Wednesday, February 3, 2010

Economic Conditions in 1789 (2)

Hamilton's investigations showed that there were seventeen distinct branches of manufactures which were carried on as regular trades and which had attained a considerable degree of maturity. Naturally these industries were closely related to raw materials which the country then afforded. As examples may be mentioned the following: manufactures of leather, trunks, gloves, parchment, and glue; tanneries were numerous, and foreign competition was hardly to be feared. From iron came bar and sheet iron, rods and nails, stoves, household utensils, and implements of husbandry, some edged tools and hollow ware. There was an abundant supply of charcoal, and iron ore of almost every quality was abundant; one-half of the steel consumed in the United States was home-made. Of copper there were manufactures of wire, utensils for distillers, sugar refiners, and brewers, and articles for household use. Timber was the raw material of ships, an industry which had been carried to a high point of perfection; there were also manufactures of cabinet and coopers' wares. From grain came flour, and also the important products of ardent spirits and malt liquors; the rum distilleries of Massachusetts were dependent for their raw material upon the molasses of the West Indies, but in the Middle States stills were common for the distillation of the home grains and fruits ; the largest part of the malt liquors consumed was the product of domestic breweries. From flax and hemp were .produced cables, sail-cloth, cordage, and twine, and though the manufactures were not large, there was a promising beginning. Manufactures of paper were well advanced, and entirely " adequate to national supply." Different manufactories of glass were on foot, and among the extensive and prosperous domestic manufactures were those of refined sugars and chocolates. In addition there were manufactures of bricks and pottery, hats, oils of animals and seeds, tin-ware, carriages, snuff, starch, painters' colors, and gunpowder. The variety of these manufactures was no more striking than the resourcefulness in household manufacture ; industry as a whole was in the handicraft stage ; cloths of wool, cotton, and flax were thus produced in the greatest variety; and in some districts from two-thirds to four-fifths of all the clothing of the inhabitants was made in the home. Woolen manufactures were only beginning to take a place as a factory industry, while the establishment of cotton mills was not much more than a prophecy.

The means of internal communication were undeveloped. The Hudson River was navigable 180 miles from the ocean; the Delaware 160; and the Potomac 300 miles above the falls near Georgetown. A few short and narrow canals had been constructed. Roads were everywhere poor and transportation was slow. In 1790 there were but 75 post-offices; mails were infrequent, as, for example, but three per week between New York and Boston, requiring in the best of weather five days on the road. These impediments to travel and intercourse constituted an important element of friction which needs to be thoroughly appreciated as a partial explanation of the difficulty of imposing internal taxes which would be acceptable to the whole country.

The foreign trade can be described more definitely. The Americans had long enjoyed an economic advantage in the building of ships, and the enterprise of those engaged in the fisheries had developed a skilful and daring race of sailors. The country exported its surplus products of agriculture and forestry, and with the proceeds bought freely of luxuries and manufactures which were not available at home. The value of the exports at this time was about $20,000,000, and that of the imports probably about the same. Trade returns are, however, too incomplete to present a satisfactory analysis of foreign commerce, particularly of imports. As in the colonial period, exports to the West Indies provided funds with which to pay for imports from Europe.

A general survey of economic conditions must also take into ; account the growth of sectional interests. Slavery in the South was developing an economy of its own ; New York and the New England cities were strongly inclined to commercial undertakings ; Pennsylvania was awakening to the possibility of manufactures. These several interests were to furnish storm-centers in the debates and govern the discussion of economic questions.

Source of Information: Financial History of the United States by Davis Rich Dewey, PH.D., LL.D., Fourth Edition; Longmans, Green and Co. 1912

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