The Economic Riddles of the Institution of Slavery - Assignment Example

The Economic Riddles of the of Slavery Introduction The long-established analysisof the economics of slavery in the United States is evidently wide-ranging and intricate: slavery was economically primitive, unproductive, and futile (Thornton 1994). Fogel and Engerman (1974), in their work Time on the Cross, summed up this traditional view in five major premises: 1,… slavery was generally an unprofitable investment…; 2,… slavery was economically moribund; 3,… slave labor, and agricultural production based on slave labor, was economically inefficient; 4,… slavery caused the economy of the South to stagnate, or at least retarded its growth…; 5,… slavery provided extremely harsh material conditions of life for the typical slave (Fogel & Engerman 1974, 169). Yet, Fogel and Engerman (1974) argued against the above premises and argued instead that slave labor was more economically efficient than free labor. Hence, the question is, what given this argument, were there economic reasons which would have put an end to slavery? This paper attempts to answer this question. Overview of Fogel and Engerman’s Argument Fogel and Engerman (11974) debunked the belief that free agriculture was more efficient than slave agriculture. In order to support their thesis, they computed the ‘ratio of output to a weighted sum of inputs’ (Thornton 1994, 36) in free and slave agriculture, and compare the results. Rooted in a historical procedure that depends on the unearthing of new information and depends on ‘technical mathematical points’ (Thornton 1994, 37), this model transformed slavery in the antebellum South from an oppressive structure to one that is currently regarded to have been more efficient and cost-effective than the North’s free labor structure. The main contribution of Fogel and Engerman was to prove that slavery was quite cost-effective and more efficient than free agriculture. They discovered that slavery was also efficient in the urban areas. In fact, while the antebellum South progressed in a remarkable pace, slavery became increasingly ingrained and slaveholders predicted unparalleled wealth on the advent of the Civil War (Thornton 1994). They discovered slaves to be diligent, determined, and more competent than the White ones. They discovered that the common situation of the black community, particularly the degree of slave breeding, licentiousness, and sexual abuse, to have been very much overstated or inaccurate (Thornton 1994). In reality, the material or physical situations of the slave were not considerably different from that of the free worker; they assumed that slaves were permitted to own ’90 percent of lifetime productivity (only 10 percent exploitation)’ (Thornton 1994, 25). Therefore, if the assumption of Fogel and Engerman is valid, then what were the possible economic reasons for the demise of slavery in antebellum South? Economic Inefficiency of Slave Labor Given Fogel’s and Engerman’s argument, free labor and slavery becomes similar to servitude in the sense that they may give to the owners all the profits of trade beyond what is needed for the subsistence of the workers; but they have this distinction, relevant for American rationales, that they allow labor to be geographically transferred, as servitude keeps it provincially bonded. By opting for these enabling types of servitude instead of the one which would have tied the workers to the land, the pioneers of the colonial administration in trade probably believed they had prevented all economic obstacles in the territories. Nevertheless, their mechanism was projected to resolve the problems of a situation where the option was between free labor and slave labor. As decades passed and laborers mushroomed in America, the servitude structure for White settlers was rapidly abolished; but bonded labor or slavery for most of the Negroes continued as an essential aspect of economic life (Phillips 1959). Whether this was beneficial or unfavorable to the success of employers and to the wellbeing of the community became eventually an issue to which intellectuals all over the world used their talents. Starting with a description of the relative primitiveness of the South in economic progress, several scholars argue, mostly in reaction to Fogel’s and Engerman’s controversial thesis, that the institution of slavery is the root of the South’s backwardness. Primarily, slavery weakened the economy be debasing labor; but more importantly, it obliged employers or owners to invest substantial sums in the hiring of workers instead of allowing them to compensate for labor out of existing revenues. It thus hindered the progress of producers, for in such areas, and in trade, “the fact that slavery absorbs the bulk of Southern capital must always present an obstacle to extensive operations” (Phillips 1959, 349). Slaveholding does not improve production at all, because demolition of the property or bonded labor by slave emancipation would not damage the efficiency of their labor. Thus all the individual prosperity which has taken that shape has contribute nothing to the community’s riches: “Slavery merely serves to appropriate the wages of labor—it distributes wealth, but cannot create it” (Phillips 1959, 349). It entails cost in obtaining early population, then functions to hamper industry diversification and land developments, limiting, in fact, even the expansion of agriculture. The control which the South has benefited from in the production of major goods has alleviated the problems of slavery, but simultaneously has developed and enlarged the system to the extent of massive damage to the public. The persistent preservation of the institution of slavery would bring great disadvantage to the owners, because the need of Southwest for slaves would diminish, and nothing but an immense progress of cotton prices and limitless reserves of productive properties for its production could maintain the prices of slaves (Phillips 1959, 350): “It is evident that the Southern country approaches a period of great and sudden depreciation in the value of slave property.” Conclusions Fogel’s and Engerman’s (1974) mathematical debunking of the backwardness of the South was applied by several other scholars in the period defending the economic contribution of slave agriculture or labor. Several scholars in the debate regarded the issue as an issue of pure theory; some scholars like Fogel and Engerman (1974) studied not just the abstract ratio of the efficiency of free and slave labor but added in their model the variable of Negro racial attributes and the opportunities and possible impacts of abolition under current conditions. On the one hand that a common slave might be assumed to complete less in an hour’s labor compared to a common free worker, consensus was undisputed; on the other hand, on almost every other point the arguments were quite contradictory as to create confusion among the general public. References Fogel, R.W. & S. Engerman. Time on the Cross: The Economics of American Negro Slavery. Boston: Little, Brown and Company, 1974. Phillips, U.B. American Negro Slavery: A Survey of the Supply, Employment and Control of Negro Labor as Determined by the Plantation Regime. Gloucester, MA: Peter Smith, 1959. Thornton, M. “Slavery, Profitability, and the Market Process” The Review of Australian Economics 7.2 (1994): 21-47. Read More