferson’s Louisiana Purchase.
Next time: The story of Chicago – a quintessential American story.