"Empire of Cotton" changed how I thought about global economic history. Beckert views the changing relationships between state, industry, capital, and labor through the lens of the cotton industry and its role in sparking the Industrial Revolution and creating our modern, globalized world.
The first surprise in this book was dichotomy between the industrial capitalism we all read about in textbooks and the earlier "war capitalism" which provided its foundations. The coercive, appropriative, and violent war capitalism enabled European countries to use their superior state organization and military capacity to mold the world into a global capitalist system that provided the raw materials and foreign markets needed for the takeoff of large-scale industrial capitalism. Beckert ruthlessly mocks the "free market" intellectual posturing espoused by the West - pointing out their rampant protectionism of domestic industries and coercive extraction of labor and resources from their colonies.
The second revelation was what Beckert calls the "proletarianization" of the global countryside. In most regions where cotton can be grown, the local population was growing it - but intercropped with their food crops on small family plots rather than the large-scale monocultures preferred by industry. The natives much preferred it this way - the land provided for all of their subsistence needs with relatively little labor (at least compared to cotton cultivation). They didn't want to switch to cotton monoculture and work harder, lose their food security, and be at the mercy of global markets. This led the colonial powers to devise pretty nefarious ways of converting subsistence farmers to producers of a global commodity (cotton) and consumers of global goods (imperial textiles, etc), including forcing payment of taxes in cotton and exploitative credit arrangements with guileless borrowers who soon defaulted, lost their land, and were forced to become cotton wage laborers. Nasty stuff.
In its discussion of the attempts by industrializing countries to impose order and "legibility" on the chaos of nature and global markets, this book had echoes of "Seeing Like a State". In its descriptions of the role of protectionism in the industrialization process, I found it in agreement with "How Asia Works".
This book is required reading for anyone who is thinking seriously about global trade today.
Finally, check out this sweet Library of Congress scan of an 1866 map by Charles Minard that shows the impact of the American Civil War on global cotton flows. (He's also got an awesome map on Napoleon's invasion of Russia - Tufte is a big fan... that data/ink ratio!)
My highlights below:
Along the way, millions of people spent their lives working the acres of cotton that slowly spread across the world, plucking billions of bolls from resistant cotton plants, carrying bales of cotton from cart to boat and from boat to train, and working, often at very young ages, at “satanic mills” from New England to China.
The empire of cotton was, from the beginning, a site of constant global struggle between slaves and planters, merchants and statesmen, farmers and merchants, workers and factory owners. In this as in so many other ways, the empire of cotton ushered in the modern world.
For about nine hundred years, from 1000 to 1900 CE, cotton was the world’s most important manufacturing industry. Though it now has been surpassed by other industries, cotton remains important in terms of employment and global trade. It is so ubiquitous that in 2013 the world produced at least 123 million cotton bales, each weighing about four hundred pounds—enough to produce twenty T-shirts for each living person.
it would take approximately 7 billion sheep to produce a quantity of wool equivalent to the world’s current cotton crop. Those 7 billion sheep would need 700 million hectares of land for grazing, about 1.6 times the surface area of today’s European Union.
Edward Baines, a newspaper proprietor in Leeds, called cotton in 1835 a “spectacle unparalleled in the annals of industry.” He argued that analyzing this spectacle was “more worthy the pains of the student” than the study of “wars and dynasties.”
This book, in contrast, embraces a global perspective to show how Europeans united the power of capital and the power of the state to forge, often violently, a global production complex, and then used the capital, skills, networks, and institutions of cotton to embark upon the upswing in technology and wealth that defines the modern world.
Unlike much of what has been written on the history of capitalism, Empire of Cotton does not search for explanations in just one part of the world. It understands capitalism in the only way it can be properly understood — in a global frame. The movement of capital, people, goods, and raw materials around the globe and the connections forged between distant areas of the world are at the very core of the grand transformation of capitalism and they are at the core of this book.
Such a thorough and rapid re-creation of the world was possible only because of the emergence of new ways of organizing production, trade, and consumption. Slavery, the expropriation of indigenous peoples, imperial expansion, armed trade, and the assertion of sovereignty over people and land by entrepreneurs were at its core. I call this system war capitalism.
When we think of capitalism, we think of wage workers, yet this prior phase of capitalism was based not on free labor but on slavery. We associate industrial capitalism with contracts and markets, but early capitalism was based as often as not on violence and bodily coercion. Modern capitalism privileges property rights, but this earlier moment was characterized just as much by massive expropriations as by secure ownership. Latter-day capitalism rests upon the rule of law and powerful institutions backed by the state, but capitalism’s early phase, although ultimately requiring state power to create world-spanning empires, was frequently based on the unrestrained actions of private individuals—the domination of masters over slaves and of frontier capitalists over indigenous inhabitants. The cumulative result of this highly aggressive, outwardly oriented capitalism was that Europeans came to dominate the centuries-old worlds of cotton, merge them into a single empire centered in Manchester, and invent the global economy we take for granted today. War capitalism, then, was the foundation from which evolved the more familiar industrial capitalism, a capitalism characterized by powerful states with enormous administrative, military, judicial, and infrastructural capacities.
Some may wonder why the claims made here for the empire of cotton do not apply to other commodities. After all, before 1760, Europeans had traded extensively in many commodities in the tropical and semitropical areas of the world, including sugar, rice, rubber, and indigo. Unlike these commodities, cotton, however, has two labor-intensive stages—one in the fields, the other in factories. Sugar and tobacco did not create large industrial proletariats in Europe. Cotton did. Tobacco did not result in the rise of vast new manufacturing enterprises. Cotton did. Indigo growing and processing did not create huge new markets for European manufacturers. Cotton did. Rice cultivation in the Americas did not lead to an explosion of both slavery and wage labor. Cotton did. As a result, cotton spanned the globe unlike any other industry. Because of the new ways it wove continents together, cotton provides the key to understanding the modern world, the great inequalities that characterize it, the long history of globalization, and the ever-changing political economy of capitalism.
We tend to recall industrial capitalism as male-dominated, whereas women’s labor largely created the empire of cotton.
By 1900 about 1.5 percent of the human population — millions of men, women, and children — were engaged in the industry, either growing, transporting, or manufacturing cotton.
This book draws on the vast literature on cotton, but places it in a new framework. As a result, it contributes to a vibrant but often stultifyingly presentist conversation on globalization. Empire of Cotton challenges excited discoveries of an allegedly new, global phase in the history of capitalism. It shows that capitalism has been globe-spanning since its inception and that fluid spatial configurations of the world economy have been a common feature of the last three hundred years. The book argues also that for most of capitalism’s history the process of globalization and the needs of nation-states were not conflicting, as is often believed, but instead mutually reinforced one another. If our allegedly new global age is truly a revolutionary departure from the past, the departure is not the degree of global connection but the fact that capitalists are for the first time able to emancipate themselves from particular nation-states, the very institutions that in the past enabled their rise.
Chapter One - The Rise of a Global Commodity
They called it ichcatl: cotton. The cotton plant thrived among the maize, and each fall, after they harvested their food crops, the villagers plucked the soft wads of fiber from the pyramidally shaped, waist-high plants, gathering the numerous bolls in baskets or sacks, then carrying them to their mud-and-wattle huts. There they painstakingly removed the many seeds by hand, then beat the cotton on a palm mat to make it smooth, before combing out the fibers into strands several inches long. Using a thin wooden spindle fitted with a ceramic disk and a spinning bowl to support the spindle as it twirled, they twisted the strands together into fine white thread. Then they created cloth on a backstrap loom, a simple tool consisting of two sticks attached by the warp threads; one stick was hung from a tree, the other on the weaver herself, who stretched the warp with the weight of her own body and then wove the contrasting thread (the weft) in and out between the warps in an unending dance. The result was a cloth as strong as it was supple.
The many peoples who grew cotton remained for thousands of years unaware that their efforts were being replicated by other peoples around the globe, all of whom lived in a geographic band roughly from 32–35 degrees south to 37 degrees north. These areas offered a climate suitable for the growing of cotton. As a subtropical plant, it needs temperatures not dipping below 50 degrees Fahrenheit during its growth period and usually remaining above 60 degrees. Cotton, we now know, thrives in areas in which no frost occurs for around 200 days, and in which it rains from twenty to twenty-five inches a year, concentrated in the middle of the growing period, a common climate zone that explains its abundance across multiple continents. Seeds are put in trenches about three feet apart and then covered with soil. It takes from 160 to 200 days for the cotton to mature.
As early as a thousand years ago, the production of cotton textiles in Asia, Africa, and the Americas was the world’s largest manufacturing industry; sophisticated trade networks, mostly local but a few regional, connected growers, spinners, weavers, and consumers.
About five thousand years ago, on the Indian subcontinent, people, as far as we know, first discovered the possibility of making thread out of cotton fibers. Almost simultaneously, people living on the coast of what today is Peru, ignorant of developments in South Asia, followed suit. A few thousand years later, societies in eastern Africa developed techniques for the spinning and weaving of cotton as well. In each of these regions cotton quickly became the dominant fiber for the spinning of thread, its properties for most uses clearly superior to those of flax and ramie and other fibers.
Today, more than 90 percent of the world’s cotton crop is G. hirsutum cultivars, also known as American upland.
An estimated 116 million pounds of cotton were produced annually in pre-Columbian Mexico, equaling the cotton crop of the United States in 1816.
After 800 CE, the spread of cotton, and its attendant production, accelerated further on the wings of Islam. Knowledge about how to grow and process cotton then traveled to western Africa. How exactly cotton came there is still unclear, but it is possible that itinerant weavers and merchants brought it from East Africa sometime around the beginning of the Common Era. With the arrival of Islam in the eighth century CE, the cotton industry expanded significantly, as Islamic teachers taught girls to spin and boys to weave, while advocating a previously unimagined modesty of dress to peoples whose environmental conditions demanded little clothing.
A few hundred years later, during the first centuries of the Common Era, Anatolian peasants had taken up cotton cultivation. Just as in Africa, the spread of Islam played a major role in transmitting the skills to grow, spin, and weave cotton across the Middle East, as religious demands for modesty made cotton an “ordinary article of clothing.” Ninth- and tenth-century Iran saw a “cotton boom” to supply urban markets, especially at Baghdad. In the thirteenth century, Marco Polo encountered cotton and cotton cloth everywhere from Armenia to Persia, and the “abundance” of cotton across Asia became a major motif of his reporting.
Just as cotton cultivation moved farther west, the knowledge of cotton also spread from India east through Asia, and especially into China. While China eventually became one of the most significant producers of cotton and cotton textiles worldwide, and is the center of the world’s cotton industry today, the plant is not indigenous there. Indeed, the Chinese word for cotton and cotton fiber is borrowed from Sanskrit and other Indian languages. By 200 BCE, cotton was known in China, but for the next millennium it did not spread much beyond the southwestern border regions where it had originally been introduced.
By 1433, Chinese subjects could pay taxes in cotton, which enabled the state to clothe its soldiers and officials in the fiber. As we will see, the connection between the crop and taxation was one of many instances of political authorities taking an interest in the cotton industry. During the expansionary Ming dynasty (1368–1644), cotton production spread throughout China’s new conquests. At the end of the Ming, the Chinese produced an estimated 20 million cotton cloth bales annually. A geographical division of labor had emerged in which northern farmers shipped raw cotton south to the lower Yangtze, where farmers used it, along with their own homegrown cotton, to manufacture textiles, some of which they sold back to the north. So vibrant was this interregional trade that cotton cloth accounted for one-fourth of the empire’s commerce. By the seventeenth century, nearly all Chinese men, women, and children wore cotton clothing. Not surprisingly, when China’s population doubled over the course of the eighteenth century, to 400 million people, its cotton industry became the second largest in the world after India’s, growing an estimated 1.5 billion pounds of cotton in 1750, roughly equal to U.S. production as its planters ramped up production in the decade prior to the Civil War.
Most important, cotton growing and manufacturing almost always remained small-scale and focused on households. While some growers sold their raw cotton into markets, including long-distance markets, and many rulers forced cultivators to part with some of their crop as tribute, no growers depended on their cotton crops alone; instead they diversified their economic opportunities, hoping to lessen risk to the best of their ability. In a large swath of Africa, and parts of South Asia and Central America, such patterns persisted until well into the twentieth century.
No significant cotton monoculture emerged before the eighteenth century, and yet when that monoculture appeared so too did the hunger for ever more land and labor. Like cotton growing, cotton manufacturing throughout the world began in households, and, with few exceptions, stayed there until the nineteenth century.
As late as the eighteenth century, a woman in Southeast Asia, for example, needed a month to spin a pound of cotton and another month to weave a piece of cloth ten yards long.
Rulers everywhere demanded cotton cloth as tribute or taxes, and indeed it might be said that cotton was present at the birth of political economy as such. Among the Aztecs, for example, it was the most important medium for tribute payments. In China, beginning in the fifteenth century, households were required to pay some of their taxes in cotton cloth. And in Africa the payment of tribute in cloth was common. Practical as a means to pay taxes, cotton cloth was also used as currency in China, throughout Africa, in Southeast Asia, and in Mesoamerica. Cloth was an ideal medium of exchange because unlike raw cotton it could be easily transported over long distances, was not perishable, and was valuable. Nearly everywhere in the premodern world, a piece of cotton cloth could buy needed things: food, manufactured goods, even protection.
Beginning in the seventeenth century, Indian cottons, in fact, were what historian Beverly Lemire has called the “first global consumer commodity.”
The center of technological innovation, however, was Asia: The roller gin (to remove seeds), the bow (to clean and disentangle ginned cotton), the spinning wheel, and new kinds of looms, including the upright warper, all originated in Asia. The spinning wheel, invented in the eleventh century, was an especially significant innovation as it allowed peasants to spin cotton much faster.
The greatest innovations occurred in the domestication of the cotton plant itself, indeed so much so that the cotton picked by slaves in the nineteenth century would be nearly unrecognizable to Indian farmers of two thousand years earlier.
Through the centuries, this process of domestication drastically altered the physical properties of cotton, creating plants that produced longer and brighter fibers (later-day cotton experts would refer to the length of the fiber as “staple”), ever more plentiful and easier to remove from the filbertlike shell. Moreover, advances in irrigation techniques and agronomy allowed for the expansion of production into new regions.
This premodern world was safe behind two bulkheads: first, the markets for finished goods, which were growing but, compared to the world after 1780, only at a modest pace, and second, the great obstacles to sourcing raw cotton across long distances.
For a very long time, in this remarkably diverse, fabulously vibrant, and economically important world of cotton, Europe was nowhere to be found. Europeans had remained marginal to networks of cotton growing, manufacturing, and consumption. Even after they began importing small quantities of cotton cloth during Greek and Roman times, they remained of little importance to the global cotton industry as a whole. People dressed, as they had since the Bronze Age, in clothing made from flax and wool.
So tight was the association between Islam and cotton that most western European languages borrowed their words for the fiber from the Arabic qutun. French coton, English cotton, Spanish algodón, Portugese algodão, Dutch katoen, and Italian cotone all derive from the Arabic root. (The German Baumwolle and the Czech bavlna—translated roughly as “tree wool”—are the exceptions that prove the rule.)
While Europe’s climate was largely unsuited for cotton growing, the Crusaders had extended European power into the Arab world, and thereby into areas where cotton grew naturally. The first endeavors to manufacture cotton were modest, but the beginning of a trend that would alter the continent’s history, and the world’s economy. The first center of a non-Islamic cotton industry in Europe emerged in northern Italy, in cities such as Milan, Arezzo, Bologna, Venice, and Verona. The industry grew quickly, starting in the late twelfth century, and came to play a vital role in these urban economies. In Milan, for example, by 1450 the cotton industry employed a full six thousand workers making fustians, fabrics using both cotton and linen. These northern Italians became the dominant producers in Europe, and they retained their position for about three centuries.
Cotton manufacturing blossomed in northern Italy for two reasons. First, these cities looked back on a long history of still vibrant wool production, which had left them with skilled workers, capital-rich merchants, and expertise in long-distance trade... Second, northern Italy had easy access to raw cotton. Indeed, the northern Italian industry was from the beginning entirely dependent on eastern Mediterranean cotton from such places as western Anatolia and what today is Syria.
As improvements in shipping allowed for the cheaper transportation of bulk commodities, Venice became Europe’s first cotton entrepôt, the Liverpool of the twelfth century.
Northern Italian entrepreneurs appropriated technologies from the Islamic world — some of which had in turn come from India and China. The twelfth century witnessed a “massive infusion of outside technology into the European textile industry” — most importantly the spinning wheel. Before the spinning wheel was introduced into Europe in the middle of the thirteenth century, Europeans, like Americans and Africans, had spun with hand spindles. It was a slow process: A skilled spinner produced about 120 meters of thread per hour. At that rate, it took about eleven hours to spin enough yarn for one blouse. The spinning wheel increased the output of European spinners tremendously, tripling productivity.
Yet even before the disruption of these crucial networks, the Italian industry faced another challenge: the rise of nimbler competitors north of the Alps, in the cities of southern Germany. They drew, like their Italian counterparts, on cotton from the Levant. But while Italian manufacturers faced high taxes, high wages, well-organized urban weavers, and guild restrictions, German producers enjoyed the advantage of the more tractable German countryside, where they gained access to cheap labor. By the early fifteenth century, German manufacturers had used this cost differential not only to capture many of the Italian export markets, including eastern and northern Europe, Spain, the Baltic region, the Netherlands, and England, but to make inroads even into the Italian market itself.
Hans Fugger furthered the rapid establishment of a dynamic cotton industry in southern Germany in the span of just one generation. Between 1363 and 1383, the output of German weavers effectively supplanted Lombardy fustians on European markets. Fugger and others like him succeeded because they had access to skilled textile workers, capital, and trade networks.
The rise of the Ottoman Empire, a powerful state capable of controlling raw and manufactured cotton flows, ruined the northern Italian and German cotton industries. To make matters worse for the once dominant Venetians, by the end of the sixteenth century British ships called ever more frequently in ports such as Izmir (Ottoman Smyrna); in 1589 the sultan granted the English merchants far-reaching trading privileges.
Some shrewd observers surely noted that the first European cotton producers, both the northern Italians and the southern Germans, failed at least in part because they had not subjugated those people who supplied them with cotton. It was a lesson that would not be forgotten. As the sixteenth century came to a close, an entirely new cotton industry arose that focused on the Atlantic, not the Mediterranean. Europeans took for granted that only the projection of state power would ensure success in these new trade zones.
Chapter Two - Building War Capitalism
The ultimate result was a radical reorganization of the world’s leading manufacturing industry: an explosion in how and where cotton was grown and manufactured, and a shocking vision of how the crop could yoke the world together. This recasting of cotton did not at first derive from technical advances, nor from organizational advantages, but instead from a far simpler source: the ability and willingness to project capital and power across vast oceans. With increasing frequency, Europeans inserted themselves, often violently, into the global networks of the cotton trade — within Asia as well as between Asia and the rest of the world—before using that same power to create entirely novel networks between Africa, the Americas, and Europe. Europe’s first incursion into the world of cotton had collapsed in the face of superior power; new generations of European capitalists and statesmen took heed and built a comparative advantage with a willingness and ability to use force to extend their interests. Europeans became important to the worlds of cotton not because of new inventions or superior technologies, but because of their ability to reshape and then dominate global cotton networks.
European capitalists and rulers altered global networks through multiple means. The muscle of armed trade enabled the creation of a complex, Eurocentric maritime trade web; the forging of a military-fiscal state allowed for the projection of power into the far-flung corners of the world; the invention of financial instruments — from marine insurance to bills of lading — allowed for the transfer of capital and goods over long distances; the development of a legal system gave a modicum of security to global investments; the construction of alliances with distant capitalists and rulers provided access to local weavers and cotton growers; the expropriation of land and the deportation of Africans created flourishing plantations.
Eventually, as we will see, controlling huge territories in the Americas allowed, among other things, the monocultural growing of large quantities of cotton.
The second momentous event in the history of cotton came five years later, in 1497, when Vasco da Gama sailed triumphantly into the port of Calicut, having pioneered a sea route from Europe to India around the Cape of Good Hope. Now Europeans could for the first time access the products of Indian weavers — the world’s dominant producers — without having to rely on the numerous middlemen who had transported Indian cloth by ship across the Indian Ocean, by camel across Arabia, and then by boat to European ports.
That expansion into South Asia, at first, was the most momentous intervention of European merchants and statesmen into the networks of the global cotton industry. With it, Europeans began to play a role in the transoceanic trade of Indian textiles, pioneered by the Portuguese, who brought large quantities of such cloth to Europe. They also tried to assert their dominance over the important trade between Gujarat and both the Arabian Peninsula and eastern Africa — first by violently restricting the access of Gujarati merchants to those traditional markets (with mixed success), and in the second half of the sixteenth century by regulating the trade. Other European merchants later joined in: In 1600, merchants established the British East India Company, in 1602 the Dutch Vereenigde Oost-Indische Compagnie, and in 1616 the Danish Dansk Ostindiske Kompagni. By the early seventeenth century, the Dutch and British were replacing the Portuguese in violently regulating the trade in Gujarati textiles, seizing Gujarati ships, and limiting local merchants’ access to the markets of Arabia and, increasingly, Southeast Asia, which were supplied from factories in southern India, along the Coromandel coast, with Madras at its center.
What all these European trading companies had in common was that they purchased cotton textiles in India, to trade for spices in Southeast Asia, and also to bring to Europe, whence they might be consumed domestically or shipped to Africa to pay for slaves to work the plantations just beginning to take root in the New World. Cotton textiles, for the first time ever, became entangled in a three-continent-spanning trading system; the consequences of Columbus’s and da Gama’s momentous journeys fed on one another.
The East India Company as early as 1621 imported an estimated fifty thousand pieces of cotton goods into Britain. Forty years later, this number had increased by a factor of five. Cotton cloths, in fact, became the company’s most important trading good; by 1766 that cloth constituted more than 75 percent of the East India Company’s total exports.
In Dhaka, as late as the 1700s, European traders acquired only about one-third of all the cloth traded. And the trading capacity of Europeans in India remained dependent on South Asian bankers and merchants who financed cotton growing and manufacturing.
Yet with bigger, faster, and more reliable boats, and more damaging firepower, “the old pattern of the Indian-Levant trade as the principal artery for world exchange underwent a complete structural change,” one historian concludes, with “the Ottoman Empire... the chief loser.”
Moreover, domination in Asia dovetailed with expansion into the Americas. As Spanish, Portuguese, French, English, and Dutch powers captured huge territories in the Americas, they took away the continent’s movable wealth: gold and silver. It was indeed some of these stolen precious metals that had funded the purchase of cotton fabrics in India in the first place.
Although it is often imagined that the slave trade was animated by simple exchanges of guns and gewgaws for human export, slaves were more frequently traded for a far more banal commodity: cotton textiles. One study of 1,308 barters of British merchant Richard Miles between 1772 and 1780 for 2,218 Gold Coast slaves found that textiles constituted over half of the value of all traded goods.
European trade in cotton textiles tied together Asia, the Americas, Africa, and Europe in a complex commercial web. Never before in the four millennia of the history of cotton had such a globe-spanning system been invented. Never before had the products of Indian weavers paid for slaves in Africa to work on the plantations in the Americas to produce agricultural commodities for European consumers. This was an awe-inspiring system, speaking clearly to the transformative powers of a union of capital and state power. What was the most radical was not the particulars of these trades, but the system in which they were embedded and how different parts of the system fed upon one another: Europeans had invented a new way of organizing economic activity. This expansion of European trade networks into Asia, Africa, and the Americas did not rest primarily on offering superior goods at good prices, but on the military subjugation of competitors and a coercive European mercantile presence in many regions of the world.
These three moves — imperial expansion, expropriation, and slavery — became central to the forging of a new global economic order and eventually the emergence of capitalism. They combined with one other feature of this new world: states that backed these merchant and settler ventures, but that only weakly asserted their sovereignty over the places and peoples in distant territories. Instead, private capitalists, often organized in chartered companies (such as the British East India Company) asserted sovereignty over land and people, and structured connections to local rulers. Heavily armed privateering capitalists became the symbol of this new world of European domination, as their cannon-filled boats and their soldier-traders, armed private militias, and settlers captured land and labor and blew competitors, quite literally, out of the water. Privatized violence was one of their core competencies. While European states had envisioned, encouraged, and enabled the creation of vast colonial empires, they remained weak and thin on the ground, providing private actors the space and leeway to forge new modes of trade and production. Not secure property rights but a wave of expropriation of labor and land characterized this moment, testifying to capitalism’s illiberal origins.
War capitalism relied on the capacity of rich and powerful Europeans to divide the world into an “inside” and an “outside.” The “inside” encompassed the laws, institutions, and customs of the mother country, where state-enforced order ruled. The “outside,” by contrast, was characterized by imperial domination, the expropriation of vast territories, decimation of indigenous peoples, theft of their resources, enslavement, and the domination of vast tracts of land by private capitalists with little effective oversight by distant European states.
Cotton manufacturing thrived especially in the northern English county of Lancashire, where both the lack of guild control and the proximity to Liverpool, an important slaving port, became key to producers who supplied the African trade in slaves and plantations in the Americas.
Unlike Indian cotton spinners and weavers, the growing class of English cotton workers had no independent access to raw materials or to markets. They were entirely subordinated to the merchants — indeed, they enjoyed less independence and power than their Indian counterparts. British putting-out merchants, as a result, had far more power than Indian banias. The British cotton men were part of a rising global power whose navy increasingly dominated the world’s oceans, whose territorial possessions in the Americas and in Asia — India foremost among them — grew rapidly, and whose slavers created a plantation complex that rested in various ways on the manufacturing capacity of spinners and weavers thousands of miles away in the remote uplands of Lancashire and the plains of Bengal.
One reason for the relatively slow growth of European cotton manufacturing was the difficulty of accessing raw cotton.
Before 1770, therefore, European merchants secured the valuable fiber through well-established trade networks from a wide variety of locations. With the exception of the West Indies, their influence did not go much beyond the port cities themselves, as they had neither the power to tinker with how cotton was cultivated in the hinterland nor the inclination to advance capital for additional cotton growing. Cotton came to them thanks to the prices they were willing to pay, but they had no influence on how the cotton came into being. Local growers and merchants remained powerful actors within this global raw cotton nexus, not least because they neither specialized in cotton production for export nor in northern European markets.
While in 1614 British merchants had exported 12,500 untailored pieces of cotton cloth, between 1699 and 1701 that number spiked to 877,789 pieces annually. Exports of cloth by the British had increased by a factor of seventy in less than a hundred years.
To obtain these fabulous quantities of textiles from India at favorable prices, representatives for the European East India companies began to insert themselves even more into the production process within India itself. For decades, representatives of the chartered European East India companies had complained about the ability of Indian weavers to sell their goods to competing European companies, competing Indian banias, traders from other regions of the world, or even to private European merchants who operated independently of the companies, creating competition that raised prices. Profitability could be increased only if Europeans could force weavers to work for their respective company alone. Monopolizing the market became the way to drive down weavers’ incomes and drive up the selling price of particular goods.
The encroachment of British power on the subcontinent meant that weavers increasingly lost their ability to set prices for cloth.
To further their goal, the company now also employed its coercive powers toward the weavers directly. The company hired large numbers of Indians to supervise and implement new rules and regulations, in effect bureaucratizing the cloth market. Extensive new regulations attached weavers legally to the company, making them unable to sell their cloth on the open market. Company agents now inspected cloth on the loom, and endeavored to ensure that the cloth was, as promised, sold to the company. A new system of taxation penalized those weavers who produced for others. The company also increasingly resorted to violence, including corporal punishment.
Ironically, imports from India helped the European cotton textile industry by creating new markets for cotton fabrics and by continuing Europe’s appropriation of relevant technologies from Asia.
Protectionism played a key role in this process, testifying again to the enormous importance of the state to the “great divergence.”
What began as a policy to protect domestic wool, linen, and silk makers evolved toward an explicit program of encouraging the domestic production of cotton textiles. “The prohibition that the industrial nations imposed on printed textiles in order to encourage their own national production,” the French traveler François-Xavier Legoux de Flaix argued in 1807, provided European manufacturers who could not yet freely compete with Indian weavers with a sense of how promising the market for cottons would be. Domestic as well as export markets were potentially huge and extremely elastic. And just as protectionist measures limited access to European textile markets for Indian producers, European states and merchants increasingly dominated global networks that allowed them to capture markets for cotton textiles in other parts of the world. These markets, in fact, provided an outlet for cottons secured in India as well as for domestic producers. Thus Europeans could both increase cloth purchases in India and protect their own uncompetitive national industries — a miraculous feat possible only because war capitalism had allowed Europeans to dominate global cotton networks while at the same time constructing new kinds of ever more powerful states whose constant warfare demanded ever greater resources and thus embraced domestic industry.
Europe’s movement toward manufacturing cotton textiles was based, in fact, on what might be considered one of history’s most dramatic instances of industrial espionage.
Last but not least, war capitalism also nourished the emerging secondary sectors of the economy such as insurance, finance, and shipping, sectors that would become exceedingly important to the emergence of the British cotton industry, but also public institutions such as government credit, money itself, and national defense. These institutions originated in the world of war capitalism “as advanced industrial techniques and commercial practices” migrated from export businesses into the domestic economy.
India and China, or, for that matter, the Aztec and Inca empires, had not even come close to such global dominance, and even less so to reinventing how people produced things in the far-flung corners of the globe. And yet starting in the sixteenth century, armed European capitalists and capital-rich European states reorganized the world’s cotton industry. It was this early embrace of war capitalism that was the precondition for the Industrial Revolution that eventually created an enormous further push toward global economic integration and continues to shape and reshape our world today.
Chapter Three - The Wages of War Capitalism
Such conditions, however, were hardly unique, in fact they were shared, if not in all aspects, then at least in many particulars, from China to India to continental Europe to Africa. They cannot alone explain why the Industrial Revolution broke out in a small part of the British Isles in the late eighteenth century. British capitalists, however, in contrast to their counterparts elsewhere, controlled many global cotton networks.
Since labor costs were the primary obstacle to grasping the new tantalizing opportunities, British merchants, inventors, and budding manufacturers — practical men all — focused on methods to increase the productivity of their high-cost labor. In the process, they effected the most momentous technological change in the history of cotton. Their first noteworthy innovation came in 1733 with John Kay’s invention of the flying shuttle.
In eighteenth-century India, spinners required 50,000 hours to spin a hundred pounds of raw cotton; their cohorts in 1790 Britain, using a hundred-spindle mule, could spin the same amount in just 1,000 hours. By 1795 they needed just 300 hours with the water frame, or, with Roberts’s automated mule after 1825, only 135 hours. In just three decades, productivity had increased 370 times. Labor costs in England were now much lower than in India.
While it had been cheaper to produce cotton cloth in India before 1780, and its quality had been superior, after that year English manufacturers were able to compete in European and Atlantic markets, and after 1830 they even began to compete with Indian producers in India itself.
These new machines, the “macro inventions” celebrated by historians Joel Mokyr, Patrick O’Brien, and many others, not only accelerated human productivity, but also altered the nature of the production process itself: They began to regulate the pace of human labor. Dependent on central energy sources and requiring large spaces, production moved out of the home and into factories. Along with the machines, workers assembled in unprecedented numbers in central locations. While putting-out merchants had traversed the countryside searching for laborers, now workers sought out manufacturers in search of employment.
To operate all this machinery and to move the cotton through the factory, manufacturers hired hundreds of workers, most of them children and women. And while not all workers arrived at the factory gates voluntarily and received wages, the majority did. This was, as we will see later, another important institutional innovation of industrial capitalism. Outside the slave plantations of the Americas capitalists for the first time organized, supervised, and dominated the production process. Such domination of labor by capital, embrace of technological revolution, and social innovation did not happen elsewhere, including in the heart of the world’s cotton industry, China and India.
Because of the different organization of households, especially limitations on women’s outside activities, female-dominated spinning had extremely low opportunity costs in India and China, making the embrace of new technologies less likely.
Cotton manufacturing, even if engaged in on a small scale, was astonishingly profitable in the 1780s and 1790s. The firm of Cardwell & Birle had average annual returns on their capital of 13.1 percent, N. Dugdale 24.8 percent, and McConnel & Kennedy 16 percent. Such profits allowed them to expand without much recourse to formal capital markets. Indeed, “the favorite source of capital [for expansion] was retained profits.”
The growth of cotton manufacturing soon made it the center of the British economy. In 1770, cotton manufacturing had made up just 2.6 percent of the value added in the economy as a whole. By 1801 it accounted for 17 percent, and by 1831, 22.4 percent. This compared to the iron industry’s share of 6.7 percent, coal’s 7 percent, and woolens’ 14.1 percent. In Britain, as early as 1795, 340,000 people worked in the spinning industry. By 1830, one in six workers in Britain labored in cottons. At the same time, the industry itself became centered on a small part of the British Isles: Lancashire. Seventy percent of all British cotton workers would eventually labor there, while 80.3 percent of all owners of cotton factories originated in that same county.
Over the course of the eighteenth century cotton exports from Britain increased two hundred times — yet 94 percent of that increase took place in the two decades after 1780, when exports exploded by a factor greater than sixteen from their 1780 value of £355,060 to £5,854,057 in 1800. By the last years of the eighteenth century, 61.3 percent of all cotton cloth produced on the British Isles was exported. After 1815, thanks to these exports, England had indeed pretty much “eliminated all rivals from the non-European world” in the global trade of cotton yarn and cloth.
The ability of merchants and manufacturers to access these markets pointed to the importance of a peculiar and novel form of state, a state that would be the crucial ingredient for industrial capitalism and would eventually travel in quite peculiar patterns around the globe. After all, cotton exports expanded on the strength of British trade networks and the institutions in which they were embedded — from a strong navy creating and protecting market access to bills of lading allowing for the transfer of capital over large distances. This state was capable of forging and protecting global markets, policing its borders, regulating industry, creating and then enforcing private property rights in land, enforcing contracts over large geographical distances, forging fiscal tools to tax populations, and building a social, economic, and legal environment that made the mobilization of labor through wage payments possible.
As one perceptive French observer argued in the early nineteenth century, “England has only arrived at the summit of prosperity by persisting for centuries in the system of protection and prohibition.” Indeed, in the end, it was not so much the new machines that revolutionized the world, impressive and important as they were. The truly heroic invention was the economic, social, and political institutions in which these machines were embedded. These institutions came to further define industrial capitalism and increasingly set it apart from its parent, war capitalism.
A rising group of manufacturers pressed for a recognition of their interests, while statesmen and bureaucrats came to understand that their own exalted position in the world rested on Great Britain’s rapidly expanding manufacturing capacity. Manufacturers fought competing interests — the East India Company, for example — and competing elites, such as aristocratic landowners. And as merchants and manufacturers accumulated significant resources on which the state came to depend, these capitalists could translate their growing importance to the national economy into political influence. Cotton mill owners became increasingly active politically, culminating in the 1832 Reform Act that extended them the suffrage, allowing many textile entrepreneurs to move into the House of Commons, where they strenuously lobbied for the (global) interests of their industry, from the Corn Laws to British colonial expansion.
Built by newly empowered manufacturers and a state with vastly increased capacity, industrial capitalism found a very different answer to the question of how to mobilize labor, capital, and markets compared to its parent, war capitalism. Labor, unlike in the Americas, could be mobilized because changes in the countryside, including legal changes, had already produced a large group of landless proletarians who were forced to sell their labor power to survive, and did so without being physically coerced. Moreover, unlike for the plantation economy of the Americas, the territorial needs of cotton manufacturing were limited and focused mostly on accessing waterpower. As markets in land had emerged centuries before, and property rights in land were relatively secure and protected by the state, the land grab so typical of war capitalism did not and could not emerge in Britain itself. At the same time, an interventionist state was able to promote land uses deemed helpful to general economic development, for instance by allowing expropriations for the building of turnpikes and canals. Moreover, a highly centralized and bureaucratic state regulated and taxed domestic industry. Finally, and perhaps most decisive for this early moment in the emergence of industrial capitalism, the mechanisms of war capitalism could be externalized thanks to the state’s imperial expansion, in effect reducing capitalists’ need to recast the domestic social structure and their dependence on domestic resources, ranging from labor to food to raw materials. Some of the problems in the mobilization of labor, raw materials, territories, and markets had indeed been solved by war capitalism in the Americas, Africa, and Asia. And it was again a strong state (a state fortified by the institutional and financial accumulations of war capitalism) that was the root cause of the ability to externalize some of the labor, land, and resource mobilization. This state could in fact enforce different kinds of institutions in different parts of the world, with slavery and wage labor coexisting, for example.
Yet in Britain itself, war capitalism provided only the foundation, not the nature, of capitalism. To dominate production, workers were neither enslaved nor populations murdered, for capitalists were not fulfilling frontier fantasies beyond the reach of the state. This was revolutionary, but in our world, in which the institutional foundations of industrial capitalism have become commonplace, it is hard to appreciate just how revolutionary it was.
It was the volume and balance of trade that provided the state the revenues it needed to invest, for example, in expanded naval power in the first place. State revenues indeed increased by a factor of sixteen between the late seventeenth and the early nineteenth centuries, as Britain engaged in these years in a total of fifty-six years of warfare. And fully one-third of tax revenues in 1800 came from customs. As the Edinburgh Review remarked in 1835, “How great a degree of our prosperity and power depend on their [manufacturers’] continued improvement and extension.” State bureaucrats and rulers understood that manufacturing was a way to produce revenue for the state, as the state itself now rested on the industrial world it had helped create.
The Industrial Revolution, powered by cotton, was, as historian Eric Hobsbawm has put it, “the most important event in world history.”
And while British cotton manufacturers quite suddenly demanded huge new quantities of cotton, the institutional structures of industrial capitalism were still too immature and provincial to generate the labor and territory needed to produce all this cotton. For a terrible ninety years, from about 1770 to 1860, as we will see, industrial capitalism reinvigorated rather than replaced war capitalism.
Chapter Four - Capturing Labor, Conquering Land
Indeed, in the five thousand years of the history of the world’s cotton industry, slavery had never played an important role.
Rapidly expanding factories consumed cotton so fast that only the exigencies of war capitalism could secure the necessary reallocation of land and labor.
Indeed, British cotton manufacturing — and later, manufacturing across Europe — seemed a poor bet, for it was the first major industry in human history that lacked locally procured raw materials.
Whatever cotton there was available for export the East India Company shipped to China to finance its purchases of tea, replacing the need to export bullion there.
In the boom years of the 1770s through the 1790s, cotton was especially attractive to two up-and-coming groups of planters. The first consisted of small growers who lacked the capital necessary to start a sugar plantation and wanted a crop that would let them work more marginal lands, with fewer slaves and less investment, and still make fabulous profits. On Saint-Croix, for example, the average cotton plantation drew on the labor of less than a fifth as many slaves as the average sugar plantation. The second group consisted of planters in newly settled territories who planted cotton as a first crop for a few seasons to break the soil and would then use the cotton profits to move into sugar.
At the height of the cotton boom, in the 1780s, as cotton prices in France increased by 113 percent over 1770 levels, nearly thirty thousand slaves were shipped to Saint-Domingue annually. That elasticity of the labor supply, a hallmark of war capitalism, was unmatched by any other region of the world.
Slavery, in other words, was as essential to the new empire of cotton as proper climate and good soil. It was slavery that allowed these planters to respond rapidly to rising prices and expanding markets.
Approximately half of all slaves (46 percent, to be precise) sold to the Americas between 1492 and 1888 arrived there in the years after 1780. Slavery’s future was now firmly attached to the industrial capitalism that it had enabled.
Though cotton would eventually become a “poor man’s crop,” its first explosive expansion in Brazil was fueled by larger slave plantations. As in the West Indies, cotton in Brazil would never challenge sugar and later coffee, but its share of total exports in Brazil grew to a respectable 11 percent in 1800, and 20 percent in the years between 1821 and 1830.
Yet the cotton manufacturers’ total dependence on a distant tropical commodity turned out to be their signal breakthrough. Indeed, their factories would likely never have expanded as rapidly without the counterintuitive gamble of relying entirely on faraway land and labor. Already by 1800, Britain alone consumed such fabulous amounts of cotton that 416,081 acres of land were needed to cultivate it. If that cotton had been grown in Britain, it would have taken up 3.7 percent of its arable land, and approximately 90,360 agricultural laborers would have been needed to work these hypothetical cotton fields. In 1860, with the appetite for cotton even greater, more than 1 million workers (or half of all British agricultural workers) would have had to work these fields, which would have taken up 6.3 million acres or 37 percent of all arable land in Great Britain.
The elasticity of supply so essential to the Industrial Revolution thereby rested on reliable access to distant land and foreign labor. The ability of Europe’s states and their capitalists to rearrange global economic connections and to violently expropriate land and labor were as important, if not more important, to the ascendency of the West as the traditional explanations of technical inventiveness, cultural proclivities, and the geographical and climatic location of a small group of cotton manufacturers in a remote part of the British Isles.
In 1791, revolution rocked the most important cotton island of all — Saint-Domingue — all but halting production of commodities for world markets, including cotton. In the largest slave revolt in history, Saint-Domingue’s enslaved population armed themselves and defeated the French colonial regime, leading to the creation of the state of Haiti and the abolition of slavery on the island. War capitalism had its first major reversal at the hands of its seemingly least powerful actors: Saint-Domingue’s hundreds of thousands of slaves. Saint-Domingue cotton production had equaled 24 percent of British cotton imports the year before the revolution, while four years later, in 1795, it was only 4.5 percent.
Chapter Five - Slavery Takes Command
Indeed, the crop would become so intrinsic to American enterprise that the earlier reality — the dominance of cotton from the Ottoman Empire, the West Indies, and Brazil — has largely been lost.
Exports from South Carolina, for example, ballooned from less than 10,000 pounds in 1790 to 6.4 million pounds in 1800.
Production received a decisive boost in 1791 when rebellion eliminated cotton rival Saint-Domingue, Europe’s most important source of cotton, sending prices upward and scattering the entire class of French cotton planters: Some went to Cuba and other islands; many came to the United States. Jean Montalet, for example, one of many of Saint-Domingue’s former cotton planters, sought refuge on the mainland, and upon his arrival in South Carolina converted a rice plantation to the growing of cotton. Revolution thus in one stroke both brought needed growing expertise to the United States and increased the financial incentive for American planters to grow cotton. But the slaves’ uprising on the plantations of Saint-Domingue also ingrained a sense among manufacturers, planters, and statesmen of the inherent instability of the system of cotton slavery and land expropriations that they were about to expand in North America.
In 1793, Eli Whitney, only a few months after arriving in Savannah from his college days at Yale, built the first working model of a new kind of cotton gin that was able to rapidly remove the seeds of upland cotton. Overnight, his machine increased ginning productivity by a factor of fifty.
The only substantial problem was the land, as the same patch could not be used for more than a few years without either planting legumes on it or applying expensive guano to it.
In 1811, one-sixteenth of all cotton grown in the United States came from states and territories west of South Carolina and Georgia, by 1820 that share had reached one-third, and in 1860 three-fourths.
In 1790, three years before Whitney’s invention, the United States had produced 1.5 million pounds of cotton; in 1800 that number grew to 36.5 million pounds, and in 1820 to 167.5 million pounds.
By 1802 the United States was already the single most important supplier of cotton to the British market, and by 1857 it would produce about as much cotton as China.
What distinguished the United States from virtually every other cotton-growing area in the world was planters’ command of nearly unlimited supplies of land, labor, and capital, and their unparalleled political power. In the Ottoman Empire and India, as we know, powerful indigenous rulers controlled the land, and deeply entrenched social groups struggled over its use. In the West Indies and Brazil, sugar planters competed for land, labor, and power. The United States, and its plentiful land, faced no such encumbrances.
In terms of unencumbered land, the South had no rival in the cotton-growing world.
Indeed, by 1850, 67 percent of U.S. cotton grew on land that had not been part of the United States half a century earlier. The fledging U.S. government had inaugurated the military-cotton complex.
Cotton planters constantly pushed the boundaries, seeking fresh lands to grow cotton, often moving ahead of the federal government. The frontier space they created was characterized by the near absence of government oversight: The state’s monopoly on violence was still a distant dream.
British banker Thomas Baring, one of the world’s greatest cotton merchants, for example, was instrumental in the expansion of the empire of cotton when he financed the purchase of the Louisiana lands, negotiating and selling the bonds that sealed the deal with the French government. Before doing so, Baring asked for approval from the British government for such a vast expansion of the United States, through Henry Addington, the British prime minister.
As industrial capitalism expanded, the zone of war capitalism continued to push outward.
Farther south, in Florida, extraordinarily rich cotton lands were expropriated from the Seminoles between 1835 and 1842, the longest war in U.S. history until the Vietnam War. It is no wonder that Mississippi planters, argues one historian, had “an obsessive concern with well-organized and trained militias, adequate weaponry, and a responsive federal army.”
America’s remarkably cheap transportation costs were not preordained, but the direct result of the expansion of its national territory. Most significant here was the Mississippi, whose surge of cotton freight turned New Orleans, at the river’s mouth, into the key American cotton port.
Indeed, by 1830 fully 1 million people (or one in thirteen Americans) grew cotton in the United States—most of them slaves.
The expansion of cotton production, as a result, reinvigorated slavery and led to an enormous shift of slave labor from the upper to the lower South. In the thirty years after the invention of the gin alone (between 1790 and 1820), a quarter million slaves were forcefully relocated, while between 1783 and the closing of the international slave trade in 1808, traders imported an estimated 170,000 slaves into the United States—or one-third of all slaves imported into North America since 1619. Altogether, the internal slave trade moved up to a million slaves forcefully to the Deep South, most to grow cotton.
Indeed, 85 percent of all cotton picked in the South in 1860 was grown on units larger than a hundred acres; the planters who owned those farms owned 91.2 percent of all slaves.
So crucial was slave labor that the Liverpool Chronicle and European Times warned that if slaves ever should be emancipated, cotton cloth prices might double or triple, with devastating consequences for Britain. While brutal coercion weighed like a nightmare upon millions of American slaves, the potential end of such violence was a nightmare to those who gathered the fabulous profits of the empire of cotton.
Southern slaveholders had enshrined the basis of their power into the Constitution with its three-fifths clause. A whole series of slaveholding presidents, Supreme Court judges, and strong representation in both houses of Congress guaranteed seemingly never-ending political support for the institution of slavery. Such power on the national level was enabled and also supplemented by the absence of competing elites in the slaveholding states themselves, and the enormous power slaveholders enjoyed over state governments. These state governments, in the end, also allowed North American cotton planters to amplify their good fortune of navigable rivers near their plantations by building railroads deeper and deeper into the hinterland.
(it was said that transporting cotton to the port added about 50 percent to its cost in India, but as little as 3 percent in the United States),
And independence removed restraints from expropriating Native Americans as well, with the relationship between white settlers and North American Indians now removed from the complex negotiations of European politics. The disjunction of political from economic spaces in fact proved to be crucial for the world’s most dynamic industry — with cotton-growing slave owners dominating regional governments and exerting significant influence on the national government, their interests and the policies of the state could be aligned to a stunning degree, an impossibility for slaveholders within the British Empire.
The largest Delta planter, Stephen Duncan, owned 1,036 slaves and the value of his property by the late 1850s was estimated at $1.3 million. While not typical cotton farms, plantations in the Delta were highly capitalized businesses, indeed among the very largest in North America, and the investments necessary would have been beyond the reach of nearly every northern industrialist.
People engaged in the cotton trade crossed the North Atlantic frequently, forging close business connections, friendships, and even marriages. Such networks, in turn, made transatlantic trade more secure and more predictable, thus lowering costs and giving the United States another decisive advantage over its potential competitors, such as India or Brazil.
At the core of all of these networks was the flow of cotton from the United States to Europe and of capital in the opposite direction. This capital more often than not was secured by mortgages on slaves, giving the owners of these mortgages the right to a particular slave should the debtor default. As historian Bonnie Martin has shown, in Louisiana 88 percent of loans secured by mortgages used slaves as (partial) collateral; in South Carolina it was 82 percent. In total, she estimates that hundreds of millions of dollars of capital was secured by property in humans. Slavery thus allowed not just for the rapid allocation of labor, but also for a swift allocation of capital.
Because plantations were frequently larger than factories and required more substantial capital investments, and because aside from the spike in innovation around the invention of Eli Whitney’s gin in the 1790s technological progress in cotton agriculture was limited, productivity gains on plantations could only result from a reorganization of labor. Slave owners secured these productivity gains by taking almost total control of the work process — a direct result of the violent domination of their workers.
The all-encompassing control of workers — a core characteristic of capitalism—experienced its first great success on the cotton plantations of the American South.
Already by 1820, cotton constituted 32 percent of all U.S. exports, compared to a minuscule 2.2 percent in 1796. Indeed, more than half of all American exports between 1815 and 1860 consisted of cotton. Cotton so dominated the U.S. economy that cotton production statistics “became an increasingly vital unit in assessing the American economy.”
By 1850, one British observer estimated that 3.5 million people in the United Kingdom were employed by the country’s cotton industry — all subject to the whims of American planters and their tenuous hold on their nation’s politics.
As late as 1854, there were only thirty-four miles of railroad in India. One expert indeed argued that American cotton was so much more competitive than Indian cotton because of the vastly better system of railroads, and, one should add, a vastly superior system of rivers.
Instead, the East India Company had to engage constantly with local rulers, local power structures, local property ownership patterns, and local ways of producing things. British difficulties in India clarify the decisive difference from the United States. Though settler conflicts with Native Americans were costly, both in lives and treasure, the result left settlers in full control of the land and its resources. Indigenous ways of doing things were no longer. The local was simply obliterated. Indian peasants, like their counterparts in Anatolia, western Africa, and elsewhere, had shaped a world in which they could resist the onslaught of European merchant capital.
The government purchased the cotton at fixed prices, collected it at central warehouses, and then shipped it to Alexandria, where Ali was the only seller of the raw material to foreign merchants. In the 1820s and 1830s, between 10 and 25 percent of the revenues of the Egyptian state derived from this sale of cotton.
Chapter Six Industrial Capitalism Takes Wing
Indeed, in 1794 — only ten years after Greg’s venture in Styal — entrepreneurs erected the first mechanized spinning mill, although government agents forced its closure soon thereafter for fear that mechanization would lead to unemployment, misery, and social upheaval.
In the United States, cotton mills opened in Rhode Island (1790), New Jersey (1791), Delaware (1795), New Hampshire (1803), New York (1803), Connecticut (1804), and Maryland (1810). In 1810, according to the U.S. census, there were 269 cotton establishments in the United States with a total of 87,000 spindles. By 1860, there would be 5 million spindles, making cotton textiles the United States’ most important manufacturing industry in terms of capital invested, workers employed, and net value of its product.
Yet if this new way of spinning cotton yarn was so compelling, should it not have spread more evenly throughout the globe? Why did it take ten or more years to travel a few hundred miles to continental Europe, twenty or more years to cross the Atlantic to the United States, fifty or more years to reach Mexico and Egypt, and a hundred or more years to reach India, Japan, China, Argentina, and most of Africa?
One economist found that “the modern cotton industry nearly everywhere is building on older home industries.”
By 1823, the Boston Associates expanded further, building more mills in Lowell, about twenty-five miles north of Boston, and creating the largest integrated mills anywhere in the world. This move of American merchant capital into manufacturing marked another tight connection between slavery and industry. Early cotton industrialists such as the Cabot, Brown, and Lowell families all had ties to the slave trade, the West Indian provision trade, and the trade in agricultural commodities grown by slaves. The “lords of the lash” and the “lords of the loom” were, yet again, tightly linked.
British competition was a strong incentive to embark upon something radically new, but no manufacturer could do so without British technology. Though the British government tried to hold on to its monopoly, that technology spread rapidly due to active programs of private and government-directed industrial espionage as well as the unstoppable outflow of skilled British workers and cotton capitalists eager to make their fortunes in new lands. Between the invention of new machines in Britain and their spread elsewhere there was typically only a ten-year lag.
The U.S. cotton industry itself relied on British technology and on industrial espionage, easily camouflaged by ceaseless trade and immigration. In 1787, Alexander Hamilton (two years before he became secretary of the Treasury) and Tench Coxe sent Andrew Mitchell to Britain to acquire models and drawings of Arkwright’s machinery, a project that failed only when Mitchell was caught. Most famously, Francis Cabot Lowell ventured to Britain in 1810, allegedly for “health reasons,” and came back with blueprints for his factory at Watertown.
Alsatian manufacturers were about fifteen years ahead of their British counterparts in developing dyes and chemicals to fix color to cloth, technology that eventually allowed for the emergence of the huge chemical and pharmaceutical industry around Basel.
The idea of relentless technical innovation, a core characteristic of industrial capitalism, spread beyond the borders of Great Britain — a sign that industrial capitalism had grown wings.
Moreover, while the prevailing economic model — war capitalism — provided the resources needed, especially raw cotton, for industrialization and many important institutional legacies, the example of Great Britain had shown that war capitalism itself was ill-suited for the next step: the mass production of cotton textiles. Another way of organizing economic activity had to be forged—and transferring that model turned out to be much more challenging than moving machines or mobilizing capital.
Without a powerful state capable of legally, bureaucratically, infrastructurally, and militarily penetrating its own territory, industrialization was all but impossible. Forging markets, protecting domestic industry, creating tools to raise revenues, policing borders, and fostering changes that allowed for the mobilization of wage workers were crucial. Indeed, the capacity of states to foster a domestic cotton industry turns out to be the key division between places that industrialized and those that did not. The map of modern states corresponds almost perfectly to the map of regions that saw early cotton industrialization.
Much more important was a state’s ability to isolate its domestic manufacturing efforts from competition, especially from Britain. But only a few states in the early nineteenth century enjoyed the capacity to police their external borders. Tellingly, the first wave of mechanized cotton spinning came to continental Europe as a direct result of the ability of the expanding French revolutionary republic to keep British manufactured goods from the continent. The blockade of British trade, from November 1806 to April 1814, provided the single most important impetus for continental European cotton industrialization, protecting feeble beginnings so that they could become a full-fledged industry.
Protectionism, once seen as a wartime cataclysm, now became a permanent feature of newly industrializing states — who in this respect followed the British example, as Britain had protected its home market from Indian competition just as furiously.
By 1843, the prohibition of cotton textile imports was written into the Mexican constitution. As a result, the number of cotton mills in Mexico increased from four in 1837 to more than fifty in 1847.
Mexico’s independent state, subject to the pressure of deeply entrenched, well-organized, and consciously, programmatically industrialist businessmen who not only could make their interests central to state policies, but in fact often dominated the state, was essential for its move toward industrial capitalism. In Mexico, unlike, for example, Brazil, promoting domestic industry was very much an issue close to the heart of nationalist politicians: As one historian of Mexico observed, “The prosperity of manufacturers depended almost exclusively on the willingness and the capacity of the state to police the marketplace.” The independence of Mexico thus mattered a great deal.
While skills, markets, capital, and technology were available in many different parts of the world, a state that could protect domestic markets, forge access to remote markets, and create an infrastructure that facilitated manufacturing was the distinctive feature of early industrial leaders. And these increasingly powerful states also forged the institutions necessary to underpin industrial capitalism — from markets for wage labor (enabled by the undermining of precapitalist dependencies in the countryside and alternative means of gaining access to subsistence) to property rights created by laws and administrative infrastructures.
To survive in a competitive state system, prosperity was imperative, and embracing industrial capitalism seemed like a sure way to reach it.
War capitalism may have brought cotton industries to Egypt by herculean determination, but the progeny did not last for long. By the 1850s, Egypt’s cotton industry had essentially disappeared, its countryside littered with factory ruins. Egypt was never able to build the institutional framework that would have enabled a full transition to industrial capitalism; even something so basic as wage labor did not take hold. Its reliance on war capitalism, both in the cotton fields and in the cotton factories, ultimately limited the growth of domestic markets.
Brazil, unlike Mexico and, for a while, Egypt, thus failed to develop its own mechanized cotton industry, despite its access to cotton, capital, and technology. Indeed, Brazilian cotton industrialization had to wait until the 1880s. This failure to industrialize was the direct result of the peculiar political economy forged by politically influential slaveholders. These powerful sugar and cotton planters envisioned Brazil’s place in the global economy as the provider of agricultural commodities produced by slave labor, a vision that ran counter to a project of domestic industrialization.
Most important to them, however, slavery demanded low tariffs to facilitate the flow of sugar and coffee from Brazil into global markets and thus precluded the kind of protectionism that had enabled European, North American, and for a time Egyptian industrialization:
Plantation slavery’s imperatives, the case of Brazil shows, could be detrimental to industrialization.
The state of war between private parties at the heart of war capitalism contradicted the emerging imperatives of industrial capitalism.
This was also the case in the slave territories within the United States, the only country in the world divided between war and industrial capitalism, a unique characteristic that would eventually spark an unprecedentedly destructive civil war.
Faced with huge imports of ever cheaper cotton yarns and fabrics from its colonial ruler, and denied the services of its own government, India’s cotton industry was decimated — first its production for export, and then its domestic spinning. In the wake of the Industrial Revolution, as we have seen, India lost its once central position in the global cotton industry and, in a great historical irony, eventually became the world’s largest market for British cotton exports.
In 1847, Mayan insurgents captured the city of Valladolid in the War of the Castes, destroying the factory. The local state was too weak to protect its borders, to subdue rebellion, or to create a unified market, showing once again how important the state was to the lasting success of cotton industrialization.
Colonialism, the embrace of slavery, the expropriation of lands — war capitalism, in short — had enabled the rise of industrial capitalism in some parts of the world, while at the same time making its emergence much less likely everywhere else. Industrial capitalism rested, as we have seen, on a combination of capital and state power — creating markets and mobilizing capital and labor in novel ways.
Crucial to this phase in the history of capitalism was the very diversity of its forms. Capitalism rested on the coexistence of war capitalism, with its violent expropriation of land and labor, its peculiar state, and the uncoordinated and unrestrained initiatives of its leading capitalists, with industrial capitalism, with its administratively, infrastructurally, legally and militarily powerful states channeling private initiative. The simultaneity of such different but mutually dependent forms of capitalism might have been the true innovation of the late eighteenth and early nineteenth centuries. It was not global integration by itself but the diversity of forms within that global integration that explained the dramatic but also the wildly different rates of cotton industrialization during these decades.
One of the greatest institutional innovations brought about by capitalists’ and statesmen’s embrace of industrial capitalism, however, was the invention of new forms of labor mobilization. While capitalism’s vast labor in the Americas had been accomplished by enslaved Africans, the huge labor needs of manufacturing industries were met by creating a powerful new system of wage labor.
Chapter Seven - Mobilizing Industrial Labor
Ellen’s story highlights the physical violence of punishment, but as important, the more banal violence of economic desperation, which brought ever larger numbers of people into factories, where they spent their lives, quite literally, in the service of the empire of cotton.
Moreover, slave labor had significant economic disadvantages — it was difficult to motivate workers under conditions of servitude, and supervision costs were high. Slave labor, moreover, incurred costs year round, sometimes for the life of the worker, and was not easily adjusted to the vexing boom-and-bust cycles of industrial capitalism. The model of the plantation, in other words, did not serve the needs of the factory.
Moreover, the bureaucratic, military, ideological, and social penetration of a bounded territory by newly consolidating states aided mill owners. Coercion had almost always been a central element in getting people to perform labor for others, a staple for feudal lords and colonial masters alike. Yet one of industrial capitalism’s signal features was that coercion would now be increasingly accomplished by the state, its bureaucrats and judges, and not by lords and masters. Many capitalists throughout the world in need of workers feared the decline of personal dependencies such as serfdom, slavery, and apprenticeships, expecting idleness and even anarchy as a result. But in some areas the state had gained sufficient strength to create conditions that secured reliable flows of women, children, and men into factories. Throughout much of Europe, the rights of landowners and capitalists to control labor as personal dependents had been severely curtailed, but at the same time the state had increasingly taken on the role of legally compelling people to work (such as paupers, so-called vagrants, and children). Moreover, by the enclosure of the commons the state had made alternative possibilities of gaining a livelihood increasingly inaccessible, in fact increasing economic pressures on those without property. As legal historian Robert Steinfeld has put it, even “economic coercion is an artifact of the law,” that is, of the state.
Despite powerful state support, recruiting workers remained a huge challenge for budding manufacturers, testifying to the fact that workers themselves, as long as they still had access to other means of subsisting, tried to escape the world of the factory.
Perhaps most dramatic was the moment when power looms replaced hand weaving beginning in the 1820s. As a huge wave of misery passed over large parts of Europe, unemployed home-based weavers were ready to move into factories. In response to such conditions, factory employment often became a family strategy to maintain a household’s ability to stay on the land, either by sending one member of the family to work at a mill full-time or by sending various members of the family for short stints. That was the case among the workers in Lowell, Massachusetts, where (unmarried) women’s factory wages often enabled their families to remain on the land. Migrating into factory labor could give marginal agricultural pursuits another lease on life.
One way manufacturers tried to circumvent the problem of attracting large numbers of people to work in factories was by recruiting the weakest members of society first, those with the fewest resources to resist. To do so, they built upon long-established relationships of power within households, especially a long history of paternalism that allowed the male head of household to deploy the labor of his wife and children as he saw fit. The emergence of industrial capitalism in fact built upon such older social hierarchies and relations of power and used these as a tool to revolutionize society more broadly. Employers understood that the “cheapness” of their labor rested on the persistence of noncapitalist ways of securing subsistence — a lesson that would eventually also inform the transition to world market production in the cotton-growing countryside in India and elsewhere. The capitalist revolution succeeded because it remained incomplete.
The availability of women was crucial to the early cotton manufacturers. And it was also what distinguished large parts of Europe (and eventually also Japan) from many other areas of the world. Not that women elsewhere did not work in textile production — they did — but in Europe and North America, unlike in Africa and Asia, women could eventually move out of households and into factories, a critical condition for textile industrialization. In China, for example, the situation was quite different. As historian Kenneth Pomeranz notes, “The Chinese family system did not allow much migration by single women, either to cities or to peripheries, until twentieth-century factories with tightly supervised dormitories made this seem possible within the bounds of respectability.”
The expansion of the world’s mechanized cotton industry thus not only rested on the deployment of new technologies and access to capital and markets, but also on the ability of capitalists to turn thousands and eventually millions of people into proletarians — and, importantly, to break resistance to the imposition of a radically new way of living and working.
When workers rebelled, mill owners often came to depend on the state to suppress such upheaval, making mill owners’ ability to accumulate capital increasingly reliant on the power of nationalizing states — states whose own power rested more and more on successful industrialization.
The territorialization of capital, its growing attachment to and dependence on nation-states, however, also enabled workers to organize collectively to improve their working conditions and wages; eventually it would turn capitalists’ dependence on the state into labor’s greatest strength.
When in England large segments of the working class gained the vote in 1867, trade unions pressured the state to limit allowable remedies for workers’ breach of contract, and succeeded in 1875. In Germany it took until the revolution of 1918 to end criminal penalties for breach of contract. Indeed, “employment at will” — allowing workers to leave their jobs whenever they decide to do so — was the result of decades of struggle by workers, not a “natural” outgrowth of the emergence of industrial capitalism and even less so the precondition for its emergence.
Chapter Eight - Making Cotton Global
It was in Liverpool that industrial capitalism and war capitalism met, its merchants applying the logic of the former to the latter, and transforming both in the process. The genius of Liverpool’s merchants lay in their ability to combine ingredients often considered antagonistic: wage labor and slavery, industrialization and deindustrialization, free trade and empire, violence and contract.
Never before had any industry connected the activities of so many growers, manufacturers, and consumers across such vast distances. And as a result, never before were merchants so desperately needed. The scale of these networks created unprecedented problems of coordination. Neither peasants nor plantation owners, nor even wealthy manufacturers, could keep the channels upon which their livelihoods rested clear. The ability of merchants to organize the radical spatial rearrangement of the world’s most important manufacturing industry was as much of an invention as the more corporal machines and novel labor organization that dotted the globe by the 1850s.
Raw cotton was also by far the most important export good of the United States: In 1820, the value of U.S. cotton exports was some $22 million; leaf tobacco was valued at $8 million, and wheat at less than $500,000. Cotton constituted about 31 percent of U.S. merchandise exports by value. By 1860, the value of tobacco exports had doubled, and wheat exports had increased by a factor of eight — but cotton had mushroomed nearly nine times to $192 million. It now constituted nearly 60 percent of the value of all merchandise exports. As merchants built the world’s first truly global economy, cotton took center stage.
The most urgent problem merchants helped solve was how to supply manufacturers with raw cotton.
Brokers provided a more direct connection between manufacturers and cotton-importing merchants, and also organized the market by setting rules and regulations, distributing information, and providing elaborate arbitration services. They “brought to Liverpool the technical knowledge of the industry,” argues one scholar, and “they also brought a new kind of administrative skill and efficiency to deal with the problems of what was, virtually, a new trade.” As a result, brokers “became central figure[s] in the market.”
Ever more specialized in the production of particular qualities of yarns and goods, and demanding ever greater varieties of cotton, manufacturers found going into market to purchase all that cotton impossible. They depended on a constant flow of the crucial raw material into their factories, and brokers guaranteed that supply.
In a second step, brokers developed clear standards and a precise vocabulary for cotton; eventually, manufacturers would acquire cotton without even inspecting samples. They would, in effect, not order a particular bale of cotton from a particular place, but a particular quality. This was a radical recasting of the trade.
These categories were still approximations that could neither be precisely defined nor enforced, but they formed the foundation upon which later enforceable standards would be built. Without such standards, such a high-volume long-distance trade of bulk commodities would have been all but impossible — the vast diversity of nature had to be distilled and classified to make it correspond to the imperatives of machine production.
In 1846, the American Chamber of Commerce in Liverpool, founded in 1801 by Liverpool merchants trading with the United States, suggested that the brokers “cause samples of the several classes of American Cotton to be taken, to be placed at the disposal of the American Chamber so as to form a standard for reference in all questions as to quality of cotton.” Increasingly, the cotton market was no spontaneous interaction of utility-maximizing individuals, but a set of institutions forged outside the market itself.
Cotton standards emerged hand in hand with, and indeed enabled, another invention: a trade in cotton that had not yet arrived. For a futures market to work, information and samples had to travel faster than bulk cotton itself, something that seems to have emerged in the 1810s in Liverpool.
But there and elsewhere, these contracts were still exceptional, and as late as the 1850s cotton broker Samuel Smith observed that “nearly all the business was bona-fide transfers of cotton in warehouse, and it was quite an exception to sell a cargo afloat.”
Yet gradually the connection between a particular contract and a particular batch of cotton began to weaken. Cotton began to be sold that had not yet been shipped, indeed that would only come onto the market in distant months, and might not even have been planted yet. This further abstraction of the trade would blossom during the American Civil War, when true futures dealings came about.
Liverpool’s merchants were far and away the world’s most important cotton importers. By the mid-1700s they had brought the first cotton to Liverpool; by 1799, a full 50 percent of all British cotton imports arrived there (most of the rest went to London), and by the late 1830s that proportion had grown to 89 percent. Liverpool’s merchants cornered the global cotton market in ways few merchants ever have. They succeeded for several reasons. Initially, Liverpool’s central position in the Atlantic slave trade set it up well for trade in cotton. Cotton initially arrived, along with sugar, tobacco, and other goods, as return freight from the West Indies — one of the sides of the triangular trade. Liverpool may have controlled up to 85 percent of the British slave trade, and by its 1807 abolition as much as one-quarter of Liverpool shipping was in slaves; everyone who worked the city’s ports, therefore, was experienced with long-distance trade, and also with the cotton-growing regions of the Americas. And, as cotton increasingly came across the Atlantic rather than the Mediterranean, Liverpool was well situated to capitalize. The city also benefited from its location near the spinning districts in and around Manchester, a connection that rapidly improved thanks to the building of canals, improvements on the river Mersey, and eventually, in 1830, the arrival of the world’s first railroads. With such connections in place, Liverpool could benefit from the institutional innovations created by its traders.
Along with the Rothschilds, the Barings were Europe’s most powerful bankers, and just like the Rothschilds, the Barings forged an important connection to cotton during the first half of the nineteenth century. They also had a long-standing relationship to the United States, not least because they had facilitated that expanding slave power’s purchase of Louisiana from the French.
One American firm, Brown Brothers, would eventually join the ranks of the world’s most important cotton merchant houses. The Browns were immigrants from Ireland. Alexander Brown founded a modest linen business in 1800 in Baltimore, then branched out into the cotton trade. As part of this diversification, Alexander sent his son William to Liverpool in 1810 to open a house for the importation of American cotton and the export of cotton goods. He sent his other sons to other port cities. Most important of all, in 1825 son James went to New York, with the goal of promoting “the interest of Messrs. William & James Brown & Co., of Liverpool, and of affording greater facility, and the choice of markets, to our southern friends who are disposed to give... us their business.” By the 1820s, Brown Brothers was among the largest cotton traders between the United States and Liverpool.
The Browns would later channel some of their fabulous wealth into railroads, banks, and industrial ventures, and cultural institutions including the Museum of Natural History in New York.
Beyond advancing credit directly to planters, European and New York merchants also invested in southern state bonds and banks that financed a further expansion of cotton planting. In 1829, Baring underwrote Louisiana state bonds issued to finance the Consolidated Association of the Planters of Louisiana Bank. Although the bank was established by planters in 1828, foremost among them Baring’s friend Edmond Forstall, when it turned out to be impossible to raise sufficient capital, ultimately the State of Louisiana guaranteed the bonds. Once the bonds were issued, Baring took $1.666 million worth of them. Two years later, by April 1830, the bank had outstanding loans to planters of $1.6 million, secured by property valued at $5 million. In effect, Baring financed a great expansion of the Louisiana plantation complex, enabling the clearing of land and the purchase of slaves, all of which eventually fed into his own huge cotton import business. Few if any places in the world drew such concentrated capital investments as the plantation belt of the United States — and few places were the source of such massive profits.
At bottom, factors like Ladd drew on capital advanced by European merchants and they advanced that capital to planters to enable them to purchase land, slaves, and provisions. Those same European merchants also advanced credit to enable manufacturers to purchase cotton, and provided capital to cloth traders worldwide, enabling them to acquire cotton goods to sell to customers. Without credit, the empire of cotton would have crumbled — indeed, as any foreclosed planter knew only too well, the empire of cotton was at its heart an empire of credit.
Other merchants, as we have seen, moved their assets from a different line of trade into the cotton business. The Barings did just that, transferring capital from their government loan business and East India engagements into the cotton trade. So did the Browns, who used the capital accumulated in the linen trade to go into cotton; the Rathbones, who used the profits from their diversified trade to specialize in cotton; Nathan Rothschild, who used his father’s profits in banking and general trade to invest massively in the textile business; and Bombay merchant Jamsetjee Jejeebhoy, who used profits from the opium trade to get into the cotton export business. Other merchants accumulated riches in the slave trade — Liverpool merchants sometimes shifted into cotton after Britain abolished the slave trade in 1807. And then there were the banks that pooled merchants’ resources in cities such as Liverpool, Le Havre, and New York, banks willing to advance credit to traders who in turn could use it to oil the global machinery of cotton production.
The American Chamber of Commerce in Liverpool understood this relationship when it reported at its 1843 meeting that it very often happens that in the course of such transactions planters or other persons in Slave holding countries become indebted to British merchants who, with a view to secure themselves from loss, take security from their debtors by means of mortgage of their plantations with the Slaves which form an essential part of the value.
Not only did individual merchants become slave owners, but more broadly, the flow of credit between Britain and the United States rested to a significant degree on slave property. It was exactly for this reason that in 1843 the American Chamber of Commerce in Liverpool lobbied against the Slave Act, which, they feared, would make “all mortgages [secured by slaves] and other Securities made... to accomplish any object or contract in relation to any object” unlawful. People used as collateral, not just as laborers, lubricated the flow of capital, and thus cotton, around the globe with ever greater velocity.
If prices for raw cotton fell rapidly, as sometimes happened, merchants would hold cotton worth less than the advances they had made, making it difficult or impossible for them to pay their debts. The result: the global panics of 1825, 1837, and 1857.
Despite periodic collapses, capital for the most part moved with remarkable ease into the farthest reaches of cotton production in regions of the world dominated by slave labor. It was much harder for European buying brokers, selling brokers, importing merchants, and factors, despite the rapidly growing capital at their command, to penetrate cotton-growing countrysides dominated by peasant labor. The rhythms of peasant production, as we have seen, proved stubborn — much to the voluble frustration of cotton merchants and manufacturers. In fact, the tools of European war capitalism, so effective in North America, did not allow for the full incorporation of land and labor in Asia and Africa into the global cotton nexus. The necessary infrastructure, physical, administrative, military and legal, simply did not exist.
In the cotton-growing countryside itself, Indian traders advanced funds to growers, often at exorbitant rates of interest, who in turn sold the raw cotton to brokers, who then advanced the cotton to coastal merchants — a system the British considered “evil,” principally because it eluded their control.
European commercial penetration into the hinterland of cotton-growing areas was still the exception rather than the rule in most of the world. At midcentury, most cotton produced was never traded through the books of European or North American merchants.
Remarkably, throughout the first half of the nineteenth century the penetration of European capital into the global cotton-growing countryside was largely limited to areas in which cotton was grown by slave labor—slavery, not peasant production, was the handmaiden of wage labor at the birth of the Industrial Revolution. Only after slavery became untenable as a mode of labor mobilization and European states had gained vastly increased administrative, judicial, military, and infrastructural capacities thanks to their ability to capture some of the wealth generated by mechanized manufacturing would European capital and state power begin to revolutionize the global countryside in India, Egypt, and, eventually, Central Asia and Africa.
The principal globalizers were neither the planters nor manufacturers, many intensely local in their mind-set, but instead, as we have seen, the traders who specialized in creating networks that connected cultivators, manufacturers, and consumers.
To become such powerful actors in the empire of cotton and to manage this trade profitably, the Rathbones, Barings, Lecesnes, Wätjens, Rallis, and others constructed dense networks through which information, credit, and goods could flow reliably. Building such networks was extraordinarily difficult. The Rathbones, for example, spent astonishing energy nurturing their links to merchants in New York, Boston, and various southern ports, especially Charleston and New Orleans. They corresponded constantly with business partners, trying to get market updates and gain access to trade opportunities. They also traveled frequently to the United States, and extended stays in North America became a rite of passage for young members of the firm.
The global cotton trade, as we have seen, rested on credit. Credit rested on trust. Trust, in a global market extended well beyond the kin of any family or tribe, rested on information. Information was accordingly at the core of most merchants’ activities. A vast swath of information was potentially relevant to any merchant, but two strands were the most valuable: who paid back their debts, and what would happen to the price of cotton in the coming months.
The need both to have information and to be seen to have it was why at the outset of his career as a Liverpool cotton broker, Samuel Smith immediately launched his own cotton circular, a step that in retrospect he judged “aided not a little in establishing my business.”
Access to information in turn privileged certain locations within the empire of cotton, as William Rathbone VI realized in 1849, when he predicted that New York would become “more and more the centre of the American trade (guided of course by advices from European markets)... Within 10 days sail from England & within an hour of information [by the newly invented telegraph] & communication with New Orleans, St. Louis, Cincinnati, Charleston & a party is in possession of more information of importance than at any other point.” Rather than proximity to either cotton-growing or cotton-manufacturing areas, what really counted for the Rathbones and others was access to information.
What set merchants apart was not just their ability to accumulate and deploy capital, or even their privileged access to information, but their ability to build and draw upon these networks, networks of trust based on extended family ties, geographical proximity, and shared religious beliefs, ethnic identities, and origin.
As the example of the Rallis shows, the Greek diaspora, like others — Armenian, Parsis, Jews — played an important role in the global cotton trade.
Other diaspora communities played an important role in the global cotton trade. Jews assumed a central position in the global trade of yarn and cotton cloth, partly because earlier discrimination had forced them to work as itinerant traders, often in textiles. The most famous example for this important role are the Rothschilds, who upon entering the textile trade in Manchester mostly found customers among their coreligionists in Frankfurt for the goods they exported to the European continent.
Though merchants lobbied their governments about anything and everything, among the most important issues was the infrastructure of trade. The construction of docks, storage facilities, railways, and waterways was high on the merchants’ agenda, since they directly affected the speed at which goods and information moved through the emerging global economy — and that speed of circulation determined the speed of accumulation.
While most merchants had a clear ideological commitment to free trade, which corresponded perfectly with their interest in market access and cheap labor, they could advocate just as forcefully for creating novel barriers to trade. In fact, their insistence on free trade was remarkably inconsistent. As early as 1794, a number of cotton merchants protested “against the export of cotton twist from England.” The export of spun cotton, according to them, threatened British prosperity, as the yarn was woven into fabrics in low-wage Germany, creating unemployment in Britain. In an eerily modern argument, they argued that “Germany’s cheaper food enabled them to manufacture by hand cheaper than our workpeople could, they had first deprived our hand loom weavers of employment and now were rapidly progressing with the other departments including spinning.” The Manchester Chamber of Commerce similarly opposed the emigration of “English Artizans” and “the free exportation of such Machinery as is employed in our own Manufactories.”
They feared that any strengthening of the federal government might interfere with their mastery over labor. Slavery, after all, required constant violence against potentially rebellious slaves, and that violence rested on the state’s willingness to condone it. Slave owners therefore felt an overpowering need to secure control over the state, or, at the very least, to keep the opponents of slavery out of the national halls of power.
Joining the Browns, foreign capitalists like the Barings also increasingly diversified, especially into railroads, coal mining, and manufacturing. They understood better than others that with the state’s capacity expanding, the role of merchant capital was diminishing, and that a future beckoned in which industrialists, in conjunction with the state, would be able to burrow even further into the global countryside to find still more land and labor for the production and consumption of cotton. The most forward-looking manufacturers and merchants discerned that such new forms of domination would decisively weaken the power of commodity producers, and thus eliminate one of the most threatening sources of instability in the empire of cotton, and with it, global capitalism.
Chapter Nine - A War Reverberates Around the World
One author boldly estimated that in 1862, fully 20 million people worldwide — one out of every sixty-five people alive — were involved in the cultivation of cotton or the production of cotton cloth. In England alone, which still counted two-thirds of the world’s mechanical spindles in its factories, the livelihood of between one-fifth and one-fourth of the population was based on the industry; one-tenth of all British capital was invested in it, and close to one-half of all exports consisted of cotton yarn and cloth.
On the eve of the Civil War, raw cotton constituted 61 percent of the value of all U.S. products shipped abroad.
By the late 1850s, cotton grown in the United States accounted for 77 percent of the 800 million pounds of cotton consumed in Britain. It also accounted for 90 percent of the 192 million pounds used in France, 60 percent of the 115 million pounds spun in the Zollverein, and 92 percent of the 102 million pounds manufactured in Russia.
The reason for America’s quick ascent to market dominance was simple. The United States more than any other country had elastic supplies of the three crucial ingredients that went into the production of raw cotton: labor, land, and credit.
As South Carolina senator and cotton planter James Henry Hammond put it famously on the floor of the Senate, “England would topple headlong and carry the whole civilized world with her” if the system of slave-powered cotton growing would be threatened. “No power on earth dares to make war upon it. Cotton is king.”
Yet from a global perspective, the outbreak of war between the Confederacy and the Union in April 1861 was a struggle not only over American territorial integrity and the future of its “peculiar institution,” but also over global capitalism’s dependence on slave labor across the world. The Civil War in the United States was an acid test for the entire industrial order: Could it adapt to the even temporary loss of its providential partner — the expansive, slave-powered antebellum United States — before social chaos and economic collapse brought their empire to ruins?
With its shocking duration and destructiveness, the American struggle marked the world’s first truly global raw materials crisis, and proved midwife to the emergence of new global networks of labor, capital, and state power.
While manufacturers closed mills and spinners and weavers suffered, cotton merchants lived — for a brief time — through a golden age. Rising prices for cotton led to a frenzy with “doctors, parsons, lawyers, wives and widows, and tradesmen speculating in it.” Cotton shipments changed hands many times between speculators before being delivered to factories; with each exchange a small profit could be made. Baring Brothers, confirmed in the summer of 1863 that the “amount of money made and still making in this article is almost fabulous; for three years or more not a bale has arrived from India but has paid profit and mostly a large one.” Liverpool cotton brokers gained as well from the presence of many speculators in the market (resulting in many transactions), and also rising prices (their commissions were a percentage of the value).
By 1863, the Liverpool Cotton Brokers’ Association had created a standard form that could be used by merchants making contracts about the future delivery of cotton, and Liverpool newspapers began reporting forward prices of Indian cotton. That year, “time bargains” had even begun to be established in Bombay, providing new opportunities for “men afflicted with a passion for gambling.” The war, in fact, resulted “in a revolutionary modernization of trade” in which the establishment of a formal futures market was perhaps the most important element.
This intense public concern with securing access to cheaply priced raw materials essential to national industries was a clear departure from the past. Since the 1780s, raw cotton markets had been decisively dominated by merchants, but now cotton had become a matter of state, a state empowered not least by decades of merchant political mobilization.
Lord Palmerston warned in October 1861 that England must have cotton because “we cannot allow millions of our People to perish.” The French Ministry of Colonies commissioned reports on cotton growing prospects in such diverse places as Guyana, Siam, Algeria, Egypt, and Senegal. The outlines of a new kind of imperialism began to emerge.
The bombardment of Fort Sumter, however, announced that India’s hour had come. For cotton merchants, manufacturers, and statesmen, no place seemed more promising a source of cotton than India.
Even The Economist, the world’s leading publicist for the benefits of laissez-faire capitalism, eventually endorsed state involvement in securing cotton, especially from India. It was hard to justify these steps in terms of the “laws of supply and demand,” but eventually The Economist — and with it many others — found a way: “The answer, at least a great part of the answer is, that there appears to exist in many important parts of Indian society very peculiar difficulties, which to some extent impede and counteract the action of the primary motives upon which political economy depends for its efficacy.” In India, it continued, “The primitive prerequisites of common political economy... are not satisfied. You have a good-demanding Englishman, but, in plain English, not a good-supplying Indian.” For that reason, “There is no relaxation of the rules of political economy in the interference of Government in a state of facts like this. Government does not interfere to prevent the effect and operation of ‘supply and demand,’ but to create that operation to ensure that effect... There is no greater anomaly in recommending an unusual policy for a State destitute of the ordinary economical capacities, than in recommending an unusual method of education for a child both blind and deaf.”
Whereas India had only contributed 16 percent of Britain’s supply of raw cotton in 1860, and 1.1 percent of France’s in 1857, it contributed 75 percent in 1862 in Britain and as much as 70 percent in France. Some of this cotton had been diverted from domestic use and competing foreign markets (especially China), while the rest was the result of a 50 percent increase in production.
“The American slaveholders have done more to promote the development of the resources of India by British capital,” observed the Cotton Supply Reporter, “than British capitalists would ever have done without their interference.” The crisis of American slavery in effect forced and enabled the reconfiguration of the cotton-growing countryside elsewhere.
By 1864, 40 percent of all fertile land in Lower Egypt had been converted to cotton farms. Egyptian rural cultivators, the fellaheen, quintupled their cotton production between 1860 and 1865 from 50.1 million to 250.7 million pounds, marking a permanent economic change of such significance that historians of Egypt rank the American Civil War among the most crucial events in that country’s nineteenth-century history.
“The biggest commercial catastrophe in the world.” French engineer Charles Joseph Minard maps the impact of the Civil War on the global cotton industry.
Some cotton manufacturers and merchants in Europe went as far as to hope for a permanent separation of the Union to enable the continued growing of cotton by slaves in an internationally recognized Confederacy. They believed that the cotton empire depended for the foreseeable future on slavery. In France, the procureur général reported widespread sentiments among mill owners in the textile region of Alsace that “from a commercial point of view, the separation would be a boon for us due to the ease that the South was willing to give the European Trade.” The procureur général of Colmar observed in 1862 that public opinion more and more favors the “prompt recognition of the Confederacy.”
Tellingly, Liverpool, the world’s largest cotton port, was the most pro-Confederate place in the world outside the Confederacy itself. Liverpool merchants helped bring out cotton from ports blockaded by the Union navy, built warships for the Confederacy, and supplied the South with military equipment and credit.
Washington, wrote Seward in April 1862, had “an obvious duty... to examine the capacities of other countries for cotton culture and stimulate it as much as possible, and thus to counteract the destructive designs of the factious monopolists at home.”
For British colonial official W. H. Holmes the dilemma was clear: “When the slave became a free man... his first desire was also to become independent; to be completely his own master.” In Guyana, which he studied carefully, “a trifling amount of labour procures the few luxuries, which a most fertile soil fails to place within reach,” making it unlikely that farmers would grow export crops for wages. Vegetables, fish, and fruit were available for the asking, a situation that, “in my opinion, [has] been fraught with evil consequences.” French colonial bureaucrats had come to essentially the same conclusion: Once “free... the Black... returns to the hut of the savage.” Freedpeople’s retreat into subsistence agriculture, envisioned by so many former slaves as a true foundation for their new freedom, was the worst nightmare of cotton merchants and manufacturers the world over.
To be sure, The Economist argued, “All these ends were secured, it must freely be acknowledged, by slavery. For the mere execution of great works cheaply no organization could be equal to that which placed the skilled European at the top, and made him despotic master of the half-skilled black or copper-coloured labourer below...” But slavery had also “moral and social consequences which are not beneficial.” And for that reason, “A new organization therefore must be commenced, and the only one as yet found to work effectively is... one based upon perfect freedom and mutual self-interest... If, however, complete freedom is to be the principle adopted, it is clear that the dark races must in some way or other be induced to obey white men willingly.”
But perhaps most important, cotton capitalists had learned that the lucrative global trade networks they had spun could only be protected and maintained by unprecedented state activism. Meanwhile, statesmen understood that these networks had become essential to the social order of their nations and hence a crucial bulwark of political legitimacy, resources, and power.
Chapter Ten - Global Reconstruction
Just as slaves had revolutionized the cotton empire, emancipation forced cotton capitalists toward their own revolution—a frantic search for new ways to organize the cotton-growing labor of the world.
Moreover, agricultural wages were too low and too insecure to entice rural cultivators to give up subsistence production, as much greater risks were not balanced by the possibility of higher rewards.
The reconstruction of the empire of cotton, at its core, required the diligent effort of cotton industrialists, merchants, landowners, and state bureaucrats to undermine such preferences, drawing, in the process, on the powers of newly consolidating nation-states, and sanctioning legal — and often illegal — coercion to make rural farmers into the cultivators and eventually consumers of commodities. They sought to revolutionize the countryside by spreading capitalist social relations, including credit, private ownership in land, and contract law. They sought — and eventually found — what French colonial officials aptly called “a new mode of exploitation.”
Though they did not know it at the time, the Civil War had disempowered the world’s last politically powerful group of cotton growers. From the vantage point of cotton manufacturers, this marginalization stabilized the empire of cotton, making the recurrence of the kind of upheaval that had emerged in defense of slavery quite unlikely.
White yeoman farmers had produced at most 17 percent of all U.S. cotton before the Civil War; by 1880 their share had increased to 44 percent.
More important as a source of labor were leased convicts.
American rural cultivators recovered, despite all predictions to the contrary, their position as the world’s leading producers of raw cotton. By 1870 their total production had surpassed their previous high, set in 1860. By 1877 they had regained their prewar market share in Great Britain. By 1880 they exported more cotton than they had in 1860. And by 1891 sharecroppers, family farmers, and plantation owners in the United States grew twice as much cotton as in 1861 and supplied 81 percent of the British, 66 percent of the French, and 61 percent of the German market.
And by 1920, it produced 598 million pounds of cotton, or twelve times as much as in 1860. A full 40 percent of all land in Lower Egypt was planted in cotton. To some, Egypt now seemed like a giant cotton plantation.
What all these struggles to recast the global countryside had in common was that states now played an important role. New forms of coercion, instituted and carried out by the state, replaced the outright physical violence of masters that had been so important to slave labor. This does not mean that physical violence was absent, but it was secondary compared to the pressures that came from contracts, the law, and taxation. As states developed new sovereignty over territory they also extended their sovereignty over labor, testifying to the new institutional strength of industrial capitalism.
The rights of the new owners were far-reaching, including their ability to “imprison, expel, starve, exploit, and exercise many other forms of arbitrary, exceptional, and, if necessary, violent powers.” As a result, these estates represented a “system of supervision and coercion that succeeded for the first time in fixing cultivators permanently on the land.” To make land into the exclusive possession of single individuals had required what political scientist Timothy Mitchell has described as the “violence of property making.” These new property rights spread rapidly: In 1863, estate owners controlled one-seventh of the cultivated land area of Egypt, by 1875 almost twice as much, and by 1901 a full 50 percent.
The largest landowner of all, Isma’il, accumulated such debts that in 1878, in the wake of falling cotton prices, he signed over his estates to his creditors, the Rothschilds. At the same time, the Egyptian state took out massive loans to finance the digging of irrigation canals (largely by resorting to forced labor), the building of railroads, and the import of steam pumps. So staggering were the amounts borrowed that the state eventually went bankrupt, despite ever greater pressure on the Egyptian people to produce for export markets. That debt brought Egypt as a whole into the arms of the British: With diminishing proceeds from cotton, Egypt could not service its debt, lost sovereign control, and was eventually taken over by the British government in 1882.
Berar’s natural landscape, for example, was turned upside down by a vast British effort to survey the land, followed by the encouragement of the British to turn so called “waste lands” into cotton farms. “Waste lands” once had been open to the collective use of farmers, but now increasingly were turned into private property. In the process, extensive forests that traditionally had been the source of firewood and wild foods were logged, and grasslands put under the plow that had in earlier times served as communal grazing lands. Logging further reduced the forests to feed the steam presses of Western merchants in the major Berar cotton towns. In some parts of the world, such deforestation led to significantly altered patterns of rainfall, undermining the very colonial cotton craze that had incited deforestation in the first place.
State involvement in cotton was furthered in many other ways. Perhaps the most comprehensive endeavor was the systematic effort to collect and disseminate information about all aspects of cotton agriculture. Huge compilations about climate and soil conditions, production trends, patterns of land ownership, seed qualities, and labor systems increasingly filled governmental office files, much of the same information that in previous decades merchants had laboriously gathered and transmitted via letters or circulars. In part this was a straightforward effort to systematize and appropriate indigenous knowledge.
But more important than either of these two tasks was a very simple effort to take stock — to observe what was there in the social and natural world, to translate that information into numbers, force it into tables, compile it, and then send it out throughout the empire of cotton. These numbers clarified the “potential” of certain places and suggested certain policies to actualize that potential.
In 1866, the colonial government of India created the “Cotton Commissioner for the Central Provinces and the Berars,” a colonial bureaucrat who collected scrupulously detailed information on cotton-growing regions. Harry Rivett-Carnac, an intrepid agent of the cotton empire’s expansion, came to fill this position,
The United States in 1862 established a Department of Agriculture, which soon began to work on cotton.
Sudanese peasants, as the Austrian consul general reported from Khartoum in 1877, refused to grow increasing amounts of cotton because “the native searches and finds his means of subsistence in much easier ways and in less taxing occupations than the difficult and relatively unprofitable cultivation of the soil.” In Iraq, a German observer remarked in 1919 that “the awakening of a greater willingness to labor is prevented by the presence of cultures in the country which provide the laborer effortlessly everything he needs for nourishment and for all other necessities” — an argument made by colonial officials the world over.
By the end of the nineteenth century, sharecropping and tenant farming had become the dominant mode of mobilizing labor for similar reasons that they dominated in the United States: Rural cultivators preferred the autonomy of working without day-to-day supervision, and they generally resisted being turned into wage workers.
Sharecropping, crop liens, and powerful local merchants in control of capital would quickly become the new normal, shaping a countryside of laborers who were not enslaved, but not quite free either. These cotton farmers, the world over, would be deeply enmeshed in debt, vulnerable to world market fluctuations, generally poor, and subject to newly created vagrancy statutes and labor contracts designed to keep them on the land. They would be politically marginalized. And they would often be subject to extraeconomic coercion. Such a system was not without precedent. But now, supercharged with private capital and the state’s legal, administrative, and infrastructure advances, it began to structure the global cotton-growing countryside to an unprecedented extent.
Some large haciendas had recruited several thousand such workers, who worked twelve hours a day six days a week. These workers joined the agricultural proletariat because they had lost their erstwhile communal access to the resources of the land due to the concentration of landownership. Many of these workers eventually arrived in La Laguna on private rail lines, packed like cattle in boxcars. Since there was no land available for these migrants, there was no possibility of engaging in subsistence agriculture.
Instead, “The landlord’s rule was law,” observes one historian, as haciendas enforced labor discipline with the help of uniformed private police forces, jails, and the “physical punishment” of workers. Some plantations even built a cepo de campaña — a specially made “cage... to punish troublesome workers.” Migrant workers were often supervised by armed guards stationed in the fields. The state helped to enforce labor discipline, with towns enacting “strict vagrancy laws to keep [those workers] outside the central area when they were not working.” This resort to physical coercion was widespread in the world’s cotton - growing areas and was important in the United States, Peru, Egypt, and elsewhere. Capitalism’s awe-inspiring advances continued to rest not just on a great variety of labor regimes, but on a staggering degree of violence.
For labor to be turned into a commodity, workers had to be “liberated” from the matrix of mutual obligations that had historically sustained them. They believed, at the same time, that land had to be “liberated” from noneconomic ties and made into a freely marketable commodity. This “liberation” rested ideologically on the naturalizing of certain historically specific ways of organizing production, and was thus enabled by economic, social, cultural, and even racial hierarchies it had helped to produce. Capitalists were the age’s true revolutionaries. Rulers and bureaucrats supported this project because securing access to raw materials, including extracting cotton, became increasingly a touchstone of national politics.
Powerful states, rulers, and bureaucrats depended on strong national industries, which in turn depended on raw materials and markets — for such industries produced wealth that could be taxed, and provided employment for millions, all of which in turn increased social stability and further strengthened the state.The construction of markets, including global markets, was thus a political process.
As the colonial world became an important supplier of raw materials and a significant market for some industries (up to 60 percent of British cotton goods exports, for example, went to India and the Far East), industrial capitalism took on a new cast, with states securing political control over territories that provided raw materials and markets. One-quarter of the globe “was distributed or redistributed as colonies” between 1876 and 1915, testifying to the rapidly growing importance of bounded territory.
Ironically, the project to strengthen newly consolidating nation-states and “national” economies increasingly also became an international project, best symbolized by the international cotton congresses that met regularly starting after 1905, bringing together merchants, manufacturers, planters, and bureaucrats in places such as Manchester, Vienna, Paris, Brussels, Milan, London, Stockholm, and Alexandria.
As competitive nation-states strengthened in a few regions of the world, they shared a burning wish to reconstruct the global countryside, and embedded their policies in strategies transcending any particular nation-state. Again, state formation and globalization unfolded hand in glove.
And while the dilemmas of “free labor” would remain central to global conversations, by the 1870s, from the perspective of cotton capitalists, the crisis of the empire of cotton that had emerged from the emancipation of cotton growing workers had been resolved. The newfound ability of capitalists and states to transform the global cotton-growing countryside with the tools of industrial capitalism allowed for ever more cotton to arrive at ever cheaper prices in the ports of Liverpool, Bremen, Le Havre, Osaka, and Boston.
Chapter Eleven - Destructions
Thanks to their backbreaking and ill-remunerated labor, well into the twentieth century trade in cotton and cotton goods “was still by far the largest single trade” in both the Atlantic world and Asia. Even as late as the 1930s, the Japanese cotton traders of Toyo Menka Kaisha asserted that “cotton is indisputably the prime commodity in the international trade of the world.”
Yet ironically, under manufacturers’ pressure to deliver the cheapest possible cotton, the commission-intensive business of importers, brokers, and factors were increasingly squeezed as well, and eventually replaced by a much simpler — and much less expensive — system of trade. In fact, so successful had merchants become in connecting distant growers and manufacturers to one another that their own labor had become less and less important. Pressured by manufacturers who sought to cut transaction costs, the myriad intermediaries who had moved cotton from the plantation to the factory before the 1860s consolidated, to be replaced by a few vertically integrated cotton dealers. New characters now strode onto the cotton empire’s stage, people who would connect growers directly to manufacturers. The old-style importers and brokers declined. Some, such as the Browns, in a savvy move, had already mostly exited the cotton business before the Civil War. Others, such as the Rathbones, accumulated huge losses after the war, and then retreated from the trade.
The importance of old-fashioned importers, brokers, and factors within the empire of cotton declined even more as the global cotton trade was increasingly dominated by a small number of cotton exchanges. Trades on these exchanges no longer rested on trust networks forged by religious, kin, or place-of-origin solidarities. Instead, these institutions were impersonal marketplaces in which anyone at any time could trade in any quantity and quality of cotton for immediate or future delivery, or could speculate on the future price movements of cotton that had not been shipped, or perhaps not even grown. Such cotton exchanges spread rapidly across the globe: In 1869, the New York Cotton Exchange opened, followed by the New Orleans Cotton Exchange in 1871, and further exchanges in Le Havre, Bremen, Osaka, Shanghai, São Paulo, Bombay, and Alexandria. These exchanges specialized in the trading of contracts on the future delivery of cotton. Such “to arrive” trading, as we have seen, had already emerged in a sporadic way before the 1860s, but now “futures” took off to become the dominant mode of the global cotton trade, made possible by the accelerated speed at which information traveled around the globe, facilitated, most crucially, by the laying of the first transatlantic telegraph cable in 1866.
Now trade was highly abstracted from the actual physical cotton and highly standardized, the great variety of nature molded through conventions and contracts into categories that corresponded to the abstractions capital required to make it commensurable. Most important was the standardization of cotton itself. The huge natural variety of cotton, for the purposes of trades in futures, was impossible to handle and thus was fictitiously reduced to just one — “middling upland” — and contracts were standardized to specific lot sizes of this quality.
As historian Kenneth Lipartito notes, the “speculation in futures helped to impose worldwide supply and demand conditions on local markets, thus moving the entire cotton trade towards the ideal of a single market with a single, internationally determined price for each grade of cotton.”
In 1914, the “Official Cotton Standards of the United States” were created, their use required for all futures transactions. In 1923, the Cotton Standards Act made it illegal to use any other standards for American cotton in interstate or foreign commerce, and as a result these standards also guided transactions on European cotton exchanges. With government classifiers in government classing rooms housed in cotton exchanges, the state had entrenched itself in the very heart of the global cotton trade.
Moreover, the state also became an important supplier of statistics that made the market more legible, rendering much less central the sophisticated networks of information gathering and exchange that merchants had forged through huge investments in time and treasure. Beginning in July 1863, the U.S. Department of Agriculture issued monthly reports on cotton production.
No market was more important than the ancient home of the world’s cotton industry. Asia’s cotton markets were vast, and winning them was the grand prize that British, French, Dutch, Spanish, and American imperialism bestowed, not just on Lancashire manufacturers, but on some continental European, North American, and Japanese manufacturers as well. India in particular became a huge market—already in 1843 it was for British manufacturers their most important customer, and it remained central for about a century thereafter. By 1900, 78 percent of the total production of the British cotton industry was exported, much of it to India.
In China, the 1842 Treaty of Nanking forced the opening of markets, and the subsequent influx of European and North American yarn and cloth had a “devastating” effect, especially on China’s hand spinners.
As cotton yarn and cloth from the heartlands of the world’s cotton industry flowed into the world’s cotton-growing areas newly constituted as backwaters, they brought with them a tsunami of deindustrialization. “The importation of cheap machine-made piece goods has in many parts driven the native spinners and weavers altogether out of the market, and many have had to take to working on the roads, or have been engaged as farm-labourers,” observed Berar cotton commissioner Harry Rivett-Carnac in 1869.
In India the American Civil War was such an event. During that war, many spinners found themselves unable to compete with the market price for their crucial raw material. The Madras Chamber of Commerce in its 1863 report observed that “the enhanced price of Cotton has rendered the position of the Cotton Weavers of this Presidency one of great difficulty.” As a result, the number of weavers decreased by as much as 50 percent during the American war, with former weavers moving into agricultural labor.
As late as 1920, there were still about 2.5 million handloom weavers remaining in India. Even Mahatma Gandhi, who made the devastating impact of colonialism on domestic industry a key aspect of his political campaigns, admitted in 1930 that “next to agriculture, hand-weaving is still the largest and most widespread industry throughout the whole of India” — not least because despite all the rapid advances, the capitalist reorganization of the countryside remained far from complete in the early twentieth century.
“In Assam and Burma,” tellingly reported the Department of Industry and Commerce, “weaving forms part of a girl’s education and woman’s ordinary household duties. The family... is supplied in this manner, and the articles turned out are seldom offered for sale; when the surplus production is disposed of in the local market, the cost of the labour spent in the domestic occupation practiced during leisure hours is not taken into consideration in calculating the price.” The incomplete transition to capitalism, in fact, enabled the super-exploitation of members of households who could labor for less than the cost of their subsistence.
In India alone, historian Tirthankar Roy concluded, “There is undeniable empirical evidence that the community of hand-spinners gave up spinning on a large scale, and this factor alone may account for a loss of industrial employment to the extent of 4–5 million persons.” Other historians have suggested that the loss of manufacturing between 1830 and 1860 amounted to between 2 and 6 million full-time jobs in India alone.
Yet the radical recasting of ever larger swaths of the world’s countryside also had less positive consequences. Most crucially, it undermined food security. During the American Civil War, British officials in Ahmedabad, Haira, and Surat had reported that “the increasing area of land devoted to cultivation of Articles of Export, such as Cotton... [has led to a] proportionate decrease in cultivation of articles of food.” As a result, food prices rose between 1861 and 1865 by more than 325 percent, and even Sir Charles Trevelyan had to admit that “at the present high prices of food, the body of the people, in several parts of India, are barely able to subsist.”
The market now increasingly subsumed all aspects of society
In Egypt as well, the booming cotton export industry, according to historian Alan Richards, “destroyed the old quasi-communal forms of land tenure, broke up the protective web of village social relations, replaced them with private property in land and individual tax responsibility, and helped create four classes: large landowners..., rich peasants..., small peasant landowners, and a landless class.”
Though historians disagree as to how much the fall in world market prices affected cotton growers, at the very least world market integration increased the economic uncertainty faced by people in remote corners of the world. Their incomes, and quite literally their survival, were now linked to global price fluctuations over which they had no control.
As one historian of India has remarked, “Successful participation in markets requires economic autonomy and the capacity to take risks and sustain losses. Poor and indebted peasants had neither.”
In 1877 and again in the late 1890s, Berar, as well as northeastern Brazil, witnessed the starvation of millions of cultivators as cotton prices fell while food grain prices rose, putting food out of reach of many cotton producers. Specializing in cotton could result in disaster, as in the 1870s famine, which was not caused by a lack of food (indeed, food grains continued to be exported from Berar), but by the inability of the poorest agricultural laborers to buy urgently needed food grains. In India alone, between 6 and 10 million people died in the famines of the late 1870s. Observed one gazetteer, “Had Berar been an isolated tract dependent on its own resources, it is possible that in the plain taluks [British administrative units] there would have been no famine.” High prices had made food unavailable to many peasants and agricultural laborers, and during the 1900 famine, another 8.5 percent of the population of Berar died, with the greatest numbers of deaths occurring in districts most specialized in cotton production.
The rebellion of cotton cultivators at times had a significant impact on national politics, as in the United States, where Populists influenced the critical presidential election of 1896 and forced a greater presence of the state in the cotton trade, but also in Mexico, where they played an important role in the Mexican Revolution of the 1910s.
Chapter Twelve - The New Cotton Imperialism
Russia had turned itself into one of the most important cotton-growing countries in the world, ranking fifth behind the United States, India, China, and Egypt. The radical changes that the Russian state and Russian and Central Asian capitalists were able to effect led others to look with envy at their success. In 1902, German economist August Etienne remarked with genuine admiration that Russia “approaches with rapid steps inexorably its objective to make the Russian cotton industry independent from America.” Russia deserved praise, since “with its Asiatic cotton culture it has shown the rest of Europe, what energetic will and well planned cooperation between national and private forces can do to solve the cotton question.” A new cotton imperialism had begun to take shape.
In 1868, New England manufacturers, including Atkinson, in cooperation with southern cotton planters, created the National Association of Cotton Manufacturers and Planters, which sought to promote the expansion of cotton agriculture, primarily in Mississippi and Texas, a project strikingly similar to those of Europe’s imperial elites.
Of the greatest magnitude, however, in terms of additional output of cotton was the further extension of the U.S. cotton complex. Its expansion had been in some ways comparable to that of Russia — state agents and military units had captured contiguous territory and sponsored the construction of new infrastructures to make it accessible. As in Russia, the state would later drain wastelands, contain waterways, and build irrigation infrastructures. Yet while Russia mobilized Central Asian cultivators and forcefully settled nomads to grow cotton (as had also been the case in the Ottoman Empire’s Çukurova), the United States removed most indigenous inhabitants from cotton-growing soils as it encouraged citizens from farther east to move in, combining, as historian John C. Weaver has put it, “defiant private initiative” with “the ordered, state-backed certainties of property rights.”
The most dramatic expansion of cotton agriculture, however, occurred farther to the west. In Arkansas, Louisiana, Oklahoma, and Texas, the production of cotton exploded from 1,576,594 bales in 1860 to 7,283,000 bales in 1920 — a factor of 4.6 in the half century after the U.S. Civil War. By far the most important expansion took place in Texas, a state whose farmers had only produced 431,463 bales of cotton in 1860, but produced ten times as many, 4,345,000 bales, in 1920. Indeed, the cotton growth of 1920 in Texas alone equaled about 80 percent of that of the entire South in 1860.
Most of these new cotton-growing territories had been captured from Mexico in 1848, and without their acquisition, Mexico, not the United States, might have been the world’s premier cotton producer by the early twentieth century.
Cotton planters chased America’s native peoples from their land, though eventually they hired some of them to work on cotton plantations. In Oklahoma, as elsewhere, the dispossession of America’s native people and the expansion of cotton-growing territories went hand in hand—state coercion, indeed, was central to the further expansion of the empire of cotton.
Yet statesmen and capitalists pushed the cotton frontier ever further, and Africa, in particular, became the focus of European efforts. These European efforts in fact were directly related to the United States’ and Russia’s successful expansion of their respective cotton empires, and focused on the goal of emancipating themselves from the United States’ cotton supply. Africa, in other words, was to be the “South” and “West” of Europe — a supplier of raw materials, labor, and agricultural commodities that were deemed necessary to confront the global challenge of a rising United States with its seemingly limitless supplies of industrial raw materials, and also of a Russia whose very territorial extent embodied a rising “threat.” Imperial efforts at cotton growing in Africa were the cutting edge of the cotton empire’s new “national” constitution.
Despite significant productivity increases, the number of workers directly engaged in cotton spinning and weaving had increased to nearly four hundred thousand, with an estimated one in eight German industrial workers so employed by 1913, making the “healthy development of our cotton industry a vital question for our national economy.” The value of their output was the most considerable of all domestic industries and constituted the nation’s most important export product. In 1897, the German cotton industry produced goods valued at 1 billion marks, or about 36 percent more than those of the next largest industry, coal, and 45 percent more than the industry that symbolized Germany’s economic miracle and all too often overshadows our historical imagination, the male-dominated iron and steel industry. And no other German industry was so reliant on other countries for its crucial raw material. Because all raw cotton came from abroad, it amounted to Germany’s costliest import. A full 1 billion pounds of cotton were imported into Germany in 1902. “King Cotton has become the most powerful ruler,” observed cotton manufacturer Karl E. Supf, “he has deeply affected the social conditions, yes, even entirely rearranged them.”
Only colonial cotton production, argued economist Karl Helfferich, could break the “economic rule of America over the European cotton industry.” Colonial cotton, in short, was the only way to resist “American rape.”
Taken together, between 1860 and 1920, 55 million acres of land in Africa, Asia, and the Americas, at the very least, were newly planted with cotton for world markets — an area larger than that of Massachusetts, Vermont, Rhode Island, Connecticut, New Hampshire, and New York combined. Approximately 80 percent of all that new cotton-growing land was situated in territories that had not grown cotton in 1860, the vast majority of which had come under the effective control of colonial powers only during those years. Indeed, by 1905, cotton experts estimated, a full 15 million people, or about 1 percent of the world’s population, were engaged in the growing of cotton. Imperial expansion and the production of ever more cotton for world markets were inextricably linked.
By World War I, the recast class structure, along with a huge deficit in food crops thanks to the reorientation of local agriculture toward cash crops, produced terrible famines, resulting in significant depopulation. In Turkestan, for example, the population fell by 1.3 million people, or 18.5 percent, between 1914 and 1921.
These plantations, many of them run by German textile industrialists, had had trouble securing a sufficient number of African laborers, who by and large were not willing to work there. Though local German planters had tried to persuade the colonial administration to raise taxes in order to force rural producers to work for wages, the government had been reluctant to do so, fearing open rebellion.
Indeed, prices, markets, and infrastructure were creations of the colonial administration. And the colonial state’s role went further: By taxing rural cultivators and making these taxes payable in labor, the state coerced them to, among other things, carry cotton from Tove to the coast, to build railroads, and even to clear land for cotton. By recasting the context in which rural cultivators came to make their decisions, they hoped to bend their inclinations toward embracing world market production of cotton.
Such price discrepancies show that a market in cotton never developed; indeed German merchants who wanted to purchase cotton in Togo had to formally guarantee that they would not pay more than the price stipulated by the colonial administration. Throughout Africa, colonial authorities created such highly regulated and supervised markets, which became increasingly coercive to break peasants’ preference to sell cotton to the thriving and more profitable local cotton industry.
German colonial officials bemoaned that “unlike America, the peasant here is not dependent on cotton growing for his subsistence. The latter always has access to other crops, and his needs are so low, that he can live without any cash income for extended periods of time.” The “dread of starving” that British abolitionists had hoped would replace the “dread of being flogged” as a motivation for colonial people to produce crops for world markets failed in Togo in the face of plentiful alternatives. Such resistance to the global marketplace, moreover, had astonishing staying power, because the Germans were unable to institute systems of exploitive credit relations.
Colonialists systematically undermined markets by setting fixed prices that were completely detached from the world market price, compelling cultivators to bring their cotton to market in ways exactly prescribed by the colonial administration, eliminating middlemen, forcing certain cotton strains on producers, and, last but not least, extracting labor from peasants by force.
By 1914, rules as to how cotton had to be treated were honed further and now included corporal punishment for indigenous growers who violated them. As time went by, force, violence, and coercion became ever more central to German policy.
To reorient an economy toward the world market in the absence of clear-cut economic incentives, social relations in the countryside had to be drastically recast — a process that usually took either several decades, as in India, or severe violence, as in the slavery-dominated societies of the American South, the West Indies, and Brazil.
It was only during the 1920s, when France got to govern much of the territory of Togo, that world market production of cotton expanded significantly — three times between 1913 and 1938. But, tellingly, cotton production only truly took off after independence, and today Togo exports 84 million pounds of cotton, or seventy-five times as much as under German rule. Togo is still one of the world’s poorest countries.
Cotton manufacturers’ shared interests in the transformation of the global countryside transcended national boundaries, resulting in the formation of an incipient transnational bourgeoisie during the period before World War I as manufacturers from a wide variety of countries met not just to discuss how to make rural cultivators in Egypt, India, or elsewhere grow more cotton, but also to take pleasure rides on the Nile or dance in the concert halls of Vienna.
Chapter Thirteen - The Return of the Global South
Despite Chhotalal’s early success and the region’s cotton history, most of the merchants and traditional business classes of Ahmedabad remained reluctant to invest in further mills, content for the time being with high rates of return on moneylending.
Most precipitous was the declining importance of cotton manufacturing in the United Kingdom. In 1860, 61 percent of the world’s mechanical spindles had turned there, but by 1900 that percentage had declined to 43 percent and by 1930 to 34 percent. Thanks to workers’ struggles for better working conditions, British machines also operated for fewer hours than machines elsewhere. They were also generally older, and thus their share of global output was even smaller, just 11 percent by 1932.
By the twentieth century, the Asian cotton industry had turned into the world’s fastest-growing, as the world’s cotton industry returned to where it had largely originated.
This rise of cotton manufacturers in the global South resulted from a shift in the balance of social power in both the heartland of industrial capitalism and its periphery. Industrial capitalism had altered class structures not only in Europe and North America, but also in the global South, which witnessed the rise of new inequalities in state strength and wealth. Two groups played a decisive role in this century-long story: workers in Europe and the northeastern United States, and aspiring cotton capitalists in the global South. They contributed independently to a pair of mutually reinforcing processes: nationalizing social conflicts and strengthening states. As workers organized across the United States and Europe, their collective action increased labor costs. This made low-wage producers elsewhere competitive on global markets, even though those operations were often less efficient. At the same time, capitalists in the global South supported state policies conducive to their own project of domestic industrialization. They could also draw on a pool of low-wage workers, many of whom had been displaced by the rapid transformation of the countryside. This combination of huge wage differentials and the construction of activist states shifted the geography of global cotton manufacturing more rapidly than most observers thought possible. In short, assertive northern workers and politically sophisticated southern capitalists changed the shape of the empire of cotton, foreshadowing the new global division of labor so familiar today.
The effects of such work regimes continued to be profound: Among the textile workers of the German city of Aachen, for example, an estimated half of all children died before celebrating their first birthday, an unusually high rate of child mortality.
Between 1870 and 1894, a total of eighty-five strikes occurred in the cotton textile industry, with 53,341 workers participating; between 1895 and 1900, 139,154 workers participated in 188 such strikes. During the huge 1905 strike wave, workers took part in 1,008 walkouts, succeeding in improving working conditions, shortening the workday, and gaining higher wages.
The spinners’ union, which organized the most highly skilled workers in spinning mills, had by the 1880s organized almost 90 percent of all workers, making it perhaps “the most powerful union in the world.” They succeeded in raising wages, improving working conditions, and managing technological development. The Spinners were among the “best organized and best-financed workers’ organizations in Britain,” and they extracted premium wages and captured a large portion of the increasing productivity of the industry from the 1880s to the 1920s.
Cotton workers in the Saxon town of Crimmitschau demanded in 1903, “One more hour for us! One more hour for our families! One more hour for living!” And even if all too often their demands were unsuccessful, over the years they managed to decrease their working hours from an annual average of 3,190 hours in 1865 to 2,475 hours in 1913. In France, labor legislation in 1892 restricted women to the eleven-hour workday, to be reduced further in subsequent years. In January 1919 the Spanish government gave cotton workers the eight-hour day.
After World War I taxes on employers also surged, demonstrating that the administrative, judicial, and military capacity of the state, so vital for industrial capitalism, came at a rising cost. Indeed, the tensions that led to war in the first place had emerged from the tightening connections between national capital, nation-states, and national territories. The competition between increasingly powerful states rested on the mobilization of their citizens into mass armies and the marshaling of taxes to fund those armies and produce war materials. Under such pressures to extract money and people, states were forced to legitimize themselves democratically.
For European and North American capitalists, this dependence on powerful states — the principal source of their strength — was now also their single greatest weakness, because these states in effect enabled working-class power on the shop floor and in politics. From the perspective of capitalists, indeed, the state was Janus-faced. It enabled the emergence of industrial capitalism, including the mobilization of labor in the global countryside, but it also “trapped” capitalists, as workers would use access to national politics to better their working conditions and wages. As a result, social conflicts that had once been primarily global (as when the mobilization of slaves in Saint-Domingue affected the interests of cotton manufacturers in Britain), or local (as when Indian peasants refused to labor on British cotton plantations), now increasingly became national.
In the long run, cotton manufacturing became a “race to the bottom.” Manufacturers tried to respond to such pressures by using their access to ever more powerful governments to insulate their respective national industries from global competition.
Italy effectively protected its home market with tariffs on cotton goods passed in 1878 and 1888. In France, at the behest of its cotton manufacturers, increasingly protectionist tariffs had fueled cotton industry profits since the 1880s, especially since 1892 with the passing of the Méline Tariff. The United States also saw the strengthening of its protectionist regime in the last half of the nineteenth century. In 1861, the Morrill Tariff increased duties on imported cotton goods, and while the Tariff Act of 1883 lowered tariffs on cheaper cottons (qualities that American manufacturers could easily produce), it increased them on higher qualities, a trend that continued with the Tariff Act of 1890.
Even in the United States, following the demands of cotton manufacturers such as Edward Atkinson, the government aggressively helped manufacturers gain access to markets abroad, especially in Latin America, the destination of half of U.S. cotton exports.
By the 1920s, the northern industry, for the first time, actually shrunk, and by 1925 the U.S. South had more spindles than the North. By 1965, the ratio was 24 to 1, a radical reversal of fortunes.
Lax labor laws, low taxes, low wages, and the absence of trade unions made the South alluring to cotton manufacturers, a region of the United States, according to an industry publication, “where the labor agitator is not such a power, and where the manufacturers are not constantly harassed by new and nagging restrictions.”
Such ideas became a mainstay of anti-imperialist conversations, from Japan to India, from West Africa to Southeast Asia. Strong nation-states, these thinkers hoped, might one day protect domestic manufacturers, build infrastructure, mobilize labor, and help manufacturers capture export markets. There was no little irony in the fact that anticolonial nationalism as often as not drew on the lessons of colonialism itself.
Japan experienced an even greater boom in cotton manufacturing. Indeed, it was of such magnitude that Japan became in the course of just a few decades the world’s dominant cotton manufacturing power.
The Japanese Spinners’ Association had formed itself as a leading lobby in 1882, pressuring the government for policies favorable to cotton industrialization, most importantly the discontinuation of the import tax on raw cotton (which was meant to protect Japanese cotton farmers) and an end to export fees on yarn. The Greater Japan Cotton Spinners’ Association followed suit in 1888. In fact, industrialists helped build the very state that supported their interests. Capitalists and rulers were able to implement these lessons because they defeated the visions of rival elites but faced no significant democratic mass movements to contest their control over the state.
The government, moreover, stood as the ultimate guarantor for all kinds of debts that were essential for the success of the industry.
The Japanese government acquired the ability to support local cotton industrialists in part because of the spoils of war. Indeed, the Japanese story once more demonstrates the tight link between colonial expansion and industrial capitalism — the one, in effect, enabling the other. Reparations gained from the 1894–95 Sino-Japanese War — essentially a land grab — were used to subsidize the nation’s shipping industry, thus helping cotton exports, and fueled the government’s ability to provide credit to the country’s trading firms and forgo the revenue generated by duties on raw cotton imports, which were removed in 1896, cheapening the industry’s essential raw material.
In one of its most decisive effects, the war also provided new markets, which would soon become supremely important to Japan’s industrialization. China turned into Japan’s most important buyer of yarn and cloth, until 1929, when it gained itself the ability to impose tariffs. By 1894 China consumed 92 percent of all Japanese exports, and by 1897–98, exports of cotton yarn, especially to China, constituted 28 percent of total Japanese spinning output. During World War I, with British manufacturers sidelined, Japan made its deepest penetration to date of the Chinese market. When exports of yarn declined, those of cotton cloth expanded. Between 1903 and 1929, indeed, more than half of all Japanese cotton cloth exports went to China.
The years between 1920 and 1937 were a golden age for the Japanese cotton industry. In 1933, Japan for the first time exported more cotton cloth than Great Britain, France, and Germany, and was the world’s third cotton power after the United Kingdom and the United States. By 1937, Japan had captured 37 percent of the globally traded cotton cloth market, compared to just 27 percent for England. Thanks to this explosion of cotton manufacturing in Japan, Asia as a whole had become again a net exporter of cottons, after a hiatus of about a century and a half.
The number of spindles exploded, from 1.5 million in 1879 to nearly 9 million in 1929. Cotton manufacturing would come to dominate the Indian manufacturing economy.
But wherever global South capitalists succeeded in carving out a niche for themselves in the global cotton industry, they did so because two processes emerged simultaneously: the nationalization of social conflict in the core countries of the first Industrial Revolution, which increased labor costs, and the construction of states favoring a project of domestic industrialization and keeping down labor costs in the global South. It was in China that these stories came together.
Cotton industrialization came to China later than to the U.S. South, Japan, India, or Brazil. This was not for lack of experience in cotton manufacturing, difficulty obtaining raw cotton, the absence of markets or capital, or lack of access to modern manufacturing technology. As we know, China had one of the world’s oldest and largest cotton manufacturing complexes, and indeed until the mid-nineteenth century Chinese peasants were the single most significant growers of cotton globally, nearly all of which was manufactured into yarn and cloth domestically. In turn, the spinning and weaving of cotton were China’s most important manufacturing activities. Despite such ideal preconditions for cotton industrialization, mechanization only began at the end of the nineteenth century.
In 1882, for example, the United States sent a gunboat to Shanghai to support its cotton interests.
At first the industry grew slowly. By 1896 there were only 12 mills with 412,000 spindles. Two decades later, the number had risen to 31 mills with somewhat more than 1 million spindles. Then came World War I, which played a similar role for Chinese cotton industrialization, and Asia’s more generally, as the Napoleonic Wars had done for continental Europe 125 years earlier. Its protectionist effects created a mill building boom, and by 1925 there were 118 mills with more than 3 million spindles, employing 252,031 workers, half of them in Shanghai alone. The growth of cotton manufacturing in China after 1914 was indeed the fastest in the world.
When the U.S. Department of Commerce reported in 1916 on the situation in Chinese cotton mills, it found tens of thousands of workers laboring day and night on twelve-hour shifts, with the only break for twelve hours on Sundays. Their pay amounted to about 10 U.S. cents a day. With working hours “longer than in any other country in the world” and no child labor laws on the books, China was the world’s lowest-cost producer.
But the financial means, and indeed the power, of the government was quite limited, especially after the defeat in the 1895 war against Japan, which saddled China with indemnity payments. It was only in the 1920s and 1930s, when Chinese nationalists called for a boycott of Japanese goods, and after 1929, when China regained the capacity to create tariff barriers, an ability that it had lost in 1842, that Chinese industrialists could begin to compete effectively.
Unlike the situation in Japan, or, for that matter, other parts of the world, Chinese investments in cotton mills were rapidly combined with, and eventually superseded by, international investments. The reason for this unusual deep penetration by foreign capital was the very weakness of the Chinese state: The 1895 Treaty of Shimonoseki that ended the Sino-Japanese War, as mentioned, explicitly allowed for the establishment of foreign-owned mills in China.
Such investments made Japanese-owned mills the fastest-growing segment of the Chinese cotton industry, and by 1925 nearly half of Chinese spinning capacity was foreign-owned, overwhelmingly by the Japanese.
Symbolizing the great significance of cotton to nationalism and anticolonialism, a few years later Gandhi not only wrote a history of cotton in India, but also publicly spun cotton on a spinning wheel, the same mechanism that the Indian National Congress chose in 1930 as the centerpiece for its flag.
More so than perhaps anywhere else in the world, cotton and nationalism became intertwined in India. Textile industrialists became supporters of the independence movement, and its leaders in turn made domestic cotton industrialization a prime goal. As Gandhi, who enjoyed close connections to Ahmedabad’s mill owners, put it in 1930, “The cotton textile industry is a valuable national asset giving employment to a large number of people, effecting the prosperity of the people of India, and its safety and progress must continue to receive attention of her capitalists, labour leaders, politicians and economists.”
Such victories—and even more so decolonialization itself — came not as a result of the political strength of global South capitalists alone, but because nationalist movements were able to draw on large numbers of newly mobilized peasants and workers. Indeed, decolonialization almost always rested on mass mobilization, and thus the construction of nation-states in the formerly colonial world looked drastically different from their constitution in Europe and North America a century and a half earlier. Capitalists’ dependence on workers and peasants in their struggle to create a state conducive to the interests of national capital, however, weakened those same capitalists in the long run.
The need to forge a state dedicated to the interests of national capital, in a colonial setting such as India, in effect brought national capitalists into an uneasy alliance with politically mobilizing workers and peasants.
Industrial capitalism had become central to the survival of the state itself, a state that often now prioritized the industrial in industrial capitalism. In fact, capitalism at times seemed to stand in the way of industrialization. Yet even though Soviet Russia, Communist China, and independent India and Egypt represented variations of the most radical merger of the state and capital, of industrialization and political consolidation, capital by the 1950s had been hedged in by nation-states more generally. It was only after the 1970s, as we shall see, that industrialists began to emancipate themselves from their age-old dependence on particular states. Capitalists, so long dependent on strong states to pursue their project of industrial capitalism, now began overcoming their greatest weakness — the territorialization of capital. It was at this point that the empire of cotton took on the shape of today.
Chapter Fourteen - The Weave and the Weft: An Epilogue
But by 1963, Europe’s domination of the empire of cotton was over. By the late 1960s, the United Kingdom could only claim 2.8 percent of global cotton cloth exports, a market it had so decisively dominated for a century and a half. Of the more than six hundred thousand workers who had once labored in British mills, only thirty thousand remained.
The symbolic evidence of the continent’s fall had come in 1958, when the Manchester Chamber of Commerce, long an adamant champion of free trade, reversed course and declared that the British cotton industry needed protection — an unintended but obvious expression of defeat.
Yet while a century ago your shirt would have likely been sewn in a shop in New York or Chicago, using fabric spun and woven in New England, from bolls grown in the American South, today it is probably made of cotton grown in China, India, Uzbekistan, or Senegal, spun and woven in China, Turkey, or Pakistan, and then manufactured in a place like Bangladesh or Vietnam. If any part of the cotton empire, whose rise this book has charted, was involved in your shirt at all, that unlikely, vestigial element would be American-grown cotton. Twenty-five thousand highly capitalized cotton farmers remain in the United States, mostly in Arizona and Texas. The cotton they grow is so uncompetitive on the world market that they receive enormous federal subsidies to continue to farm it, subsidies that in some years equal the GDP of the country of Benin (coincidentally, another important cotton grower).
Thanks to their often ill-paid efforts, about 98 percent of all garments sold in the United States today are made abroad. China alone supplies the United States with about 40 percent of all apparel, followed by Vietnam, Bangladesh, Indonesia, Honduras, Cambodia, Mexico, India, El Salvador, and Pakistan. Fabric and yarn no longer come primarily from the United Kingdom or even the American South: China, India, Pakistan, and Turkey spin and weave the most cotton globally. Today, China’s factories contain nearly half of the world’s spindles and looms, working up 43 percent of the world’s raw cotton (Asia’s total is 82.2 percent), while North America uses 4.2 percent and western Europe 0.7 percent of the global cotton harvest. After more than two hundred years, most global cotton use is once again concentrated in the pre-1780 heartlands of the cotton industry.
Moreover, it is less and less likely that the shirt on your back is made of cotton at all: Beginning in the mid-1990s, production of synthetic fiber began to outpace cotton textile manufacturing. Today, about 52 million metric tons of petroleum-based synthetic fiber is produced annually to make, for instance, the fleece jacket you might be wearing, almost twice the worldwide figure for cotton.
While in 1860 the United States had a near monopoly on cotton growing for export, today only 14 percent of cotton worldwide is grown in North America. Instead, China and India lead the way, producing 34 million and 26 million bales of cotton yearly, compared to the United States’ 17 million bales. Global production has increased by a factor of seven since 1920, with cotton growing becoming immensely important to the economies of many countries, particularly in Asia and West Africa. It has been estimated that 10 million farmers in Central and West Africa alone depend on cotton. Worldwide, estimates of the number of people involved in the growing and manufacturing of cotton range from approximately 110 million households involved in the growing of cotton, 90 million in its transportation, ginning, and warehousing, and another 60 million workers operating spinning and weaving machines and stitching together clothing, to a total for all branches of that industry of 350 million people. This number, never before reached in one industry, represents between 3 and 4 percent of the world’s population. More than 35 million hectares of land are dedicated to the growing of cotton, the equivalent of the surface area of Germany.
Uzbekistan, for instance, one of the globe’s top ten cotton exporters, continues to force its farming population to grow cotton despite the fact that the need to irrigate its dry lands has essentially drained the Aral Sea and turned much of the country into virtual salt flats.
Moreover, the emergence of new, genetically modified cotton plants has doubly amplified the burdens of many farmers. The seeds for these plants are more expensive to buy and maintain, but they are also far more productive, thus pushing costs up at the same time that they push cotton prices down. Many Tajik cotton farmers, for instance, are locked in a cycle of debt and forced cotton production just like their counterparts a century ago in India and the American South. Indeed, cotton growers have remained relatively powerless. In India in 2005, after a season of weak rains and crop failures, hundreds of heavily indebted farmers of genetically modified cotton committed suicide by drinking their own pesticides, a trend that persists to this day.
It is not the distances that are new; rather, it is the way the elaborate networks that move the fiber through its various iterations are held together. Instead of manufacturers, or cotton or cloth merchants, it is massive retailers like Walmart, Metro, and Carrefour that have come to dominate the commodity chains linking contractors, subcontractors, farmers, mills, and sweatshops. Manufacturers no longer “push” their products upon consumers; instead, products are “pulled” across oceans by retailers, allowing them to pit manufacturers, contractors, and workers against one another to ensure the quickest speed and lowest cost. This reemergence of merchants, particularly from the 1990s on, in the form of retailers and branded apparel sellers as key actors comes as a surprise. In some ways, of course, their power is reminiscent of the importance of merchants in the first half of the nineteenth century. Yet since the 1860s, as we have seen, the central actors in the empire of cotton had been states in conjunction with manufacturers.
In the United Kingdom, to cite the most prominent example, the British government, in response to wartime conditions, took over the entire cotton market in 1941, including the purchase and distribution of raw cotton. After the war, government control continued, and to the great lament of the Liverpool Cotton Association, the government’s Raw Cotton Commission remained the sole purchaser and distributor of cotton in Britain. Merchants who had built a globe-spanning network were reduced to begging the government for some consideration of their interests. As the New York Times put it in 1946, “It would be difficult to imagine a more direct blow to the whole system of free world markets.” Yet the Times editors also registered, accurately, that “this action with regard to cotton seems to illustrate a world-wide bureaucratic distrust of the free market... combined with a boundless faith in the magic of government ‘planning.’ ”
In response to the devastating agricultural crisis of the 1920s and the subsequent Great Depression, the New Deal created the Agricultural Adjustment Administration, which regulated production to match demand and provided subsidies to cotton farmers — roles that continue to this day with ever increasing controversy. Cotton growers and manufacturers themselves, cognizant of the increasing importance of government, founded the National Cotton Council in 1939 to lobby Washington and promote market and scientific research on cotton. The Foreign Agricultural Service, an agency within the U.S. Department of Agriculture, was founded in 1953 to open markets for American cotton all over the world. Its mission continues unabated today.
They could not have imagined that by 2008 a semimilitary unit of the People’s Republic of China, the Xinjiang Production and Construction Corps, would grow 1.3 million tons of cotton, or 5 percent of the world’s total.
Even though force continued to play an important role in mobilizing labor, outright physical coercion now represented industrial capitalism’s most extreme edge. While differences between the global South and Europe and North America were significant, from a long-term perspective what is most remarkable is the way that over the course of the twentieth century the trajectory of the empire of cotton converged more and more with the goals of state-led development. State-directed economic planning, which had claimed its first great victories in Europe’s scattered imperial possessions, was by the 1950s the globe’s efficient and seemingly inevitable norm.
By the mid-twentieth century, governments had transformed the global countryside; the capitalization of everyday life had reached an unprecedented level. Most of the world’s people were now inextricably tied to both commodity production and consumption. As a result, capitalists no longer needed the state to turn rural cultivators into cotton growers, a reservoir of factory labor, and consumers of those textiles. That process was already far advanced, meaning that these new merchants can now profit from a larger market of consumers and a larger labor reservoir than has ever existed in human history. But their successes were also due to their ability to organize production globally, and to create branded goods and the sales channels to offer them for purchase all over the world.
Unlike in the nineteenth century, these modern merchants focus not on the trade in raw cotton, yarn, and cloth, but on the apparel business. They source cotton, yarn, cloth, and clothing from the cheapest suppliers they can locate, without engaging in manufacturing themselves. They then focus their energies on developing channels to sell those goods, with branding, as in the case of the American company Gap (“Get together”), Chinese Meters/bonwe (“Be different”), and German Adidas (“Adidas is all in”), but also with the development of new forms of retailing, as in the case of Walmart (United States), Lojas Americanas S.A. (Brazil), and Carrefour (France). To dominate this global cotton supply chain, these merchants still depend on state power, but their reliance on any one specific state has lessened considerably. As a result, they foster competition not just between manufacturers and growers, but among states. In today’s empire of cotton, merchants have finally managed to emancipate themselves from their previous dependence on particular states. As a result, the protections that strong nation-states offered, to at least some of their workers, for at least part of the twentieth century, have been gradually eroded. Workers today are increasingly at the mercy of corporations that can easily shift all forms of production around the globe. Globalization is nothing new in the empire of cotton, but the ability of capitalists to utilize a number of states and thus remain free of the demands of all of them, is new. The state, the very institution that facilitated capitalists’ rise to wealth and power in the first place, is now increasingly desperate for their investments.
In the United States, as mentioned, huge subsidies keep cotton farmers in business: In 2001, the U.S. government paid a record $4 billion in subsidies to cotton growers, a cost that exceeded the market value of the crop by 30 percent. To put it another way, these subsidies amounted to triple that year’s USAID payments to all of Africa, a part of the world where production costs for cotton were only about a third of what they were in the United States. In fact, in 2002, Brazil lodged a lawsuit against the United States through the World Trade Organization, alleging that the government’s cotton subsidies violated its own previous trade commitments. As part of the settlement, the U.S. government now also supports the Brazilian cotton economy, at a rate of $147.3 million a year. The European Union, in similar ways, produces its own small cotton harvest, in Spain and Greece, thanks to subsidies ranging from 160 to 189 percent of the world price for cotton. Highly subsidized cotton then is dumped onto world markets, depressing prices for the much more competitive cotton growers in Africa and elsewhere.
In Uzbekistan, the government forces children to help out in the cotton harvest (it has been estimated that up to 2 million children younger than fifteen are sent to the cotton fields), a “system [that] is only sustainable under conditions of political repression,” reports the International Crisis Group. In China the repression of independent trade union activity keeps wages low.
The geographical rearrangement of economic relations is not just a noteworthy element of capitalism or an interesting aspect of its history; rather the constant shifting recombination of various systems of labor, and various compositions of capital and polities is the very essence of capitalism. As capitalists search for ever cheaper labor, better infrastructure, and greater markets, they combine and recombine the world’s workers and consumers, and the world’s lands and its raw materials, in ever new ways.
It is easy to assume, in our relentlessly branded world, that today’s vast corporations exist entirely on their own. Yet such a simplification misses the reality that, historically, capitalists’ greatest source of strength was their ability to rely on unusually powerful states — and simultaneously, for much of capitalism’s history, the greatest weakness of these same capitalists was that dependence on the state. It was this dependence that gave workers an opening to improve the conditions of their labor. We now know that the increasing emancipation of capital from particular nation-states has dramatic consequences for the world’s workers. Workers’ successes in improving their conditions almost always lead to the reallocation of capital. For the last several decades, Walmart and other retail giants have continually moved their production from one poor country to a slightly poorer one, lured by the promise of workers even more eager and even more inexpensive. Even Chinese production is now threatened by lower-wage producers. The empire of cotton has continued to facilitate a giant race to the bottom, limited only by the spatial constraints of the planet.
Again and again, a seemingly insurmountable crisis in one part of the empire generated a response elsewhere; capitalism both demands and creates a state of permanent revolution. This permanent revolution is only possible because of the existence of places and people whose lives can be turned upside down.
Although our historical imaginations are usually dominated by cities, factories, and industrial workers, we have seen that much of the emergence of the modern world occurred in the countryside — by the often violent turning of rural people into the creators and consumers of commodities made or used elsewhere. This emphasis on the countryside allows for an equally important emphasis — the importance of coercion and violence to the history of capitalism. Slavery, colonialism, and forced labor, among other forms of violence, were not aberrations in the history of capitalism, but were at its very core. The violence of market making — forcing people to labor in certain locations and in certain ways — has been a constant throughout the history of the empire of cotton.
Without its Eurocentric distortions, decolonialization would be at the very center of the narrative we tell about the twentieth century — and this retelling would allow us to see that global capitalism today is most fundamentally shaped by the struggles for independence. Either way, our journey through the empire of cotton has shown that civilization and barbarity are linked at the hip, both in the evolution of the world’s first global industry and in the many other industries that have modeled themselves after it.
Moreover, the fruits of their activities continue to be distributed in radically unequal ways — with cotton growers in Benin, for example, making a dollar a day or less, while the owners of cotton growing businesses in the United States have collectively received government subsidies of more than $35 billion between 1995 and 2010.
As late as the 1950s, it took sixty days of hard spinning and weaving labor to produce enough clothing to fulfill the most minimal subsistence needs of a family of five in northern China. Today, the average American family (albeit at 2.5 persons also smaller than the Chinese family of the 1950s) spends only 3.4 percent of its household income on much more ample clothing — that is, the equivalent of approximately eight days of labor.
The human capacity to organize our efforts in ever more productive ways should give us hope, the hope that our unprecedented domination over nature will allow us also the wisdom, the power, and the strength to create a society that serves the needs of all the world’s people — an empire of cotton that is not only productive, but also just.
I will never forget the reception room of the National Archives of Cairo, where I spent many hours sipping tea with its director as he tried to get me access to early nineteenth-century records that the state deemed too sensitive to be perused by a historian.