Figure 1.--

The English implanted their economic and political system along the coast of North America (17th century). It was not at first a capitalist system. The English colonies developed along two different lines, booth with an sgricultural base (17th and 18 centuries). The northern colonies were small family farms combined with handicraft subsistence. English laws prohibited the development of industry least the colonies compete with the mother country. Raw materials such as timber were shipped to England. And the colonies in the 8h century develooed a maritime trade. The colonial merchant fleet was small by British standards, but substsatisal in European terms. Another factor was the importance of the Puritans and Calvinidst teachings in the northern colonies. The southern colonies developed along a more agricultural path based on slave labor. During the British colonia era the major export crop was tobacco. The second period of America's econnomic development might be called the Ante-Bellum era or the period between Independence (1776-83) and the Civil War (1861-65). America at first seemed an unlikely place for the world's great capitalist power to develop. It is not surprising that Marx largely ignored America in his work. Not only was the country split between free and slsave labor, but the majority in the north were confirmed agrarianists deeply suspicious of banks, merchants, and cities. The first Secretary of the Treasury, Alexander Hamilton, used capitalist financing to put the new Federal Government on a sound financial footing. But the expanding demoritization of the sufferage elected a populist president, General Andrew Jackson, who destroyed the Bank of the United States causing a depression. During this period, several industries began along capitalist lines. English capital played a major role in this development by financing northerrn economic expsansion, especially building railroads. An Americans as well as European emigrants introduced a range of the technical innovations. Agriculture in the north increasing shifted from subsistence to producing market crops. And America continued its maritime tradition. Most of this economic innovation occurred in the North. Ironically, soon after independence, a northerner Ely Witney's invented the cotton gin which invigorated the Southern plantation system. The South built a hugely profitable agricultural economy based on slave labor and the platation production of cotton. While radically different, the two regional economies were not unrelated. Export earmings from cotton helped finance indusrial expandion in the North. his industrial expansion would lead to the destriction of the Ante-Bellum South in the Civil War (1861-65). It was in the third era that America developed as a capitalist industrial behemoth (1865-1929). Populist suspicion of capitalism did not disappear during this period, although it was weakened by the defeat of the Southern Condederacy. A number of factors contributed to this extrodinary growth. Economists will argue as to the relative importance of the various factors. There was the invaluable contribution of English law and a stable political system which protected property. Emigration brought both workers and individuals with technical skills. Important scientists continued to work mosly in Europe, but many technical innovations occurred in America. An the Jeffersonian-Jacksonian suspicion of a strong central government served America well during this period. The Federal and state governments placed few impediments and a very limited tax burdsen in the path of industrial expansion. In fact government promoted the expansion by distributed 131 million acres of land grants to encourage railroad construction (1850-72).

English Colonial Period (17th and 18th Centuries)

The English implanted their economic and political system along the coast of North America (17th century). It was not at first a capitalist system. The English colonies developed along two different lines, booth with an sgricultural base (17th and 18 centuries). The northern colonies were small family farms combined with handicraft subsistence. English laws prohibited the development of industry least the colonies compete with the mother country. Raw materials such as timber were shipped to England. And the colonies in the 8h century develooed a maritime trade. The colonial merchant fleet was small by British standards, but substsatisal in European terms. Another factor was the importance of the Puritans and Calvinidst teachings in the northern colonies. The southern colonies developed along a more agricultural path based on slave labor. During the British colonia era the major export crop was tobacco.

Ante-Bellum Era (1783-1865)

The second period of America's econnomic development might be called the Ante-Bellum era or the period between Independence (1776-83) and the Civil War (1861-65). America at first seemed an unlikely place for the world's great capitalist power to develop. It is not surprising that Marx largely ignored America in his work. Not only was the country split between free and slsave labor, but the majority in the north were confirmed agrarianists deeply suspicious of banks, merchants, and cities. The first Secretary of the Treasury, Alexander Hamilton, used capitalist financing to put the new Federal Government on a sound financial footing. But the expanding demoritization of the sufferage elected a populist president, General Andrew Jackson, who destroyed the Bank of the United States causing a depression. During this period, several industries began along capitalist lines. English capital played a major role in this development by financing northerrn economic expsansion, especially building railroads. An Americans as well as European emigrants introduced a range of the technical innovations. Agriculture in the north increasing shifted from subsistence to producing market crops. And America continued its maritime tradition. Most of this economic innovation occurred in the North. Ironically, soon after independence, a northerner Ely Witney's invented the cotton gin which invigorated the Southern plantation system. The South built a hugely profitable agricultural economy based on slave labor and the platation production of cotton. While radically different, the two regional economies were not unrelated. Export earmings from cotton helped finance indusrial expandion in the North. his industrial expansion would lead to the destriction of the Ante-Bellum South in the Civil War (1861-65).

Industrial Development (1865-1930)

It was in the third era that America developed as a capitalist industrial behemoth (1865-1930). Populist suspicion of capitalism did mnot disappear during this period, although it was weakened by the defeat of the Southern Confederacy. A number of factors contributed to this extrodinary growth. Economists will argue as to the relative importance of the various factors. There was the invaluable contribution of English law and a stable political system which protected property. Emigration brought both workers and individuals with technical skills. Important scientists continued to work mostly in Europe, but many technical innovations occurred in America. One would have expected that the great technical innovations of the age would have come out of European universities ad scientific institutes. Some did, much a huge number of major innovations of emense economic importance came from America workshops and were often made by indivisduals of minimal education. The major factor seems to hsave been the economic system respoding to the innovations and not the qualiy of the scientific community. And the Jeffersonian-Jacksonian suspicion of a strong central government served America well during this period. The Federal and state governments placed few impediments and a very limited tax burdsen in the path of industrial expansion. In fact government promoted the expansion by distributed 131 million acres of land grants to encourage railroad construction (1850-72). The Progressive Era and America's democratic system began in the late-19th century to shift popular attitudes to the role of government in the economy. The end of this era of induustrial development came wih the Wall Street Crash (1929) and resulting Deopression.

Created: 12:55 AM 8/24/2009
Last updated: 12:55 AM 8/24/2009