TABLE OF CONTENTS
Editors’ Acknowledgments
Introduction - Michael Zakim, Gary J. Kornblith
DOI: 10.7208/chicago/9780226977997.003.0001
[capitalism, United States, capital, economy, social order, family farms, mortgages, slaves, clerks, Civil War]
This book explores how capitalism emerged as an economic and cultural force in the United States during the nineteenth century, showing how capitalism eventually stepped out of the realm of both capital and the economy and gave rise to a social order that created new roles for government, families, and individuals. It also discusses how family farms, general incorporation laws, mortgages, inheritance, filing systems, and risk management contributed to the growth of capitalism, and how the market became the basis of social order. Moreover, the book describes how slaves were systematically collateralized in order to raise the operating funds and long-term credit that would allow their masters to better control the plantation economy. Finally, it assesses the role of clerks in the production of the market, and how the Civil War transformed the relationship between political authority and economic practice. (pages 1 - 12)
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The Agrarian Context of American Capitalist Development - Christopher Clark
DOI: 10.7208/chicago/9780226977997.003.0002
[capitalism, United States, agriculture, agricultural expansion, land markets, wage labor, farming, commerce, labor, proprietors]
Agrarian expansion has long been associated with the spirit of capitalism in the United States. Agriculture was a key player in the country’s transformation into a global economic power. This chapter examines the complementary aspects of agricultural expansion for broader capitalist development in the United States. It first provides an overview of the rise of American capitalism in the nineteenth century and how it turned the country into the world’s largest economy by setting in motion the growth of industries such as manufacturing, mineral production, and finance. The chapter then looks at how agriculture and its expansion became deeply involved in many of capitalism’s principal attributes, along with the emergence of land markets and markets for wage labor. In addition, it explores how structural conditions guiding the relationships between agriculture and capitalism gave rise to conflicts among different kinds of producers, between farming and commerce, and between labor and proprietors. (pages 13 - 38)
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The Mortgage Worked the Hardest - Jonathan Levy
DOI: 10.7208/chicago/9780226977997.003.0003
[landed independence, farmers, farming, old-age security, landed wealth, mortgage, capitalism, America, mortgage-backed securities, land ownership]
In early nineteenth-century America, “landed independence”—a way of life characterized by freehold ownership, command over household labor, and control over agricultural resources—helped farmers to become proprietors rather than members of the expanding class of dependent wage laborers. Freeholders resorted to “mixed farming” to meet their families’ baseline subsistence needs and sell their “marketable surplus” for a profit. At mid-century, American farming evolved into a commercially oriented endeavor with built-in hedges against the vicissitudes of an expanding market system. The ideal of landed independence was filled out by old-age security provided to farmers by their accumulation of landed wealth. Land ownership offered a uniquely autonomous form of commercial life. After 1870, “mortgage-backed securities” emerged in the American market. Capital flowed westward while staples such as corn and wheat flowed eastward. Western farmers turned to the mortgage market both by choice and out of necessity. This chapter explores the transformation of American farming, and its significance not only for its participants, but also for the history of American capitalism. (pages 39 - 68)
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Toxic Debt, Liar Loans, Collateralized and Securitized Human Beings, and the Panic of 1873 - Edward E. Baptist
DOI: 10.7208/chicago/9780226977997.003.0004
[slaves, credit, plantation economy, cotton growers, hedges, securities, panic, banks, Andrew Jackson]
This chapter examines how slaves, as a highly instrumental financial asset, were systematically collateralized in order to raise the operating funds and long-term credit that enable their masters to have more control of the plantation economy. This was an urgent goal for cotton growers looking for hedges against the pernicious booms and busts of the world market. By effectively capitalizing the bodies of slaves, the resulting securities were widely marketed throughout America and Europe. However, this success also contributed to extreme vulnerability during economic crises, such as the one that occurred in the wake of panic in 1837. The subsequent failures of Southern banks, together with Andrew Jackson’s destruction of the Bank of the United States that had provided most of its credit to the plantation economy, made slaveholders increasingly dependent on foreign, including Northern, money. (pages 69 - 92)
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Inheriting Property and Debt - Elizabeth Blackmar
DOI: 10.7208/chicago/9780226977997.003.0005
[family, land, inheritance, family property, family farms, debts, estates, real property, family capitalism, capitalism]
This chapter examines the family as a possible alternative to land as a form of property, one that could bring order and stability. Although the transfer of wealth from one generation to the next was definitely motivated by an ethos of preservation antithetical to the liquidity, risks, and uncertainties of capitalist economy, distribution of the returns from the land’s sale replaced direct partitioning of land among heirs. Partible inheritance became more common after America gained independence, thus helping to advance republican goals of a wide distribution of property. Distribution proved to be a more equitable way of passing on family property. While this practice did not diminish the central importance of land, it gave rise to the measurement of land’s value in monetary terms. Family farms had a greater likelihood of carrying extra-family debts at the time of the householder’s death, resulting in complicated settlement of estates. Due to uncertainties and conflicts associated with the settling and administration of estates, the institution of real property as a foundation of family capitalism eroded in the nineteenth century. (pages 93 - 118)
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Slave Breeding and Free Love - Amy Dru Stanley
DOI: 10.7208/chicago/9780226977997.003.0006
[chattel slaves, slavery, America, capitalism, slave breeding, abolitionists, slaveholders, love, social relations, unfree love]
The proliferation of chattel slaves lay at the heart of the relationship between slavery in America and the transformation of capitalism worldwide during the nineteenth century. This chapter examines how the seeming contradiction between making profits and protecting families sparked an acrimonious debate over slave breeding in antebellum America. The reproduction of slaves was a characteristic of the chattel system, but its significant role in the creation of market society cannot be understood by looking at the practical apparatus of sexual compulsion. Instead, the focus should be on the attendant moral controversy that arose between abolitionists and slaveholders, one which actually reflected a confrontation over the meaning of love. The chapter also revisits the argument that the existence of a giant slave market is strong proof that the South was essentially dedicated to capitalism. It suggests that slave breeding for commercial profit represented the antithesis of capitalism’s social relations because “unfree love” violated the core values of individual will and personal autonomy by which liberals justified market competition and profit maximization, as well as the satisfaction of personal desire. (pages 119 - 144)
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Capitalism and the Rise of the Corporation Nation - Robert E. Wright
DOI: 10.7208/chicago/9780226977997.003.0007
[corporations, America, incorporation, capital, competition, management techniques, accountability, financial capital, capitalism]
Corporations are a well-established and the most prevalent economic institution in America. Incorporation was an effective method for coordinating physical capital, human capital, and money capital that made it possible to take advantage of economies of scale and influence prices. In addition, it is central to the development of a credit base for financing the market system in general. However, these “economic” advantages became a political liability. Critics translated effective control over capital into a risky concentration of power and influence. Due to popular protest, the existing rules of incorporation were replaced with general procedures so that everyone was now entitled to the special privileges traditionally enjoyed by corporations. Yet the result was a rise in competition that renewed the focus on management techniques, which in turn shielded the corporation from public oversight and accountability. Financial capital did not give rise to capitalism. Rather, its appearance and proliferation were caused by capitalism. (pages 145 - 168)
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Capitalist Aesthetics - Tamara Plakins Thornton
DOI: 10.7208/chicago/9780226977997.003.0008
[docks, London, Liverpool, aesthetics, commercial progress, risk, control, capitalist sublime, technological innovation, profit]
A series of similar docks were constructed in London and Liverpool, a remarkable engineering feat that differed from the usual wooden wharves found in other ports on both sides of the Atlantic. The docks’ stone walls enclosed various warehouses and tens to hundreds of acres of water at a permanent high tide reminiscent of a canal lock. What used to be an expression of awe and terror in response to the wonders of the natural world was now applied to an entirely artificial landscape. Such aesthetics balanced the two essential, albeit incompatible, elements of commercial progress: risk and control. “Capitalist sublime” introduced order and security into a reality often associated with anxiety and adventure. Transition to a world dominated by profit did not seem impossible, together with a new self-identity for the propertied classes that would be dependent on economic and technological innovation and not on ground rents and gentlemanly leisure. (pages 169 - 198)
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William Leggett and the Melodrama of the Market - Jeff rey Sklansky
DOI: 10.7208/chicago/9780226977997.003.0009
[market, William Leggett, free market, paper money, banks, natural economy, money power, capital, corporations, political economy]
The market as it is known today was the greatest creation of the eighteenth and nineteenth centuries, made possible by combining classical economics and popular culture. William Leggett (1801–1839), a New York City newspaper editor and labor leader, provided a life-like portrayal of the market and championed the free market amid the tumultuous boom and bust of the 1830s. Like many less ardent and articulate Jacksonians, however, he discovered a scourge for the market he revered in paper money and the banks that supplied it. The colossal conflict between the “natural economy” and the “money power” gave rise to a political melodrama that personalized the abstract and often intangible operations of capital. Leggett arrayed “publick credulity” against “soulless corporations,” labor against money, and democracy against monopoly, thus casting political economy as a moral clash between the forces of good and evil. (pages 199 - 222)
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Producing Capitalism - Michael Zakim
DOI: 10.7208/chicago/9780226977997.003.0010
[free market, capitalism, clerks, abstract knowledge, industrial production, office]
Anxious to introduce regularity and integrity to what was usually advertised as a free market, capitalists recruited a large new class of clerks who would discipline the growing volume of exchange with ledgers, inventory controls, credit reports, regular communications, and the rising circulation of information across ever-expanding networks of time and space. These clerks labored on the production of the market, capitalism’s most important creation. Their paperwork produced abstract knowledge that was more essential to industrial production than the material excesses of crops and goods. These clerks were ambitious employees scribbling hard at their desks in the office and hoping to make partner someday. (pages 223 - 248)
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Soulless Monsters and Iron Horses - Sean Patrick Adams
DOI: 10.7208/chicago/9780226977997.003.0011
[government, Civil War, slavery, corporations, industrial development, corporate charters, industrial capital, capitalism, America, economy]
The government had long been in charge of the regulation of the economy and maintenance of the social order, but the Civil War changed all that. Aside from saving the Union and ending slavery, it transformed the relationship between political authority and economic practice, as mass mobilization forced Northern legislatures to grant corporations wide-ranging protections in order to boost the economy and support the military effort. As a result, the state no longer had to regulate industrial development and instead became an active partner in such an endeavor. New corporate charters were instituted that strengthened the rehabilitation of corporations, often disparaged as “soulless monsters” by political critics during the antebellum era, into engines of national progress. The government’s promotion of general prosperity complemented industrial capital’s unmatched ability to organize resources, setting in motion the rise of the corporate enterprise and capitalism in America in the late nineteenth and early twentieth centuries. (pages 249 - 276)
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Afterword - Jean-Christophe Agnew
DOI: 10.7208/chicago/9780226977997.003.0012
[capitalism, America, corporations, managerial revolution, Great Collateralization, bankers, brokers, attorneys, accountants, clerks]
This book has explored how capitalism took command in America’s long nineteenth century in invisible and anonymous fashion. Corporations emerged in the latter half of the century, along with the strategy and structures devised by their newly created managerial class to reorganize and rationalize resource, labor, and distributive markets. This “managerial revolution” was also largely anonymous and invisible. The contributions to this book converge to provide an insight into what might be called the Great Collateralization to refer to the multitude of legal and commercial instruments that helped the United States make the transition from a mosaic of familial, proprietary, and conspicuously “landed” capitalisms to a national system of industrial capitalism. In this process, bankers and brokers, attorneys and accountants, together with their clerks, all played key roles. (pages 277 - 284)
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Contributors
Notes
Index
