This notion that slavery somehow benefited the entire economy is a surprisingly common one and I want to briefly refute it. This is related to the ridiculously bad academic study (discussed here) that slave-harvested cotton accounted for nearly half of the US’s economic activity, when in fact the number was well under 10%. I assume that activists in support of reparations are using this argument to make the case that all Americans, not just slaveholders, benefited from slavery. But this simply is not the case.
At the end of the day, economies grow and become wealthier as labor and capital are employed more productively. Slavery does exactly the opposite.
Slaves are far less productive than free laborers. They have no incentive to do any more work than the absolute minimum to avoid punishment, and have zero incentive (and a number of disincentives) to use their brain to perform tasks more intelligently. So every slave is a potentially productive worker converted into an unproductive one. Thus, every dollar of capital invested in a slave was a dollar invested in reducing worker productivity.
As a bit of background, the US in the early 19th century had a resource profile opposite from the old country. In Europe, labor was over-abundant and land and resources like timber were scarce. In the US, land and resources were plentiful but labor was scarce. For landowners, it was really hard to get farm labor because everyone who came over here would quickly quit their job and headed out to the edge of settlement and grabbed some land to cultivate for themselves.
In this environment the market was sending pretty clear pricing signals — that it was simply not a good use of scarce labor resources to grow low margin crops on huge plantations requiring scores or hundreds of laborers. Slave-owners circumvented this pricing signal by finding workers they could force to work for free. Force was used to apply high-value labor to lower-value tasks. This does not create prosperity, it destroys it.
As a result, whereas $1000 invested in the North likely improved worker productivity, $1000 invested in the South destroyed it. The North poured capital into future prosperity. The South poured it into supporting a dead-end feudal plantation economy. As a result the south was impoverished for a century, really until northern companies began investing in the South after WWII. If slavery really made for so much of an abundance of opportunities, then why did very few immigrants in the 19th century go to the South? They went to the industrial northeast or (as did my grandparents) to the midwest. The US in the 19th century was prosperous despite slavery in the south, not because of it.
Warren Meyer, “Slavery Made the US Less Prosperous, Not More So”, Coyote Blog, 2019-07-12.
November 10, 2023
QotD: Economic distortions of slavery in the Antebellum South
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