I hope everyone finds the facts/insights presented in this article valuable.  If you find them interesting please send me a comment @ dan@betterbizbooks.com and forward the article onto as many friends as you want to.  If you want to learn more about U.S. history I highly recommend Paul Johnson's book pictured on the left.  Click on the Amazon.com or Barnes and Noble.com links if you are interested in purchasing the book.  If you want to receive further articles such as this click on the subscribe button on the right to sign up for my Free Monthly Newsletter.

The inspiration for this article came from a recent comment I heard on CSPAN2 by Tom Clancy, a best selling author of mystery/suspense books.  His comment, when talking about the Middle East and Wars in general was, "All wars are about economics.  People may end up taking one side or another in a war based on race, ethnic background or religion but, at the end of the day, wars are about economics."

Given that comment I looked into some historical facts about slavery and the civil war to see if that general thesis held.  Sure enough, it did......

The following article is based on historical facts from the book A History of the American People by Paul Johnson (pages 313 - 315.)  If anyone is looking for a thorough analysis of U.S. history I can attest that this book definitely fits the bill.  To date I have only read approximately 100 pages but I have found the insights excellent and the book compliments my previous reading in economic history such as The Worldly Philosophers, A Brief History of Economic Genius and History of Economic Thought.

Until the end of the 18^th century, the human race had always been unsuitably clothed in garments which were difficult to wash and therefore filthy.  Cotton offered an escape from this misery, worn next to the skin in cold countries, as a complete garment in hot ones.  The trouble with cotton was its expense. 

Until the industrialization of the cotton industry, the following clothing materials took the below amount of time to produce a pound of raw material:

• 12 - 14 man days to produce a pound of cotton thread.

• 6 man days to produce a pound of silk.

• 2 – 5 man days to produce a pound of linen.

• 1 – 2 man days to produce a pound of wool.

With fine cotton muslin, the most sought after, the value-added multiple from raw material to finished product was as high as 900.  This acted to spur mechanical invention.

The arrival of the Arkwright spinning machine and the Hargreaves jenny in England of the 1770s meant that, whereas in 1765 a half a million pounds of cotton had been spun in England, all of it by hand, by 1784 the total was 12 million, all by machine.  In 1785 the steam engine was introduced to power the cotton spinning machines and the first part of the Industrial Revolution was underway.

In 1793 Eli Whitney was vacationing Whitney came about a supposedly intractable problem of separating the cotton lint from the seeds-the factor that made cotton costly to process.  After tinkering for some time Whitney devised a solid wooden cylinder with headless nails and a grid to keep out the seeds, while the link was pulled through by spikes, a revolving brush cleaning them.  This resulted in lowering the cost of producing raw cotton and dramatically altered cotton production in the U.S.

To put it into perspective, a slave on a plantation, using a cotton gin, could produce 50 pounds of cotton a day versus previous levels of one pound a day, thereby lowering the process costs dramatically and further dropping the cost of cotton production. By 1812 the cost of cotton yard had fallen by 90%.  Lower raw material costs enabled prices for cotton clothing to drop precipitously in the late 1790’s – early 1800’s and it caused the demand for cotton clothing to soar.  The huge growth in the cotton industry was made possible by Whitney’s genius – it rose at 7% compound annually-soon making it America’s largest export.

The first American cotton bale arrived in Liverpool in 1784.  However, by 1810 Britain was consuming 79 million pounds of raw cotton, of which 48% came from the American South.  Twenty years later, imports were 248 million, 70% coming from the South.  In 1860 the total was over 1,000 million pounds, 92% from Southern plantations.  During the same period, the cost (in Liverpool landing prices) fell from 45 cents a pound to as low as 28 cents.

But the South’s increasing reliance on cotton had precipitous consequences for the slave trade. 

Before the cotton boom, the price of slaves in America had been falling.  In the quarter century 1775 - 1800 the value of a slave dropped by 50% and slavery appeared to be falling in importance. 

However, after Whitney’s gin was invented the value of a slave rose, in real terms, from about $50 per slave to $800-$1000 per slave from the years 1800-1850.  For every 100 acres under cotton in the Deep South, you needed at least ten and possibly twenty slaves.  The Old South (Virginia, North Carolina) was unsuited to cotton but its plantations could and did breed slaves in growing numbers.  As a matter of fact, slave breeding became the chief source of revenue of many of the old tobacco plantations.  By the 1820s a new kind of large-scale specialist cotton plantation, worked by hundreds of slaves, began to dominate the trade.– page 311

The big plantations were highly commercial slave-breeding plantations.  The notion that Southern slavery was an old fashioned institution, a hangover from the past, was false.  It was a product of the Industrial Revolution, high technology, and the commercial spirit catering for mass markets of hundreds of millions worldwide.  It was part of the modern world and that is why it was difficult to eradicate. The value of the slaves accounted for 35% of the entire capital in the South.  By mid-century their value was over $2 billion in gold; that was one reason compensation was ruled out-it would have amounted to at least ten times the entire federal budget.

With so much money invested in slavery it was not surprising that the South ceased to apologize for slavery and began to defend it.

I hope everyone found the facts/insights presented in this article valuable.  If you find them of value please send me a comment @ dan@betterbizbooks.com and forward the article onto as many friends as you want to.  If you want to learn more about U.S. history I highly recommend Paul Johnson's book pictured above.  Click on the Amazon.com or Barnes and Noble.com links if you are interested in purchasing the book.  If you want to receive further articles such as this click on the subscribe button on the right to sign up for my Free Monthly Newsletter.