Wyatt L.T. III The Industrial Revolution

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undeniable boost to the desire for unfettered enterprise in the colonies.

Even the lack of an abundant, ready supply of capital comparable to

Great Britain was not a huge detriment as the colonies could fall back

on the mother country for support in terms of British investors, entre-

preneurs, equipment (tools, machines, and supplies), and shipping

(80% of the Atlantic trade was carried on British ships on the eve of

the Revolution).

In spite of the importance of the linkage between the colonies

and Great Britain, the mother country in the first half of the 18th cen-

tury on occasion attempted to stifle the growth of certain infant Ameri-

can industries. In fact one of the main grievances of the colonists

against the British government was its restrictions on manufacturing

by Americans. In most cases the pressure to ban certain colonial manu-

facturing came from competing enterprises in Great Britain. For exam-

ple, in 1699 parliament forbade the export of woolen fabrics between

the colonies. Furthermore, in 1732 London declared that the colonies

could not export hats. Finally, in 1750 a Parliamentary act attempted

to prevent the colonies from constructing mills or engine devices for

the purpose of slitting or rolling iron or furnaces for making steel. In

reality, the distance and effort in monitoring these acts proved too diffi-

cult for Parliament and most prohibitions were ignored.

The Impact of the American Revolution

Eventually, the American Revolution eliminated the long-stand-

ing connections and set the new nation on its own course. Indeed, the

Revolution foreshadowed the importance that manufacturing would

assume in the nation in the years ahead. Some industry grew out of the

war effort. Smelting iron in small charcoal furnaces helped to produce

items for the colonial army. George Washington’s winter encampment

in 1777 to 1778, for instance, was at Valley Forge near metal work-

shops. The army also required shoes, caps, uniform items, firearms,

and powder, but the demand surpassed the production capability of

small and fledgling colonial industries. In addition, America no longer

provided Great Britain with raw materials and served as the focal point

for its finished products. The new nation found markets for timber,

tobacco, cotton, and other raw materials in far distant ports from Spain

to the Indian Ocean. After the Treaty of Paris in 1783, the United States

and Great Britain gradually restored their economic ties. This relation-

ship ultimately prevailed in spite of the renewed tensions with Great

Britain during the Napoleonic era and the War of 1812. However, the

development and growth of a national economy was not assured and at

The Industrial Revolution in America

times seemed to advance at only a snail’s pace. Manufacturing was

present but not highly visible and in the early 19th century lagged well

behind that of Great Britain, as only one of thirteen males worked in

the trade or manufacturing sectors. In some respects this disparity was

misleading because a number of farmers continued to serve as rural

artisans and produced manufacturing wares such as soaps, candles,

cloth, and simple tools at the local level. The larger industrial enter-

prises were centered in the towns and cities. In 1787, Philadelphia, for

instance, had some 60 examples of manufacturing but their scale

remained small. Iron foundries did outpace Great Britain but produced

only 30,000 tons a year, an amount about equal to lesser developed

countries today. Nails were so scarce that restless pioneers who moved

often burned down their old houses in order to gather the nails for use

in constructing their new homes. The up-to-date flour mills exported

only 250 tons a year and shoemakers in New England produced only

60,000 pairs a year or one pair for every forty persons in America’s

white population.

Despite this small hint of the potential for manufacturing, the in-

terest in industry that had been piqued by the Revolution waned and

the new nation returned to an emphasis on agriculture and the trade of

foodstuffs and related products. Even such leading figures as George

Washington, Benjamin Franklin, and John Adams advocated that the

country revert to its pre-war practices. The United States had not

adopted or developed the necessary industrial techniques to compete

with Great Britain, which in the first few years following the Revolu-

tion forbade export of technology and impeded access to its markets.

This situation changed with the arrival of Samuel Slater in the

United States in 1789. Slater had been employed by Richard Ark-

wright. He labored to create efficient cotton mills and collaborated

with Moses Brown, a Rhode Island textile pioneer who had previ-

ously failed in his effort to establish a working mill. Within two

years the pair had built a successful machine that had 72 spindles.

After several missteps, Slater and Brown had a mill in operation at

Pawtucket, Rhode Island that employed nearly 100 children under

the watchful eye of adult overseers. Over the next several years more

than two dozen mills of the Slater–Brown type sprang up, although

almost all of these factories failed soon after beginning operations.

Furthermore, until the second decade of the 19th century, manufac-

turing developments in the United States remained haphazard at best

because of a series of bounties, an awkward patent application proc-

ess, claims and counter-claims, little investment of public funds, and

the paucity of technical publications to assist in standardization of

machines and processes.

THE INDUSTRIAL REVOLUTION

Jefferson versus Hamilton

The early republic had a significant debate between two of its

most prominent statesmen on the future of manufacturing and the

prospects for industry in the nation. Thomas Jefferson and Alexander

Hamilton took opposing views and saw a different outcome if the

United States introduced industrial enterprises. Their only area of

agreement was that manufacturing would not occur unless the federal

government and local leaders lent support and encouragement. While

their difference of opinion was real, it should be remembered that nei-

ther Jefferson nor Hamilton understood completely the transformation

of Western economies that was occurring right before their eyes. They

did not have the luxury of looking back in time at the British industrial

model since it had only gained momentum in their lifetime.

Thomas Jefferson had traveled in Great Britain, and he objected

to what he had observed in the early stages of its industrial growth:

poverty, the filthy and overcrowded cities, and a working class with

few rights and no political voice. Jefferson seriously questioned

whether such a society could foster democratic principles. It should be

emphasized that Jefferson was a firm believer in science and technol-

ogy. He experimented frequently at Monticello, his Virginia estate, and

even attempted to supplement his income with the manufacture and

selling of nails. Thus, he did encourage the continued use of home-

based manufacturing, similar to the American enterprises in the colo-

nial period. However, he remained suspicious of larger-scale factories

because he believed such enterprises tended to dominate the cities and

subject the working classes to corrupt influences. Jefferson also

observed that because Europe had cultivated all of its available land, it

seemed only natural that the Europeans had turned to manufacturing

out of necessity rather than choice as the only alternative livelihood

for its people. Jefferson opined that the United States’ situation was

markedly different because of the infinite amount of land stretching

west. This abundant land was ripe for agricultural development, and it

would take nearly the entire population to subdue and improve it for

the benefit of the nation at large. He favored a country populated by

landowners and farmers, persons who tilled the soil and were favored

by God. He considered them proud, highly valued citizens who had

exhibited the admirable traits of vigor, independence, and liberty. Jef-

ferson saw those same cultivators as honest and not easily corruptible,

whereas those involved in manufacturing depended on the capricious-

ness of the buying public and acted in concert with blind ambition,

a characteristic that he claimed led to subservience and the

The Industrial Revolution in America

abandonment of virtue. His creed was that the land, not the workshop,

was the key to the value of work. Agricultural, not mercantile, interests

should dominate the nation’s economic life. A man who had unlimited

freedom of action should live on his land and plan and manage it with-

out any outside or governmental influence. If, for some reason, the

available land had been cultivated over time and the nation had a sur-

plus of farmers, the excess people should turn their economic pursuits

to the sea rather than manufacturing. A national government, while

essential, must not usurp the authority and power of the states, politi-

cal entities that could best safeguard his vision of democracy.

Alexander Hamilton had a distinctly different perspective. He had

an urban background and believed that the federal government should

manage the country’s economy as a whole. Did Hamilton have an in-

kling that something important (we now know it was the Industrial

Revolution) was beginning, even in its early stages during his lifetime?

It seems he possessed just such an intuition and appeared willing to

embrace and encourage it. He rejected Jefferson’s purely democratic

emphasis, stating that such an approach had the potential to break up

the union, an unacceptable outcome that only a strong national gov-

ernment could prevent. He saw the U.S. and British industrial interests

as intertwined, but if Great Britain failed to see the value of such an

economic alliance, America should warm to the French. Yet he also

viewed the United States as a potential rival to Great Britain. Immedi-

ately upon becoming Washington’s Secretary of the Treasury, Hamilton

became a charter member of the New York Manufacturing Society. He

also encouraged his Assistant Secretary of the Treasury, Tench Coxe, to

obtain British industrial techniques by luring textile managers to the

United States to teach their secrets, a venture that proved successful

over time despite a Parliamentary act levying a fine of 500 pounds and

one year in prison for any British subject committing such a transgres-

sion. On one occasion, a man was sent to Great Britain to snoop

around textile mills and make models of machinery to smuggle back to

the United States, and on another Coxe gave a British subject a U.S.

patent for a flax mill that would use Arkwright’s design.

Hamilton conducted exhaustive research on the state of U.S.

manufacturing enterprises. He surveyed a number of revenue collec-

tors and early U.S. cotton, wool, and other industries in the Northeast

to obtain information on the volume of production and prices and

quality of goods. He even set up a trade fair in a committee room of

the House of Representatives with samples of the wares he had gath-

ered in an effort to sway members of Congress to see the utility of fed-

eral support for manufacturing. In 1791 Hamilton published his Report

on the Subject of Manufacturers and submitted it to Congress. In this

THE INDUSTRIAL REVOLUTION

work, Hamilton recommended that the federal government take an

active role in the promotion of manufacturing and that it should enact

import tariffs to protect native goods. Hamilton’s work aimed to rebut

the widely-held Jeffersonian view that agriculture and trade were the

heart and soul of the nation’s economy as they alone provided subsist-

ence to the people. Hamilton conceded that while these pursuits were

indeed important, manufacturing would provide a positive impact on

American society and that the productivity and revenue of the nation

from such enterprises would be higher than without such a capacity.

He argued that the nation possessed the capacity to accumulate enough

capital for development across the country. He also wrote that factories

would surpass local handicraft production because of the division and

specialization of labor. His report implied that factory-produced goods

would find markets abroad and further stimulate the economy. Fur-

thermore, Hamilton believed that his program offered employment to

segments of society not otherwise engaged in business practices and

emphasized that manufacturing served as a magnet for immigrants, a

necessary additional labor component of any economy. In his opinion,

manufacturing also encouraged the development of a variety of talents,

and the resulting increased production would ultimately enlarge the

market for agricultural products. Members of Congress, many of them

landowners themselves, ignored Hamilton’s report, believing his ideas

were too far-fetched for them to embrace.

In the same year as Hamilton’s report to Congress, the New Jersey

state legislature created the Society for Establishing Useful Manufac-

tures (Hamilton himself was one of the sponsors). This organization

had the authority to raise $1 million in shares and had the mission to

support the manufacture of a wide range of items. The Society showed

early promise and had visible support. It was not required to pay local

taxes and was exempted for a decade from paying state taxes. The state

granted the society a large parcel of land near present day Paterson,

New Jersey. Major Pierre-Charles L’Enfant, the individual who planned

the nation’s capital, was hired to lay out the town and its mills. The

state made an initial investment of $10,000, and many local officials

and citizens soon boosted the total to $100,000. The society did not re-

alize its vision. In truth, none of the individuals engaged in the enter-

prise had any manufacturing experience, much of the initial

investment was spent on construction costs, and the early articles pro-

duced could not compete with those from Great Britain. Within five

years the endeavor failed, although the Society remained in existence

until after World War II when it was purchased by the city of Paterson.

It had survived such a long time by selling land for factory locations

and because it controlled the important sources of water in the area.

The Industrial Revolution in America

Thus, the industrial opportunities that arose in America in the

late 18th century failed to gain momentum. Even enterprises such as

the Slater mill projects and the Society for Establishing Useful Manu-

factures had only temporary success because the nation seemed con-

tent to rely on agricultural exports to finance the purchase of

European manufactured goods. Nonetheless, Hamilton’s vision eventu-

ally was validated although in the near term the prejudice for agricul-

ture remained strong; the country lacked both infrastructure, and an

adequate supply of skilled labor and persons with sufficient capital to

invest shied away from the risk. However, the trend toward industrial

development in the long term was unstoppable. The transition

occurred, albeit slowly, for several reasons. First, a few manufacturing

enterprises such as cotton goods, arms making, and flour milling

emerged to match British competitors. Second, proponents of manu-

facturing argued that sufficient labor existed in the form of women and

children and that men could remain employed on the farm. Finally, the

shortage of capital for investment could be supplied by the state

through the extension of credit and enhanced by a strong currency.

These developments supported Hamilton’s viewpoint. Even Thomas

Jefferson, after witnessing the stress that the War of 1812 had placed

on the country, conceded before his death in 1826 that manufacturing

was a worthy partner with agriculture and trade to ensure the health of

the nation’s economy and maintenance of its liberty.

The 19th Century

Beginning in 1800 the pace of change quickened in the United

States. By the late 19th century, the United States would grow to rival

Great Britain as the most powerful industrial nation in the world. The

rate of change was dramatic. On the eve of the 19th century, the United

States had roughly 4 million people and the nation was still predomi-

nantly rural, with approximately 3.7 million persons employed in agri-

cultural pursuits. The nation’s population was divided half and half

between the North and South, although some 700,000 slaves were

included in the latter. Urban living was a rarity. There were no cities

with a population in excess of 50,000 persons, only two with a popula-

tion more than 25,000, three with 10,000 to 25,000 persons, seven

with 5,000, and only a dozen with 2,500. On the eve of the Civil War,

the United States had acquired a different complexion. Although a ma-

jority of workers still toiled on the land, the population had increased

six times to over 30 million. Whereas in 1790 relatively few people

lived west of the Appalachian Mountains, in 1860 half of the nation’s

THE INDUSTRIAL REVOLUTION

population resided there. The shift in population from rural to urban

began to accelerate. The nation began the new century with a birthrate

of 55 per 1000, an incredibly healthy rate that reflected the push west

for land and the necessity of farming families to have as many hands as

possible for labor.

In 1820 one person in twenty lived in a city of

8,000 or more persons, in 1840 it was one in twelve, and in 1850 it

was one in seven. The old cities of New York, Boston, and Philadelphia

had new rivals such as Pittsburgh, Cincinnati, St. Louis, and Louisville

springing up along the Ohio and Mississippi Rivers. Nine American

cities had populations in excess of 100,000 persons. Furthermore, the

population increase and westward expansion resulted in an increase in

the number of states from 16 to 39 on the eve of the Civil War.

The economic relationship that had been restored between the

United States and Great Britain following the American Revolution

experienced fundamental challenges as a result of warfare in the first

two decades of the 19th century. The Napoleonic Wars changed the

dynamic as Napoleon’s Continental System attempted to strangle

Great Britain by preventing British goods from entering Europe. In

retaliation, Britain aggressively attempted to sever the lines of raw

materials headed for France. As the contest evolved, each side vied for

advantage by stopping and searching all ships, even from neutral

nations. President Jefferson countered with the Embargo Act of 1807

that halted all American vessels from departing the country for foreign

destinations. The embargo had two different outcomes. Those individ-

uals and firms engaged in the export business suffered terrific losses

of revenue as the demand for United States’ exports declined precipi-

tously from $108 million to just $22 million in the first year. On the

other hand, manufacturers who could make articles formerly bought

abroad found a brief but profitable niche. Before 1808 only fifteen cot-

ton mills existed in the United States. By 1809 more than one hundred

cotton mills were in operation, and more continued to be built for the

next three years. A report issued during the middle of the war

recorded that there were 76 cotton factories containing more than

50,000 spindles in operation within a thirty-mile radius of Providence,

Rhode Island.

However, after 1812 the situation reversed itself. An unfettered

wave of British goods flowed into the country and undermined the

infant industries that had emerged just several years prior. Further-

more, the imposition of additional tariffs after the War of 1812 ended

merely accumulated additional revenues and did little to stimulate

growth of America’s young industries. Even the major tariff passed in

1828, referred to as the ‘‘Tariff of Abominations’’ by Southern agricul-

tural interests because it increased the cost of imported manufactured

The Industrial Revolution in America

goods, was in reality a resurrection of the anti-Hamilton economic

views and brought the nation to the brink of a political crisis in the

early 1830s.

At that moment, however, the nation was poised to take its next

step in the industrialization process, one that took the form of new

factory enterprise approaches and the creation of a transportation net-

work that stimulated a market revolution. On the surface, the United

States potential for industrial growth in 1815 seemed to be no stron-

ger than the situation in 1800. The nation was still one of farmers.

Only ten percent of the population lived in urban areas, defined as

communities with 2,500 or more residents. In the American South

the number was half that amount. The dominant economic pursuits

in these cities still revolved around merchant business, sea trade, sim-

ple handicrafts, or service activities that supported these endeavors. It

is estimated that the total number of factory workers in textile, iron,

saw mills, paper mills, and flour mills numbered no more than

15,000 persons.

In 1815 the nation faced several challenges if it was to realize any

ambition for industrial development. First, the geographical magni-

tude of the United States posed an impediment to industrialization,

especially since the country expanded and consolidated so rapidly af-

ter 1815. Great Britain, with its relatively compact size, an intricate

port, river, and canal network, and short distances between natural

resources and industrial centers, did not have to contend with con-

structing an infrastructure to overcome the obstacle of the sheer

breadth of a nation like the United States. Indeed, no town in Great

Britain was situated farther than 70 miles from the sea, and by the early

19th century the country had approximately 20,000 miles of roads and

an important network of canals. In many respects the United States

remained a rough and primitive country. In 1815 it took a yoke of

three oxen three days to make a round trip between New York and Bos-

ton. Furthermore, the overland transport of items such as iron or corn

might be greater than transatlantic shipment and could only sustain a

profit by moving them only a few miles from their source. Second, the

shortage of labor was also a key hurdle. As a result of the enclosures,

Great Britain had experienced a long, steady transition of its labor sup-

ply (men, women, and children) from the rural areas to the factories in

the cities. The situation in the United States was similar in that a popu-

lation boom was underway, but there was also an abundance of land to

occupy and own. Third, despite some flashes of individual technical

ingenuity such as the invention of the cotton gin and the perfection of

steam powered transportation on waterways, the United States lacked

sufficient capital investment to finance the construction of machines

THE INDUSTRIAL REVOLUTION

necessary for the factory system to operate profitably. During the last

three decades before the Civil War, these three obstacles would be

overcome through the creation of a vast transportation network, the

employment of women, children, and immigrants in the mills, and the

growth of technological capabilities to support new transportation and

factory organizations.

Transportation—Roads

The impetus for the creation of a wide-ranging transportation

network began in the early days of the new nation. The turnpike sys-

tem, a combined effort of private investors with state support, began in

the 1780s. The first turnpike was constructed in Virginia in 1785, and

the Philadelphia to Lancaster, Pennsylvania turnpike was completed a

decade later.

During Thomas Jefferson’s second administration, seri-

ous discussions took place about linking the nation together north–

south and east– west through the construction of roads and canals. The

proposal ran into partisan and sectional bickering and did not move

forward beyond the national government’s building of one major over-

land turnpike, the National Road or Cumberland Road. The construc-

tion for this road took place from 1811 to 1839. Originating in

Cumberland, Maryland, the road ran initially through what is now

Wheeling, West Virginia on the Ohio River and eventually through

Columbus, Ohio and Indianapolis, Indiana to its termination at Van-

dalia, Illinois, the original capital of the state of Illinois. Until the 20th

century and the appearance of a federal highway program, the National

Road was the only endeavor of this type constructed under the aus-

pices of the national government. Congress mandated that the road

have proper grading and be sixty-six feet wide with its surface of stone

covered by gravel. All bridges were also constructed of stone. The orig-

inal portion of the road opened in 1818, and soon a steady stream of

wagons, people, and animals poured westward. By the time the final

phase of construction reached Vandalia, much of the earlier portions

had fallen into disrepair. The last segments of the road also presented

problems because of improper leveling and the failure to remove even

tree stumps from the road.

Besides the National Road, private and state interests became

involved in road construction. Between 1800 and 1810 the number of

state governments and private enterprises seeking to make a profit in

turnpike construction swelled from 72 into the thousands. New York

had almost 400 toll roads, although many were difficult to traverse.

The significant consideration in road construction was its cost, not the

benefits offered by more rapid or efficient transit, as evidenced by the

The Industrial Revolution in America

fact that the roads built took a direct route between points rather than

the longer but less obstructed passage over flat terrain and through val-

leys. The utility of the early roads also suffered from the ravages of the

weather, which often left them as streams of mud, or legal provisions

that permitted stumps or obstacles to remain on the thoroughfares. By

1840 substantial private investment had been made in turnpike con-

struction: more than $6 million in New England and a similar amount

of combined public and private money in Pennsylvania alone. This im-

pressive investment must be tempered by consideration that nearly

half of the turnpikes had failed either partially or wholly by this time

because of lack of proper planning or poor supervision and construc-

tion. Nonetheless, the steady carving out of routes for travel helped the

economic growth in America and set the stage for the next develop-

ments in transportation.

Transportation—The Erie Canal

Turnpike construction waned not only because of the heavy

investment and physical effort required but also because of a new

venture—canal construction. Of course, the British had engaged in

canal construction and proved its worth since the 1760s. The U.S.

government had in fact considered the viability of canals during the

debate surrounding the construction of the National Road. However,

the serious impediment involving canals was the exorbitant cost

when compared with building roads. Turnpikes cost between $5,000

to $10,000 per mile to construct, and in most cases took only several

years to complete. Canals, on the other hand, cost between $8,000 to

$25,000 per mile, depending on the terrain, and took a decade or

longer to construct. The United States only had about 100 miles of

canals in operation in 1816, and most of them were only several miles

in length.

Canal construction hit its zenith with the Erie Canal. The idea for

such a project arose in the late 1760s with a proposal to connect the

Hudson River with Lake Ontario near Oswego, New York. In 1792 the

New York state legislature chartered the Western Inland Lock Com-

pany to construct such a water route by linking the Mohawk and

Oneida Rivers and Oneida Lake. The project faced insurmountable

problems in financing and construction, and thus the company con-

structed only a one-mile bypass around the Little Falls of the Mohawk

River. The company’s toll collections barely kept the canal in opera-

tion. The work of the company did inspire other political and business

officials to expand their vision and push for the construction of a canal

that would link the Hudson River and Lake Erie. The most prominent

THE INDUSTRIAL REVOLUTION