A Patriot's History of the United States: From Columbus's Great Discovery to the War on Terror (40 page)

If land provided the allure for most of those who moved to the Mississippi and beyond, a growing, but important, substrata of mechanics, artisans, inventors, salesmen, and merchants soon followed, adapting their businesses to the new frontier demands.

No one captured the restless, inventive spirit better than Eli Whitney. After working on his father’s farm in Connecticut, Whitney enrolled in and graduated from Yale. There he met Phineas Miller, who managed some South Carolina properties for Catherine Greene, and Miller invited the young Whitney to take a position as a tutor to the Greene children on a plantation. His cotton gin—in retrospect a remarkably simple device—shook the world, causing an explosion in textile production.

In 1810, 119 pounds of cotton per day could be cleaned, and by 1860 that number had risen to 759 per day.
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Mrs. Greene soon came to say of Whitney, “He can make anything.” Indeed he could. Whitney soon tried his hand at musket production, using a largely unskilled workforce. What emerged was the American system of manufacturing, which served as the basis for a powerful system.
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Advances in mass production, steam power, and management techniques coalesced in the textile mills founded in New England by Samuel Slater, a British emigrant. Slater built a small mill in Rhode Island with the support of Moses Brown, a Providence candle manufacturer, first using water wheels, then replacing water with steam power. Within twenty years, Slater and his close circle of associates had 9,500 spindles and controlled nearly half of all American spinning mills—Brown even wrote to his children that the mill founders had “cotton mill fever.”
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Francis Cabot Lowell exceeded even Slater’s achievements in texile production, employing young girls who lived on site. Lowell further advanced the organizational gains made by Whitney and Slater.
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Gains in manufacturing resulted in part from widespread application of steam power. Steam revolutionized transportation, with Robert Fulton’s
Clermont
demonstrating steam propulsion on water in 1807.

Within a decade, Cornelius Vanderbilt began using steam technology to cut costs in the New York–New Jersey ferry traffic, and steam power started to find its way to inland waterways. Entrepreneurs had already started to shift the focus of water travel in the interior from natural rivers to man-made canals. The period from 1817 to 1844 has been referred to as the canal era, in which some 4,000 miles of canals were constructed at a cost of $200 million. States collaborated with private interests in many of these projects, usually by guaranteeing state bond issues in case of default. But some of the earliest, and best, were built by private businesses, such as the Middlesex Canal in Massachusetts and the Santee and Cooper Canal in South Carolina. The most famous, the Erie Canal, linked the Hudson River and Lake Erie and opened up the upstate New York markets to the coast. Unlike some of the other early privately financed canals, the Erie was built at state expense over an eight-year period, and its completion was so anticipated that the state collected an advance $1 million in tolls before the canal was even opened.
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It was a massive engineering feat: the canal was 40 feet wide, 4 feet deep, and 363 miles long—all bordered by towpaths to allow draft animals to pull barges and flatboats; 86 locks were used to raise and lower boats 565 feet. When the Erie opened in 1825, it earned 8 percent on its $9 million from the 3,000 boats traversing the canal. After the board of commissioners approved enlarging the canal in 1850, it reached its peak tonnage in 1880.
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Steam power soon replaced animal power on all the nation’s waterways. Well before steam power was common, however, canals had driven down the costs of shipping from twenty cents per ton mile to a tenth of that amount, and even a “noted financial failure like the Ohio Canal yielded a respectable 10 percent social rate of return.”
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Steam vessels on the Great Lakes, where ships occasionally exceeded 1,000 tons, and in the case of the
City of Buffalo,
displaced a whopping 2,200 tons, also played an important role. By midcentury, “The tonnage on the Mississippi River and on the Great Lakes exceeded that of all shipping from New York City by over 200 percent.”
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The canal era provided the first model of state government support of large-scale enterprise (through bond guarantees), often with disastrous results. In the Panic of 1837, many states were pushed to the brink of bankruptcy by their canal-bond obligations.

Steam also reduced shipping costs for oceanic travel, where, again, Cornelius Vanderbilt emerged as a key player. Facing a competitor who received sizable federal mail subsidies, Vanderbilt nevertheless drove down his own transatlantic costs to the point where he consistently outperformed his government-supported opponent.
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Having won on the Hudson, then on the Atlantic, Vanderbilt next struck on the Pacific Coast, breaking into the subsidized packet-steamer trade. Vanderbilt’s competition received $500,000 in federal subsidies and charged a staggering $600 per passenger ticket for a New York to California trip, via Panama, where the passengers had to disembark and travel overland to board another vessel. After constructing his own route through Nicaragua, rather than Panama, Vanderbilt chopped passenger prices to $400 and offered to carry the mail free! Within a year, thanks to the presence of Vanderbilt, fares dropped to $150, then $100. As occurred in the Hudson competition, the commodore’s competitors finally bought his routes, but even then they found they could never return to the high ticket prices they had charged before he drove costs down. When Vanderbilt left the packet-steamer business, a ticket cost just half what could be fleeced from passengers in the pre-Vanderbilt era.
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Steam technology also provided the basis for another booming American industry when Phillip Thomas led a group of Baltimore businessmen to found the Baltimore and Ohio (B&O) Railroad in 1828. Two years later, the South Carolina Canal and Railroad Company began a steam locomotive train service westward from Charleston, with its locomotive
Best Friend of Charleston
being the first constructed for sale in the United States. The king of American locomotive building was Matthias Baldwin, who made his first locomotive in 1832 and founded the Baldwin Engine and Locomotive works. His firm turned out more than fifteen hundred locomotives during his lifetime, including many for export.

Within a few years, contemporaries were referring to railroad building as a fever, a frenzy, and a mania. There were enormous positive social consequences of better transportation. By linking Orange County, New York, the leading dairy county, to New York City, the railroad contributed to the reduction of milk-borne diseases like cholera by supplying fresh milk.
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By 1840 most states had railroads, although the Atlantic seaboard states had more than 60 percent of total rail mileage. Like the canals, many railroads received state backing. Some were constructed by individual entrepreneurs. But the high capital demands of the railroads, combined with the public’s desire to link up every burg by rail, led to states taking a growing role in the financing of American railroads.
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Railroads’ size and scope of operations required huge amounts of capital compared to textile mills or iron works. This dynamic forced them to adopt a new structure in which the multiple stockholder owners selected a professional manager to run the firm. By the 1840s, banks and railroads were inexorably linked, not only through the generation of capital, but also through the new layer of professional managers (many of them put in place by the banks that owned the majority stock positions). As transportation improved, communications networks also proliferated. Banks could evaluate the quality of private bank note issues through
Dillistin’s Bank Note Reporter
, which was widely circulated. The Cincinnati-based Bradstreet Company provided similar evaluation of businesses themselves. Investor knowledge benefited from the expansion of the U.S. Post Office, which had over 18,000 branches by 1850—one for every 1,300 people. Congress had a direct stake in the Post Office in that congressional apportionment was based on population, and since constituents clamored for new routes, there was a built-in bias in favor of expanding the postal network. Most routes did not even bear more than 1 percent of their cost, but that was irrelevant, given the political gains they represented. In addition to their value in apportionment, the postal branches offered legislators a free election tool. Congressmen shipped speeches and other election materials to constituents free, thanks to the franking privileges. Partisan concerns also linked post office branches and the party-controlled newspapers by reducing the cost of distribution through the mails. From 1800 to 1840, the number of newspapers transmitted through the mails rose from 2 million to almost 140 million at far cheaper rates than other printed matter. Postal historian Richard John estimated that if the newspapers had paid the same rate as other mails, the transmission costs would have been 700 times higher.
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The new party system, by 1840, had thus compromised the independence of the mails and a large part of the print media, with no small consequences. Among other defects, the subsidies created incentives to read newspapers rather than books. This democratization of the news produced a population of people who thought they knew a great deal about current events, but who lacked the theoretical grounding in history, philosophy, or politics to properly ground their opinions. As the number of U.S. Post Office branches increased, the Post Office itself came to wield considerable clout, and the position of postmaster became a political plum. The postmaster general alone controlled more than 8,700 jobs, more than three fourths of the federal civilian workforce—larger even than the army. Patronage explained the ability of companies receiving federal subsidies to repel challenges from the private sector, allowing the subsidized postal companies to defeat several private expresses in the 1830s. The remarkable thing about the competition to the subsidized mails was not that it lasted so long (and did not resurface until Fred Smith founded Federal Express in 1971), but that it even appeared in the first place.

Setting the Table for Growth

At the end of the War of 1812 America emerged in a strong military and diplomatic position. The end of the Franco-British struggle not only quickened an alliance between the two European powerhouses, but also, inevitably, drew the United States into their orbit (and, a century later, them into ours). American involvement in two world wars fought primarily in Europe and a third cold war was based on the premise that the three nations shared fundamental assumptions about human rights and civic responsibilities that tied them together more closely than any other sets of allies in the world. Getting to that point, however, would not have been possible without consistently solid diplomacy and sensible restraint at critical times, as in the case of Florida, which remained an important pocket of foreign occupation in the map of the United States east of the Mississippi. In 1818, Spain held onto Florida by a slender thread, for the once mighty Spanish empire was in complete disarray. Spain’s economic woes and corrupt imperial bureaucracy encouraged revolutionaries in Argentina, Columbia, and Mexico to follow the American example and overthrow their European masters. Within five years Spain lost nearly half of its holdings in the western hemisphere.

From the point of view of the United States, Florida was ripe for the plucking. President Monroe and his secretary of state John Quincy Adams understandably wanted to avoid overtly seizing Florida from Spain, a nation with which they were at peace. Adams opened negotiations with the Spanish minister Luis de Onis. Before they could arrive at a settlement, General Andrew Jackson seized Florida for the United States. But Jackson followed a route to Pensacola that is more complex and troublesome for historians to trace today than it was for Jackson and his men to march through it in 1818.

Jackson’s capture of Florida began when Monroe sent him south to attack Seminole Indians, allies of the reviled Creeks he had defeated at Horseshoe Bend in 1814. Some Seminole used northern Florida’s panhandle region as a base to raid American planters and harbor escaped slaves. Alabamians and Georgians demanded government action. On December 26, 1817, the secretary of war John C. Calhoun ordered Jackson to “adopt the necessary measures” to neutralize the Seminoles, but did not specify whether he was to cross the international boundary in his pursuit. In a letter to Monroe, Jackson wrote that he would gladly defeat the Seminoles
and
capture Spanish Florida if it was “signified to me through any channel…that the possession of the Floridas would be desirable to the United States.” Jackson later claimed he received the go-ahead, a point the administration staunchly denied.
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The general went so far as to promise that he would “ensure you Cuba in a few days” if Monroe would supply him with a frigate, an offer the president wisely refused. (Later, when questioned about his unwillingness to rein in the expansionist Jackson, Monroe pleaded ill health.)

Whoever was telling the truth, it mattered little to the Indians and Spaniards who soon felt the wrath of the hero of New Orleans. Between April first and May twenty-eighth, Andrew Jackson’s military accomplishments were nothing short of spectacular (indeed, some deemed them outrageous). He invaded Florida and defeated the Seminole raiders, capturing their chiefs along with two English citizens, Alexander Arbuthnot and Robert Ambrister, who had the great misfortune of being with the Indians at the time. Convinced the Englishmen were responsible for fomenting Indian attacks, Jackson court-martialed and hanged both men. By mid-May, he had moved on Fort Pensacola, which surrendered to him on May 28, 1818, making Florida part of the United States by right of conquest, despite the illegality of Jackson’s invasion—all carried out without exposure to journalists. Although Monroe and Adams later disclaimed Jackson’s actions, they did not punish him, nor did they return the huge prize of his warfare—nor did Congress censure him for usurping its constitutional war power. Jackson was able to wildly supercede his authority largely because of the absence of an omnipresent media, but the United States gained substantially from the general’s actions.