Industrial Revolution · 1890
Was US industrial success built on resources or people?
The seminar question: “Was America’s industrial success built more on its resources or on its people?”
Between the Civil War and the First World War the United States became the world’s largest industrial economy, drawing on a protected market, vast resources and immigrant labour. The first transcontinental railway was completed at Promontory Summit, Utah, on 10 May 1869, its western section built largely by Chinese workers.
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America’s industrial rise began before the Civil War, and its first stage was tied to slavery and to Britain. Samuel Slater, who had memorised the inventor Richard Arkwright’s spinning machines in England, began spinning cotton in Rhode Island in 1790, and in 1823 a group of Boston merchants began production at Lowell in Massachusetts, a planned factory town whose mills hired young women from New England farms, who struck against wage cuts in 1834 and 1836. The cotton these mills spun came from the slave South, where the enslaved population grew from about 700,000 in 1790 to almost four million in 1860. The Civil War of 1861–65 destroyed slavery and confirmed the power of the industrial North, because its factories and railways outproduced the South’s. Emancipation freed four million people, yet most of them remained poor farm workers and sharecroppers, tenants who paid their rent with a share of the crop, in a South kept poor and segregated.
The short answer
- A continent of resources. The United States held some of the world’s largest deposits of coal, iron ore, copper and oil, as well as vast forests and farmland taken from Native American nations by treaty and war. The hatched patches on the map show the Pennsylvania coalfields and the Lake Superior iron ranges whose ore fed Pittsburgh. Cheap resources rewarded technologies that used them lavishly, which is why American industry became so hungry for energy and materials.
- A huge protected market. American industry grew inside the largest protected market in the world: the population of the United States rose from about 31 million in 1860 to 92 million in 1910, and railways joined it into one market with no taxes on trade between states. High tariffs, taxes on imports, raised during the Civil War and kept afterwards, sheltered American factories from British and German competition, much as Friedrich List, the German economist who argued that young industries need protection, had recommended for Germany. Firms that could sell to a whole continent could build plants of enormous scale and spread their costs over millions of customers.
- Immigrant and coerced labour. Industry’s workforce came from Europe, China, Mexico and the American countryside. Immigrants supplied the hands for mines, mills and railways, often at low wages and in dangerous conditions, while Black southerners, freed from slavery but bound by debt and segregation, grew the cotton that remained a leading export. Labour from abroad kept wages lower than they would otherwise have been, although they stayed higher than in Europe, which kept the migrants coming.
- Capital, organisation and the state. British and European investors financed American railroads, and federal land grants and loans lowered their risks. The railroads pioneered the large company run by salaried managers, which the business historian Alfred Chandler called the visible hand because managers’ planning now did the coordinating that markets had done, and steel, oil and meat firms copied them. Courts and governments generally sided with employers, sending troops and issuing injunctions, court orders that banned strikes, which kept labour costs down and profits high. The state built the conditions in which private enterprise flourished.
THE TURNING POINT
Promontory Summit, 10 May 1869. The meeting of the rails is the hinge because it joined the Atlantic and Pacific economies of the United States into one continental market. Goods, settlers and migrants could now cross the country in about a week, a journey that had taken months, and within twenty-five years four more lines followed. The railroad opened the West to farms, ranches and mines, drew the grasslands of the Great Plains into the world market and accelerated the destruction of Native American nations and the bison herds they lived on. Built largely by Chinese and Irish labour, the line also made the United States a nation whose industrial wealth rested on migrants it did not always welcome.
What it changed
America overtakes Britain. By about 1886 the United States made more steel than Britain, and by 1913 about a third of the world’s manufactured goods. American methods, from interchangeable parts, standard components that fit any copy of a product, to the assembly line, spread to Europe and Japan in the twentieth century, and American consumers, with the highest wages in the world, became the first mass market for cars and electrical goods. Britain’s old title of workshop of the world had crossed the Atlantic, and with it the lead in mass production that would shape the twentieth century.
Grain and migrants remake Europe. Cheap American grain carried by rail and steamship flooded European markets from the 1870s, lowering bread prices for workers but ruining many farmers and pushing millions of rural Europeans to emigrate. Germany and France answered with tariffs, taxes on imported grain, while Britain, committed to free trade without such taxes, let its farming shrink. The same railways and steamships that carried American grain east carried European migrants west, so one wave of globalisation fed the other.
The labour question goes national. Strikes at the Homestead steelworks in 1892, broken by Pennsylvania’s state militia after strikers fought off guards from the Pinkerton detective agency, and at the Pullman railway-car works in 1894, broken by federal troops, made the power of corporations a national political issue. Reformers of the Progressive Era, a movement of the 1900s and 1910s that set out to curb corporate power, passed laws against monopolies, firms that dominate a whole market, and unsafe food, states restricted child labour, and unions grew slowly. Industrial power had grown too large for American politics to leave it to the market alone.
The full answer, argued
Resources made the scale of growth possible. Coal, ore, oil, timber and land, much of it taken from Native American nations, gave American industry cheap inputs, and the economic historian Gavin Wright’s evidence shows how resource-intensive its exports were. Yet resources needed people to exploit them, and the people came from everywhere: inventors and managers who built the large corporation, about 22 million immigrants between 1880 and 1914, Chinese railway workers later barred from the country, and the formerly enslaved and their children whose cotton remained a leading export. Institutions shaped how both were used. High taxes on imports, federal land grants and courts friendly to employers channelled wealth toward industry and kept labour costs low, at the price of fierce conflict. The most convincing answer is that America’s abundance of resources set the direction of its technology, while its ability to draw labour and capital from the whole world set the speed. Abundance and openness together explain the rise, and exclusion and conflict show who paid for it.
An interesting fact
Railways gave the United States its time zones. Before 1883 American towns kept their own local times, and the railroads used dozens of different times on their timetables. On Sunday 18 November 1883, known as the day of two noons, the railroads of the United States and Canada switched to standard time zones, four of them across the United States, and in many eastern towns clocks struck noon twice as they were set back to the new standard. Most towns adopted railway time at once, and Congress made the zones law only in 1918, so a private industry had set the nation’s clocks for thirty-five years.
This is the study layer of Industrial Revolution in America, chapter 9 of The Industrial Revolution, 1750–1914; the full index of the atlas is here.
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