The Rise and Fall of the American Textile Industry

Posted by PITHOCRATES - July 2nd, 2013

History 101

Inventions and Innovation gave the United States a Burgeoning Textile Industry

The American textile industry was founded by businessmen.  And inventors and their inventions.  Not by any labor movement.  For before there could be a labor movement there first had to be industry to employ laborers.  And laborers weren’t creating these industries.  They were just selfishly waiting for others to do this so they could get a job in them one day.

We may never know which came first.  The chicken or the egg.  But we do know which came first when it comes to industries and laborers.  The mind came first then the muscle.  Rich people with a keen eye to judge a good investment.  Businessmen and entrepreneurs unafraid to take a risk.  And who will throw their body and soul into their business.  Then the non-risk taking people come along.  The laborers.  Who have no skin in the game.  Who wait until the minds come together to create something in which they can apply their labor.  And get a paycheck.

Samuel Slater built cotton mills in New England (1800ish).  Slatersville Rhode Island, the town he established, bears his name.  Francis Cabot Lowell and Paul Moody created a more efficient power loom and a spinning apparatus (early 1800s).  Elias Howe invented the sewing machine (mid 1800s).  And the lock-stitch.  Throw in a few more inventions, some improvements on past inventions and some innovation and you have a burgeoning U.S. textile industry.

The Luddites went about England smashing the Machines of the Mechanized Textile Industry

Cloth-making used to be a labor-intensive activity of highly skilled artisans.  For those who had the money to afford the costly clothing they made.  Many could not.  And made their own clothing in the home.  Women would spin fiber into yarn.  And weave the yarn into cloth.  Which was very labor intensive.  Allowing only a meager production of clothing for the family to wear.  Which meant a lot of darning for worn out clothing.  Hand-sewing patches to cover holes.  Sewing ripped seams back together.  And sewing together rips and tears.  Until the clothing was so worn that it couldn’t be darned anymore.

It is hard to fathom how important this was during early America.  A time of a mini ice age.  In the north the winters were long and they were cold.  This homemade clothing may not have been pretty.  But it could keep you from dying of exposure in those brutally cold winters.  The mechanization of the textile industry changed all of that.  Smart inventors and business owners used machines to automate the cloth-making process.  Allowing less skilled people to operate smart machines.  Producing more clothes for less.  Bringing the cost of clothing down.  So anyone could afford to buy clothing.

Of course, this did not make everyone happy.  As those machines replaced the need for highly skilled artisans.  Who demanded high prices for their craft.  Allowing only the rich to afford their wares.  They didn’t like these machines cutting into their high wages.  And did something about it.  A group of people called ‘Luddites’ went about England smashing the machines of the mechanized textile industry (1811-1817).  Hoping to force a return to the old ways of making clothing.  By skilled artisan.  Where only the rich could afford to buy clothing.

Unions have Exported Entire Industries to Emerging Economies to Escape Soaring Labor and Regulatory Costs

Just as the textile industry was modernizing and mechanizing two seamstresses formed the first all-women’s labor union in 1825.  The United Tailoresses of New York.  Protesting 16-hour workdays.  And the lack of a living wage.  Strikes followed.  The Lowell, Massachusetts, mill women’s strike in 1834.  The Manayunk, Pennsylvania, textile strike in 1834.  The Paterson, New Jersey, textile strike in 1835.  And the Llowell, Massachusetts, mill women’s strike in 1836.  In 1844 women formed and ran the Lowell Female Labor Reform Association.  Then more strikes.  The Cohoes, New York, cotton mill strike in 1882.  The Fall River, Massachusetts, textile strike in 1884.  The Augusta, Georgia, textile strike in 1886.  The Fall River, Massachusetts, textile strike in 1889.  In 1890 New York garment workers won the right to unionize.  Close their shops to nonunion workers.  And fire any nonunion workers on the payroll.  In 1900 the International Ladies’ Garment Workers Union was founded.  In 1901 the United Textile Workers was founded.  Then came the New York shirtwaist strike in 1909.  Massachusetts passed the first minimum wage law for women and minors in 1912.  Then came the Lawrence, Massachusetts, textile strike in 1912.  Giving us the walking picket line.  Then the Paterson, New Jersey, textile strike in 1913.  The Amalgamated Clothing Workers union was founded in 1914.  Then the Fulton bag and cotton mill strike in 1914.  The Passaic, New Jersey, Textile Strike in 1926.  And so on.

The Luddites hated the machinery of the modern textile industry.  As they didn’t like the idea of replacing many highly skilled and well-paid artisans with automated machinery operated by fewer low-skilled laborers.  So they tried to smash the automated machinery.  To try and save their jobs.  Which the labor movement was happy to see go away.  For they would rather pack as many low-skilled laborers into those Dickensian factories as possible.  For the more members they had in their unions the more powerful they were.  And the more they could demand from the business owners.  They demanded a lot, too.  Higher wages, shorter hours and better working conditions.  So much so that the cost of labor rose while productivity fell.  Throwing the door open to foreign competition.

The big labor movements used their friends in government to protect their generous union contracts.  By passing pro-union legislation.  And placing tariffs on imported textile goods.  Keeping clothing prices high.  So business could earn enough to pay those generous union pay and benefits.  But this left these businesses uncompetitive in the world’s markets.  Which they wanted to sell in.  For it wasn’t only Americans that wore clothes.  Those union contracts increased labor costs so much that businesses found it hard to remain in business let alone remain profitable.  So they started leaving the United States during the 20th century.  Which is why today there is no U.S. textile industry.  Because of the high cost of labor.  And costly regulatory policies.  Where is the textile industry today?  In the emerging economies.  Where labor and regulatory costs are lower than in America.  While the standard of living for those employed in these factories are often higher than their fellow countrymen.  Which is what unions have often done in the United States.  Create good jobs in emerging economies.  By exporting entire industries from the United States to these emerging economies.  Where they can escape soaring labor and regulatory costs.

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FUNDAMENTAL TRUTH # 50: “What do the great entrepreneurs have in common with politicians? Not a whole hell of a lot.” -Old Pithy

Posted by PITHOCRATES - January 25th, 2011

A Mathematician, an Engineer and a Beautiful Woman

Stop me if you heard this one.  A mathematician and an engineer are at one end of a long room.  At the other end is a bed.  On the bed is a beautiful, naked woman.  She also happens to be a brainiac.  And someone who enjoys a bit of fun.  If you know what I mean.

She offers to get intimate with the guy who can solve this riddle.   Cross the room in a series of moves.  Each move shall be one half of the distance between them and her.  Be the first to do that and reach her and she’ll make all of your dreams come true.

Well, the mathematician sits down with paper and pencil and starts scribbling.  He proves mathematically that is impossible to ever reach the beautiful woman.  Because by moving half of the distance each time, there will always be a remaining distance to cover.  Therefore, he concludes, it’s impossible.  He looks up to tell her this.  And when he does he sees the engineer lying up in bed with her.  Smoking a cigarette.

Entrepreneurs Like to Think outside the Box

So what happened?  Well, while being theoretically impossible to reach her, the engineer could get close enough for a bit of fun.  And did.  It’s an old joke.  With many variations.  And depending on who’s telling it the loser is sometimes a physicist.  Or even the engineer.  Of course, some may say it’s the beautiful woman that losers in all cases.  Because smoking hot women don’t hang out with math and engineering geeks.  Until they get rich enough to buy them things, that is.  But I digress.

Entrepreneurs and politicians are a lot like mathematicians and engineers.  At least in this joke (and I apologize to mathematicians everywhere who are offended.  But you shouldn’t feel bad.  I’m sure if you could have been engineers you would have).  Nothing is ever easy for a politician.  Like the mathematician, they feel that they must over analyze everything.  Get a lot of bureaucrats involved. Layers and layers of oversight and control.  Hoops to jump through.  Exhaust every possibility to get to the ‘best’ solution.  Even if it takes weeks.  Months.  Years.  Time is never of the essence.  They have forever.  And they take forever.  No matter the costs.

Entrepreneurs don’t work this way.  They have an idea.  And want to act.  They hate waiting.  Time is money.  They hate bureaucracy.  Because time is money.  And they have an easier way to determine what the best solution is.  Sales.  Those who have the greatest sales have the best solution.  Because thus speaks the market.  So they keep thinking.  Keep creating.  Keep coming up with good ideas.  They see what the market is demanding.  Or what it will demand.  Once they show that market the wonderful new thing they’ve created.  Sales proved the Sony Walkman a success.  And sales proved the Apple iPod a success.  Why?  Because Sony and Apple are a couple of companies that like to think outside the box.  And create things people aren’t even demanding yet.  And you gotta admit that that’s some pretty damn good thinking.

Politicians Fear what’s Outside the Box

Politicians, on the other hand, fear what’s outside the box.  They want to stay inside the box.  They like it there.  It’s snug.  Familiar.  Dark.  Orderly.  No surprises.  No new things to have to think about.  Or worry about.  Like all that uncertainty in an uncontrolled free market.  Yeech.  They don’t like that.  Or understand it. For when it comes to the economy, these progressives are ‘conservative’.  They want to build on the governmental bureaucracy of the past.  The bureaucracy they know.  And love.  It may not have worked.  But so what?  It’s just so cozy.  And makes a [deleted expletive]-load of federal jobs.

Of course, this expanding bureaucracy doesn’t give us anything new.  Anything innovative.  Anything that we’re yearning for.  Or anything we will yearn for once we learn about that next great thing.  Because they don’t create anything.  Other than obstacles to those who do.  Once someone comes up with an idea, though, they’ll then want to take that idea and over think it.  Manage it.  Regulate it.  Tax it.  Because an entrepreneur may come up with a great idea.  But a politician knows best how to use that idea.  Or so they believe.

Of course, when you think of the great inventions, you never think of a politician.  To prove this, tell me who you think of when I mention some famous inventions.  The telephone?  (Alexander Graham Bell).  AC power distribution?  (Nikola Tesla).  An affordable automobile?  (Henry Ford).  The light bulb?  (Thomas Edison).  An efficient steam engine?  (James Watt).  Notice anything about all of these inventors?  That’s right.  They don’t have a ‘Senator’ or ‘Congress Person’ in front of their name.  But Senators and Congress people have been regulating and taxing these great inventions ever since.

Can’t see the Nude Woman on the Bed

An entrepreneur, like an engineer, doesn’t get lost in the theoretical.  They see possibilities.  And they act.  Politicians, like mathematicians, like to crunch numbers.  Prove things can’t be done.  And then call for blue ribbon panels or commissions to further analyze things.  Entrepreneurs are positive, can-do people.  While politicians are negative, can’t-do people.  They can’t see the forest for the trees.  Or the nude woman on the bed.

Politicians can’t not interfere with people.  An entrepreneur can’t stand being interfered with.  He or she is too busy creating stuff.  They’re not sitting around waiting for something to happen.  They’re leading the way.  While the politicians are nipping at their heels.  Trying to catch up with them.  Just so they can slow them down.

Our future is like the nude woman on the bed.  The entrepreneurs know how to get to her.  And will.  If left alone to do what they do best.  To think.  And create great things.  Make the world a better place.  But the politicians haven’t a clue.  They covet the nude woman.  But they can’t get to her.  Because she’s somewhere outside the box.  Smart.  Complex.  Something new.  Waiting to be discovered.  And when her riddle is solved, it won’t be a politician smoking a cigarette in bed with her.  It’ll be an entrepreneur.

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