Liberty Matters

Much Was Unwell with the Cotton Economy

My own personal discovery of Leggett came from philosophical frustrations when navigating the politics of the Jacksonian era. I can relate to both Anthony and Larry in this sense – first, in seeing the liberal idealism of the Jeffersonians succumb to the toxins of slavery, and second in finding a historical literature on antebellum banking and tariffs that at times seemed oblivious to the corrupting influence of special- interest lobbying – or rent extraction in the modern sense - upon policy outcomes in these arenas. Leggett offered it all. He was a small-"d" democrat who retained the decentralized spirit of the Tertium Quids but minus the unwarranted valorization of agrarian life and the moral corruption of accommodating and eventually embracing slavery. And yet he also cut through a political narrative that presented economic debates as the opportunistic three-way contest between Jackson, John C. Calhoun, and Henry Clay. A free-trader and free-banker who understood that political interests often captured economic-policy institutions and redirected them to self-serving ends, Leggett offered an invaluable unromanticized critique of the lofty rhetoric behind the American System and the bombastic political posturing of the nullificationists.
I wanted to offer a few additional thoughts, though, on Brian's insightful continuation of the running discussion around slavery's economic dimensions. Brian asks us to consider a fundamental conundrum presented by the slave system's political entrenchment vis-à-vis its economic position, namely, how to wean the country from this morally destructive system:
Very few slaveholders followed John Randolph's and George Washington's lead and voluntarily freed their slaves. An older generation of scholars thought that slavery might die a natural laissez-faire death, but most economists and historians (even those using the best data) no longer see that as likely. The question then is who or what would have stopped the slaveholders' violation of the slaves' natural rights and thwart the holders' general legal dominance.
This question presents no easy answer, but it also serves as a reminder that the political critique of slavery's entrenchment found in much of Leggett's work is also historically linked to economic indictments of the slave system.
The "natural death" argument seems to be unsupported in the available evidence, but its underlying intuition is informative. This argument held that slavery suffered from comparative economic inefficiency when juxtaposed with a free-labor alternative. Faced with the disadvantages of coerced labor and growing industrial competition, the slaveowning regions would begin to lag economically. Free labor, it followed, would eventually win out.
Even at the late-antebellum peak of the southern cotton economy, several observers saw structural weaknesses in the economic status quo. Frederick Law Olmstead's blistering travelogue of the American South, published between 1852 and 1857, lent credence to the notion that slavery served as an economic retardant in the region. Edward Atkinson similarly provided statistical heft to this position during the Civil War, publishing detailed maps of the South that posited rampant inefficiency and misuse of cotton-growing land as a result of the labor-market distortions caused by slavery. Southern partisans such as Fitzhugh and DeBow reacted to these and other similar data points by denying that slavery was the cause, but also by ramping up their respective cases for a slave-based industrialization program across the region.
Such accounts are historically important not because they presaged a natural economic demise, but because they illustrate that much was structurally unwell with the cotton economy, whether we designate it as capitalism or something else. Slavery's persistence then in spite of its comparative economic woes thus becomes a conundrum that can only be explained through its political entrenchment. Adam Smith, one of the main originators of the efficiency critique of slavery's economics, was also among the first thinkers to notice its intractable political persistence. "The persons who make all the laws in that country are persons who have slaves themselves," Smith explained, and as such "will never make any laws mitigating their usage; whatever laws are made with regard to slaves are intended to strengthen the authority of the masters and reduce the slaves to a more absolute subjection."[54] The problem of slavery was not a feature of capitalism but of governance. Furthermore, as Smith observed, democratic governance (albeit constituted among landed whites) seemed to politically entrench the institution with even greater fervor than arbitrary or monarchial rule.[55]
What this meant for the American slave system in 1835 or 1860 is a contest between its liberal adversaries and its small but often homogeneous and politically entrenched economic beneficiaries. It is therefore interesting to ponder how Leggett might have proceeded were it not for his early death. Some who shared his economic disposition and rhetorical fervor eventually turned to arms. Atkinson, himself an adherent of the old free-trade doctrine, became a financier of the John Brown conspiracy. Others, such as Leggett's patron Bryant, cast their lot with the political channels of the Republican Party, only to find it stumbling through an eventually successful, but also unimaginably destructive and costly, war that at first seemed to muddle its way through the moral considerations attached to its triggering cause. One has to ponder the idea of Leggett's own pen being turned loose once again upon the political classes of his day, placing the blame – as Smith had done before him – on their centuries-long complicity with the brutal instruments of chattel-slave production.
[54.] Adam Smith, Lectures on Jurisprudence, (Indianapolis, IN: Liberty Fund, 1982) p. 181.
[55.] Adam Smith, The Wealth of Nations, Book IV, Chapter VII.