Restricted Economic Historians: the South was a prosperous agricultural region

Desert Kid

2nd Lieutenant
Joined
Dec 3, 2011
Location
Arizona
I believe Mr. Ransomsbooms book seems to justify the claims of Mississippis Justification for secession, interms of economics.

That the Southern system of Chatel Slavery was economically viable, is hard to refute. If Economics is the only criteria to judge viability.

Yes, and even after the abolition of slavery the cotton economy did bounce back to it's pre-war productivity by the end of the 1870's. The Age of the Cotton Barons as it was lasted all the way up into the 1910s. The Boll Weevil still killed it, and forced an economic diversification, and the cotton economy of the Mississippi Delta never came back from it.

I've long posited, had the CSA become independent, chattel slavery would have lasted roughly 40 more years. The Boll Weevil would still cross into Texas and ravage the cotton states until slavery is abolished by either populist mandate, or near economic collapse between 1900-1910.
 

OpnCoronet

Lt. Colonel
Joined
Feb 23, 2010
Yes, and even after the abolition of slavery the cotton economy did bounce back to it's pre-war productivity by the end of the 1870's. The Age of the Cotton Barons as it was lasted all the way up into the 1910s. The Boll Weevil still killed it, and forced an economic diversification, and the cotton economy of the Mississippi Delta never came back from it.
I've long posited, had the CSA become independent, chattel slavery would have lasted roughly 40 more years. The Boll Weevil would still cross into Texas and ravage the cotton states until slavery is abolished by either populist mandate, or near economic collapse between 1900-1910.
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More or less true enough, but, in ref. to the OP, the book reviewed seems to prove that according to the economi theory of the time and the indices used to descrie them, the South ws a prosperous agricultural area.of the United States.

The problem with the Southern system of Slave based economy was generally social and Political in particular not economic.

As you note, the southern economic system and its social order that it supported, continued long after the Lost Cause was lost and that was because the Civil War settled the unequal representation of between the Northern and Southern states in Congres, i.e., before the CW Slaves counted in counting of state representatives, after the war, through disenfranchisement of the ex slaves, they were effectively not counted at all.
 

John S. Carter

Sergeant Major
Joined
Mar 15, 2017
In Eufaula,Al. there is or was unless the storm took it down ,a statue to honor the boll weevil .The reason is thanks to that weevil being so destructive to the cotton crop and then with the scientific research by George Washington Carver into the peanut .The South became the Capital center of Peanut production .You may be interested in knowing that Dr.Carver took a plant that was used as feed for hogs into one of the most useful plants not just for sports games but also for medicine.Thank you , Mr.Peanut.He research into soil production ,sweet potato,and pecans.Good work for a man born a slave in1860.
 

OpnCoronet

Lt. Colonel
Joined
Feb 23, 2010
In economic and agricultural terms, the South was, potentially, as prosperous as any other section of the Country, pre and post Civil War. But, was it any more properous than the North during the ante-bellum years as Southern leaders often tried to claim at the time ?
 

lurid

First Sergeant
Joined
Jan 3, 2019
Of course the wealth generated is tied to its immorality. My only point is that the wealth generated was real.

We can't just deny that this wealth was created simply because we don't like the way it was created. The reasoning for slavery cannot be understood without knowing that it generated a lot of wealth for enslavers, and others who benefitted from the economic output of slavery. Indeed, knowing about this wealth enables us to understand, for example, why some people might start a civil war to protect it.

- Alan

I do understand how you are calculating "a lot" of wealth? It appears, slavery supposedly accumulated a lot of wealth for about 30 years from 1830-1860, but what kind of wealth was it? Was it nominal or real wealth? The reason people don't understand the true value of a slave and slave/cotton production is that they cling to old-fashioned economic historian's commentary. To be frank, those old economists got it wrong. They were naturally onto something, but they made accounting errors that inflated the slave's value and the value of cotton production, or they just didn't know how to calculate the real formulas to give an accurate estimation. I'm talking purely from a real GDP and real wealth standpoint. You have to be talking from nominal wealth standpoint because in terms of real wealth it was not what appeared to be.

From a classical economic standpoint slaves would not be considered real wealth for a couple of reason(s). First, the slave's value fluctuated in boom and bust cycles that was/is common for a commodity like cotton. In other words, the slave's 1860 value was a result of cotton being in a boom cycle from 1830-1860, but that value would not have held its 1860 worth in a bust cycle. The four decades prior to the CW cotton was in boom cycle, which the demand for it increased every decade and the demand for labor increased along with it. The demand for cotton and the demand for slaves ran parallel, and the value of a cotton slave ran parallel with cotton production. The more cotton that was produced the more value of a slave increased. Conversely, the less amount of cotton production the decrease in the slave's value. That 1860 value never would have stood the test of time in the subsequent cotton bust in the second half of the 1800s.

The problem that economists run into is that emancipation hindered a quantitative analysis on the value of the slave during a bust cycle that occurred during the four decades following the CW. Nevertheless, paradigms of cotton demand can easily determine that slave's value was not remotely as high in a bust cycle than boom cycle. Therefore, the slave was a volatile asset because there were variables that fluctuated the value of a slave, which means it was a risky investment. Moreover, the slave was a non-liquid asset that could not be easily converted to cash. Who was going to buy the slaves at their 1860 value? Assure you nobody outside the south would have bought them, therefore, the slave was an White Elephant investment. Therefore, we can take that $3 billion value for slaves with a grain of salt, it was nominal only.

Furthermore, cotton production value has been exaggerated also from the sect of economic historians that double and triple intermediates, even though they have done it—it was an economic impossibility. That type of accounting error has sored cotton's economic value beyond the scope of the actual GDP. Never happened. People think that because cotton exports made up of 80% of the total exports that it was a huge number. No, the reason why it wasn't a big number was because the USA was closed economy and most of the USA GDP stemmed from manufacturing, transportation, banking and food stuff agriculture. The 80% of exports and tricky, because it did make up the majority of exports but it actually was only 5% of the nation's GDP.

cotton gdp.png

The bottom line, slaves were the south's center of gravity and it's a small wonder why the south went to war. In the seven states where most of the cotton was grown, almost one-half the population were slaves, and they accounted for 31 percent of white people’s income; for all 11 Confederate States, slaves represented 38 percent of the population and contributed 23 percent of whites’ income. The threat of ending of slavery was a potential catastrophic threat to the south's entire economic system. But ending slavery did not remotely end the United States of America's economy, not even close.


Table 1

The Fraction of Whites’ Incomes from Slavery
StatePercent of the Population That Were SlavesPer Capita Earnings of Free Whites (in dollars)Slave Earnings per Free White (in dollars)Fraction of Earnings Due to Slavery
Alabama451205041.7
South Carolina571595735.8
Florida441434833.6
Georgia441364029.4
Mississippi552537429.2
Louisiana472295423.6
Texas301342619.4
Seven Cotton States461635030.6
North Carolina331082119.4
Tennessee25931718.3
Arkansas261212117.4
Virginia321212117.4
All 11 States381353525.9
Source: Computed from data in Gerald Gunderson (1974: 922, Table 1)


In conclusion, there was no doubt that slaves/cotton accrued a lot of wealth for a few people, but how real was it? I think a lot that wealth was on paper, which means a lot of it was nominal wealth.
 

wausaubob

Colonel
Joined
Apr 4, 2017
Location
Denver, CO
It was doomed. For the white people sitting on top of the system, it was highly profitable. But the grinding poverty in which the slaves and many poor whites lived suppressed population growth and caused young people to leave for jobs in the cities or opportunities in the west.
The system was unattractive to immigrants. Hence despite the rapid growth in the south, they were faced with rapidly falling behind the rest of the United States.
1595674056936.png

The cotton south had some prosperous regions. But slavery was numerically fading in Delaware and the western counties of Virginia. Politically, in Missouri and Maryland it was fading away.
 

ForeverFree

Major
Joined
Feb 6, 2010
Location
District of Columbia
I do understand how you are calculating "a lot" of wealth? It appears, slavery supposedly accumulated a lot of wealth for about 30 years from 1830-1860, but what kind of wealth was it? Was it nominal or real wealth? The reason people don't understand the true value of a slave and slave/cotton production is that they cling to old-fashioned economic historian's commentary. To be frank, those old economists got it wrong. They were naturally onto something, but they made accounting errors that inflated the slave's value and the value of cotton production, or they just didn't know how to calculate the real formulas to give an accurate estimation. I'm talking purely from a real GDP and real wealth standpoint. You have to be talking from nominal wealth standpoint because in terms of real wealth it was not what appeared to be.

From a classical economic standpoint slaves would not be considered real wealth for a couple of reason(s). First, the slave's value fluctuated in boom and bust cycles that was/is common for a commodity like cotton. In other words, the slave's 1860 value was a result of cotton being in a boom cycle from 1830-1860, but that value would not have held its 1860 worth in a bust cycle. The four decades prior to the CW cotton was in boom cycle, which the demand for it increased every decade and the demand for labor increased along with it. The demand for cotton and the demand for slaves ran parallel, and the value of a cotton slave ran parallel with cotton production. The more cotton that was produced the more value of a slave increased. Conversely, the less amount of cotton production the decrease in the slave's value. That 1860 value never would have stood the test of time in the subsequent cotton bust in the second half of the 1800s.

The problem that economists run into is that emancipation hindered a quantitative analysis on the value of the slave during a bust cycle that occurred during the four decades following the CW. Nevertheless, paradigms of cotton demand can easily determine that slave's value was not remotely as high in a bust cycle than boom cycle. Therefore, the slave was a volatile asset because there were variables that fluctuated the value of a slave, which means it was a risky investment. Moreover, the slave was a non-liquid asset that could not be easily converted to cash. Who was going to buy the slaves at their 1860 value? Assure you nobody outside the south would have bought them, therefore, the slave was an White Elephant investment. Therefore, we can take that $3 billion value for slaves with a grain of salt, it was nominal only.

Furthermore, cotton production value has been exaggerated also from the sect of economic historians that double and triple intermediates, even though they have done it—it was an economic impossibility. That type of accounting error has sored cotton's economic value beyond the scope of the actual GDP. Never happened. People think that because cotton exports made up of 80% of the total exports that it was a huge number. No, the reason why it wasn't a big number was because the USA was closed economy and most of the USA GDP stemmed from manufacturing, transportation, banking and food stuff agriculture. The 80% of exports and tricky, because it did make up the majority of exports but it actually was only 5% of the nation's GDP.

View attachment 367392

The bottom line, slaves were the south's center of gravity and it's a small wonder why the south went to war. In the seven states where most of the cotton was grown, almost one-half the population were slaves, and they accounted for 31 percent of white people’s income; for all 11 Confederate States, slaves represented 38 percent of the population and contributed 23 percent of whites’ income. The threat of ending of slavery was a potential catastrophic threat to the south's entire economic system. But ending slavery did not remotely end the United States of America's economy, not even close.


Table 1

The Fraction of Whites’ Incomes from Slavery
StatePercent of the Population That Were SlavesPer Capita Earnings of Free Whites (in dollars)Slave Earnings per Free White (in dollars)Fraction of Earnings Due to Slavery
Alabama451205041.7
South Carolina571595735.8
Florida441434833.6
Georgia441364029.4
Mississippi552537429.2
Louisiana472295423.6
Texas301342619.4
Seven Cotton States461635030.6
North Carolina331082119.4
Tennessee25931718.3
Arkansas261212117.4
Virginia321212117.4
All 11 States381353525.9
Source: Computed from data in Gerald Gunderson (1974: 922, Table 1)


In conclusion, there was no doubt that slaves/cotton accrued a lot of wealth for a few people, but how real was it? I think a lot that wealth was on paper, which means a lot of it was nominal wealth.

The value of a lot of assets exist on paper. The value of homes exists on paper. The value of stock exists on paper. It's not until, for example, that an asset is sold can we know the real or realized value of an asset. (Of course, the realized value which can also be affected by things occurring at the time of the negotiated transaction that can make the realized value different from the actual value ~ for example, someone who is desperate for cash from a home sale might do a "fire sale" and take less money for the home than it's actually worth.)

The fact that the value of assets fluctuates with supply and demand does not mean that their value as wealth is "nominal." It just means that the actual value of the wealth is subject to change.

If people are selling slaves and getting something for them, or using slaves as collateral, then this is proof that the value of chattel was not merely nominal. And I do understand that slaves were being sold and used as collateral when the Civil War began.

It is absolutely true that economic conditions can wipe out the value of an asset. Was the value of chattel property "wiped out" when the war began, such that their value was nominal? I haven't seen such evidence. In the secession declaration of the state of Georgia, the value of slave property was put at $3 billion, in their dollars. (See the section the declaration which says "by their declared principles and policy they have outlawed $3,000,000,000 of our property in the common territories of the Union".)

Was that valuation correct? I've seen different numbers in different places, but $2-4 billion seems to be the range of aggregate value for slave property, as put forward by people of the era. And the behavior of the secessionists was based on their perceived value of chattel property. Now, perception might not match reality, but people act on what they believe. So their perception of the value of chattel is key to know, even if those valuations were technically faulty, or even, totally baseless.

- Alan
 

wausaubob

Colonel
Joined
Apr 4, 2017
Location
Denver, CO
The value of a lot of assets exist on paper. The value of homes exists on paper. The value of stock exists on paper. It's not until, for example, that an asset is sold can we know the real or realized value of an asset. (Of course, the realized value which can also be affected by things occurring at the time of the negotiated transaction that can make the realized value different from the actual value ~ for example, someone who is desperate for cash from a home sale might do a "fire sale" and take less money for the home than it's actually worth.)

The fact that the value of assets fluctuates with supply and demand does not mean that their value as wealth is "nominal." It just means that the actual value of the wealth is subject to change.

If people are selling slaves and getting something for them, or using slaves as collateral, then this is proof that the value of chattel was not merely nominal. And I do understand that slaves were being sold and used as collateral when the Civil War began.

It is absolutely true that economic conditions can wipe out the value of an asset. Was the value of chattel property "wiped out" when the war began, such that their value was nominal? I haven't seen such evidence. In the secession declaration of the state of Georgia, the value of slave property was put at $3 billion, in their dollars. (See the section the declaration which says "by their declared principles and policy they have outlawed $3,000,000,000 of our property in the common territories of the Union".)

Was that valuation correct? I've seen different numbers in different places, but $2-4 billion seems to be the range of aggregate value for slave property, as put forward by people of the era. And the behavior of the secessionists was based on their perceived value of chattel property. Now, perception might not match reality, but people act on what they believe. So their perception of the value of chattel is key to know, even if those valuations were technically faulty, or even, totally baseless.

- Alan
The question of the value of the slave population assumes they were all for sale. First, they were a form of property only recognized in the US south, Cuba and Brazil, and some places in the eastern hemisphere. The British by 1852 had nearly eliminated any chance to move slaves from one slave economy to another.
Thus US slaves were only saleable in the 15 slave state section of the US. Second, how many of these slaves were actually for sale, at any price? They certainly had value as income producing workers, and unpaid servants, but how many people in MO, KY, w. VA, and MD were willing to participate in the interstate slave trade. Not all, and hence for most owners only the local price mattered. They were only to sell to a neighbor or local acquaintance, never a broker.
DE had already prohibited the out of state sale of slaves.
The moral attacks on the slave trade were growing, especially after the Savannah liquidation of part of Butler's slave ownership.
The legal attacks, under the commerce clause, as previously stated before 1844, were bound to renewed. The British had set the example and it was sure to be followed.
Slavery was doomed in the US because it was intimately connected to a growing and prosperous paid labor economy. The US had several examples of functioning free black communities.
Which meant that sooner or later discussions of emancipation in the 5 border slave states would recur.
The abolition plan was not complex. Slavery would be barred from the territories. The internal slave trade would be continually attacked and one by one the states would be encourage to abolish slavery.
The problem with the value of the slaves, we have almost no idea of what a collective balance sheet for the southern states would have looked like.
There was a lot of debt. There were double and triple pledged assets and banks in major southern cities were highly skeptical of lending locally to private parties.
Even some of our southern bloggers have pointed out the huge amount of debt that went unpaid to the true creditor during the Civil War.
 

uaskme

2nd Lieutenant
Joined
Nov 9, 2016
Location
SE Tennessee
Slavery was a byproduct of Cotton by 1860. Slavery was sinking to the Cotton States. Several reasons for it. The North could not grow Cotton. They tried it. Not enough warm days, it was impossible. Lincoln and the Republicans vowed not to touch Slavery where it existed for many good reasons. A major one is because the Country needed Cotton. Russia could grow Wheat. No other country In 1860 competed with Southern Cotton. 60% of Exports. Yankee Shipping, financiers, and Spinning Mills depended on it. Yankee’s had no Care for the Negro, but they did Cotton. England had no Care for the Negro either, but they did Cotton. Yankee had such an investment in Cotton in 1860 that the Sections couldn’t be separated. Cotton was the reason the North wouldn’t let the South Go.

Western Territories outside the South had No Slaves or such a low number it was irrelevant. Recon Why? None of them could produce Cotton, or any Plantation commodity. Harvard Race Science determined that the Negro was a Tropical being. Missouri had 60k Slaves when they became a State. There wasn’t a Dozen in Kansas. Missouri produced Hemp. If not for a protected subsidy, they couldn’t of grown hemp. So, there is no argument that can be made that Slavery could survive outside a Cotton producing State in 1860. Southern California was an exception. It was warm enough to grow Cotton. Sugar had a protective subsidy. If not for that, Sugar couldn’t compete with other producers in warmer climates. The South had issues with using Slaves in jobs that were considered White Jobs. Only about 5% of Slaves were in Industrial Slavery. No evidence that could grow to a significant number. CA ran anybody but Whites out of the Gold Fields. No evidence Slavery would work in mining.

Yankees were still involved in the Slave Trade in 1860. NYC was a hub of the Trade. Yankee merchants also shipped Coolies, slave replacements. Even Abolitionist approved of the Coolie Trade. Which mirrored Slavery. Same ships, same treatment, same countries involved in slavery, Cuba and Peru. Yankees did most of the inter State slave trade. Yankees sold their Slaves South after emancipation and after the trade was made illegal. Laws never stopped it. Brits were confiscating Slaves Ships and when possible forcing captives into apprenticeships in their Plantation system. Terms of 7 and 14 years to life if they could get away with it. Life expectancy was 7 years on a Sugar Plantation. Apprenticeships were for a fixed period. So they were EXPENDABLE. They got more harsh treatment that others. Brits also apprenticed Coolies and other poor substitutes who were colored and starving. After their emancipation in 1838, they discovered a Problem. No one to work their Plantations. They set up a similar system to Slavery to fix it. The Yankee and Brit did Not have a large Black Population. The Yankee had the South, the Brit their Colonies. Neither were Benevolent. No one was in the 19th Century. They participated and prospered in everyone else’s Slavery. Just as Racist as anyone else. Had the Same Racist Attitudes as the South.

Study Cotton Production post Civil War and up to about 1920. It exposes the Myth about Profits. No doubt Planters stole labor from the Slaves. Large Producers gained huge wealth. Most of them spent it. Farming was on a Credit System that ate up a huge portion of profits. That was to the Yankees benefit. Asset Values in Slaves are mostly Myth.
 
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ForeverFree

Major
Joined
Feb 6, 2010
Location
District of Columbia
The question of the value of the slave population assumes they were all for sale. First, they were a form of property only recognized in the US south, Cuba and Brazil, and some places in the eastern hemisphere. The British by 1852 had nearly eliminated any chance to move slaves from one slave economy to another.

Thus US slaves were only saleable in the 15 slave state section of the US. Second, how many of these slaves were actually for sale, at any price? They certainly had value as income producing workers, and unpaid servants, but how many people in MO, KY, w. VA, and MD were willing to participate in the interstate slave trade. Not all, and hence for most owners only the local price mattered. They were only to sell to a neighbor or local acquaintance, never a broker.

Study Cotton Production post Civil War and up to about 1920. It exposes the Myth about Profits. No doubt Planters stole labor from the Slaves. Large Producers gained huge wealth. Most of them spent it. Farming was on a Credit System that ate up a huge portion of profits. That was to the Yankees benefit. Asset Values in Slaves are mostly Myth.

The value of anything is set by the marketplace. People have written books with hundreds of pages on this subject. But we can try to make it simple, at the risk of oversimplifying.

To use an example: every house in the US is not for sale. But we can estimate the value of a house in a number of ways. I had an appraisal done of my house several years ago. The appraiser looked at the physical condition of the house, and prices garnered in recent sales in my neighborhood, and said, "this is the value of your house." My house was not on sale, but I did get a value, an appraised value, for the house.

I get a property tax bill for my house every year. My house is not for sale, yet the government assesses the value of my house, based mainly on recent sales in my neighborhood.

The appraised value and assessed value of my house are estimates that would not match the value of my house at a sale to the penny. But they are reasonable estimates to the extent that they are based on data, such as recent sales in my neighborhood. And as we take sale data from across the US, we can get an aggregate of the value of all houses. This is mechanically simple, although very laborious, given the size of the US.

In the case of slavery in the US at the time of the Civil War: it's true that the market for slaves was limited to a smallish number of states. But those states were large enough in total that there was in fact a marketplace for slaves. And in that marketplace, slaves were bought and sold. When that sale transaction occurred, there was an actual, not nominal price involved. The prices obtained in those sales give us data points which we can use to estimate the aggregate value of slaves. That is, we can go beyond myth, and actually get a reasonable estimate.

As noted earlier, the state of Georgia put that value at $3B. I am not saying that we should take that estimate at face value, but that is how a group of contemporaries saw it. That is, they did perceive that this was the actual value of slave property.

I do not have the desire to research this issue to the most exacting degree, but I would think/hope/guess that by now some scholar or scholars somewhere have determined the aggregate value of slaves at the time of war, based on data such as sale prices. Of course that value would reflect marketplace forces such as those mentioned in the posts I quote from above. But all of that would finally be resolved at the point of sale, and there is data out there which would give us actual, not mythical sale prices, and then enable reasonable estimates of total value. The truth is out there.

- Alan
 

uaskme

2nd Lieutenant
Joined
Nov 9, 2016
Location
SE Tennessee
The value of anything is set by the marketplace. People have written books with hundreds of pages on this subject. But we can try to make it simple, at the risk of oversimplifying.

To use an example: every house in the US is not for sale. But we can estimate the value of a house in a number of ways. I had an appraisal done of my house several years ago. The appraiser looked at the physical condition of the house, and prices garnered in recent sales in my neighborhood, and said, "this is the value of your house." My house was not on sale, but I did get a value, an appraised value, for the house.

I get a property tax bill for my house every year. My house is not for sale, yet the government assesses the value of my house, based mainly on recent sales in my neighborhood.

The appraised value and assessed value of my house are estimates that would not match the value of my house at a sale to the penny. But they are reasonable estimates to the extent that they are based on data, such as recent sales in my neighborhood. And as we take sale data from across the US, we can get an aggregate of the value of all houses. This is mechanically simple, although very laborious, given the size of the US.

In the case of slavery in the US at the time of the Civil War: it's true that the market for slaves was limited to a smallish number of states. But those states were large enough in total that there was in fact a marketplace for slaves. And in that marketplace, slaves were bought and sold. When that sale transaction occurred, there was an actual, not nominal price involved. The prices obtained in those sales give us data points which we can use to estimate the aggregate value of slaves. That is, we can go beyond myth, and actually get a reasonable estimate.

As noted earlier, the state of Georgia put that value at $3B. I am not saying that we should take that estimate at face value, but that is how a group of contemporaries saw it. That is, they did perceive that this was the actual value of slave property.

I do not have the desire to research this issue to the most exacting degree, but I would think/hope/guess that by now some scholar or scholars somewhere have determined the aggregate value of slaves at the time of war, based on data such as sale prices. Of course that value would reflect marketplace forces such as those mentioned in the posts I quote from above. But all of that would finally be resolved at the point of sale, and there is data out there which would give us actual, not mythical sale prices, and then enable reasonable estimates of total value. The truth is out there.

- Alan

What would happen if all Houses were put on the Market at the same time? What was the value of the Slaves at the end of the War? So yes, some between 3 Billion and 0 was their Value.

I fully understand that many have no desire to research this subject beyond it was all about Slaves and the South had them. Self limiting ones understanding of the causes of the War. Limits ones Understanding of other Minorities and what they were experiencing. Also limits ones understanding of other Whites Racism of the period and what that relation was to Civil War Causation.

Yes it seems as though some have a Limited Understanding if the Period. And no Desire to broaden their Perspective.
 

wausaubob

Colonel
Joined
Apr 4, 2017
Location
Denver, CO
The value of anything is set by the marketplace. People have written books with hundreds of pages on this subject. But we can try to make it simple, at the risk of oversimplifying.

To use an example: every house in the US is not for sale. But we can estimate the value of a house in a number of ways. I had an appraisal done of my house several years ago. The appraiser looked at the physical condition of the house, and prices garnered in recent sales in my neighborhood, and said, "this is the value of your house." My house was not on sale, but I did get a value, an appraised value, for the house.

I get a property tax bill for my house every year. My house is not for sale, yet the government assesses the value of my house, based mainly on recent sales in my neighborhood.

The appraised value and assessed value of my house are estimates that would not match the value of my house at a sale to the penny. But they are reasonable estimates to the extent that they are based on data, such as recent sales in my neighborhood. And as we take sale data from across the US, we can get an aggregate of the value of all houses. This is mechanically simple, although very laborious, given the size of the US.

In the case of slavery in the US at the time of the Civil War: it's true that the market for slaves was limited to a smallish number of states. But those states were large enough in total that there was in fact a marketplace for slaves. And in that marketplace, slaves were bought and sold. When that sale transaction occurred, there was an actual, not nominal price involved. The prices obtained in those sales give us data points which we can use to estimate the aggregate value of slaves. That is, we can go beyond myth, and actually get a reasonable estimate.

As noted earlier, the state of Georgia put that value at $3B. I am not saying that we should take that estimate at face value, but that is how a group of contemporaries saw it. That is, they did perceive that this was the actual value of slave property.

I do not have the desire to research this issue to the most exacting degree, but I would think/hope/guess that by now some scholar or scholars somewhere have determined the aggregate value of slaves at the time of war, based on data such as sale prices. Of course that value would reflect marketplace forces such as those mentioned in the posts I quote from above. But all of that would finally be resolved at the point of sale, and there is data out there which would give us actual, not mythical sale prices, and then enable reasonable estimates of total value. The truth is out there.

- Alan
I agree. But the New Orleans prices were not valid indicators in Kentucky, Virginia and Maryland. The slaves were valuable, but the value was not a straight forward aggregate.
The second point I was making is that the although the southern areas had a cotton boom, especially after England and France ramped up textiles in the wake of the Crimean War, and those areas experienced significant cash flow, we don't know much about the debt structure. Banks in New Orleans and Louisville were strong but they kept the loans/reserve ratios low and many cotton producers were relying on factors in New York City, which they greatly resented.
In general Gavin Wright wrote that the wealth of the cotton producers was dependent on outside factors in the world textile market.
So there was wealth, but there was also debt and dependence on the outside buyers. They were very much at odds with Henry Clay and the Whigs, who wanted the US to stop being an economic colony of Britain.
 

ForeverFree

Major
Joined
Feb 6, 2010
Location
District of Columbia
What would happen if all Houses were put on the Market at the same time? What was the value of the Slaves at the end of the War? So yes, some between 3 Billion and 0 was their Value.

I fully understand that many have no desire to research this subject beyond it was all about Slaves and the South had them. Self limiting ones understanding of the causes of the War. Limits ones Understanding of other Minorities and what they were experiencing. Also limits ones understanding of other Whites Racism of the period and what that relation was to Civil War Causation.

Yes it seems as though some have a Limited Understanding if the Period. And no Desire to broaden their Perspective.

RE: What would happen if all Houses were put on the Market at the same time?

When market conditions change, the value of assets changes. Of course. The thing is, before the Civil War began, all slaves were not being put on sale. Even in the early months of the Civil War, all slaves were not put on sale. Based on pre-war conditions, the value of chattel property was not mythical. As mentioned, there is data that can show us these values.

RE: What was the value of the Slaves at the end of the War?

I was referring to the value of slaves pre-War. Obviously the market for slaves changed as a result of the war. But I was speaking to the thread topic concerning southern prosperity prior to the war.

RE: I fully understand that many have no desire to research this subject beyond it was all about Slaves and the South had them. Self limiting ones understanding of the causes of the War. Limits ones Understanding of other Minorities and what they were experiencing. Also limits ones understanding of other Whites Racism of the period and what that relation was to Civil War Causation.

Uh, what? I said this:

As noted earlier, the state of Georgia put that value at $3B. I am not saying that we should take that estimate at face value, but that is how a group of contemporaries saw it. That is, they did perceive that this was the actual value of slave property.
I do not have the desire to research this issue to the most exacting degree, but I would think/hope/guess that by now some scholar or scholars somewhere have determined the aggregate value of slaves at the time of war, based on data such as sale prices. Of course that value would reflect marketplace forces such as those mentioned in the posts I quote from above. But all of that would finally be resolved at the point of sale, and there is data out there which would give us actual, not mythical sale prices, and then enable reasonable estimates of total value. The truth is out there.

My point about no wanting to research the issue was purely a reference to researching the actual value of chattel property. I was not referring to the market forces that shape such value, at least, not in that text. I was responding to your comment:

Asset Values in Slaves are mostly Myth.

In fact, we can determine the value by looking at data and make estimates of value, just as is done with property appraisals and property assessments, and then applying that that to aggregate numbers of slaves. Again, I was NOT saying I had no interest in the subject as how chattel assets came to be valued. Rather, I was saying that, if we want to see if the value of slaves was mythical, we could simply do a deep dive into the data. Which you haven't done. But neither have I; that's work we haven't done.

But here's the thing: I am not the one who said that value of slaves was "mythical"; you said that with no data to prove that. I would think or hope or guess that research has been done empirically and quantitatively estimate aggregate slave value. So if you want to prove that slave assets values were mythical, you can do so... if you're interested.

- Alan
 

ForeverFree

Major
Joined
Feb 6, 2010
Location
District of Columbia
I agree. But the New Orleans prices were not valid indicators in Kentucky, Virginia and Maryland. The slaves were valuable, but the value was not a straight forward aggregate.
The second point I was making is that the although the southern areas had a cotton boom, especially after England and France ramped up textiles in the wake of the Crimean War, and those areas experienced significant cash flow, we don't know much about the debt structure. Banks in New Orleans and Louisville were strong but they kept the loans/reserve ratios low and many cotton producers were relying on factors in New York City, which they greatly resented.
In general Gavin Wright wrote that the wealth of the cotton producers was dependent on outside factors in the world textile market.
So there was wealth, but there was also debt and dependence on the outside buyers. They were very much at odds with Henry Clay and the Whigs, who wanted the US to stop being an economic colony of Britain.

I agree with your basic point that there are a lot of factors which went into marketplace for slaves, including the ones you cite. So, for example, the value of slaves can and did change from one place to another. But as with the modern economy, in which people make estimates of asset values that are adjusted based on various factors, some aggregate value of slaves can be determined. Although certainly, people might argue over the factors that should go into these valuations.

On the subject of debt: My house has a value of so many thousand dollars, regardless of how much I owe on the mortgage. I am assessed based on my home's value, the tax assessor does not care how much I owe. And the house has value to me, even if I haven't made my first mortgage payment, because my house is better than an apartment whose rent payments benefits the landlord, not the accumulation of my wealth. And my house can increase in value, netting me a gain in a sale (of course, there is a risk I can take a loss on a sale). So even with debt, assets have value which is unrelated to the debt.

But I do realize that there is a thing called net worth, which is the value of an asset owned less the value of debt/liabilities owed for such asset. But unless I am totally underwater with an asset, the asset is wealth. And even if an asset is totally leveraged, it can still have value. For example, it can generate income. I am reminded of the term OPM:

Other People’s Money (OPM): In finance, other people’s money, or OPM, is a slang term that refers to financial leverage. Other people’s money refers to borrowed capital that is used to increase the potential returns as well as the risks of an investment. OPM can be used by individuals or by corporations.​
Using other people’s money is considered a double-edged sword – it cuts both ways. If an investment that is levered with other people’s money turns out to be profitable, then the profits are magnified by the effects of the leverage. However, if the levered investment goes sour, then the investor that utilized other people’s money can incur steeper losses.​

Even if fully leveraged, assets have value, or can have value. An enslaved person who's value is fully leveraged can still pick cotton and bring in a crop, thus generating income. That makes the asset valuable.

We're taking about indicators of prosperity. If I have chattel that is fully leveraged, and I bring in a crop with a net income of hundreds of dollars, even after debt service and expenses; versus a subsistence farmer whose family eats what it grows, with no surplus; am I not more prosperous? The answer is yes. I realize this is a micro-level example. But it seems that many economists have aggregated this and said that the South was prosperous (or at least, the slave holders who dominated the economy were prosperous).

- Alan
 

ForeverFree

Major
Joined
Feb 6, 2010
Location
District of Columbia
Roger Ransom and Gavin Wright both published on this subject. Ransom in particular included numerous value charts, showing cotton prices, production/hand, and slave prices, in real and current dollar values for long time series.

As fate would have it, I am just now looking at Ransom's book Conflict and Compromise: The Political Economy of Slavery, Emancipation and the American Civil War.

- Alan
 

uaskme

2nd Lieutenant
Joined
Nov 9, 2016
Location
SE Tennessee
QUOTE="ForeverFree, post: 2290352, member: 2771"]
RE: What would happen if all Houses were put on the Market at the same time?

When market conditions change, the value of assets changes. Of course. The thing is, before the Civil War began, all slaves were not being put on sale. Even in the early months of the Civil War, all slaves were not put on sale. Based on pre-war conditions, the value of chattel property was not mythical. As mentioned, there is data that can show us these values.

RE: What was the value of the Slaves at the end of the War?

I was referring to the value of slaves pre-War. Obviously the market for slaves changed as a result of the war. But I was speaking to the thread topic concerning southern prosperity prior to the war.

RE: I fully understand that many have no desire to research this subject beyond it was all about Slaves and the South had them. Self limiting ones understanding of the causes of the War. Limits ones Understanding of other Minorities and what they were experiencing. Also limits ones understanding of other Whites Racism of the period and what that relation was to Civil War Causation.

Uh, what? I said this:

As noted earlier, the state of Georgia put that value at $3B. I am not saying that we should take that estimate at face value, but that is how a group of contemporaries saw it. That is, they did perceive that this was the actual value of slave property.
I do not have the desire to research this issue to the most exacting degree, but I would think/hope/guess that by now some scholar or scholars somewhere have determined the aggregate value of slaves at the time of war, based on data such as sale prices. Of course that value would reflect marketplace forces such as those mentioned in the posts I quote from above. But all of that would finally be resolved at the point of sale, and there is data out there which would give us actual, not mythical sale prices, and then enable reasonable estimates of total value. The truth is out there.

My point about no wanting to research the issue was purely a reference to researching the actual value of chattel property. I was not referring to the market forces that shape such value, at least, not in that text. I was responding to your comment:



In fact, we can determine the value by looking at data and make estimates of value, just as is done with property appraisals and property assessments, and then applying that that to aggregate numbers of slaves. Again, I was NOT saying I had no interest in the subject as how chattel assets came to be valued. Rather, I was saying that, if we want to see if the value of slaves was mythical, we could simply do a deep dive into the data. Which you haven't done. But neither have I; that's work we haven't done.

But here's the thing: I am not the one who said that value of slaves was "mythical"; you said that with no data to prove that. I would think or hope or guess that research has been done empirically and quantitatively estimate aggregate slave value. So if you want to prove that slave assets values were mythical, you can do so... if you're interested.

- Alan
[/

You said yourself that the 3B estimate was probably not reliable. And it is Not.

Most of these estimates about Planters Wealth and Profits are a What If. What if they sold each Slave today at Market Price. When did they ever sell all of their Slaves in one Day? Never. Would they have got the same price liquidating Land and Slaves. Values fluctuated. Boom to Bust.

If you study what happened During and After the War when Yankees came South to Get Rich Quick Growing Cotton, you will find that the Vast Majority went home Broke. They exploited the Negro. Treated them worse than Southern Planters by every account. They cared nothing about tomorrow or the Negro. Was given land at reduced prices. Had every advantage and went BROKE.

Study again post War. After Cotton Lands expanded. During Sharecropping. Most years were dismal. A few Black communities tried to Racially separate themselves. They were hard workers. Motivated. Experienced. They Failed.

A English company made a Huge investment in Southern Cotton Lands. Trying to stabilize production so as to supply English Cotton Mills consistently with Raw Material. Very few years did they turn a profit. They had every advantage of scale. Complexity of Farming. Weather, Bug resistant seed. They ended up making more money selling their seed than growing Cotton.[/QUOTE]
 

wausaubob

Colonel
Joined
Apr 4, 2017
Location
Denver, CO
Except the cotton boom took place mainly in the 7 cotton states, with extensions into Arkansas, Tennessee and North Carolina.
Moreover the census data did not survey the indebtedness. Thus we only know the gross values.
The facts were that the only four major cities of the 15 slave states were all connected to the northern economy. Those cities were Baltimore, Louisville, St. Louis and New Orleans. Even New Orleans was beginning to experience the shift towards west to east railroading in the northern states. Wheat, pork, lumber, wool and coal, no longer had to go down river and by ship to New York. There was by 1860 a third alternative, that was weather resistant.
 

wausaubob

Colonel
Joined
Apr 4, 2017
Location
Denver, CO
The problem with the cotton boom was the sugar industry of Louisiana and Texas, and the tobacco growers of Kentucky and Virginia, were mainly selling to a domestic US market. The contradiction of using slave labor to produce goods sold to an adjacent paid labor economy was going to have to be resolved.
 
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