rates of wages? In colonial times the product was made along the Atlantic, and nearly the whole price at Philadelphia went to the laborer. Now, a large per-centage must be deducted for the two thousand miles' carriage by land, lake, canal, and river, and the laborer's share is small. The truth is, the pioneer is poorly paid; he is struggling hard for a mere pittance. His receipts are small, and he can give but a small price for the hireling he employs to assist him on his farm. He is no longer the cause of high wages through the whole breadth of the

Thus, even to the war of 1812, our rich, cheap lands were the source of our prosperity, and the explanation proposed by Dr. Smith for the high rate of wages and of interest prevailing here was still satisfactory. But when peace was restored, in 1815, and the immense armies of the different states of Europe were returned to their homes to become producers instead of consumers; when the several countries encouraged their own shipping and their own farmers by restoring their usual prohibitions and restrictions, the advantages we possessed before the war were very much lessened. Our land. His influence and empire have ceased. country had by this time become more populous. Lands along the sea-board had risen in price; the people had penetrated the interior; the distant transportation had become a heavy burden to the producer; and thus, at the very same time that the European demand was lessened, and the price depressed, our ability to supply the demand with profit was decreased. The money value of our products was diminished, and the laborer's share in this value was at the same time lessened. The usefulness of our cheap lands was decreased, and their advantages were less and less experienced.

Besides, our country has increased in population so largely, that the foreign demand for flour and other products of our lands will not pay for a tithe of our necessary wants, which must be supplied from abroad. Our people have increased in wealth, and their wants for wines, and silks, and other luxuries, cannot be paid for by the export of flour and grain, and the products of our forests. If, besides agricultural productions, we are forced to export manufactures to pay for our foreign supplies, the price of labor, which is the main element in the cost of manufactures, must at once fall to the Euro

If, then, we had cheap lands even on the Atlantic, we could not pay for our present large supplies of foreign goods, so that these could not maintain our high rates for wages and interest; much less are they able to do it when they are thousands of miles from the coast.

If we come down to recent times, our ad-pean standard. vantages have not improved. Our country has become larger. The region of cheap land is beyond the Alleghanies. We must take a journey of a thousand miles from New York, crossing the Ohio and the Wabash, passing Indiana and Illinois, before we reach the country of cheap lands. The grain that is brought down the Hudson from Albany has been carried more than three hundred miles, in the Erie canal, from Buffalo, and more than a thousand, by vessels on the lakes, from Chicago, and thither from the interior of Illinois by railroad. There the land on which it was produced is worth ten, twenty, fifty dollars per acre. Now, however cheap the transportation by railroad and on the lakes, the canal, and the river, the freight must be a large per-centage of the sales at New York. The rent of land in Illinois is also to be deducted, leaving but a small balance to be finally paid the laborer who has produced it. We must go hundreds of miles further to reach the region of cheap land, and then the increased cost of transportation will neutralize the advantage of procuring land at a dollar and a quarter per acre.

Now, will the cheap lands of Iowa, and Wisconsin, and Nebraska, explain our high

A reference to the history of our foreign commerce will illustrate the principles we have been referring to. When our general government was first formed, our population was less than four millions; of these ninetyfive per cent. were along the Atlantic slope, their average distance from the coast being less than a hundred miles. Our average domestic exports for the five years from 1790 to 1794, were less than twenty-two millions of dollars. Of these, flour alone averaged more than 800,000 barrels, and wheat more than 1,200,000 bushels; making a value of more than six millions of dollars. Other products of the farm and the forest made up nearly the whole of the balance. Now when lands were cheap, and near to the seaports; when the forests bordering on the coast were not yet thinned or cut down, the laborer had a rich and abundant harvest, and high wages could be maintained by our cheap lands.

Ten years later, our population had risen by the surplus of the empire state. The to five millions, of which ninety per cent. yet occupied the Atlantic slope. Our domestic exports had risen to forty millions for the five years after 1800; and of these, flour alone amounted to eight millions and a half, its average price being $8.40, and the number of barrels exceeding a million. The demand for our agricultural products was now large and the price high; so that the imports could yet be paid for by the products of our lands and our forests. These were still near the coast, and nearly all their proceeds belonged to the labor that produced them.

coal and iron districts of Pennsylvania had become better markets for grain and flour than Philadelphia. Populous cities had risen in the west, and all these intercepted the supplies of food that were to be sent abroad for the purchase of our imports. The only flour that could be exported had to be carried from five to fifteen hundred miles. The foreign demand was no greater than it had been fifty years before, and our exports only reached 1,000,000 of barrels, while $163,000,000 were needed to pay for our imports. The other products of the In 1810 our population had increased to west were small, and so were those of the 7,000,000, of which 80 per cent. were on forest. It is evident, therefore, that cheap this side of the Alleghanies. For the next lands could no longer furnish the supplies two years which preceded the war, our ex- to pay for our imports, much less could they ports of domestic produce reached $43,- keep up the price of labor above the foreign 000,000, of which flour constituted one-standard. The advantages furnished by fourth, the number of barrels exceeding 1,100,000, and the average price being $9.66. Other products of our lands, yet cheap and near the coast, made up a large portion of the means we used to pay for our foreign supplies, and up to this time it may be justly said that high wages were sustained by the abundance of our fertile lands.

But what a change in 1820. The people had increased to 10,000,000, 40 per cent. of whom had their homes across the mountains. Our exports of domestic produce were over $50,000,000, and the whole demand for flour did not average, for the five years after 1820, 1,000,000 barrels, and that at only $5.68 per barrel. While the products of our lands had to be brought much further to market, the amount demanded for foreign countries, and the prices they gave for them, had declined. It was the same with the products of the forest. For the ten years after the war they were less than for the ten years before. The first were much nearer the sea, and for the last we gave more labor and received less money. The efficiency of cheap lands to pay for our imports was gone, and their power to keep up prices departed also.

nature in the early history of our country had ceased, and we were thrown on other resources, to keep up the prosperity and progress of our people.

But this prosperity has not ceased. There has been no step backward in our career. The high prices of labor and of capital have been sustained, and the onward. progress of our country, in power, wealth, and greatness, has never received the slightest check.

That labor is still higher than in Europe, is abundantly evident. We import a large amount of cotton goods; the importer pays the expenses of transportation across the sea, and a duty of 24 per cent. at the customhouse, and yet sells his goods at the same price with the American manufacturer who has bought his raw material at a lower price than the foreign producer. There is no explanation of this possible, except that labor and capital are higher in this country than in Europe. The iron ore of Pennsylvania is as good and abundant as in England; fuel and limestone are as cheap, and as near to the beds of ore; but the English iron is not only imported under heavy duties, but carried into the interior, and sold in the very If we come down to 1850, our population had neighborhood of the American furnaces. reached 23,000,000, of whom only 54 per cent. These two manufactures have long been were along the Atlantic. The centre of the ag-favored by the protection of government. ricultural population had receded from the sea- Under the device of specific duties and board and crossed the mountains. The grain minimums, the tariff for a while amountproduced along the coast was all wanted at home. New England did not produce her own supplies. The city of New York contained a half million of people, who could not be fed

ed to a prohibition on many of these goods. On all it was very large and burdensome. The manufacturers have had time and opportunity to learn and introduce

an active commerce with all the world, and a free interchange of commodities with every country, and yet to sustain a higher price for labor and capital than the other nations with whom we trade?

all the improvements, and skill, and knowl- | have we? the gift of nature or our own edge that would facilitate and cheapen their arrangement, by which we are able to have production; they have had enterprise, and capital, and energy to manage and direct them; and there is no possible explanation of the continued import of these articles to the amount of millions and tens of millions of dollars every year, unless labor and capital were dearer here than in England.

Perhaps a more striking proof that wages are higher here than in Europe may be found in the immense emigration into the United States from foreign countries. The principal motive of these emigrants is to improve their condition. The Irish laborers who rejoiced in the old country at having meat once a week, are here able to place it on their tables three times a day; to whet their appetites with as much whiskey as they may wish; to enjoy comforts and luxuries they never dreamed of abroad; and to send back to the parents, and brothers, and sisters they left behind, millions of dollars every year, that they also may come here and participate in the same prosperity. The Germans bid adieu to their homes and fatherland that they love so well, and come over by tens of thousands to buy land, and build fine barns, and lay up treasures for old age or for their children; while in their own country they would have been poor and humble peasants all their lives.

The only way to keep up the rates of wages and of money higher than in Europe, is to produce some articles here that are in large demand abroad, for which we have peculiar advantages, so that we can make them cheaper than other countries, in spite of our high price for labor and our high interest for money.

Such an article we have in cotton. It is of prime necessity, and in large demand abroad, because it furnishes the cheapest material for clothing, and for other purposes of civilized life; it is produced here under such favorable circumstances that we can supply this demand at a fair profit to ourselves; this profitable production being sustained by the favorable circumstances of our soil and cli mate, and by the use of cheap labor in the midst of a country where labor is dear.

The large demand for cotton in other countries enables us to pay for the imports that we must have, and also for others that we ourselves might supply, were it not that our high rates for labor and capital permit the foreign producers to undersell us in our own market, after paying heavy duties at the seaports, and the cost of transportation across the Atlantic.

This high price of wages is of the utmost importance. It is the source of our rapid increase in wealth and greatness, and the exact measure of our prosperity. It belongs It is easy to follow out the course of not merely to the day laborer who works operations by which these effects are prowith his hands, but to the artisan who has duced: the planter produces the cotton skill, and to the man of talent who has which is sold abroad, and buys the foreign brains. The superintendent and the master supplies of the north, the south, and the manufacturer, as well as the weaver, receive west. The north carries the cotton to the high wages; the captain of the ship as well foreign country, and brings back the returns. as the sailor; the merchant as well as his She delivers to the south her share, and porter; and as industry, enterprise, and tal-pays for the balance in manufactures. After ent earn higher rewards here than in any supplying herself, she buys food from the other country, the workman is inspired west with the remainder. with new zeal, his aims and aspirations are raised, wealth accumulates with greater rapidity, and every thing that makes a country prosperous and powerful is developed with a quicker growth.

The manufactures of Europe being loaded with the expenses of transport across the seas, and with duties paid to the general government, the northern manufacturer can keep the prices for his goods up to the importing limit, and these the south is able to pay, because of the profit on her great staple, and the monopoly she has of the European market.

If, then, it is a fact that wages are higher here than in Europe; if this is a fact of the utmost importance to the prosperity and greatness of our country, the question recurs, How is this high rate of wages sustained? Thus are the high prices of labor sustainIf not by cheap lands, what other advantage | ed, and the foreign supplies of the country

paid for by the export of cotton, whose cost of production does not depend on the high paid labor of the country, but on the cheap labor of the negro slave.

During the last ten years the gold of California has had precisely the same effect, and its operations have been in every respect similar. The demand abroad for gold is of course unlimited; the cheap and profitable production of it here depends on the abundant gifts of nature. The eastern manufacturers sell their high-priced products to the miners, who are prevented from obtaining them cheaper by the distance from Europe, and the duties of the custom-house, and are able to pay for them by the abundant rewards they receive from their own labor. In this case nature, without any aid, makes the production profitable; in the other nature is aided by the domestic institutions of the south. But the effects are in both cases identical.

These two articles are assisted by rice and tobacco, which are in almost every respect similar to cotton. The demand abroad is not so great, and our advantages in their cultivation over the other producers for the European market are not so marked and decided. They are, however, real, and they may properly be regarded as aids to cotton and gold in producing the effect.

abroad, or of new inventions, or discoveries, or patents. The whole amount of these being small, and due to real advantages we have here, or to accident, or fashion, or taste, or prejudice, do not form any objection to the explanation we have proposed, that high prices are maintained in our country chiefly by cotton.

So also with agricultural products; we export some of these to the markets on our own continent, where we have many advantages over the European producer. In some of these, as in the flour to Brazil, these are very considerable. Our import of coffee is large, and our exports in return are very small, and consequently freights are low. We produce a kind of wheat in our southern climate manufactured into flour, which will not readily sour in the voyage across the equator. These two reasons secure a large demand for the brand of southern mills. And there are many other circumstances that induce a few shipments without reference to price, so that even the small influence of our agricultural exports in sustaining prices is not due entirely to cheap lands, but to position, accident, advantages of climate, and other things of this kind.

If we refer to our commercial statistics, it will be seen how small a ratio our manufactures and the products of our cheap lands The propriety and correctness of this ex- bear to the whole exports. In 1850 the planation of our high prices is not affected cotton, rice, and tobacco exported were by the fact that we also export some manu- worth eighty-five millions of dollars, and factures. This is done in spite of their high formed sixty-three per cent. of the whole prices, because they are carried, not to Eng-value; the flour, grain, cheese, butter, lard, land and France, but to Mexico, South tallow, beef, pork, naval stores, and many America, and the West Indies, where our other animal and agricultural products were proximity and trade give us some advantages over the European manufacturer. A few cotton goods are carried to China; these are coarse, so that the superior cheapness of the raw material here partly compensates for the superior cost of manufacturing. This advantage is aided by the influence of fashion, habit, and accident; by the superior adaptedness of our goods to their wants at the commencement of the export, and the good will and good name that were then secured; and by various other inducements which often lead to the purchase of higher-priced commodities even in a free and open market. Some few manufactures are even carried to England, France, and Germany, on account of the temporary superiority of our workmen, or of new improvements in the mode of manufacture not yet introduced

less than twenty-four millions, and constituted only eighteen per cent. of the domestic exports; while the manufactures of every kind, including those of cotton, were only fifteen millions, forming but eleven per cent. of the exports. For 1859, the last year of our published returns, the value of cotton, rice, tobacco, and gold was $245,000,000, or seventy-three per cent. of the whole value; all the products of animals and of the field, forty-two millions, or thirteen per cent. of all; and manufactures of every kind (including eight millions of cotton goods) thirty millions of dollars, or nine per cent. of the whole exports. Of cotton alone the exports were $161,000,000.

We repeat, then, that it is cotton almost entirely that keeps up the price of labor and capital in this country above the rates

of every other part of the world that it ton by machinery. But so complex and is aided in this by the gold of California imperfect were the details of this machinery and the rice and tobacco of the Southern of Wyatt and Paul that these projects failed. states, and, to a very small and insignificant The principle was discovered, but important extent, by our cheap lands and abundant practical improvements were wanting before forests; that cotton brings about this result it could be made successful. because it is in large demand in foreign countries, being the cheapest article of clothing; because our planters produce it in large amounts, and at great profit to themselves; and because we have almost a monopoly of the foreign market, on account of our ability to produce a cheaper and better article than any other country in either of the four quarters of the globe. This cheapness is secured by the advantage of our soil and climate, and by the aid of cheap labor, which does not come into competition with the other labor of the country so as to depress the general standard of wages.

To establish the first of these propositions, we have only to refer to the history of the cotton manufacture of Europe and America, and especially of England, as found in another chapter.

CHAPTER II.

PRODUCTION AND PRICES OF COTTON.

COTTON has been employed as a material for clothing from the earliest times, and at the beginning of the eighteenth century nearly two millions of pounds were imported into England to supply their spinning wheels and looms, and to be used for the other purposes to which it was applied. In 1751 the imports rose to 2,976,610 pounds, in 1764 they were 3,870,392 pounds, and in 1781 they had increased to 5,198,778. At this period they took a sudden rise, and in the next five years increased to nineteen millions, and in the next five to twenty-nine millions of pounds, thus making a more rapid progress in five years than in the preceding hundred.

The cause of this rapid advance was the introduction of machinery for the spinning of cotton. This reduced the price and increased the demand, and led to the exclusion of linen, silk, and wool, and the substitution of cotton in their place.

As early as 1738 Wyatt had taken out a patent for the spinning of cotton by machinery. He was assisted by Paul, who afterward took out a patent for carding the cot

In 1769, Arkwright took out a patent for his water-frame and throstle, and in 1770, Hargreaves invented his spinning-jenny, both of which were on the same principle as Wyatt's machine, but led to a very different result. Between 1770 and 1780 these machines were fairly tested, and in the next ten years they were rapidly introduced. The patent of Arkwright was broken down in the courts of law in 1785, by the persevering opposition of those who had wrongfully appropriated his discoveries; and the expiration of the other patents in a short time opened the whole manufacture to the free use of the people. In 1800 the imports of cotton had risen to fifty-six millions, an increase of eleven fold in twenty years. In the first eighty years of the eighteenth century the increase had been one hundred and fifty per cent.; in the last twenty years it had been a thousand.

These improvements of Arkwright and Hargreaves were not the end and perfection of the inventions for spinning. These machines were not adapted for the finer numbers, and in 1779 Samuel Crompton invented the mule, which combined the excellences of the two former inventions. No patent was taken out for it, and it was worked for a while in secret. But the high prices Crompton obtained for his yarn soon attracted such attention that he could no longer keep it concealed. For number forty, he received three dollars and a half a pound; and for number sixty, six dollars. These prices were commanded by the superiority of his yarn, and the mule was, therefore, a great improvement on the old machines. At first the invention was quite imperfect, but it was soon improved and brought nearly to its present perfection. In the course of ten years it was everywhere introduced. Under its influence the demand for labor rapidly increased.

The next important invention was the power-loom, first proposed and patented by Cartwright. The patent was issued in 1787, but all efforts failed to introduce it successfully until after the beginning of the present century. The improvements in dressing the warp, which were indispensable to the suc