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Humanities Libertexts

11.4: Economic and Social Changes

  • Page ID
    7936
  • The end of the war seemed almost a cathartic moment for the nation. The squabbles with Britain that had dominated the landscape for so long were now over. A new national bank was in place, and Americans could look within their own borders for consumer goods and necessities. Trade with foreign nations was a luxury Americans could enjoy but did not need to depend on any longer. The United States was ready to enter a new phase of history, one in which it would truly stand on its own feet.

    The war changed political opinions as well. Madison and many members of his party realized that some national institutions in the Federalist style were necessary to build a nation, even if such institutions were not in keeping with the traditional principles of the Republicans. A new national bank, tariffs to protect American industry, and a standing professional army and navy able to defend the nation when needed were all ideas Madison now embraced.

    The American people thus experienced the market revolution in the early nineteenth century as the nation transitioned from home production to factory production. During this period, traditional controls over production, distribution, and exchange gave way to market transactions. Supply, demand, and price became far more important in economic transactions than did social relationships. In the colonial period, emotional attachments often dictated economic transactions. As historian John Lauritz Larson notes, “who you were, where you were, and what you were” shaped “how you bought, sold, and prospered.” In the nineteenth century, customary social practices did not play a role in economic transactions. In essence, “money alone mobilized goods and people” in a system of anonymous transactions. Individuals’ good names came from their willingness to honor their contracts.

    On the positive side, these changes encouraged greater mobility among the American people. Increasingly, they spread into the territory beyond the Appalachian Mountains in an attempt to better their social and economic position. Throughout the Old Northwest and the Old Southwest, settlers staked claim to land and put that land into production, thereby providing raw materials for the increasing number of factories in the Northeast. The social changes that occurred also prompted political changes as states throughout the country moved toward universal white male suffrage. On the negative side, when a pioneer’s wife gave up spinning in the home, he needed to produce more cash crops to purchase cloth, or when a slaveholder moved west, the demands on those slaves often increased. Meanwhile, as more young men and women took positions in workshops and factories, they found themselves working for wages for most of their lives. Lastly, greater settlement in less populated regions caused problems between the settlers and the Indians living on the land. Because expansion was considered vital to the interests of the country, the Indians’ rights to land were seen as an obstacle.

    11.4.1: Market Revolution

    The market revolution largely stemmed from an availability of resources. As the United States acquired more territory, like the Louisiana Purchase, it attained more natural resources and land to produce raw materials. As the nation’s population increased, it gained more workers and ultimately more consumers. American entrepreneurs also had access to monetary resources; in other words, they found investors willing to support their new businesses. Furthermore, recognizing the importance of transportation and communication to economic growth, state governments supported internal improvement projects. At the same time, the market revolution occurred because the American people largely embraced the changes. They willingly pulled up stakes and ventured into new regions. They also possessed a spirit of enterprise that spurred the expansion of transportation and industry. And more unfortunately, they seemed content in many cases to exploit workers—slave or free—to bring their economic vision to life.

    Prior to the War of 1812, the United States exported raw materials such as cotton and tobacco, and imported manufactured goods such as cotton fabric and fine smoking tobacco. Thomas Jefferson had attempted to use the need for the exports to put economic pressure on Britain and France, with disastrous economic results for the United States. During the war, exports were not essential for either European nation, so the farmers continued to suffer financially. Buyers in England and France were forced to look for new sources of raw materials, and American farmers needed to find new buyers for their produce. After the war, industrialization was on the rise in the United States, creating homegrown markets for raw materials and a new American source for quality manufactured goods for American consumers. The Northeast became the manufacturing center of the country with many factories and mills located there. The earliest mills depended on reliable sources of water power, on rivers flowing with enough force to turn the water wheels that in turn powered the machinery. The advent of steam broke the bonds tying the mills to the rivers and instead bound them to any site of water and coal.

    Good transportation was needed to move the raw materials to the mills and factories and the manufactured goods out to the shops for sale, as well as to connect the agricultural regions of the nation with the manufacturing region. Transportation was also important for the expansion of the nation. Between 1816 and 1821, six new states joined the Union: Indiana, Mississippi, Illinois, Alabama, Maine, and Missouri. Before the War of 1812, there were roads, often old Indian trails that had been widened but not paved, and a few canals. There were also ships that would sail up passable rivers and around the coast, yet overall traveling was inefficient and quite expensive. According to some estimates, it cost as much to ship a ton of material thirty miles overland in the United States as it did to ship that material to Europe.Problems moving goods and people especially during the war prompted American leaders to support improvements.

    State governments helped to build turnpikes by chartering private corporations and granting them the exclusive right to construct a road. Then they would invest some state money in the corporation’s securities; the rest of the money came from private stockholders. The number of investors in these projects, according to historian Daniel Walker Howe, showed “the extent of grass-roots enthusiasm for improved transportation.” Given the slow pace of travel on these roads, people also clamored for other forms of transportation. Many northern states turned to extending their canal system. In 1817, the New York legislature decided to support the construction of the Erie Canal—a forty-foot-wide canal with a twentyfoot-wide towpath. When it opened in 1825, the canal stretched 363 miles from Buffalo on Lake Erie to Albany on the Hudson River and connected the Northwestern territories to global markets. Moreover, it made the state a good deal of money. Robert Fulton’s invention of the steam engine in 1807 made steamboats and later railroads possible. Steam allowed boats to navigate up rivers as well as down rivers. Flat-bottom paddleboats became especially important for travel on the Mississippi River, thereby allowing the Southwestern territories access to global markets as well. Ultimately, canals, steamboats, and railroads improved the comfort and speed of travel and provided for economic growth.

    As evidenced by the improvements in transportation, innovation became a key factor in the market revolution. Eli Whitney, known best for inventing the cotton gin, also developed the idea of interchangeable parts so that, if a part on a machine broke, it could easily be replaced with an identical part. Prior to Whitney’s new system, everything was made by hand and was therefore unique. Replacements consequently had to be custom-fitted to each machine. This system was time-consuming and costly. With Whitney’s interchangeable parts, machines and products could be produced more quickly, each part being an exact duplicate of every other like part, each machine as a whole an exact duplicate of every other machine of the same type and manufacture.

    The impact was enormous for the process of moving from home to factory production and ultimately to massive industrialization later in the century. Inventors continued to churn out new creations for both industry and agriculture as evidenced by the fact that the number of patents issued by the federal government went up significantly. For example, Elias Howe, a machinist in Massachusetts, created the sewing machine, while Cyrus McCormick, a blacksmith in Virginia, developed the reaper. Moreover, entrepreneurs looked for new ways to market their products. Chauncey Jerome, a clockmaker in Connecticut, not only developed new techniques for making timepieces, he also found markets by pricing his products so consumers could buy them and by convincing consumers they needed them.

    11.4.2: Cotton Revolution

    Cotton became a cash crop for the South thanks to Eli Whitney’s cotton gin, invented in 1793. Cotton has two forms: the long staple, which has long fibers and relatively easy-to-remove seeds, and short staple, which has shorter fibers and a difficult-to-remove seed. The long staple cotton was most desirable but could only be grown along the coast. Inland cotton planters had to grow the less-valuable short staple cotton. The only way to make any profit from growing the short staple cotton was to produce large quantities of it. Whitney’s gin made this possible because it removed the seeds quickly, making production faster. Thanks to Whitney’s gin, the short staple cotton supply soon dominated the market. As Americans moved into the Old Southwest, they also found the soil well-suited to grow short-staple cotton. With the price of cotton rising on the international market, new land was quickly put into production in an effort to make a profit. From 1800 to 1820, cotton production increased significantly, from somewhere around 73,000 bales to 730,000 bales, and the numbers continued to rise throughout the century. By mid-century, the United States produced roughly 68 percent of the world’s cotton.

    As the production of cotton increased, Americans began to think more about domestic production. In the 1790s, British immigrant Samuel Slater, with the support of merchant Moses Brown, built the first American textile mill in Pawtucket, Rhode Island. Using water power, workers spun cotton into thread, which was then woven into fabric in rural homes. Slater then created in Slatersville, Rhode Island, the first mill village, complete with a factory, houses, and a company store. Before the War of 1812, the number of spinning mills did increase; by 1809, eightyseven mills dotted the Northeastern landscape. Still, in the first decade of the nineteenth century, most Southern cotton flowed to British mills.

    This situation only began to change when Francis Cabot Lowell established in 1814 the Boston Manufacturing Company and built a textile mill at Waltham, Massachusetts. The mill relied on the Charles River for its power source. It was an integrated mill, meaning that all parts of cotton fabric production were integrated into one building, making it the first of its kind in the United States. Workers brought in raw cotton, which they spun, dyed, and wove into finished cotton fabric. They even built looms for the mill on-site in their own machine shop and also produced looms for sale to other mills. While Lowell died in 1817, his company lived on. Using the Waltham System, the company built factories for Lawrence and Lowell by 1821. Textile mills, like those run by the Boston Manufacturing Company, provided a new market for southern cotton, making cotton fabric truly an all-American product.

    To operate their mill, the Boston Manufacturing Company employed women. Lowell, who had travelled to Britain where he learned about cotton production, worried about the creation of a permanent working class. He felt young women could work for a few years to earn money for their dowry, and then they would return to their rural communities, marry, and raise a family. These young, single women worked eighty hours a week in a noisy and hot factory filled with particles of thread and cloth. They also lived in company-owned boarding houses, which one worker described as “a small, comfortless, half-ventilated apartment containing some half a dozen occupants.” Moreover, the company provided the girls with “wholesome” activities such as concerts, dances, church services, classes, and lectures to fill their time when not at work, and were given chaperones to help ensure the protection of their reputation. They could be fired for not performing their work properly or for not obeying company rules when not working. Finally, they were paid less than men for the same work; still, the mill gave young women the opportunity to leave the farm life behind with socially acceptable employment. Lowell’s mill was thus able to attract workers despite its dismal conditions. However, increasingly the workers did not come from the American countryside; rather, new Irish immigrants, who were willing to work for low pay, took positions in the mills.

    These new American mills provided unwanted competition to the English, who could sell their cotton fabric for a lower price in the United States. In 1816, Lowell successfully lobbied Washington for a tariff to protect the new American textile industry. Although the practice of having underpaid workers living in a controlled environment would eventually fail, the integrated mill itself would be the model followed for textiles and other factories. Just as importantly, the development of manufacturing in the North, while the South focused on agriculture, would widen the cultural gap between the two regions as the nineteenth century progressed.

    11.4.3: Before You Move On...

    Key Concepts

    The War of 1812, and the events leading up to it, resulted in major economic and social changes in the United States, producing the market revolution fueled by the availability of resources and an entrepreneurial spirit. As the United States moved from home production to factory production, it ceased to depend on imports/exports and instead developed a domestic market. American farmers produced more cotton and other raw materials, which American manufacturers turned into finished products. The market revolution took a major step forward with the development of interchangeable parts and the integrated mill. The differences between Northern and Southern society increased with the industrialization of the North and the increasing focus on agriculture in the South.

    Test Yourself

    Exercise \(\PageIndex{1}\)

    The market revolution brought many social and economic changes to the United States.

    a. True

    b. False

    Answer

    a

    Exercise \(\PageIndex{2}\)

    Eli Whitney created the Cotton Gin.

    a. True

    b. False

    Answer

    a

    Exercise \(\PageIndex{3}\)

    Short staple cotton was preferred to long staple prior to the invention of the cotton gin.

    a. True

    b. False

    Answer

    a

    Exercise \(\PageIndex{4}\)

    Francis Cabot Lowell built the first integrated textile mill in New England.

    a. True

    b. False

    Answer

    a

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