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Thursday, January 17, 20081200609600

Why the Industrial Revolution? Why not an Industrial Counter-Revolution?

My friend Lexington Green of Chicago Boyz emailed me "King Kong and Cold Fusion: Counterfactual Analysis and the History of Technology," by Joel Mokry. The piece was originally Chapter 10 in Unmaking the West. The piece is very deep, and should definitely be read on paper.

The article focuses on the question of why there was an Industrial Revolution in the west at the time there was. That is not just where there was this or that invention, but why all of a sudden there this rush of economically productive innovations that's still going on.

The Industrial Revolution ended the Starving Years (the Malthusian Era) that began some 12,000 years ago. Prior to the Industrial Revolution, technological growth was slow enough in non-violent societies that population growth always kept up, leading to just enough resources to keep the population alive at its standard of living. (East Asians, being more hygienic, required less calories to keep alive, and so suffered worse living conditions. Western Europeans, being filthy, suffered higher losses from disease, and thus more nutritious diets.)

The Industrial Revolution is around 200 years old, but note that's includes the years of growth that preceeded the return to Malthusian normalcy. It took until about 150 years ago that the average Englishman's living standards were as high as there were when Columbus discovered America.


From A Farewell to Alms, page 195


The article that Lexington sent makes a big deal of evolutionary analysis, and it's right to do that. As both the article and Enterra CEO Stephen DeAngelis note, evolution is a process of random change and non-random selection. Two ideas flow from this:

  1. Any change that actually takes hold was preceded by many identical changes that did not take hold

  2. Selection can be unfriendly


For the first, consider that while Europeans can drink milk because of one specific mutation, the ability to drink milk may have evolved 25 times in our species' history.

For the second, consider the history of technological relapse. In a matter of years, the Chinese lost their ability to navigate the oceans, and would be defeated by an island nation that may not have been worth the bother of conquering in Admiral Zheng He's time. The Mokyr articles notes some other examples of relapse:

The religious strictures that prevented Islam from adopting the printing press for centuries and the politics of insulation and the ban on firearms practiced in Tokugawa Japan...


Thus, we have two questions. "Why was there potential for an Industrial Revolution in Europe at al" and why "Why did the Industrial Revolution happen in Europe" and "why didn't an industrial counter-revolution occur there, as well?" Why did Europeans have the ability to innovate? And why didn't Europeans revolt against the machines in the way that the Chinese, the Japanese, the Muslims -- and for that matter, the Tasmanians -- did?

The first question is quite possibly the result of climate resulting in and interacting with culture and genetics.

To answer the second question: the Europeans did try to overthrow the machines, of course. William Blake, writing in 1804:

And was Jerusalem builded here

among these dark Satanic Mills?


Less obliquely, the Luddites just killed people. There was an Industrial Counter-Revolution, and this was a real war.

However, the European states set themselves to fighting this counter-revolutionary movement. This is strange, because the landed classes should have been united in their fear of industry. The Luddites, the breakers, all those criminals and terrorists, were fighting for King and Country, to defend the Predatory State and extend the Starving Years. The counter-revolutionaries were fighting to keep their chains.

I think the answer is cooperative competition, that existed in Europe but did not exist to the same extent in China or Japan. While primitive by modern standards, Europe in 1800 constained a system of nation-states. England fought the breakers because the English were more afraid of the Dutch than they were of the Revolutionaries.

Fortunately for us, the distracted Europeans focused on fighting each other, allowing the Revolution to overtake them all.

Comments

Dan,
Can you provide a link to the article?

Posted by: ElamBend | Thursday, January 17, 2008

"Competition brings out the best in products and the worst in people" - David Sarnoff

Posted by: deichmans | Thursday, January 17, 2008

The Tasmanians were an outlier example of severe cultural and perhaps, genetic, regression. By the time the British arrived, the Tasmanians had trouble with syntax, much less mechanics. Paleolithic Archaic homo sapiens in Eurasia had a more complex culture.

A few generations prior to their extinction, it was reported that the studious efforts of Anglican missionaries had only managed to inculcate in the Tasmanians a vague sense that after death, a man went to England.

Posted by: zenpundit | Thursday, January 17, 2008

ElamBend,

Sent!

Deichmans,

Agreed.

zenpundit,

Well said.

"A few generations prior to their extinction, it was reported that the studious efforts of Anglican missionaries had only managed to inculcate in the Tasmanians a vague sense that after death, a man went to England."

Transmigration to a western pure land [1]...

The Anglicans were infiltrated by Amidists!!!

[1] http://en.wikipedia.org/wiki/Pure_Land

Posted by: Dan tdaxp | Friday, January 18, 2008

How did the wealth stolen from the Americas and Africa contribute to the development of the "industrial revolution"?

Posted by: ortho | Friday, January 18, 2008

Ortho,
It could be argued that the wealth stolen from the Americas (gold) and Africa (men) had very little to do with the industrial revolution.
By far the vast majority of the material wealth taken from the Americas went to Spain and in the long run, it did nothing for them in terms of development, either in the home country or in the colonies. When wealth can just be picked out of the ground, there is very little incentive for real development or change and Spain stagnated. (Replace gold with oil and you can see the fate of many other nations, if they are not careful).
As for the stolen fortunes of Africans, they were kidnapped to the Americas for decidedly UN-industrial revolution uses in agriculture. I guess that one could argue that the cotton gin was a part of the slave economy, but for the most part slavery was not applied to industrial uses on a large scale (which is not to say that it couldn't - I just don't think the slave economy encouraged this type of 'innovation'). Indeed, many have argued that the forces of the industrial revolution defeated the forces of the agrarian elite, on the battle field in the 1861-1865 war.
Finally, please note that the first country to undergo the industrial revolution, Britain, was indeed the one that ultimately used it's sovereign wealth to end the Atlantic slave trade.

Posted by: elambend | Friday, January 18, 2008

ortho,

The industrial revolution began approximately three centuries after the influx of gold from the new world, so probably not much.

Europe's great age of colonialism in Africa, for its sake, took place well after the Industrial Revolution was under way

elambend,

An excellent comment!

Posted by: Dan tdaxp | Friday, January 18, 2008

I believe "How the West Grew Rich" deals with that. Namely that divided political authority allowed capitalism and entrepreneurship to come into being.

Posted by: Steve French | Friday, January 18, 2008

"How did the wealth stolen from the Americas and Africa contribute to the development of the "industrial revolution"?

Before Europeans could even start "stealing wealth" they had to create the capabilities to do so. The best explanation for this was the one covered by Steve French. People make a similar argument about "slavery building the US." If anything, slavery is responsible for a one crop economy that parts of the South are still recovering from. Take this, along with the hidden costs that are still being paid out and one can conclude that slavery was certainly a terrible investment.

Posted by: Seerov | Saturday, January 19, 2008

Steve,

While a long period of stability combined with malthusian downward mobility was needed for the industrial revolution, Malthusian growth was unaffected by the Magna Carta, the English Civil War, the Glorious Revolution, etc.

Seerov,

Well said.

It's interesting to think that nearly every slave society eventually emancipated all or nearly all its slaves without a political push (Roman Empire, England proper, etc).

Posted by: Dan tdaxp | Saturday, January 19, 2008

On a point related to Ortho's comment, the wealth derived from overseas investments, including looting India and using slave labor to grow sugar in the Caribbean, was not the major impetus to financing the industrial revolution, either. The people who were getting those income streams were building country houses, not iron foundries. Nor was there a capital market that would have allowed the capital to be moved around to reach the first generations of industrial businesses. Instead, they borrow locally, or self-financed on a small scale from their own profits. It is a myth that the industrial revolution occurred off the backs of the exploited.

Posted by: Lexington Green | Saturday, January 19, 2008

Elambend and Seerov, thank you so much for your elegant and informative responses to my initial query.

Elambend, I find your argument unconvincing. Perhaps I would have found it more convincing if you did not read the mid-nineteenth century back into the past. The economic system of mid-nineteenth-century American slavery should not be projected back into an earlier time of European imperialism nor should it be transposed upon other geographic areas such as the Caribbean and South America.

Seervov, your comment was already well-covered by Dan's excellent post. In paraphrasing Mokry, he attempted to set the "local" preconditions within the "core" for the industrial revolution.

Steve, you raise an excellent point. For instance, the 17th- and 18th-century English state when compared with Spain or China during the same time period appears less bureaucratic, institutional, and hierarchic. This government structure allowed English merchants (mostly sons of obscure, lesser gentry) the freedom to sail the seas, the freedom to pillage Spanish galleons, establish colonial footholds, and open potential markets for trade.

Overall, I had no major quibbles with the initial post. It's exclusive focus on what some people in today's parlance call the "core," misses how places that the same people call the "gap" influence developments in the core. It's all well and nice to apply a Jared Diamond like interpretation to establish the preconditions for the industrial revolution. But once the revolution began, colonialism (both the products produced and trade markets it opened) contributed to the revolution's success.

I have another question: what role did religion play in establishing the preconditions for the industrial revolution or in the revolution's development?

Posted by: ortho | Saturday, January 19, 2008

Ortho,

"But once the revolution began, colonialism (both the products produced and trade markets it opened) contributed to the revolution's success."

Clearly free markets, free trade, free sees, etc, helped world economic growth The majority of this growth was taken by poorer countries (first the US and western Europe, then India, China, and Latin America).

This increase in growht of course helped the people affected by it, but as hte major revolution was net long term economic growth in absolute living standards greater than 0% per annum, the benefits of these additional markets (and additional suppliers) were ones of degrees.

"I have another question: what role did religion play in establishing the preconditions for the industrial revolution or in the revolution's development?"

Clark doesn't address religion much [1], but I imagine the answer would be "substantially" if you view Europe's higher birthrates among the rich , compared to China or Japan, as a function of Christian pro-birth theology.

[1] http://www.amazon.com/Farewell-Alms-Economic-History-Princeton/dp/0691121354

Posted by: Dan tdaxp | Saturday, January 19, 2008

Quick answer is that they did revolt against the industrial
revolution. What we think of as the Industrial Revolution was pretty much limited to England, the US, and parts of northern Europe. The rest of Europe was against it and didn't participate that much until later in the 19th century when it became a matter of national survival.

France, for instance, had a number of laws preventing the use of machinery in certain industries and regulating how the work was done. Their large agricultural economy and population kept them a world power, as was the case in much of the rest of Europe.

The exceptions were places like the Netherlands (which started the financial revolution that allowed the Industrial one), the UK, and some German states. They were poor countries due to their size, climate, and/or geography. So they had to turn to industrialization as a way to become wealthy and powerful.

There's a good book on the subject of exactly what happened and why called "The Birth of Plenty : How the Prosperity of the Modern World was Created". It also has some chapters on why other parts of the world didn't succeed.

Posted by: Andrew G | Saturday, January 19, 2008

Ortho,
It appears that I read your question too broadly, for when you said Americas, I assumed both the American continents. As for the issue of time, I do believe that the proceeding centuries are an issue, in particular in terms of wealth stolen from the Americas given that the vast majority of it was removed prior to the mid nineteenth century. Since you had asked whether the wealth stolen from the Americas had contributed to the industrial revolution, I had assumed you meant all the wealth.

Focusing more narrowly on mid-nineteenth century [North] American slavery, there has been a lot of study of the rise of industrialism during that time. I had the benefit of taking a Civil War survey class taught by someone whose specialty was labor history. He was good enough to point out that businessmen in the south did use slavery for some small industrial uses the results often weren't good. Note that the Tredegar Iron Works, the main (and for most intensive purposes, only) iron foundry suffered throughout the civil war for skilled labor. Field hands that were forced to labor under the law of a whip did not make good industrial workers. Contrast this with the beginnings of the industrial revolution in the northern part of North America. There it was often small water-powered mills manufacturing small goods to begin with.

The mostly likely avenue in which wealth from the Americas and Africa would have effected the industrial revolution would be in raw materials (for instance, cotton picked by slaves in the Americas). However, I think that this use of outside raw materials came after the industrial revolution had come into full swing (and continued into the 20th century through the more brutal practices in Africa, like the Belgium rubber slaves in Congo), plus there were other sources as well, such as the cotton markets in Egypt.

Posted by: ElamBend | Saturday, January 19, 2008

Another commonly overlooked fact, or maybe conveniently overlooked fact is the reality of Arab slave trade. If mass slavery = wealth, then the middle east should be 10 times as wealthy as the Western Hemisphere, due to 10 times the amount of African slaves being brought to the Middle East. But then again, the people who propagate these "ideas" are the same people who subscribe to Marxist theories which figure racism as being the tool of the rich to maintain their class interests. These same people screech at high volumes regarding the "racist" anti-immigration movement in the United States while overlooking the biggest lobbyists [for illegal immigration] being the rich. This reflects the highest irony as the these same Marxist thinkers act very effectively as tools for the rich in their very holy "social activism." Meanwhile, the same "workers" they claim to love so much are hurt the most as they see their wages drop due to increases in the supply of labor.

So the question now is, why do the Marxist propagate such ideas? The answer is happens to be one the main questions that this blog deals with and that happens to be 5GW. The Marxist left [whose American roots can be found in the 5GW strategy center known as the Frankfort School] construct the myth of "white oppression" or "white theft" to accomplish two tactical goals.

First, raise an army of the "oppressed" in disgruntled ethnic minorities and second, to effectively psychologically castrate Westerners and their perceptions of their historical institutions. This castration can been seen in people of European origin who in a turrets-like manner, qualify their displeasure in the behavior of ethnic minorities with the words "I'm not a racist but". This turrets-like statement-"I'm not a racist but"-must be said before stating any displeasure regarding the behavior of ethnic minorities in the United States.

This turrets-like tic is a perfect indicator of the effectiveness of the Marxist use of 5GW. In fact, the West is the first civilization in history to literally assist in its own displacement. After the armies of the oppressed are in their staging area, the transition will be made to 4GW or even 2GW, and the West will be just another anthropological oddity.

See Bill Lind Video for more details:
http://video.google.com/videoplay?docid=8630135369495797236&q=political+correctness+bill+lind&total=2&start=0&num=10&so=0&type=search&plindex=0

Posted by: Seerov | Sunday, January 20, 2008

Lexington Green writes,
Nor was there a capital market that would have allowed the capital to be moved around to reach the first generations of industrial businesses.

This interpretation is a bit off. See for example David Hancock's London Merchants and the Integration of the British Atlantic Community, 1735–1785 or Paul Langford's A Polite and Commercial People
England 1727-1783.

ElamBend, thank you for your response; it is informative. You are right; you had a great professor.

Dan tdxap writes,
This increase in growht of course helped the people affected by it, but as hte major revolution was net long term economic growth in absolute living standards greater than 0% per annum, the benefits of these additional markets (and additional suppliers) were ones of degrees.

I am sorry Dan. I had trouble understanding this. Also, thanks for the book link.

Servo, I do not know how you can claim that the Arab slave trade is a "commonly overlooked fact." At least a dozen books are published each year on this subject.

Servo writes,
If mass slavery = wealth, then the middle east should be 10 times as wealthy as the Western Hemisphere, due to 10 times the amount of African slaves being brought to the Middle East.

This is a fallacious assertion. Mass slavery does not equal wealth. Slave labor produces wealth. The majority of African slaves kidnapped by Arab traders and sold to Middle Eastern royalty and merchants did not, like their Atlantic counterparts, work in intense, manual, agricultural labor. Instead, the majority of Middle Eastern slaves, were essentially, consumer products of conspicuous consumption. They worked in harems, served in royal palaces, as soldiers, guards, and of course, eunuchs. For a brief, descriptive overview, see Humphrey Fischer's Slavery in the History of Black Muslim Africa.

Seerov digresses,
But then again, the people who propagate these "ideas" [that the Atlantic slave trade generated wealth?] are the same people who subscribe to Marxist theories which figure racism as being the tool of the rich to maintain their class interests.

This is a shoddy and misleading argument. How can you make such a blanket, universalist assertion without evidence? How can you malign a historical discipline (Atlantic Studies) as a tool of Marxist (however you define "Marxist"; I'm inclined to believe that your use of the said term is no more than a rhetorical strategy) propaganda?

I could respond to the rest of Seerov's comment in detail. On the other hand, I could respond with gross generalizations and blanket condemnations. For example, I could write that Seerov’s attempt to conveniently minimize the role Europeans played in underdeveloping Africa, is a 5GW (dis)information tactic deployed by neoliberals who wish to maintain a fragile planetary capitalist order that was built upon historical patterns of exploitation. But, of course, I would not dare to say any of these assertions without evidence.

Dan, thanks for posting a great post that generated much enlightening and informative discussion. I look forward to reading your future posts.

Posted by: ortho | Sunday, January 20, 2008

Ortho, to answer in a different way:

""But once the revolution began, colonialism (both the products produced and trade markets it opened) contributed to the revolution's success.""

This can be read as making two statements at once:

1. colonialism increased the rate of growth from some positive number to another positive number.
2. colonialism was necessary for maintaining an economic growth rate above 0%.

#1 is beyond the scope of my interest, at least as far as this thread goes.
I disagree with #2. I don't see why colonailism is necessary for avoiding falling back into a Malthusian economy.

Posted by: Dan tdaxp | Sunday, January 20, 2008

when thinking about the Industrial Revolution, you also have to take into account the unique family system of north-west Europeans as a significant factor.

In most parts of the world everyone marries, and usually (especially for women) soon after puberty; that seems to have been the pattern from time out of mind.

In Europe north and west of a line between St. Petersburg and Trieste, people married late -- about the same ages we do now, in the mid-20's for both sexes -- and a high percentage, sometimes as many as one quarter, never married or had children at all.

There was what amounted to a taboo against more than one married couple under the same roof, and you had to accumulate enough resources for your own 'hearth' before you could marry and become a full adult -- a 'servant' (someone working in someone else's household) wasn't really grown-up regardless of age, and would be addressed as "boy" or "girl" even if in their 20's or 30's. Conversely, a 'family' in general usage included everyone living under one roof and under the authority of the head of the family, whether related or not.

This was also the pattern from "time out of mind", or at least as far back into the medieval period as we have any demographic information. Marriage happened at least a decade after puberty and extra-marital childbearing was very rare, while never-married women were quite common and apparently usually died _virgo intacta_, at least in the technical sense.

This had three main consequences.

First, it provided a self-regulating population-control mechanism because marriage (and birth) rates tracked the economy, with a lag. When times were hard by customary standards, people married later and more never married; for example, the population of England stopped growing in the 1640's and didn't start up again until the 1720's, for exactly that reason -- as many as a quarter of the women in late Stuart England never had children, and the average age of marriage was as high as 26.

Hence despite a 'natural' pattern of conceptions (every 2 years or so from marriage to menopause or other physical reason for infertility) crude birth rates were quite modest, about 23 per 1000 annually.

They were never all that much higher than that; really large families were fairly rare and usually a sign of unusual wealth. Typical TFR's were about 4 children per woman, or a bit less.

This mechanism kept the population from pressing too hard on the subsistence capacity of the territory; given the high infant mortality rates, crude birth rates needed to be well above 25 per 1000 to produce consistent population growth. Even in the late 18th and early 19th centuries, when English nuptuality rates and fertility hit levels never seen before or since, they were lower than say, Uganda is today. Typically there were century-long swings between (modest) population growth and stasis or decline.

(By contrast, in the American colonies, where land was abundant, food cheap and wages high and it was easy to start a household, the birth rate in the 1600's and 1700's was near the biological maximum -- higher than Niger or Afghanistan today.)

Second, the fact that there was no "extended family", except to a limited extent among the very rich, and that most people spent a decade or more working away from their families of birth, meant that people were geographically and occupationally mobile.

Few Englishmen (or women) died in the parish where they were born; less than a third, in most years. A tenth of every generation after the 1500's moved to London alone. They were individualist profit-maximizers ready to shift place or job long before the Industrial Revolution. People didn't support their aged parents, either; the parish did it. Ordinarily a man died about the time his first son married; and anyway, they couldn't afford it.

Hence the Industrial Revolution in England didn't have to pry people out of time-encrusted customary communities of peasants 'rooted in the soil', because if any such had ever existed they'd been dissolved a long, long time before.

Third, there was a very strong incentive to accumulate property and/or skills, at least to a modest level -- enough to rent a cottage or practice a craft. Unless you did, you couldn't become an adult, couldn't get married, couldn't have children, couldn't become a full member of society even at a fairly humble level.

Posted by: S.M. Stirling | Sunday, January 20, 2008

SM Stirling,

Thank you for the comment, and apologies for the bad service [1].

You're correct on fertility. However, China and Japan had even lower fertility rates than Europe in the early modern Era (I discuss this in passing in my review of Greg Clark's "A Farewell to Alms" [2]). Also in the period Tokyo was the largest city in the world.

Actually, your comment goes a long way to foreshadowing Clark's discussion of why England, China, and Japan, but not India, were on the road to industrialization. Clark mentions the presense of worker's family on factory workflows as just one example of lower productivity of Indian workers than European workers.

The desire to accumulate property increased over time in England, as people's time horizons expanded and the interest rate required for capital fell.

Excellent thoughts!

[1] http://tdaxp.blogspirit.com/archive/2008/01/20/major-apologies-to-s-m-stirling.html
[2] http://tdaxp.blogspirit.com/archive/2008/01/17/why-the-industrial-revolution-why-not-an-industrial-counter.html

Posted by: Dan tdaxp | Sunday, January 20, 2008

Dan,
Douglass North wrote a book called "Understanding the Process of Economic Change" In part of it he detailed the conditions of the rise of the current economic system from its roots in Northwest Europe. Some of it is echoed by S.M.'s comment and I wouldn't be surprised if North and Clark did not use the same sources.
Great Thread!

Posted by: ElamBend | Sunday, January 20, 2008

"I could write that Seerov’s attempt to conveniently minimize the role Europeans played in underdeveloping Africa, is a 5GW (dis)information tactic deployed by neoliberals who wish to maintain a fragile planetary capitalist order that was built upon historical patterns of exploitation. But, of course, I would not dare to say any of these assertions without evidence."

You shouldn't make this argument for fear of lack of evidence, the best reason for not making this statement is lack of logic or reason.

How would minimizing Europe's role in the undevelopment of Africa help maintain a fragile capitalist order? I can't figure this out? How would this work. Please explain this to me?

You don't need to include footnotes [unless you want to] or any other "proof" to make an argument to me. Just lay out exactly how minimizing the Europeans role in Africa's development helps maintain a fragile capitalist order?

Now regarding Arab Slavery compared to American slavery. I will take your word for it that the Arabs used their capital in a different manner than the West. The purpose of bringing it up was just to point out that many people choose to focus on the Wests "crimes" while usually ignoring the "crimes" of others.

The reason for this is to maintain the "whites as oppressors" narrative. The purpose of the narrative was laid out above in the part about the Marxist use of 5GW.

As far as the word "Marxist", I only use it because the "white as oppressor" narrative is the product of the Marxist intellectual lineage. See the film I posted to learn more about this.

The important thing is that you explain how minimizing the Europeans role in the underdevelopment of Africa helps to maintain a fragile capitalist order.

Posted by: Seerov | Monday, January 21, 2008

As to China and Japan: no, they weren't on the path to industrialization. Not until Westerners showed up and started kicking them around, and they felt they had no choice.

Japan managed it quicker, but then Japan had a social system that was similar to the Western one in some respects. It was a nation, for starters, in the Western sense; it had a similar decayed-feudal/ancien regime system, and so forth.

Even so, there were a lot of lurches and angst. And even now, Japanese scientists are much more productive in American labs than they are at home, where fundamental research is involved, for complex cultural reasons.

China had to abandon the whole Confucian scholar-gentry system, one which had defined the Han identity for millenia, and the process was long and bloody. They've done better in the past generation, but China's prospects are not good. Apart from the looming demographic catastrophe, their growth is quantitative, with low Total Factor Productivity increases. That sort of thing can go on for some time and lead to impressive GDP figures -- the USSR outgrew the US for over 40 years -- but then it hits a wall as the ability to shift factors _en masse_ runs out, which is just starting to happen there. Shifting to qualitative growth is much harder.

The Industrial and Scientific revolutions happened only once, in one subset of the Western countries; this requires a whole constellation of lucky coincidences, cultural, economic, religious, philosophical, political, and just plain coin-falling-heads-ten-times-in-a-row. They were then widely copied, because it became apparent that failure to do so meant poverty and weakness, but it wasn't an easy path for most peoples and it has proved impossible for some; they're not willing to pay the price, which is wholesale Westernization.

The process goes a long way back in the history of Western civilization; it would be more accurate to say that both science and machine industry were the products of a certain habit of mind and way of looking at the world, one which was becoming increasingly widespread throughout the medieval period. But the process was fragile and any number of things happening otherwise could have bumped it off-track; a different outcome to the theological controversies of the 13th century, for example.

It was a low-probability historical accident, which is where I think "Years of Rice and Salt" falls down. It might have happened elsewhere sometime, but not anytime soon, and I think not within the lifetime of any of the other civilizations then current.

Posted by: S.M. Stirling | Monday, January 21, 2008

Someone brought up the subject of industrial slavery in the antebellum South. This is a topic I've studied carefully for a long time, and it's riddled with historical 'urban legends' and unrecognized remnants of mid-19th-century controversies, particularly the abolitionist-Free Soil critiques of the South. These were ferocious partisan propaganda, not objective analysis, just as the South's denunciations of Northern capitalism were.

Only in the past decade or two have historians freed themselves of the 'victor's narrative' of the Civil War era, and those myths are still wandering around loose in the general population. Olmstead's "Journey through the Slave States", for example, was about as reliable as a convinced Marxist traveling through the US in the 1950's would have been. He went knowing the truth, and observed precisely what he expected to see -- quite honestly, but very unscientifically.

You still get howlers today like the belief that slavery "locked up" capital; which is obviously impossible, if you think about it. Slaves were a very liquid asset. Every time someone bought one, someone else (almost invariably another Southerner) got the price, and the new owner now had an excellent security against which he could borrow. He'd also bought an appreciating asset -- since slaves had a high reproduction rate, if you had enough women of childbearing age, you got the capital gains of natural increase. And, of course, you could always rent a slave out if you didn't want to use his labor yourself; that was a commonplace practice, with active markets everywhere in the slave states, and increasing numbers of specialist brokers to handle it.

In economic terms, slavery is a capitalized rent. And a slave economy is much more like a capitalist one than either is like, say, a manorial-feudal-seigneurial local-subsistence type. In a capitalist or slave economy, the factors of production move according to market pricing signals. Who makes the decisions about that are different, but it's quite distinct from the customary-household system.

The Southern slave system was profitable, flexible, and efficient. It was extremely evil, too, of course, but there's no necessary connection between that and inefficiency. Slavery is not wrong because it limits development or because slaves were badly treated; in most respects, they weren't in the antebellum US, by the material standards of the day. The one in which they were badly treated -- denial of personal ownership and autonomy -- is the one that counts.

It's also often been said that slaves couldn't be used as factory workers. This is untrue.

They could be and were so used, and functioned about as well as most workers of the time -- which, incidentally, isn't saying all that much.

Industrial work patterns of continuous effort and clock-bound regularity were intensely unpopular with almost all the ex-peasants who staffed factories in the 19th century, and chronic absenteeism, outright sabotage and so forth were problems everywhere, which explains the ferocious factory discipline and widespread use of extra-economic incentives like payment in truck. Or, in some countries, jailing and beating and shooting.

An industrialist in northern France remarked in the 1840's, sort of offhand, that every factory owner lived in fear of an uprising 'like that of the slaves of Santo Domingo'.

Read up on Hall's modernization of the Harper's Ferry arsenal, for an American example. He nearly got killed a couple of times simply because the (free, white) workers were outraged at his attempts to have management actually control the production process and to make everyone work as directed for the full day. In some respects, slaves were actually _superior_ from an employer/owner's point of view.

The state with the largest number of steam engines in 1861 was Louisiana, and almost all of them were operated and maintained by slave mechanics. Slave workers at, for example, the Tredegar Works, were about as productive as free employees and their maintenance costs were lower -- about half the wages a skilled worker could command, with additional advantages in lower turnover and absenteeism.

The reason the South didn't have more factories was fairly straightforward economics; comparative advantage, to be precise, and substitutability factors in labor supply. Plantation agriculture paid better, for a number of reasons:

1: Slavery meant that Southern agriculture didn't have the diseconomies of scale that Northern farming did. You could expand the size of a farming enterprise well beyond what was possible in the North, where farm labor was relatively scarce, costly, and most of all unreliable and difficult to discipline. In agriculture, you can only use non-family labor that you're absolutely sure you can get when you need it -- if the labor you expected isn't there for the harvest, you can lose an entire year's profits or more.

There were many attempts to set up large-scale, employer-manager type farming operations in the antebellum North; none succeeded for long. Family farmers out-competed them; they still do, for the most part. So if you wanted to be an entrepreneur in the North beyond the "prosperous working farmer" stage, you had to leave the family farm and go into something else, industry or trade or the professions or politics.

In the South, you could just keep adding acre to acre and slave to slave, and make _very good_ returns.

Even in the least profitable agricultural areas of the South, slaves returned about 5% on capital; in the boom zones of the Southwest and Texas, it was more like 15-25%, allowing for ups and downs and price fluctuations. This was extremely good money at the time -- railway securities usually paid around 5%, if you avoided extremely speculative lines.

2: Southern agriculture was more efficient than Northern; or to be more precise, its plantation sector was more efficient.

Slaves worked slightly shorter hours than Northern free farmers, but they worked harder and their per-hour productivity was greater, because the gang system (together with a generally skillful standard of management) allowed workers to be driven in a steady lockstep fashion more like an assembly line than the rather pre-modern Northern rural labor habits.

Add in that the longer growing season meant that labor could be applied to farming much more continuously than in much of the north; there was less seasonal downtime.

Technical standards of agriculture in the South's plantation sector were also rather high, much higher than they were after 1865; cotton production per work-hour almost tripled between 1820 and 1860, for example.

And labor force participation rates were extremely high -- or to put it another way, slave women in the South did almost all the same sort of agricultural labor as men, and spent much less time on household tasks, in contrast to what even very poor free women did. 100 families of slaves would give a lot more output to their employer than 100 families of white workers; the difference was that the slaves could be compelled to concentrate on commercial production at the expense of non-monetized things like domestic felicity and family pride.

When you factor in the much lower "wages" slaves got -- maintaining an adult slave cost about $150 a year, even in an urban area, only a little more than half of what even the lowest-paid free laborer got -- and the reason planters tended to keep most of their assets in slaves and land is obvious: it paid.

Why undertake a risky and unfamiliar form of investment, when the one you knew about was doing so well?

Planters often invested in railroads and other transportation improvements because they needed the cheapest possible route to market, and they weren't at all hostile to manufacturing -- such industrial investment as there was in the South tended to come disproportionately from planters, who were after all the ones with the money, the education and the connections. They just had better ways to get rich, from their perspective.

3: Slave labor could do nearly all the same types of manual labor as free, and about as well, but the reverse was not true. There was a substitutability problem.

You couldn't get freemen to work in gangs under supervision on plantations -- not at any wage that left the planter any profit.

Note that after emancipation, despite being dead broke, the ex-slaves fanatically resisted all attempts to make them work in the old style. They wanted to be family farmers, growing their own food and choosing how to allocate their own labor and how and to what degree to participate in the market.

They mostly had to settle for sharecropping since the planters retained possession of the land, but they insisted on taking their women out of as much field labor as they could, even at the cost of a steep drop in living standards, and they scattered their cabins rather than grouping them near the "big house".

As the song said, "want to get away from the white-man Boss". They thought of freedom in concrete terms: not having someone standing over you every hour of the day telling you what to do.

In the antebellum era, then, slaves _could_ be used in, say, factories or urban domestic service or as general laborers. There was an active market in rented slaves, and a profitable one, especially as wages in general were higher in the South than in the North, often as much as a quarter higher.

But you could also use free labor, particularly immigrant Irishmen and Germans, for those tasks. The South as a whole attracted few immigrants but its cities all had large foreign communities.

You _couldn't_ use free labor for plantation gang work, and since that paid so handsomely, farming "bid away" labor from urban uses; and larger plantations were starting to show a tendency to "bid away" labor from smaller holdings.

Despite this, all Southerners with enough money continued to buy slaves when they could -- about one-third of all white Southerners in the area of the CSA were in slaveholding families -- and prices continued to increase, indicating market confidence in future profitability. Only when the South was visibly losing the war did prices start to drop.

Note that a very large majority of factory and mine workers in the North were immigrants. Few native-born American adult white men worked as unskilled factory labor before 1860, or in fact at any time during the 19th century, unless absolutely desperate.

The South, after 1807, couldn't import labor; hence the relentless rise in slave prices, which tended to concentrate ownership and to concentrate slave labor in the _most_ profitable sectors.

If there had been an abundant supply of fresh slaves from Africa at $200 a head, the Southern population would have grown more rapidly and there would probably have been more diversification.

As it was, when the war came along and incentives changed, much was accomplished.

The South was a rural and agricultural country in 1860, but not a backward or poor one; it had more railroad mileage than any European country, and about as much manufacturing per capita as France, and incidentally a higher per-capita income than France even counting the slaves. Even a deeply agricultural and newly-settled state like Mississippi had several machine-shops which could manufacture complete steam engines.

The Confederate government managed to manufacture most of the arms it needed -- 50 ironclads, for instance, the world's largest and most modern powder mill, and about half as many 12-pounder Napoleons as the North. When Lee's army surrendered, every man had 75 rounds and a modern rifle-musket, and there was as much artillery as there were men to work it. Food was short, shoes were short, they were running out of fit adult males to be soldiers, but weapons were sufficient if not superabundant.

The main weaknesses of the Confederate war economy were in things like transportation, finance, and in basic materials production, for reasons I could go into but about which whole books have been written. There's a limit to what you can do in a few years, while also mobilizing over half you total adult males for actual fighting. The learning curve is just too steep.

Posted by: S.M. Stirling | Monday, January 21, 2008

S.M. Stirling,

Excellent comments!

All I'll add is Greg Clark's [1] focus on per-unit labor productivity as being much higher in Western Europe than India, regardless of management, machinery, etc. Approximately three Indians were required to perform the same task as one unskilled Englishman in a factory, due to higher absenteeism, higher error rates, etc. This about wiped out India's "low wage" advantage. Indeed, Independence has seen hand-looms increase in absolute production: Indian textile factories (both formal and informal) are still unable to corner the market.

Therefore I'd question the argument that American slaves would be as productive in a factory setting as freeborn Americans, as it would seem on its face that the difference between freebornes and slaves would be similar to that between Englishmen and Indians. Likewise, if as Clark maintains, these good traits were peculating down in the population through Malthusian selection, China and Japan may have reached a workforce in a couple hundred years capable of an Industrial Revolution, provided that domestic political forces don't get in the way. (Which is obviously a very big hurdle.)

The New York Times review of Farewell to Arms [2] focuses on the labor productivity angle, btw.

Seerov,

If I'm reading ortho correct, he is arguing that attacking one idea as Marxist is logically the same as attacking another as 5GW: besides the point of if it is correct or not.

ElamBend,

Thanks!

[1] http://tdaxp.blogspirit.com/archive/2008/01/20/review-of-a-farewell-to-alms-by-gregory-clark.html
[2] http://www.nytimes.com/2006/11/02/business/02scene.html?ex=1320123600&en=45c0cd3f64070ad2&ei=5090&partner=rssuserland&emc=rss

Posted by: Dan tdaxp | Monday, January 21, 2008

"Approximately three Indians were required to perform the same task as one unskilled Englishman in a factory, due to higher absenteeism, higher error rates, etc."
"Therefore I'd question the argument that American slaves would be as productive in a factory setting as freeborn Americans, as it would seem on its face that the difference between freebornes and slaves would be similar to that between Englishmen and Indians."

I'm not sure how you got from the first paragraph to the second. Seems to me that absenteeism wouldn't be as much of a problem when you can force people into the shop at gun point and chain them to their stations.

I'm curious, though. You mentioned in passing in an earlier post that the habit of bringing one's family to work reduced the productivity in Indian factories. Could you elaborate on this?

Posted by: Michael | Monday, January 21, 2008

"Seems to me that absenteeism wouldn't be as much of a problem when you can force people into the shop at gun point and chain them to their stations."

You gain that, and lose any real ability to fire people. (Of course, British textile mills in India had to resort to notices that employees may be fired after 10 consecutive days of unexcused absence, so if you're labor productivity is low enough, perhaps it becomes less of an issue).

"I'm curious, though. You mentioned in passing in an earlier post that the habit of bringing one's family to work reduced the productivity in Indian factories. Could you elaborate on this?"

Chapter 17, "Why isn't the whole world evenly developed," goee into the details of the difference in Indian and western productivity. While there is some variation, between 1907 and 1996 there is a roughly consistent rate of Indian productivity (on the same equipment) of 16% of industrialized world rates.

Clark goes into less detail on qualitative findings (families coming to work as well), though I believe his point is that market rates for labor in India relied on labor quality that was unacceptable low by industrial standards. This could be fixed of course by paying more for the best employees -- rates which quickly negated the wage advantage of India.

Posted by: Dan tdaxp | Monday, January 21, 2008

Actually, I was referring to the comparison between India and the American South; absenteeism probably wasn't a big issue on Antebellum plantations, so I'm wondering if that part might be comparing apples and oranges.

As for the latter part, the qualitative analysis is what I'm interested in. When lack of quality daycare is one problem sited in the West's low birthrates, obstacles to parents bringing their kids to work are worth studying. I've also read some pop-psychology stuff suggesting that maximizing the amount of time spent with parents in the first 18 months of life can improve a child's well-being in later life.

Posted by: Michael | Monday, January 21, 2008

Michael,

Reducing absenteeism doesn't address productivity differences of people actually on the job.

"As for the latter part, the qualitative analysis is what I'm interested in. When lack of quality daycare is one problem sited in the West's low birthrates,"

I've heard this as well, but never with evidence.

Posted by: Dan tdaxp | Monday, January 21, 2008

There's an old saying that there are no bad soldiers, only bad officers. The same thing applies to most industrial work; if there's low productivity, it's management's fault 99% of the time. Anyone with the full complement of limbs and senses can be taught to do any form of manual work well enough.

And textile factory work is not rocket science. It's the archetypical 'beginner's industry', the one every industrializing country starts with. Any dumb peasant fresh from the plow can do it, given good management and supervision. That's why Bangladesh has a huge export trade in the stuff, and why countries moving up the scale of value-added generally stop being major textile producers. New England lost its textile factories to the Southern states, and they to various Third World countries.

From the labor-supply point of view, the advantage that England had in the Industrial Revolution period wasn't the quality of its unskilled or semiskilled labor, which is much the same anywhere, but the high degree of labor mobility. English workers weren't peasants; the English peasantry had been liquidated long, long before the Industrial Revolution. Most Englishmen in the countryside were already full-time laborers, renting their cottages, working for cash wages, and buying their food and clothing in the market. The farmers themselves weren't peasants; they were capitalist entrepreneurs, renting their land from the gentry in fairly large units, and working it with landless wage labor.

This made it _comparatively_ easy to shift workers from agriculture into other sectors and it meant that there was a widespread monetized demand for ordinary consumer goods like cloth. English industrialists didn't have to break into the closed world of subsistence agriculture because it had already been smashed up long since. English farms (usually tenanted) were already about seven or eight times larger than French ones, and sold most of their produce.

Another English advantage was the very wide diffusion and high standard of craft skills.

Hargreaves, the guy who invented the spinning jenny, was illiterate; but he was a highly skilled carpenter. When someone like Arkwright who wasn't himself a craftsman got an idea, it was fairly easy to have it translated into wood, leather and metal. These craft skills later morphed into the machine-building and machine-tool trades.

As to hostility to innovation, there was plenty of it in Britain -- Hargreaves nearly got lynched by a mob of irate spinners and had to go into hiding, and Kay, the inventor of the flying shuttle, was chased all the way to France.

A lot of people considered innovators like that to be selfish monsters stealing and destroying honest men's livings. This is natural enough; any innovation damages the employment and profits of people already here, while those it benefits don't exist yet. The idea that it's worth the temporary pain for the overall gain is a relatively modern one.

In fact, the landed Whig oligarchy who ran Britain at the time probably often agreed with that traditional negative appraisal of the consequences of innovation for ordinary people.

The important thing was that they just didn't care if spinners and weavers got hurt. They were rich, wanted to get richer, and while they weren't manufacturers or merchants themselves many of their political supporters were.

They also knew that increases in trade and manufacturing rebounded to the advantage of the 'landed interest', through everything from increased market demand to rising land prices.

This explains why a government so thoroughly dominated by landed gentry and aristocrats was extremely solicitous of trade, despite the fact that they more or less despised its practitioners. They knew it put guineas in their pockets, and beside that their social prejudices were not of much importance to them. It also made the country stronger, by increasing the revenue available in time of war.

And due to the history of England during and after the Civil Wars of the 17th century, they were ferociously dedicated to the principle of private property -- that an owner should be able to 'do as he willed with his own' and the devil take anyone else. To that period, that's what "liberty" meant; that the King could not interfere with private property.

England had ceased to be a society of castes or Estates, and had become one of classes, long before the factory or the steam engine.

So where most Continental governments might have accommodated the sort of protest that Kay and Hargreaves met, if only for the sake of preventing expensive unrest or costly demands for relief, the Whigs put it down with troops and a ferocious penal code -- hangings and punitive transportation to the colonies as forced labor. The Parliamentary government of England was far more coldly indifferent to ordinary people than the "absolutist" Royal one of France.

It helped that England (and Britain as a whole) had the most concentrated pattern of landownership in Europe, surpassing even that in Poland or Hungary. By the 18th century, around 5000 closely related families owned essentially every square inch of Britain, and dominated its politics from the local level up through London; the only other significant interest was the mercantile/financial one, and it was closely linked to landed wealth in a number of ways.

Both houses of Parliament were run by the same group; the aristocracy in the Lords, and the untitled gentry in the Commons -- and in fact, many members of the Commons were young aristocrats who hadn't inherited their titles yet, or their relatives or retainers.

As an English radical of the early 19th century noted sourly: "Our landed classes have the best of all possible reasons to be satisfied with our system of government. They ARE the government."

Posted by: S.M. Stirling | Tuesday, January 22, 2008

I'm torn: part of me wants to recommend this thread to my lefty friends just for Sterling's commentary, part of me shudders at the number of rants and lectures I'll likely have to listen to if I do:P

Posted by: Michael | Tuesday, January 22, 2008

SM
The picture you paint makes it seem all the more amazing that tbr IR arose in Britain. I wonder one the industrialists started to make real money, what then did the landed gentry think? Is the current prince of wales attitude a legacy of the disdain for those who did it on there own?

Also, it seems to me that labor mobility is the under rated, but key component of economic change and growth.

Posted by: elambend | Tuesday, January 22, 2008

Further discussion of this post at bulletin board for John Reilly's Long View blog:

"...Why not an Industrial Counter-Revolution?"
http://www.johnreilly.info/Bulletin/viewtopic.php?t=120

Posted by: Jayson | Tuesday, January 22, 2008

Jayson,

Wow! Thanks for posting this thread to that one! It's neat to see the different ways the same conversation can evolve!

ElamBend,

Clark emphasizes the low returns of the industrialists, and how into the middle part of the 19th century, your best bet if you had money was either land or government bonds.

In the US, by the time the landed class realized the threat of industrialization, it was too late. [1]

Michael,

As long as they'll lecture here, bring 'em on in!

SM,

Excellent comment! A tour-de-force!

Only comment is re: Indian labor. If the problem is the result of low mobility of labor, or less ability to transition out of an agricultural setting, then the problem is stil with labor. Likewise, India's management problems survived Indian managers, British managers, imported managers from other parts of India, socialist managers, post-socialist managers, etc. The problem seems systemic.

[1] http://en.wikipedia.org/wiki/American_Civil_War

Posted by: Dan tdaxp | Wednesday, January 23, 2008

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