A history of commerce

by Clive Day

Cotton took a position in national commerce equal in importance to that which it occupied in international trade. Not only did it furnish directly more than half of the total exports of the United States; it shared its prosperity with other industries, and influenced the development of every part of the country. Northern merchants made fortunes in handling and transporting southern cotton; the manufacturers of every district found in the South a market where people had plenty of money to buy goods which they were too busy to make; the farmers of the Northwest supplied in considerable part the needs of the South for food. The people of the South were not blind to these facts, and tended, indeed, to exaggerate their importance. As a sample of their attitude this extract from a speech by Senator Hammond in 1858 may be taken: “Without firing a gun, without drawing a sword, should they make war on us, we could bring the whole world to our feet. What would happen if no cotton was furnished for three years? I will not stop to depict what every one can imagine, but this is certain, England would topple headlong, and carry the whole civilized world with her. No, you dare not make war on cotton. No Power on the earth dares to make war on it—cotton is king.”

641. Slight contributions of the South to exports, aside from cotton.—In the period before the Civil War, when southern plantations were worked by slaves, it was considered to be the best policy to plant cotton continuously, without alternation or diversification of crops, though this policy led necessarily to exhaustion of the soil and required frequent removals to fresh land. Cotton was, therefore, the single product which the South contributed in great quantities to the internal and foreign trade of the country. The rice culture was maintained on the eastern coast and was extended along the Gulf, but there was little increase in the export of rice, as the crop was consumed largely at home. Indigo disappeared from the list of American products. Tobacco production spread in the States of the Ohio valley, and the exports of this ware rose after the middle of the century to double the value which they had about 1800, but a comparison of the figures given at the opening of the chapter shows that tobacco declined still further from the position it had held in colonial times.

642. Trade between the North, the South, and Europe.—In 1860 only one third, approximately, of the total exports of the country came from the North. Conditions in this period resembled closely those of colonial times, with the substitution of the southern States for the West Indies in the triangle of trade. The North imported from Europe far more than it could export in return; it shipped South, however, large quantities of foodstuffs and manufactures; and the South gave in exchange bills on Europe which were drawn against the great quantities of cotton sent thither. Cotton from the South to Europe, manufactures from Europe to the North, manufactures and foodstuffs from the North to the South: such were the three sides of the triangle.

643. Chief exports from the North.—The North could no longer look to colonial industries, like fisheries and forestry, to provide the means of purchasing the foreign wares which it required. The exports from those industries had increased, it is true, but were still so small that they had become items of slight importance in the total. The exports of manufactures, on the other hand, had grown very rapidly, and formed now a considerable item in our trade. The South contributed to this class some wares (manufactured tobacco, turpentine, cottonseed oil cake), but the products of developed manufacture came almost entirely from the North; manufactures of cotton and of iron were the leading items. The rise of these manufactures will be treated in the next chapter. At the North, however, as at the South, agricultural products held the first place among the exports. Foodstuffs and animal products were exported to the value of about fifty million dollars, and these wares came chiefly from the North. The total is small in comparison with that of the cotton export (one hundred and ninety million), and gave little promise of the remarkable expansion which was to follow after the Civil War; still, foodstuffs and animal products were the mainstay of the Northern export trade.

644. Gradual increase in the exports of foodstuffs.—The increase in the exports of northern agriculture was rather less than would be expected from a people rapidly increasing in numbers and provided with an abundance of fertile land. For many years after the close of the war of 1812 commerce in wheat and flour languished, and even toward 1840 the export of those articles was less than it had been at the opening of the century. There was talk, even, of imposing a duty on wheat, to protect the farmers of the Atlantic seaboard from imports. As late as 1835 Ohio was the only grain-exporting district of the West, and the first grain shipment on the Great Lakes, of which there is record, was made about that time. Chicago became of importance as a center of grain shipments only about 1850. In the decade from 1850 to 1860, however, the Chicago shipments increased (roughly) from two to twenty million bushels, and the total exports rose rapidly; canals and railways were at last bringing the cheap grain from the West to the people of Europe, who at last were ready to welcome it. The export of animal products was growing also. Lard and pickled pork were the chief items under this head, for the lack of modern appliances prevented the export of fresh meat; but the price of hogs at Cincinnati doubled in the fifteen years preceding 1860, and western farmers were encouraged to give increased attention to the supply of animal products.

645. Exports of precious metals; result of the California gold discoveries.—The last item in the list of exports given at the beginning of the chapter is that of precious metals, which we shipped abroad to the value of more than fifty million dollars. Ordinarily the exports and imports of precious metals are not included in the figures of a country’s trade. Coin and bullion are used to make up the balance of accounts between different countries; they may leave a country one year and may return to it the next year; and they represent, therefore, no contribution to commerce like that of the shipment of merchandise. An exception must be made, however, in the case of the few countries which produce such quantities of gold and silver that they can regularly export a surplus. The mines of precious metals are to these countries as much a commercial resource as are the coal or iron mines to countries like England and Germany. The United States was not at first among these favored countries: it produced little gold and less silver, and needed to import most of the precious metals which it required for use as currency and in the arts. These conditions were suddenly reversed by the discovery of gold in California in 1848. The gold production of the country, which had been formerly less than a million dollars a year, had risen by 1850 to fifty million, and provided the country with a handsome surplus which it could afford to exchange abroad for merchandise.

QUESTIONS AND TOPICS

1. Prepare a graphic chart of the figures, sect. 633, for comparison with earlier and later conditions.

2. Review the distinction between domestic and foreign exports. The principal foreign wares exported from the U. S. in 1860 were as follows, in millions of dollars: coffee 2.2, sugar 2.1, tea 1.9, hides 1.6, tobacco 0.7. From what countries do you think these wares came?

3. Write a report on one of the following topics: