Saint-Domingue Slave Rebellion, Great Migration and 1967 Detroit Race Riot

Posted by PITHOCRATES - July 23rd, 2013

History 101

The Brutal Slave Rebellion on Saint-Domingue created Haiti and opened the Door to the American West

Haiti was born from a slave rebellion.  Inspired by the French Revolution, which was inspired by the American Revolution, the slaves on Saint-Domingue could taste the liberty in the air.  The slaves outnumbered the whites on the island.  And when they rose in rebellion in 1791 their white overlords were powerless to stop them.  The slaves massacred the white planters.  Those lucky enough to survive fled the island.  The French tried to reestablish control.  Then they went to war again against the British.  Which complicated matters.  And led to a British invasion of Saint-Domingue.

Toussaint Louverture, a former slave, and educated, eventually led the now former slaves to victory.  And won the peace.  He invited the planters back.  Replaced slave-labor with paid-labor.  Reestablished trade with Great Britain.  And the new United States.  While the French did away with slavery in their colonial possessions.  For a while.  During the convulsions going on in France following the French Revolution there were many changes in government.  And the government in 1802 lent a sympathetic ear to the former white planters who wanted their plantations back.  And their slaves.  Napoléon Bonaparte, interested in reestablishing New France in North America, sent a military force to take back Saint-Domingue.  Who captured and sent Toussaint Louverture back to France.  But things did not go well for the French.

Jean-Jacques Dessalines continued the fight in Louverture’s place.  A determined enemy, and Yellow Fever, were too much for the French.  They pulled out their remaining soldiers.  Gave up on Saint-Domingue.  And on New France in North America.  Causing another exodus from the island.  And if you ever wonder why New Orleans is so French this is why.  A lot of those fleeing Haiti settled in New Orleans.  Doubling the city’s population.  Needing money to continue the war against Great Britain Napoléon offered to sell the Louisiana Territory, the thick center part of the United States between Texas and Canada, to Thomas Jefferson.  And did.  So the brutal slave rebellion on Saint-Domingue not only created Haiti.  It gave the Americans the Mississippi River and its tributaries.  The Mississippi Valley.  The Great Plains.  And opened the door to the West.

The Great Migration brought some 6 Million Blacks from the Rural South to Northern Factories

But that brutal slave rebellion did something else.  It made the southern planters nervous.  Over half of the 40,000 white colonists were killed during that slave rebellion.  A fact that weighed heavily on the minds of the highly outnumbered white planter class in the South.  Who lived in fear of a similar slave rebellion happening in the United States.  Which lead to a more oppressive control over their slaves.  So they could snuff out any rebellion at the first sign of trouble.  And there was a reversal of policy.  The Founding Fathers had shelved the issue of slavery for 20 years to get the South to join the new nation.  Believing that the institution of slavery would die out on its own.  And in the following two decades some slave owners were freeing a slave or two.  But that all stopped following the revolution in Saint-Domingue.  When the life of a slave went from bad to worse.  For the last thing the white planter class needed was a Toussaint Louverture in their midst.

By the time of the American Civil War the slave population had grown much larger.  Which added another element to the Civil War.  Especially for the South.  The North was fighting for a noble purpose.  To free the slaves.  And fulfilling the declaration that all men were created equal in the Declaration of Independence.  But what then?  What happens after the North wins the Civil War?  And they free the slaves?  Where are the slaves going to go?  Back to Africa?  Even the ones who have no idea what or where Africa was?  Having been born and raised in the United States?  No.  They weren’t.  They were going to remain in the South.  Nothing would change in the North.  But life in the South would be changed into something that just didn’t exist.  A biracial society.  Worse, this was going to be a biracial society where the majority was once brutally oppressed by the minority.  Thanks in large part to the slave rebellion on Saint-Domingue.

With this backdrop the odds for a peaceful reconstruction were slim.  The South did not adjust well to the new reality.  There were fears.  Anger.  And the old prejudices.  While in the North life went on as it always did.  Predominantly white.  And industrializing.  Creating more and more factory jobs.  That drew immigrants to the industrial north.  As it drew southern blacks.  Leading up to the Great Migration.  From 1910-1930.  Pausing during the Great Depression and World War II.  And picking up again from 1940-1970.  When some 6 million blacks left the rural south.  And headed to the jobs in the big cities in the Northeast.  The Midwest.  And the West.  Working and living in the big cities.  Like Detroit.

The 1967 Detroit Race Riot accelerated the White Flight from the City which decimated the Tax Base

Detroit dominated following the post-war period.  It was an economic powerhouse.  Thanks to a booming automotive industry.  And a war-torn Europe and Asia.  Whose industrial capacity suffered greatly from Allied bombing.  Leaving the motor city the auto capital of the world.  And making Detroit one of the richest cities in the nation.  With their population peaking in 1950.  As people came to the city for those manufacturing jobs.  But the housing did not keep up with the growth in population.  Blacks and immigrants often faced discrimination.  Getting the worst jobs.  And the worst housing.  Things that changed in the Sixties.  Thanks in large part to a shift of the auto industry out of Detroit.

Following World War II Packard, Hudson, and Studebaker went out of business.  And the Big Three went on a building spree.  In the suburbs.  And a lot of white Detroiters followed them.  Relieving the housing pressure a little.  Allowing a black middle class to grow.  But the suburbs kept growing.  As businesses moved their jobs to the suburbs that were a little more business friendly.  With sprawling spaces for new factories.  And a brand new interstate highway system to easily ship material and parts from one to another.  The same interstate highway system that converged four expressways in the city of Detroit.  Destroying a lot of neighborhoods.  Which were predominantly black.

Many of those displaced people moved to the 12th Street area.  An area that become twice as crowded as the city average.  Unemployment was rising.  As was crime.  Including prostitution.  Where white johns were coming to the neighborhood to solicit black prostitutes.  A big complaint of the black community.  So the police cracked down on prostitution.  And a black prostitute ended up dead.  The people blamed the cops.  The cops blamed a pimp.  Tensions were rising.  Then on July 23, 1967, the police raided a blind pig.  An unlicensed after-hours bar.  On the corner of 12th Street and Clairmount.  Where a party of some 80 people were celebrating the return of two soldiers just back home from the Vietnam War.  The cops arrested them all.  While they were waiting for the paddy wagon to take them away a crowd formed outside.  Someone threw a bottle at a cop.  And thus began the 1967 Detroit race riot.  Which only accelerated the white flight from Detroit.  Caused an exodus of jobs, too.  As businesses fled the city.  Which just decimated the tax base.  Accelerating the urban decay.  Soon the black middle class followed the whites.  In pursuit of those jobs.  And to escape the dying city.  Which it did in 2013.  Die.  Figuratively.  By filing the largest municipal bankruptcy in U.S. history.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Constantinople, Byzantine Empire, Ottoman Empire, the New World, Tobacco and Slavery

Posted by PITHOCRATES - July 16th, 2013

History 101

With the Fall of Constantinople to the Ottomans in 1453 Islam spread Unchecked into Christian Lands

Constantine the Great moved the capital of the Roman Empire to a place on the Bosporus.  Where the ancient city of Byzantium once sat.  Where Asia met Europe.  Where the Mediterranean Sea met the Black Sea.  And the great rivers beyond.  The Danube.  Dnieper.  And the Don.  Constantine named his new city Constantinople.  And made it a jewel.  With great Christian churches.  To celebrate his new conversion to Christianity.  Which started following the Battle of the Milvian Bridge.  Where on the eve of battle Constantine and his soldiers had a vision of the Christian God.  Promising them victory if they placed His symbol on their shields.  Which they did.  And they won.

Constantine spared no expense in his new city.  Which was easy to do because it was a very wealthy city.  For the greatest trade routes went through the Bosporus.  Which is why when the western half of the Roman Empire fell the eastern half, or the Byzantine Empire, carried on for another thousand years.  Give or take.  As it thrived on that trade pouring through it.  Especially from the Far East.  Along the Silk Road.  Which peaked during the Byzantine Empire.  Bringing the exotic goods of the Far East west.  From silk to porcelain to spices.  Which flowed unhindered to Christian Europe while the Christians still controlled the Byzantine Empire.

But all good things must come to an end.  Thanks to the Seljuk Turks.  And the rise of the Ottoman Empire.  Islam had united the Arab people.  And with the fall of Constantinople to the Ottomans in 1453 Islam spread unchecked into Christian lands.  Up through the Balkans into southern Europe.  Lands they would contest for time and again.  Making for some bitter Christian-Muslim animosity that continues into modern times.  But more crucially at the time was the loss of control over that trade from the Far East.  Making those goods not as reasonably priced as they once were.  Which proved to be quite the problem.  As the European Christians had grown quite fond of them.  Luckily for them, they could do something about that.  Thanks to all of those wars they fought with the Muslims.  The Crusades.  Which brought back a lot of Greek books of science that were collecting dust in some of the old great Greek cities all around the Mediterranean.  Founded during the Hellenistic period.  Which came before the Roman Empire.  Thanks to a fellow by the name of Alexander the Great.  Who spread Greek learning throughout the known world after he conquered it.

Christopher Columbus sailed West to establish Far East Trade without going through Muslim-Controlled Constantinople

From those books the Europeans were able to become better sailors.  On ships that could catch the wind and navigate their way great distances.  Portugal and Spain led the way.  Prince Henry (1394-1460), the Navigator, trained navigators in Portugal.  His students pushed further and further down the African coast until Bartholomeu Dias rounded the Cape of Good Hope (1486).  Vasco de Gama would round the Cape of Good Hope and sail up the eastern coast of Africa all the way to India (1498).  Pedro Álvares Cabral was heading south to round the Cape of Good Hope in (1500).  Swung out too far west.  And ran into Brazil in South America.

Spain then financed the voyages of Christopher Columbus.  Who had read that the earth was round.  And wanted to prove it.  As well as spread Christianity.  Columbus wanted to find a way west to the Far East.  Sure it was just beyond the horizon of the Atlantic Ocean.  After a voyage longer than his near mutinous crew expected they finally landed on San Salvador Island in the Bahamas (1492).  Thinking he found an ocean passage to the Far East.  Around the Muslim controlled land route.  He would later understand that he had found the New World.  Which we would be calling Columbia.  Had his dispatches beat a Florentine passenger’s on a Portuguese ship who wrote about what he saw.  Amerigo Vespucci.  Which is why there is not a North Columbia, a Central Columbia and a South Columbia.  Instead, there is a North America, a Central America and a South America.

With Columbus’ success Spain financed others.  Vasco Núñez Balboa.  Who crossed the Isthmus of Panama and reached the Pacific Ocean (1513).  Ferdinand Magellan.  Who sailed around South America through the Straits of Magellan and into the Pacific Ocean.  Sailing on to the Far East.  And back home.  Being the first to circumnavigate the globe (1519-1522).  Hernán Cortés.  Who conquered the brutal Aztec regime in Mexico (1521).  Eventually the Spanish would bring great riches of gold and silver back to the Old World.  Meanwhile France financed Jacques Cartier in his attempt to find a Northwest Passage to the Pacific.  Who sailed up the St. Lawrence River to Montreal (1534).  Then Samuel de Champlain founded Quebec (1608).  Where they established a lucrative fur trade with the native Indians.

Cultivating Tobacco took Large Tracts of Farmland which required more Laborers that they had in the Colonies

Queen Elizabeth of England financed Walter Raleigh.  Who explored the coast of North America (1584).  Looking for a place to settle a colony.  On a subsequent voyage he brought 100 settlers with him.  And settled a colony at Roanoke, North Carolina (1585).  Which became the Lost Colony of Roanoke (1591).  The Virginia Company of London, a joint-stock company, would have better luck.  They raised financing by selling stock shares to investors who would share in any profits of the colony.  Christopher Newport led a voyage that established the first permanent English settlement in the New World.  At Jamestown (1607).

Though the Americas were not the Far East it was a vast landmass with inexhaustible resources.  And endless tracts of fertile soil.  The possibilities were endless.  The marriage of John Rolfe to Pocahontas (1614) provided an uneasy peace between the settlers and their Indian neighbors.  Then Rolfe figured out how to cure tobacco (1612).  Something the English began smoking after Columbus observed the Cubans sticking burning rolls of tobacco in a nostril.  The English refined smoking with a pipe.  And they really enjoyed it.  Importing vast quantities from the Spanish colonies in America.  Thanks to Rolfe, though, the English could produce their own tobacco.  Once they worked out a few problems.

Cultivating tobacco took large tracts of farmland.  But to put large tracts of farmland into production you needed laborers.  And in 1612 Virginia there just weren’t a lot of colonists living there yet.  The demand for labor far outstripped the supply.  So they tried to satisfy that demand with indentured servants.  Preferably from Europe.  Even criminals from English jails.  As well as from Africa.  Who worked in bondage during their indentures.  Then went free.  Until around the 1660s.  When things changed.  Starting in the southern colonies.  Where slavery became hereditary.  For Africans, at least.  Like it was in the Old World.  Where peasants and serfs were bonded to the land.  Once a slave.  Always a slave.  And if your parent was a slave so were you.  Like it was in ancient Athens.  At the end of the Western Roman Empire.  And in the Muslim world.

Muslim didn’t only enslave Christians.  They also established slave markets with African slave traders.  Who opened their markets to the Portuguese, the Spanish, the French and the English.  To help them meet that soaring demand for labor during the early days of the New World colonies.  When there were so few colonists.  Who found their way to the New World in the first place because of the Muslim conquest of Constantinople.  Which sent the Europeans to the seas to find a western way to the Far East.  And when they did they discovered the New World.  Creating the largest market ever for African slaves.  And the greatest convulsions in the New World as they struggled to end slavery in the Americas.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Paid Labor vs. Slave Labor

Posted by PITHOCRATES - July 15th, 2013

Economics 101

Paid-Laborers are Rented as Needed while Slave-Laborers are Owned even when not Needed

There is a common misconception that slave labor was free labor.  The argument goes that the United States got rich because of all their free slave labor.  They’ll say this despite knowing of the immense suffering of African slaves on the slave ships.  Who came to the New World where slave traders auctioned them off.  This was the slave trade.  The key word in this is ‘trade’.  African slave traders sold them to European slave traders.  Who auctioned them off in New World slave markets.  To feed a labor-hungry market.

People bought and sold slaves.  And anything you buy and sell is not free.  So slave labor wasn’t free.  It was a capital cost.  Let’s explain this by comparing leasing and owning.  Businesses can buy buildings.  Or lease them.  If they buy them they own them.  And are responsible for them.  They add a large asset on their balance sheet that they depreciate.  And add new debt that they must service (making premium and/or interest payments).  They also must pay expenses like taxes, insurance, maintenance, supplies, utilities, etc.  Things owners are responsible for.  When they lease a building, though, they don’t add an asset to depreciate.  And they don’t pay any expenses other than a lease payment.  The owner, the lessor, pays all other expenses.  When you lease you pay only for what you use.  When you buy you pay for what you use now.  And what you will use for years to come.  We can make a similar comparison between paid-labor and slave-labor.

Paid vs Slave Labor 1 of 3

For this exercise let’s take a factory today with 125 employees.  We’ll look at the costs of these laborers as paid-laborers versus slave-laborers.  We assume that the total labor cost for everything but health care/insurance is $65,000 per paid-laborer.  And an annual health care expense of $5,000.  Bringing the total annual labor and health care/insurance costs for 125 paid-laborers to $8,750,000.  For the slave laborers we assume 47 working years (from age 18 to 65).  But we don’t multiple 47 years by $65,000.  Because if we buy this labor there are a lot of other costs that we must pay.  Slave traders understand this and discount this price by 50%.  Or $32,500 annually for 47 years.  Which comes to $1,527,500 per slave-laborer.  Bringing the annual total cost for all 125 slave-laborers to $4,062,500.  And, finally, because they own these laborers they don’t have to offer premium health insurance to attract and keep employees.  So we assume health care/insurance expense is only half of what it is for paid-laborers.

Slave-Labor Overhead included Food, Housing, Clothing and Interest on Debt that Financed Slave-Laborers

If we stop here we can see, though not free, slave-laborers are a bargain compared to paid-laborers.  But if they own these people they have to take care of these people.  They have to provide a place for them to live.  They have to feed them.  Clothe them.  As well as pay interest on the money they borrowed to buy them.  And the building to house them.  For if they are not fed and protected from the elements they may not be able to work.

Paid vs Slave Labor 2 of 3 R1

A slave-owner will try to keep these overhead costs as low as possible.  So they won’t be feeding them steaks.  They will feed them something inexpensive that has a high caloric content.  So a little of it can feed a lot of people.  In our exercise we assumed a $1.25 per meal, three meals daily, seven days a week, 52 weeks a year.  For a total of $170,625 annually.  We assumed a $500,000 building to house 125 slave-laborers and their families.  The depreciation expense (over 40 years), taxes, insurance, supplies (soap, toilet paper, laundry detergent, etc.) and utilities come to $24,100 annually.  For clothing we assume a new pair of boots every 5 years.  And 7 inexpensive shirts, pants, tee shirts, underwear and socks each year.  Coming to $10,094 annually.

Then comes one of the largest expense.  The interest on the money borrowed to buy these slave-laborers.  Here we assume they own half of them free and clear.  Leaving $95,468,750 of debt on the book for these slave-laborers.  At a 4.25% annual interest rate the interest expense comes to $4,057,422.  We also assume half of the debt for the housing still on the books.  At a 4.25% annual interest rate the interest expense comes to $10,625.

George Washington was Greatly Bothered by the Contradiction of the Declaration of Independence and American Slavery

These overhead expenses bring the cost of slave-laborers nearly to the cost of paid-laborers.  Almost making it a wash.  With all the other expenses of owning slaves you’d think people would just assume to hire paid-laborers.  Pay them for their workday.  Their health insurance.  And nothing more.  Letting them go home after work to their home.  Where they can take care of their own families.  Provide their own food.  Housing.  And clothing.  Which they pay for out of their paycheck.  Of course, this wasn’t quite possible in the New World.  There weren’t enough Europeans living there to hire.  And the Native Americans in North, Central and South America were more interested in getting rid of these Europeans than working for them.  Which left only African slaves to exploit the natural resources of the New World.  But that slave-labor could grow very costly over time.  Because when you own people you own families.  Including children and elderly adults who can’t work.  By the time of our Founding this was often the case as some slave owners owned generations of slave families.

Paid vs Slave Labor 3 of 3 R1

In our exercise we assume an equal number of men and women working in the factory.  Assumed these men and women married.  And half of these couples had on average 3 young children.  We’ve also assumed the current working generation is a second generation.  So their surviving parents live with them.  We assumed half of all parents are surviving.  These children and the surviving parents cannot work.  But they still must eat.  And require medical attention.  Using the costs for the workers these non-workers add another $845,469 to the annual labor cost.  Brining the cost of the slave-laborers greater than the cost of the paid-laborers.

George Washington was very conscious of history.  Everything he said or did was with an eye to future generations.  And their history books.  One of the things that greatly bothered him was the contradiction of the Declaration of Independence declaring all men equal while the institution of slavery existed.  But to form a new nation they needed the southern states.  And they wouldn’t join without their slaves.  So they tabled the subject for 20 years.  Sure by then that the institution would resolve itself and go away.  Washington believed this because he had many generations of slaves on his plantation.  And desperately wanted to sell them and replace them with paid-laborers.  Because he was feeding so many slaves that they were eating his profits.  But people wanted to buy only those who could work.  Not the children.  Or the elderly.  Unable to break up these families he did what he thought was the honorable thing.  And kept using slaves.  To keep these families together.  Making less money than he could.  Because slave-labor was more costly than paid-labor.  Contrary to the common misconception.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , ,

Slavery, the Cotton Gin, the Jacquard Loom, Punch Cards and Computers

Posted by PITHOCRATES - June 12th, 2013

Technology 101

(Originally published December 7th, 2011)

African Slaves came to the New World because the Colonists needed Laborers

The Europeans didn’t invent slavery when they introduced it to the New World.  It’d been around since the dawn of civilization.  And it’s been a way of life in many civilizations for thousands of years.  Where no one was safe from the slave traders.  Some were born into slavery.  Some were simply soldiers captured in battle.  Even children were bought and sold.  Perhaps the saddest story is the Children’s Crusade of 1212.  When about 50,000 poor Christian kids walked from Central Europe to free Palestine from Muslim control and return it to the Christians.  They got as far as boarding ships in Italian ports.  But those ships did not deliver them to Palestine.  They delivered them instead into the Muslim slave markets of Northern Africa and the Middle East.  Where they were never heard from again.

African slaves came to the New World because the colonists needed laborers.  They tried enslaving the Native Americans.  But it was too easy for them to escape back into friendly territory.  And blend in with the indigenous population.  Not the case with black Africans.  Who didn’t know the surrounding country.  Or the languages.  What they knew was an ocean away.  Also, the locals had a tendency of dying from European diseases.  Especially smallpox.  Whereas the Africans were long exposed to smallpox.  And built up some resistance to this scourge of European colonialism.

So the New World colonies began with slaves harvesting their crops.  Slaves that the Europeans bought from African slave traders.  Who had long been selling captured Africans to the Arabs.  And had no problem selling them to the Europeans.  And so began the problem of slavery in America.

With the Cotton Gin Separating the Seed from the Cotton Fiber became not so Labor Intensive

When the British American colonists started talking about liberty the slavery problem was the elephant in the room that they were reluctant to talk about.  When Jefferson wrote that all men were created equal they knew that meant those enslaved against their will, too.  Yet here they were.  These liberty-seeking people were enslaving people themselves.  But there was a problem.  To form a united country the Founding Fathers needed the southern states.  Who used slaves as the basis for their economy.  And they weren’t going to join a union without their slaves.  So they wouldn’t talk about the elephant.  Instead they tabled that discussion for 20 years.  With the population growing they didn’t need slaves anymore.  There were few in the North.  And the South should follow suit.  It was inevitable.  Leaving just one problem to solve.  What to do with their slaves as they transitioned to paid laborers.  Which the Founding Fathers were sure the southern slave owners could solve within those 20 years.

Slave-labor was not efficient.  George Washington wanted to sell his slaves and replace them with paid laborers.  Because paid laborers cost less.  You only paid them for their labors.  And then they went away.  And if you changed your crops you could easily hire new laborers skilled in the new crop.  Not quite so easy with a large slave labor force.  So those in the North had good reason to believe that slavery would slowly give way to paid laborers.  Even in the South.  Or so they thought.  But one of the staple crops of the South started to shape events.  Cotton.

Cotton was a labor-intensive crop to harvest.  And separating the seed from the cotton was even more labor-intensive.  Until someone mechanized this process.  With a cotton engine.  The cotton gin.  Patented in America by Eli Whitney.  A hand-cranked device that used hooks to pull the cotton fiber through a screen.  The holes in the screen were small enough to let the cotton fiber through.  But not large enough for the seeds to pass.  With the cotton gin separating the seed from the cotton fiber became not so labor intensive.   In fact, these little machines could clean cotton faster than the slaves could harvest it.  Which meant, of course, there was a lot more cotton that could be grown and harvested.  Which created a new slavery boom.  And dashed all the hopes of the Founding Fathers.

Cheap Cloth Unleashed a lot of Economic Activity which Improved the Quality of Life

Many blame the cotton gin for extending the institution of slavery in America.  And the bloody American Civil War that ended it.  But apart from this the cotton gin was a fundamental step in modernizing economies everywhere.  And helped to spur the textile industry forward.   By creating an abundant source of material for weaving looms everywhere.

The textile industry was important because everyone wore clothes.  And we made clothes from cloth.  Once upon a time people made their own clothes.  Or spent a lot of money for store-bought clothes.  Leaving them with little time or money for other things.  So cheap cloth unleashed a lot of economic activity.  Which improved the quality of life.  The Chinese started this process.  By giving us an advanced loom that used foot-power to lift thread.  And the spinning wheel to make yarn.  All the weavers needed were abundant sources of fiber to feed these machines.  Such as American cotton.

The Chinese also made some beautiful silk tapestries with complex patterns.  Which were very difficult to reproduce by hand in the West.  Until the French automated this process.  When Joseph Marie Jacquard improved on the works of Basile Bouchon, Jean Baptiste Falcon and Jacques Vaucanson.  And created the Jacquard loom.  This automated the pattern process coming from those Chinese looms.  By using punch cards to automatically lift the proper threads to reproduce that complex pattern.  An impressive advance.  But one that did not impress the French.  Who were busier with revolution than fancy weaved patterns.  But the British were interested.  And they used the Jacquard loom in their booming textile industry.  Fed largely by that abundant American cotton.  Until the American Civil War, at least.

An Advanced Automated and Mechanized Economy has no Room for Slavery

The British also used this punch card idea to automate their shipbuilding industry.  To speed up the riveting process.  By automating riveting machines.  To make ships that carried immigrants to the new world.  Who swelled the American population.  Making the census taking more and more complex.  And another punch card system made counting these people simpler.  The tabulator.  Where an operator punched holes in a card to represent information for each person.  Age.  Marital status.  Country of origin.  Etc.  IBM would use this idea of punching information into a card later.  To program some of the first computers.  Machines that increased efficiencies further.  By replacing ever more people with machines.

So it is an interesting turn of events.  Eli Whitney created the cotton gin in America.  A machine that was part of a series of technological developments that increased efficiencies and reduced the number of workers needed to perform once labor intensive tasks.  All during this process fewer people were able to do more things.  Except one thing.  Planting and harvesting cotton.  That would take first a civil war.  And then steam-powered farming equipment.  To automate farming.  Which came later to the South than it did in the slavery-free North.  And other parts of the world.

Life got better for everyone the more advanced the economy became.  Sure, a lot of people lost jobs.  But that’s progress.  A few lost jobs is a small price to pay when the masses can enjoy a better life.  Thanks to automation and mechanization.  And that includes slaves.  Or, rather, former slaves.  For an advanced automated and mechanized economy has no room for slavery.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

2012 Endorsements: Abraham Lincoln

Posted by PITHOCRATES - October 25th, 2012

2012 Election

The Slave Owners were the Social Elite and Holders of Political Power Similar to the Aristocracy in European Feudalism

General Motors (GM) required a government bailout and bankruptcy protection because of rising labor costs that prevented them from selling enough cars at a price to cover their costs while being profitable.  Their problem goes back to FDR.  During the Great Depression his government placed a ceiling on wages.  To encourage companies to hire more people.  By paying more people less money instead of fewer people more money.  So businesses had to do something else to attract the best employees.  And the employee benefit was born.  Pensions and health care benefits.  That were very generous when there was no competition and car companies could sell cars at whatever price they chose.  But that wasn’t the case in the 21st century.  Competition put great cost pressures on those companies with rising health care and pension costs.  And the job bank paying for workers who didn’t work.  Until they could be put back to work.  Adding a lot of costs to each car.  And sending GM into bankruptcy.

Slavery as an economic model had a similar problem.  High costs.  Which goes contrary to the public perception that slave labor was free labor.  George Washington wanted to sell his slaves and hire paid-laborers.  Because his slave families had grown so large.  So he had a growing slave population.  But they all weren’t working.  The young children could not do the work of a young man in his working prime.  Nor could the elderly.  Or the sick or infirmed.  (Who he couldn’t sell along with the healthier and stronger ones in their families.  So he kept his slaves, keeping those families together.  Freeing them upon the death of his wife.  And including provisions in his will to help them integrate into free society.  Giving them some job skills to help them find gainful employment so they could care for their young, elderly, sick and infirmed.)  Yet Washington was feeding them all.  While the growing amount of food they ate couldn’t go to market.  As the years passed his costs went up and his revenue fell.  Just like at GM.  For both had long-term labor commitments that became more inefficient over time.  Which is why slavery was a dying institution in the United States.  The industrial North was slave-free.  As they used more efficient paid-laborers.  Drawing a lot of immigrants to those northern factories.  And slavery was dying out in the South.  Until the cotton gin came along.  Allowing workers to comb (separating the seeds from the fiber) huge amounts of cotton at a time.  Greatly opening the market for that labor-intensive cotton crop.

The typical image of the South in 1860 is endless plantations each with hundreds of slaves working the fields.  Which is wrong.  Most people worked a small family farm.  In fact, most of the Confederate soldiers who fought in the American Civil War came from those small family farms and never owned a slave in their life.  The actual numbers of large slaveholders will probably surprise you.  Approximately 0.84% of the southern population owned at least 20 slaves.  Only 0.05% of the southern population owned at least 100 slaves.  And the number of big plantations owning at least 500 slaves?  Twelve.  So it was a very small population that had a vested interest in the institution of slavery.  Yet the South seceded from the union over the issue of slavery.  Why?  Because of who those slave owners were.  The social elite and holders of political power.  The Planter Elite.  People similar to the aristocracy in European feudalism.  An Old World nobility.  The very wealthy few who ruled the South.  And for awhile they ruled the United States thanks to an unfair advantage they had in the House of Representatives.  Where they determined their representation by not only counting the free population but by counting every slave as 3/5 a free person as well.  And this southern nobility was determined to maintain their aristocracy.

Popular Sovereignty created a Bloodbath in Kansas as ‘Free’ and ‘Slave’ People raced there to Settle the State

Which was easier said than done.  Because of that industrial growth in the north attracting so many immigrants that they swelled the northern population.  Transferring control of the House from the South to the North.  Which left only the Senate (and the presidency) for the South.  As each state got two senators the race was on to admit free and slave states to the union.  Which didn’t really solve anything.  It only made the differences between the North and the South greater.  And intensified the bad feelings between the North and the South.  The North was full of abolitionist busybodies trying to tell southerners how to live.  While the southerners were a bunch of immoral slaveholders.  Bringing shame to the nation that was supposedly a place where all men were created equal.   Words enshrined in the Declaration of Independence.  Words written incidentally by a southern slaveholder.  It was finally time to address the nation’s original sin.

Congress passed the Missouri Compromise (1820) after Thomas Jefferson bought the Louisiana Territory from the French.  Adding a lot of new land to form states from.  The compromise prohibited slavery north of the border between Arkansas and Missouri (except in the state of Missouri).  They added new states in pairs.  A free state.  And a slave state.  Maintaining the balance of power in Congress.  Then came Kansas and Nebraska.  Both above the Missouri Compromise line.  Well, that meant two new free states.  And a change in the balance of power.  Which the South couldn’t have.  So Senator Stephen Douglas introduced the Kansas-Nebraska Act.  And the idea of popular sovereignty.  The idea of letting the people in these new states decide for themselves if they should be a free state or a slave state.  Creating a bloodbath in Kansas as ‘free’ and ‘slave’ people raced there to settle the state.  Fighting and intimidating each other so they would be the ones to vote on making Kansas free or slave.  It was anarchy.

Abraham Lincoln had reentered politics in 1854 to campaign for fellow Whig Richard Yates.  Who opposed the Kansas-Nebraska Act.  Democrat Stephen Douglas was making a series of speeches in Illinois.  In response to one of Stephens’ speeches Lincoln gave his Peoria speech.  In commenting on letting slavery into Nebraska and Kansas Lincoln said, “I hate it because of the monstrous injustice of slavery itself.  I hate it because it deprives our republican example of its just influence in the world—enables the enemies of free institutions, with plausibility, to taunt us as hypocrites—causes the real friends of freedom to doubt our sincerity and especially because it forces so many really good men amongst ourselves into an open war with the very fundamental principles of civil liberty—criticizing the Declaration of Independence, and insisting that there is no right principle of action but self-interest.”

If Lincoln were Alive Today he would Likely Endorse the Republican Candidates Mitt Romney and Paul Ryan

The fallout from the Kansas-Nebraska Act splintered existing political parties apart.  Created new ones that disappeared later.  And gave birth to the new Republican Party.  The party of George W. Bush, Ronald Reagan and Abraham Lincoln.  Who became the leading spokesman of the party.  The Republicans lost the 1856 presidential election but won majorities in most of the northern states.  Tipping the balance of power further away from the South.  When Lincoln won his party’s nomination to run for senator in 1858 he gave his ‘House Divided Speech’ saying, “A house divided against itself cannot stand. I believe this government cannot endure permanently half slave and half free. I do not expect the Union to be dissolved—I do not expect the house to fall—but I do expect it will cease to be divided. It will become all one thing, or all the other.”

When slave Dred Scott traveled to a free state with his owner his owner died.  Scott said he was then a free man.  The Supreme Court thought otherwise.  Saying that Scott was still a slave because neither Congress nor any territory legislature had the authority to change that.  Which meant no one could restrict the movement of slaves because no one had the right to restrict the movement of private property.  Thus opening all the new territories to slavery.  Making the South very happy.  While infuriating the North.  Who refused to enforce slave laws on the books like the Fugitive Slave Law.  A provision included in the Compromise of 1850 for the states’ rights South.  That called for the federal government to force northerners to return slaves or face arrest and penalties.  States’ legislatures in the North passed laws saying a slave living in a free state was a free man.  The Supreme Court struck down these laws.  Favoring southern states’ rights over northern states’ rights.  So the states just refused to help the federal government in any prosecution of a violation of the Fugitive Slave Law.  Then abolitionist John Brown’s failed slave revolt at Harper’s Ferry, Virginia, further angered the South.

Then came the 1860 presidential election.  That Abraham Lincoln won.  Which was the last straw.  The South lost both Congress and the presidency.  Worse, the new president, though not an outright abolitionist, opposed the expansion of slavery.  Leaving the South with one last option.  Secession.  Which they did.  Leading to the American Civil War.  Which the South lost because of everything they believed in.  For an Old World nobility just could not defeat a modern industrial power.  Lincoln won because he had modern factories building whatever he needed.  The northern economy was large and diverse providing war financing.  Railroads crisscrossed the North.  A large navy controlled the interior rivers and blockaded the southern ports.  Cutting off the South from the outside world and starving it.  When the South desperately pursued the British for recognition Lincoln issued the Emancipation Proclamation.  Making it impossible for Britain to ally itself with a nation fighting for the institution of slavery.

No president entered office with a heavier burden than President Lincoln.  Standing on principle he made the hard decisions.  Becoming the most hated sitting president of all time.  He did not look for an easy solution like every other politician had up to his time.  Only making the inevitable solution more costly.  And more painful.  He would do what had to be done.  Regardless the price he would pay.  Politically.  Or personally.  A cost so high that it made him a one term president thanks to an assassin’s bullet.  He didn’t base his decisions on the polls.  Or populist movements.  But on principles.  Drawn from the Constitution.  And the Declaration of Independence.  As well as the Bible.  So if he were alive today who would he endorse in the current election?  He would, of course, support his party.  Out of party loyalty.  And because it tends to stand on principle more than the Democrat Party.  Which often used an activist Supreme Court to get what they couldn’t get in the legislature.  Which tends to use populist movements and character assassination to advance their agenda.  Such as the so-called war on women to scare women into voting Democrat because they can’t persuade them to based on a successful track record in office.  Also, the Republicans are more pro-business and more pro-military.  Which gives you the ability to win civil wars.  And other wars.  As well as protecting US security interests around the world.  Maintaining peace through strength.  For anything was preferable to the hell he went through during the four long years of the Civil War.  And to have so much blood on his hands.  The war being so horrific because of a policy of continued failed diplomacy when there was simply no common ground.  He said that there was only one of two possible outcomes.  All free.  Or all slave.  And he was right.  But it took someone willing to be the most hated sitting president to have the courage to act to bring about the inevitable.  So if Lincoln were alive today he would likely endorse the Republican candidates Mitt Romney and Paul Ryan.  Not the party that wants to delay the inevitable by refusing to address the systemic problems of Medicare and Social Security.  And a growing welfare state.  Systems a declining population growth rate can no longer fund.  Because aging populations bankrupt nations with expanding welfare programs.  Just like an aging workforce can bankrupt a car company like GM.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

FT133: “Liberal Democrats want to run our lives because they are far smarter than the people voting for them.” —Old Pithy

Posted by PITHOCRATES - August 31st, 2012

Fundamental Truth

People like to Laugh and not get Weighed Down with the Serious Issues so they Watch the Fake News and SNL

Those on the Left are suave.  Hip.  Cool.  Funny.  And boy are they full of self-confidence.  They are so sure of themselves that they sound like they know everything.  That they are smarter than the average person.  Especially when they speak with arrogance and condescension.  When they laugh with all-knowing condescension and smirk they just seem like people we should agree with.  And many do.  For they sound so smart that they must know what they are talking about.  Besides, these people are the suave, hip, cool and funny people on television we so enjoy watching who are saying this.  We like these people.  And want to be like them.  So we make disparaging comments about conservatives like they do.

The people who get their ‘hard news’ from Jon Stewart on the Daily Show or from Stephen Colbert on the Colbert Report are probably like the people in their audiences.  Who laugh longer and harder when the humor is more derogatory.  Disparaging conservatives.  Or Republicans.  They are there for the laughs.  And they love the conservative insults.  Those watching at home laugh, too.  Because they have been conditioned for so long to laugh at conservatives.  From listening to their classmates in schools.  Their teachers.  Their professors in college.  Movies.  And, of course, television.  From the fake news shows.  To Saturday Night Live.  That made belittling conservatives an art.

These people like to laugh.  To enjoy life.  And not get weighed down with the serious issues.  Which is why they watch the fake news and SNL.  To escape.  And enjoy a good laugh.  But because they don’t like getting weighed down with the serious issues they typically don’t watch serious news.  So most of the news they get is from the fake news shows.  SNL.  And the liberal talking heads on the opinion/news shows that are more opinion than news.  And even on these opinion/’news’ shows they take cheap potshots at conservatives.  Laugh.  And smirk.  Which reinforces what they saw on the fake news shows.  Giving these derogatory attacks on conservatives more legitimacy.  Making them mainstream.  Normal.  And, therefore, correct.

Do those on the Left know their Idol, JFK, was a Tax-Cutter like Ronald Ragan?

As you watch these shows and hear these guffaws at the expense of some conservative have you ever wondered how much these people understand the underlying issue that their lampooning the conservative about?  Do they have a fundamental understanding of economics?  Can they differentiate Keynesian economics from the Austrian school of economics or the Chicago school?  Do they understand the connection between monetary policy and inflation?  Do they understand the affect of the population growth rate on government spending?  Here’s a hint.  Think of why Social Security and Medicare are going bankrupt in the very near future.  What’s the connection?  If the number of taxpayers grows at a slower rate than those retiring from the workforce you get what we have today.  And no amount of taxing the rich can change that.

Can they name the Founding Fathers?  Do they know what each did to help found the nation?  Other than own slaves?  Do they understand that they abandoned a slave-based economy in the North because it was a very inefficient economic model?  As well as immoral.  Slavery didn’t make the nation rich.  It only made a few southern plantation owners rich.  Do they understand why there was slavery in a nation built on liberty?  It was the only way to get the southern plantation owners to join the union.  And the southern plantation owners held power in the southern states.  If the large union failed there would have been smaller unions of states.  In the northeast.  The middle states.  The south.  In the west.  With the British, French and Spanish at their borders.  Had the northern states had their way on the issue of slavery at the Founding there would not have been a United States.  But more of the Old World in the New World with the constant fighting that has plagued the Balkans.  Don’t believe that?  Well, it has happened.  America’s bloodiest war, the American Civil War, was a war between sectional interests.  Which the South lost because they and their slave-economy was poorer than the non-slave North.  And finally on the issue of slavery do they understand that it was the Republicans that ended slavery?  That the Democrats pushed the Jim Crowe Laws?  That the Democrats filibustered the Civil Rights Act of 1964?  And that more Republicans voted for that act than did Democrats?  I’m guessing when those on the Left who call Republicans racists do not know the history of the United States.

Do those on the Left know their idol, JFK, was a tax-cutter?  Who favored trickle-down economics?  It’s true.  His policies of tax cuts produced an economic boom.  Just like they did when Ronald Reagan continued the work started by JFK.  Which was rudely interrupted by LBJ, Richard Nixon, Gerald Ford and Jimmy Carter.  Do they understand that using corn for fuel leads to higher grocery prices?  And more hunger in the less developed world?  Do they understand that if everyone drove an electric car that it would be equivalent to adding one air conditioner on the electric grid for each car?  And the only way to meet that additional demand is by adding more coal-fired power plants?  Producing more air pollution than the cars they replaced?  Of course they don’t know this.

People tend to Vote Conservative because of what they Know not what they Feel

Those on the Left have little understanding of what their policies will do.  As they’ve littered the nation with the unintended consequences of their best intentions.  Which typically makes whatever problem they’re trying to fix worse.  Such as trying to help single mothers with AFDC.  Aid to Families with Dependent Children.  That relieved fathers of their parental responsibilities by having the state be husband and father.  Which destroyed poor families in the inner city.  But despite their failures the Left continues with more of the same.  Resorting to the same old attacks on conservatives.  Knowing that those on television will take their cheap potshots, laugh, smirk, disparage and condescend.

They hate conservatives.  Not for any rational reasons.  They just have been conditioned to.  And those on television are wealthy enough that they don’t have to live in the real world where they have to deal with those unintended consequences.  Insulated from the fallout of horrible policy they can go through life whistling a happy tune.  Knowing that even though the policies they support have failed they can feel good about themselves because they had the best of intentions.  That they care.  They are so sure of themselves that they could never conceive that they could, perhaps, be wrong.  And the reason why they are so arrogant, condescending and downright mean is that conservatives don’t accept their infallibility.  While these uppity conservatives dare to believe they could actually be right.

Liberals believe that not only can they be right but that they always are right.  Because they are so much smarter than the average person.  Which is why they believe they should run our lives.  People have other things to worry about.  Like sitting in the audience of a fake news show.  These people need help.  Because they can’t get by in life without a progressive government looking out for them.  Life is complicated.  And hard.  They need help.  They need smart people looking out for them.  So these people vote liberal.  To leave the governing to experts.  So those who can’t live without the help of smarter people providing for them decide who those smarter people are.  Even though they are the least qualified to do so.  For it’s not the people who have a fundamental understanding of economics voting for liberals.  People who understand our history.  Those who run small business.  The fiercely independent with rugged individualism.  The people who have built this nation.  No.  These people tend to vote conservative.  Because of what they know.  Not what they feel.  Like others do.  Like those who vote liberal.  Because they don’t know any better.  But feel good about who they vote for.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , ,

FT125: “Welfare states fail because economic systems based on slavery don’t create enough stuff.” -Old Pithy

Posted by PITHOCRATES - July 6th, 2012

Fundamental Truth

In the Barter System the Only Way to Get Something you Wanted was to create Something of Value Yourself

What’s more important?  Money?  Or stuff?  Stuff, of course.  Because people work to earn money to buy stuff.  They don’t work just for the money.  Because you can’t eat money.  You can’t drink money.  You can’t smoke money.  You can drive money.  You can’t watch or listen to money.  You can’t live in money.  You can’t surf the Internet with money.  No.  The only thing money is good for is buying stuff.  It’s the stuff we buy that makes our lives more enjoyable.  Having money helps.  But it is only a means to an end.  That end being stuff.  And someone has to make that stuff.  For if no one does then all the money in the world is worthless.

Early economies were barter economies.  People traded stuff.  Stuff they created, dug up, grew, manufactured, etc.  Instead of working to earn money to buy stuff they created stuff and traded it for other stuff.  So the only way to get something you wanted was to create something of value yourself.  Money didn’t change this.  Money just made trading with other people more efficient.  By being a temporary storage of wealth.  Because the barter system had a serious flaw.  High search costs. 

It took time to bring two people together to trade their stuff.  If a toolmaker wanted a pottery vase he had to find a potter who wanted a tool the toolmaker made.  This could take awhile.  Hence the high search costs.  Because while these people were seeking each other out they couldn’t make anything else of value.  With money, though, you could accept money in trade.  And then go and trade that money for what you wanted.  This greatly reduced search costs.  Because all you had to do was find the things you wanted.  And trade your temporary storage of wealth (i.e., money) for them.  Allowing them to spend more time creating value.  And less time searching.

The North won the American Civil War because the North practiced Free Market Capitalism while the South Didn’t

Advances in agriculture allowed larger and larger food surpluses.  Which, in turn, allowed more and more people to do something other than farm.  This unleashed human capital.  Allowed people to think about other things.  Create new things.  And improve existing things.  This created a middle class of artisans.  Craftspeople.  The people that created goods and services and brought them to the market place.  Creating the complex economy.  These people became entrepreneurs.  They efficiently used resources and sold things in the market place the people were demanding.  Not out of the goodness of their hearts.  But because they were pursuing profits.

This is free market capitalism.  The economic system that ushered in the modern world.  Free people thinking freely.  Creating.  Bringing their bold new ideas into reality.  Giving us the steam engine.  The railroad.  Machine tools.  Electric power.  The assembly line.  Free market capitalism brought us these things and improved our standard of living.  Because they were free to enter the market place.  And make profits.  Providing a powerful incentive to make the world a better place for everyone else.  Because when they took risks and worked hard to make the world a better place they could get rich in the process.

This is why the North won the American Civil War.  Because the North practiced free market capitalism.  While the South did not.  Their economy was a slave economy.  Instead of an expanding middle class working and contributing to the economy they had an expanding slave population.  That didn’t contribute to the economy.  They worked in the fields.  With all the proceeds from their labors going to a few plantation owners.  Slaves in general didn’t tinker or bring new things to market to enrich their masters.  For they had no incentive to do so.  They did have an incentive to do as they were told and work the fields.  To avoid punishment.  And they had no wages to spend in the market.  So there was less demand for manufactured goods in the South (in some states of the Deep South slaves made up to a third to half of the population).  So there was less manufacturing in the South.  Far less.  This is why the North exploded in manufacturing.  Entrepreneurs could bring things to market.  And the manufacturing workers earned wages they could use to buy those things.  As well as mass-produce the implements of war.  Unlike they could in the South.  Because of the economic superiority of the North it was just a matter of time before the South was overwhelmed.  And lost. 

When the Roman Empire turned into a Welfare State they had to Force People to Make Stuff Against their Will

Governments can print money.  They can tax people.  They can borrow money.  But the one thing they can’t do is create stuff.  If they could create stuff (i.e., economic activity) simply by printing money then the South would have matched the North in economic output.  But they did not.  Which is why they ultimately lost the war.  Because they could print Confederate dollars.  But that didn’t make muskets, bullets, canon, shoes, food, ships, steam locomotives or railroad track.  Creative people had to make these things first before the Confederate government could procure them.  Which is why the government didn’t procure them.  Because no one made them.

This is why governments just can’t print money and give it to the people.  They could.  But it would be pointless.  Let’s say they gave everyone $100,000 a year.  So no one would ever have to work again.  A lot of people would vote for the politician that promised that.  Of course if no one works who will create all the stuff to buy with that $100,000?  Having money is one thing.  But if there is nothing to buy with it then that money is worthless.

This is why the welfare state will ultimately fail.  As more people collect welfare benefits instead of creating stuff there will be less stuff to buy.  When supply shrinks while demand increases prices rise.  Higher prices that everyone has to pay.  People who create.  And people who don’t.  So they will raise taxes on those who work to pay for the benefits for those who don’t.  So those who don’t work can afford the higher prices, too.  Higher taxes are a great disincentive to create.  Or to become an entrepreneur.  Some may just choose the easier path.  Stop creating.  And start collecting that government money, too.  Further reducing supply and increasing demand.  Raising prices further.  Reducing overall economic activity.  And reducing the standard of living.

This happened in the Roman Empire as they kept raising taxes and debasing their coin to pay for their excessive government spending.  It got so bad that people quit their jobs because they couldn’t make any money.  Creating great shortages of goods.  And food.  So the Romans passed laws forbidding people from leaving their jobs.  Even tied people and their descendants to the land they farmed.  Which grew into European feudalism.  And Russian serfdom.  Economic systems little better than the slavery of the Deep South.  Which stunted innovation.  Lowered the standard of living.  And led to the fall of the Western Roman Empire.  But it was the only way the Romans could get the stuff they needed.  By forcing people to make it against their will.  Which is what they had to do when the Roman Empire turned into a welfare state.  And the creators quit creating.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Slavery, the Cotton Gin, the Jacquard Loom, Punch Cards and Computers

Posted by PITHOCRATES - December 7th, 2011

Technology 101

African Slaves came to the New World because the Colonists needed Laborers

The Europeans didn’t invent slavery when they introduced it to the New World.  It’d been around since the dawn of civilization.  And it’s been a way of life in many civilizations for thousands of years.  Where no one was safe from the slave traders.  Some were born into slavery.  Some were simply soldiers captured in battle.  Even children were bought and sold.  Perhaps the saddest story is the Children’s Crusade of 1212.  When about 50,000 poor Christian kids walked from Central Europe to free Palestine from Muslim control and return it to the Christians.  They got as far as boarding ships in Italian ports.  But those ships did not deliver them to Palestine.  They delivered them instead into the Muslim slave markets of Northern Africa and the Middle East.  Where they were never heard from again.

African slaves came to the New World because the colonists needed laborers.  They tried enslaving the Native Americans.  But it was too easy for them to escape back into friendly territory.  And blend in with the indigenous population.  Not the case with black Africans.  Who didn’t know the surrounding country.  Or the languages.  What they knew was an ocean away.  Also, the locals had a tendency of dying from European diseases.  Especially smallpox.  Whereas the Africans were long exposed to smallpox.  And built up some resistance to this scourge of European colonialism.

So the New World colonies began with slaves harvesting their crops.  Slaves that the Europeans bought from African slave traders.  Who had long been selling captured Africans to the Arabs.  And had no problem selling them to the Europeans.  And so began the problem of slavery in America.

With the Cotton Gin Separating the Seed from the Cotton Fiber became not so Labor Intensive

When the British American colonists started talking about liberty the slavery problem was the elephant in the room that they were reluctant to talk about.  When Jefferson wrote that all men were created equal they knew that meant those enslaved against their will, too.  Yet here they were.  These liberty-seeking people were enslaving people themselves.  But there was a problem.  To form a united country the Founding Fathers needed the southern states.  Who used slaves as the basis for their economy.  And they weren’t going to join a union without their slaves.  So they wouldn’t talk about the elephant.  Instead they tabled that discussion for 20 years.  With the population growing they didn’t need slaves anymore.  There were few in the North.  And the South should follow suit.  It was inevitable.  Leaving just one problem to solve.  What to do with their slaves as they transitioned to paid laborers.  Which the Founding Fathers were sure the southern slave owners could solve within those 20 years.

Slave-labor was not efficient.  George Washington wanted to sell his slaves and replace them with paid laborers.  Because paid laborers cost less.  You only paid them for their labors.  And then they went away.  And if you changed your crops you could easily hire new laborers skilled in the new crop.  Not quite so easy with a large slave labor force.  So those in the North had good reason to believe that slavery would slowly give way to paid laborers.  Even in the South.  Or so they thought.  But one of the staple crops of the South started to shape events.  Cotton.

Cotton was a labor-intensive crop to harvest.  And separating the seed from the cotton was even more labor-intensive.  Until someone mechanized this process.  With a cotton engine.  The cotton gin.  Patented in America by Eli Whitney.  A hand-cranked device that used hooks to pull the cotton fiber through a screen.  The holes in the screen were small enough to let the cotton fiber through.  But not large enough for the seeds to pass.  With the cotton gin separating the seed from the cotton fiber became not so labor intensive.   In fact, these little machines could clean cotton faster than the slaves could harvest it.  Which meant, of course, there was a lot more cotton that could be grown and harvested.  Which created a new slavery boom.  And dashed all the hopes of the Founding Fathers.

Cheap Cloth Unleashed a lot of Economic Activity which Improved the Quality of Life

Many blame the cotton gin for extending the institution of slavery in America.  And the bloody American Civil War that ended it.  But apart from this the cotton gin was a fundamental step in modernizing economies everywhere.  And helped to spur the textile industry forward.   By creating an abundant source of material for weaving looms everywhere.

The textile industry was important because everyone wore clothes.  And we made clothes from cloth.  Once upon a time people made their own clothes.  Or spent a lot of money for store-bought clothes.  Leaving them with little time or money for other things.  So cheap cloth unleashed a lot of economic activity.  Which improved the quality of life.  The Chinese started this process.  By giving us an advanced loom that used foot-power to lift thread.  And the spinning wheel to make yarn.  All the weavers needed were abundant sources of fiber to feed these machines.  Such as American cotton.

The Chinese also made some beautiful silk tapestries with complex patterns.  Which were very difficult to reproduce by hand in the West.  Until the French automated this process.  When Joseph Marie Jacquard improved on the works of Basile Bouchon, Jean Baptiste Falcon and Jacques Vaucanson.  And created the Jacquard loom.  This automated the pattern process coming from those Chinese looms.  By using punch cards to automatically lift the proper threads to reproduce that complex pattern.  An impressive advance.  But one that did not impress the French.  Who were busier with revolution than fancy weaved patterns.  But the British were interested.  And they used the Jacquard loom in their booming textile industry.  Fed largely by that abundant American cotton.  Until the American Civil War, at least.

An Advanced Automated and Mechanized Economy has no Room for Slavery

The British also used this punch card idea to automate their shipbuilding industry.  To speed up the riveting process.  By automating riveting machines.  To make ships that carried immigrants to the new world.  Who swelled the American population.  Making the census taking more and more complex.  And another punch card system made counting these people simpler.  The tabulator.  Where an operator punched holes in a card to represent information for each person.  Age.  Marital status.  Country of origin.  Etc.  IBM would use this idea of punching information into a card later.  To program some of the first computers.  Machines that increased efficiencies further.  By replacing ever more people with machines.

So it is an interesting turn of events.  Eli Whitney created the cotton gin in America.  A machine that was part of a series of technological developments that increased efficiencies and reduced the number of workers needed to perform once labor intensive tasks.  All during this process fewer people were able to do more things.  Except one thing.  Planting and harvesting cotton.  That would take first a civil war.  And then steam-powered farming equipment.  To automate farming.  Which came later to the South than it did in the slavery-free North.  And other parts of the world.

Life got better for everyone the more advanced the economy became.  Sure, a lot of people lost jobs.  But that’s progress.  A few lost jobs is a small price to pay when the masses can enjoy a better life.  Thanks to automation and mechanization.  And that includes slaves.  Or, rather, former slaves.  For an advanced automated and mechanized economy has no room for slavery.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Free Labor

Posted by PITHOCRATES - December 5th, 2011

Economics 101

Unlike Slaves Paid-Laborers Worked, Went Home and Fed & Housed their Own Families

Agriculture advances gave us food surpluses.  Food surpluses gave us a division of labor.  The division of labor gave us trade.  Money made that trade more efficient.  Religion and the Rule of Law allowed great gatherings of people to live and work together in urban settings.  Free trade let us maximize this economic output and elevated our standard of living.  And to sustain this economic growth we needed something else.  Free labor.

Slavery as an economic model has serious defects.  For one the labor is not free.  People are restrained against their will.  And only work to minimize their pain and suffering.  They do not think or innovate.  Their human capital is wasted.  Because no one voluntarily thinks and innovates to make a better life for others.  Especially if it  won’t improve their own life.  A slave, then, has little incentive to think or innovate.  Their incentive is to follow orders.  Because that was the proven way to minimize their pain and suffering.

Buying human beings is also less efficient than renting them.  Not everyone in a slave family was in their working prime.  The elderly couldn’t work the fields anymore.  Neither could the infant children.  But they all needed room and board.  Unlike a paid laborer.  Who you paid only for the hours they worked.  You didn’t feed or house them.  They worked and went home.  And fed and housed their own families. This is why George Washington wanted to sell his slaves and replace them with paid laborers.  To increase his profits.  But he found people were only interested in buying slaves in their working prime.  He could sell some.  But not all of them.  Which meant breaking up slave families.  Something he couldn’t do.  So he kept his slaves.  Settled for lower profits.  And kept the slave families together.

The Slave-Economy in the New World was a Step Backward toward Old World Aristocracy

Not everyone was as kind as Washington.  Some people had no problem breaking up families.  Or abusing their slaves.  But they all had to exercise restraint.  Because a maimed or a dead slave couldn’t work.  A problem for slave owners because they bought their slaves.  Often borrowing money for the purchase.  So it was costly to replace them.  As well as to train them.  One skilled in picking cotton may not readily take to harvesting and drying tobacco.  Whereas you could simply advertise for a hired hand who was skilled in harvesting and drying tobacco if you used free labor.

Free labor added to the economy.  Because they had earnings for economic exchange.  Slaves didn’t.  The slave owner provided their room and board.  So they were not only enslaved they were also dependent on others for everything free laborers bought with their earnings.  Economic exchanges in a slave economy, then, were limited to the wealthy landowners.  Making it a system much like European feudalism or Russian serfdom.  Only instead of peasants or serfs there were slaves.  Who were less free.  And even poorer.

Thus the slave-economy in the New World was a step backward toward Old World aristocracy.  (And a little beyond it.)  Where there were a few rich and a lot of poor.  Agricultural reform came with the help of the Black Death.  When the balance of power tipped from the landed aristocracy to the much thinned out labor force.  Who could then demand wages and better conditions.  And then came capitalism.  For those new wage-earners had money for economic exchanges.  Which they made.  Thus producing a prosperous middle class.  Which took root in the New World.  At least, in the parts of the New World that used free labor.

Our Capacity to Think is the Key to Unlocking our Human Capital, Economic Growth and the Quality of Life

The great problem of slavery (other than the moral one) is that it excluded a great part of the population from the economy.  Slavery excluded millions of people from making economic exchanges.  And millions who might have thought and created didn’t.  Their human capital was wasted.  Setting economic development back.  As well as the quality of life.

In a modern capitalistic economy there must be no slavery.  Or dependency.  Because those enslaved or dependent do not create.  Or innovate.  They just exist.  And do not maximize the gift of being human.  Our capacity to think.  Which is the key to unlocking our human capital.  Economic growth.  And the quality of life.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , ,

LESSONS LEARNED #60: “Fool me once shame on you. Fool me twice shame on me. Fool me again shame on public education.” -Old Pithy

Posted by PITHOCRATES - April 8th, 2011

Slaves were Costly and Inefficient

George Washington made a profit on his plantation.  Better than some of his fellow Founding FathersThomas Jefferson couldn’t make a profit and was forever in debt.  But Washington could.  And did.  And would have been more profitable had he split up his slave families.  You see, he wanted to sell his slaves and use paid-laborers instead.  Why?  Because paid-labor was more profitable than slave-labor?  “What?!?” you ask.    Yes, that’s right.  Paid-labor was more profitable than slave-labor.  For a couple of reasons. 

First of all, slaves weren’t free.  People bought them at auction.  And anyone familiar with an auction knows that people sell to the highest bidder.  So there was an initial ‘investment’ in a slave that you didn’t have with a paid-laborer.  Think of this as the difference of buying or renting a house.  If you buy you pay a lot of money to own the house.  And you are responsible for all of the maintenance and upkeep on the house.  It’s different with renting.  You pay just a little bit each month for as long as you stay in the house.  It’s similar with paid-labor.  You rent people for the time they work.  Then they go home and feed and house themselves.  Slaves didn’t go home.  Because they were home.  And planters had to feed and house them.  And attend to their other needs.  These costs added up.  Especially if you had a lot of slaves out of their working prime (old men and young children) that you still had to feed and house.  And these are what Washington had a lot of.  Many generations of non-working slaves that he had to feed and house.  Which is why he wanted to sell them.  But people only wanted the workers.  Not the rest of the family.  But he refused to break up the slaves families.  So he kept them.  Even though it was a poor business decision.

Now Washington was no abolitionist, but he saw the conflict between the institution of slavery and the American ideal.  But his motives were financial at first.  His large crop of tobacco was not a money-maker.  So he wanted to diversify his crops.  And his risks.  Which meant different labor skills for different crops.  And this favored paid-labor.  Because you can always hire skilled laborers to grow these different crops.  Which was the great disadvantage of slave-labor.  Their advantage was in the large, single-crop plantation where a diverse skill-set was not required.  Trained in one skill, they kept repeating that single skill on a grand scale.  It was the best you could hope for from slave-labor.  Where people did the minimum to avoid punishment.  For that was their only incentive.  Paid-laborers, on the other hand, you can fire them.  Or reward them for bumper crops.  So they have an incentive to hone their skills and become the best at what they do.

King Cotton Abdicates

But Washington couldn’t break up the slave families.  And there was no way to give them the many years of farming skills overnight in these new skill areas and turn them into proper paid-laborers.  Who could take care of themselves and their families while integrating them into free society.  Unless he gave up his day job.  So he continued to use slave-labor.  However, his will freed his slaves after his wife passed away.  He and his wife were the last generation to live the old way of life.  His successors were to live the new way of life.  His will further instructed to teach the newly freed slaves trade skills and help them integrate into free society.

Many critics of the United States like to point to the institution of slavery and say that is why we became a great nation.  That we grew rich on slave-labor.  That we reaped huge profits because slaves were free.  Nothing could be further from the truth.  First of all, as noted above, slave-labor was not free labor.  It was costly.  And inefficient.  It was such a bad business model that it had almost died of its own accord.  As many of the Founding Fathers had earnestly wished.  But something happened.  Eli Whitney invented the cotton gin.  Now machines could separate the seeds from the cotton faster than they could pick it.  All of a sudden the large, single-crop, cotton plantations in the south needed to plant, grow and pick more cotton than ever before.  To feed these new, hungry machines.  Cotton was the new high-demand fabric.  The textile markets in Great Britain couldn’t buy enough of it.  And the Southern economy flourished like it had never did before.  Southern planters grew rich.  As did the Southern economy.  King Cotton they called it.  Because cotton was king.

And that is why the South lost the Civil War.  For if cotton was king that meant the South was a monarchy.  And for all intents and purposes, it was.  Most Southerners didn’t own slaves.  Most were poor.  Working on family farms.  The institution of slavery didn’t tarnish them.  No.  The rich planters owned the vast majority of the slaves.  The planter elite.  The planter aristocracy.  And it was an aristocracy in every sense of the word.  Just watch the classic Gone with the Wind and tell me what that world reminds you more of.  America?  Or European feudalism?  That wasn’t America.  America was the poor southerner working the family farm.  And the poor northerner working the family farm.  It was not inherited wealth passed from generation to generation.  Wealth created by labor bonded in servitude attached to the land (serfs in Europe, slaves in America).  No, this was not America.  It was a charmed life for the privileged few.  But only the privileged few.  Because it mattered what your last name was.

Laissez-Faire Capitalism wins the Civil War

The North won the Civil War because it was more laissez-faire capitalism.  The South had the better generals at the beginning of the war.  And the Southern soldier was a formidable foe in combat.  But factories in the North fed Northern shipyards.  Which built a navy that blockaded southern ports.  Making all that cotton worthless.  Great Britain would then turn to India for her cotton needs.  So much for King Cotton. 

The Southern economy was a cotton economy without a market.  They had factories and shipyards, too, buy not like the industrialized North.  The South never had a chance.  Unless she could strike a winning blow early.  Because they could not win a war of attrition.  Which is what the Civil War became.  Especially after the Confederate ‘high water’ mark.  Gettysburg.  The Confederacy shrank as the Union Army advanced.  Fed by a growing network of railroads.  This relentless advance of man and material made possible by the prudent investment of capital by savvy investors.  The genius of entrepreneurs.  And the drive of industrialists.

This miracle of capitalism would tip the scales again in World War I.  And in World War II.  The Arsenal of Democracy.  Laissez-faire capitalism.  Paid-laborers.  Incentive.  And profit.  The best things in life.  They gave us the comforts we now take for granted.  And they took us from a new nation to a superpower in little over one hundred years.

Pliant, Subservient Students grow up to become good Democratic Voters

So that’s history.  But people today still think slavery made us great.  They attack capitalism.  Incentive.  Profits.  And just about everything else that built and made this country great.  Why?  Because they learned somewhere that slavery made us great.  That capitalism is bad and unfair.  That incentive and profits exploit the working class.  Where?  In our public schools.  And our public universities.  Kids in our public institutions learn these things.  Not the things that made us great.  Because these schools indoctrinate.  They don’t educate.  Why?  For the same reason the planter aristocracy fought in the Civil War.  To protect a privileged class.

Today, the liberal Democrats are the descendants of the planter aristocracy.  Not literally.  But figuratively.  Liberal Democrats are not capitalists.  Or industrialists.  They don’t like incentive or profit.  They prefer patronage.  They like rewarding their friends.  And punishing their enemies.  And to have this power they need to have the people vote for them.  So they come across as the champion of the poor and friend of the working man.  Or any other minority or class of people whose vote they need to buy.  But they’re anything but.  For an example just look at one of their favorite cause célèbre.  The black family.  These white liberals want to ease other whites’ guilt over slavery by doing as much as they can for the black family.  To make up for all those years of injustice.  And they dropped a neutron bomb.  Aid to Families with Dependent Children.  AFDC.  A real feel-good thing to do.  But it led to an explosion of single-mother families in the black community.  Because of the incentives of the program.  It encouraged women to have more children.  Stay unmarried.  And not work.  For a young woman with no working skill this was a godsend.  The state would replace the father and provide for her and her children.  But as it turned out, the state was a very poor father figure.  Children need fathers.  We all know this.  That’s why there are big brother programs.  To provide a father figure for these fatherless children.  For they will stray without this strong role model in the family.  And have.  Economist Thomas Sowell blames AFDC for greatly destroying the black family.

But the liberal Democrats don’t look at the destruction they cause.  They look at the political power they’ve gained.  Much like the planter elite.  So they need to tweak history a bit.  To mask their failures.  And accentuate the good they meant to do.  But never did.  And what better way to do that than in our public schools?  So they take care of our teachers.  Pull them into their aristocratic class.  Help them get favorable contracts without allowing the taxpayers a say.  Feed them big salaries.  Some of which is returned to them via their union dues.  Quid pro quo. They live the good life.  The politicians get ‘campaign’ contributions.  And pliant, subservient students grow up to become good Democratic voters.

And thus the lie is sustained.  Those who destroy are portrayed as nurturers.  And those who nurture are portrayed as destroyers.  A political sleight of hand.  That pays dividends in the voting booth.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

« Previous Entries