The Rise of Cotton Mills in the South

THE RISE OF COTTON MILLS IN THE SOUTH

A DISSERTATION
Submitted to the Board of University Studies of The
Johns Hopkins University in Conformity with
the Requirements for the Degree of
Doctor of Philosophy

by
Broadus Mitchell

Baltimore, Maryland
1918

CONTENTS

FOREWORD

These pages represent a partial exploitation of materials gathered with a view to their ultimate use in more extended form. Many phases of the problem have been left entirely untreated, but the research upon these subjects has not been without indirect service in the present study. In the case of two chapters written midway of the investigation, in revision care has been taken to bring them into consonance with the indications which developed from subsequent discoveries. It is hoped, therefore, that their lack is rather as to completeness than as to fidelity of temper.

Unless this presentation is entirely inadequate, in addition to the more objective economic forces, in the rise of cotton mills in the South, there will appear the human elements that lie at the core of the development.

For assistance, my first thanks are due to Professor Jacob H. Hollander and Professor George E. Barnett, of The Johns Hopkins University, who have contributed in a hundred ways over the whole period of study, and to Dr. Nathaniel R. Whitney, formerly of The Johns Hopkins University and now of the Iowa State University, who helped form my original conception of the problem. In the wider aspects of my study I have drawn upon the experience and judgment of my father continuously. Acknowledgment is due Miss Ellen Rothe and Miss Ethel Hubbard, of the library staff of The Johns Hopkins University; to the authorities of the library of the Peabody Institute of Baltimore, and to the officers of the reading room of the Library of Congress.

In two field investigations in the South, many gentlemen connected directly or indirectly with the cotton manufacturing industry have been instituting in extending their time and counsel and courtesy. From lack of space, it is not possible to make individual mention of all of these in this place; foot-note references to the interviews must be understood each one as expression of appreciation. For extraordinary assistance, however, it gives me pleasure here to return thanks to Hon. John Skelton Williams, Comptroller of the Currency; Mr. George A. Nölting, Jr., of Richmond, Virginia; Mr. O. D. Davis, of Salisbury; Mr. J. L. Hartsell, of Concord; Messrs. J. Lee Robinson and S. N. Boyce, of Gastonia; and Miss Anna L. Twelvetrees, Mr. Sterling Graydon and Mr. Hudson Millar, of Charlotte, North Carolina; Mr. W. J. Thackston, of Greenville; Mr. August Kohn, Professor Yates Snowden and Mr. William W. Ball, of Columbia, South Carolina, and Mr. T. S. Raworth, of Augusta, Ga. Of more intimate sort is my obligation to Professor K. Roberts Greenfield, of Delaware College, who by his constructive criticism has helped shape my opinion in a large way and has at many points improved the text as such.

I cannot fail to acknowledge, finally, my gratitude to Mrs. Charles Reuter and the members of her family, under whose roof most of these pages were written.

Broadus Mitchell

Baltimore, February 6, 1918.

THE RISE OF COTTON MILLS IN THE SOUTH

CHAPTER I

THE BACKGROUND

This opening chapter undertakes a broad survey in brief compass of the historical and economic background out of which the cotton manufacturing industry of the South, as a distinct development, emerged. Thus to begin the story of the rise of the mills with discussion of a period which commences a century in advance, is not unlike the production of a play hopeful in conception, robust in theme and rapid in action, but in which the curtain first rises on a stage which remains empty throughout an entire act.

In viewing the period lying back of the concerted erection of cotton mills in the South, some observers have said they caught satisfying glimpses of men and facts not only presaging but causally related to the main action later. In spite of the present writer's usual disbelieve in the sufficiency of the evidence in these findings, it is a primary purpose of this discussion to give their statements, together with the supporting testimony that they deliberately and others incidentally have brought forward.

The total of this study will show that the development, as such, not only first substantially showed itself, but had its complete genesis, about the year 1880. It is plain that in order to present, however, the conclusions of students who have believed they discerned signs of it in earlier years, it is necessary to include in these preliminary pages much that will not appear as fact exhibit, but rather as opinion. And not simply this, but in seeking to make clear the opposite theory, free recourse is taken to the findings and statements of others than the writer.

No apology is made for the incorporation of secondary material. On the contrary, this is intentioned. Lying, after all, outside of the central facts to come under view in this essay, exclusively original research in so extended a period has not seemed justified. In the second place, it has not appeared necessary for the reason that there has been usually less dispute as to the facts and the completeness of the data that much study has uncovered, than as to the right interpretation of material evidences agreed upon. Besides these considerations, it should be understood that much which might carelessly be taken as second-hand information, is really entirely and valuably first-hand. Peculiarly in the case of the economic history of the South, the statements of those who spoke from intimate elbow-touch with and active participation in the events of the various periods are sources in the finest sense. This is particularly true with respect to the work of the late Mr. D. A. Tompkins, which is repeatedly made use of. No document giving a photograph of conditions at one point of time could replace an utterance which sprang from his rich association with the whole fabric of the South's economic life, and which voiced the result of his long and sensitive responsiveness to stimuli external and internal. He absorbed influences as a sponge does water, and when pressed his books and speeches yield observations quick, living, liquid. There is considerable reason for belief, too, that Mr. Tompkins' concepts, however correctly or incorrectly interpretative of the past, stood in a causal relation to the cotton manufacturing development in his active period and continuing to a less extent even to the present.

While there has perhaps been no previous effort to bring the several beliefs into parallel presentation, concerning the rise of cotton mills in the South a little body of theory has grown up. Many of the statements are not well-informed, and in other cases they are almost too studied. Aside from a preparatory instance, designed to show the limits of divergence between the various views, the method here chosen is that of relating the different assertions to all of the periods to which they apply, rather than attempting to give at once expositions of each in continuity. It is hoped that in trying to examine the views in detail, the relative weighing of periods as intended by the writers will not be lost.

One who made his study with empirical purpose, and may believed to have been not deeply interested in the historical setting of the cotton mills, has made the following observation for South Carolina, taken by him as typical of the Southern States:

"The story of the development of the cotton manufacturing industry in South Carolina is not wanting in impressive elements. From the beginning in 1790 till 1900 it was a struggle of gradually increasing intensity and extension."[1] This is a very positive statement of what may be called the continuity theory. Mr. Goldsmith's view is in marked contrast with a representative expression of Mr. Tompkins, like himself a Southerner for considerable time a resident of the North:

"The settlement of mountainous and middle North Carolina was practically by the same elements,—Scotch-Irish, Germans, Moravians, and Quakers,—as came to Pennsylvania. Many emigrants landing at Philadelphia and New Castle, Delaware, settled first in Pennsylvania and moved southward through the Valley and Piedmont of Virginia to the Carolinas. Others landed at Charleston and moved northwestward. In South Carolina even the names of several of the northern counties are identical with those of Pennsylvania, as Lancaster, Chester, and York counties.

"These settlers brought with them a large degree of knowledge and skill in manufacturing. All along the Piedmont and even in the mountains from Pennsylvania to Georgia, they not only followed agriculture, but developed varied household manufactures in the period between 1750 and 1800.... In 1800 many charcoal blast furnaces making pig iron and many catlin forges and rolling mills making wrought iron bars, and other products of iron, indicate that a manufacturing development throughout the Piedmont region of the South might have continued parallel with that which has taken place in Pennsylvania, except for the circumstances of the combined influence of the invention of the cotton gin, the institution of slavery, and the checking of this immigration. As late as 1810 the manufactured products of Virginia, the Carolinas and Georgia exceeded in variety and value those of the entire New England States. By Whitney's invention, and its improvement by Holmes, cotton planting became so profitable, that for a period of forty years the price remained above twenty-five cents a pound. Factories were abandoned, the owners going into the production of cotton with slave labor. Some of the factory workers ... went into a precarious agriculture. The factory workers and small farmers were largely ... located on the mountain sides, and the development of cotton production with slave labor tended further to separate this democracy from the white race aristocracy of the low country. As cotton and slavery advanced, the population of free white work people were driven farther and farther into the mountain country, and thus many of the white industrial workers of 1800 became the poor mountain farmers of 1850.... the owners of factories who operated with free white labor in 1800 had become in 1850 the cotton planters operating with black slave labor.... when the abolition of slavery removed one great difficulty of industries and the white people who had formerly deserted manufacturers for agriculture went back to the pursuits of their fathers, these mountaineers formed the labor supply.... it was found that the descendants of the industrial workers of 1800 could, with a little training, do as good work as their forbears did."[2]

This opinion is not so categorical as that of a close observer of the South who believes that "from 1810 to 1880 the section was industrially a desert of Sahara", but it makes clear the view that from a point early in the century until a date subsequent to the Civil War absorption in cotton culture threw manufacturing of all sorts into the discard. This conception may be held to be so generally accepted as to be commonplace and not requiring of proof; to examine in detail, however, the varying statements that would cast doubt upon this, so far from being a tilting at windmills, will serve to fix with some conclusiveness the date most nearly according with the commencement of the industry, and so accomplish the chief object of this introductory discussion.

And now to begin.

In declaring in 1908 that Spartanburg was regaining the position of a central point in one of the most forward manufacturing developments in America, such as the place had been a century earlier, Mr. Tompkins said: "When I left South Carolina to go North to learn the trade of machinist and to study engineering I thought I was leaving a country which had never had any important manufactures. Later, when I was in the middle of industrial life in the North, I conceived the idea of writing an industrial history of the United States. To my amazement I found that the agricultural South, from which I had come in a spirit of industrial despair, was the cradle of manufactures in the United States."[3]

Mr. Thompson has developed carefully the industrial character of what may roughly be called the Revolutionary period, particularly with reference to North Carolina: "The domestic industries ... flourished. Though there were no towns of any size, the number and the skill of the artisans was such that, in 1800, it seemed probable that the logical development would be into a frugal manufacturing community, rather than into an agricultural state."[4] Records in the office of the Secretary of State of South Carolina show the early encouragement given to the manufacture of cotton specifically. In a list of inventions, copyrights and patents, it appears that March 13, 1789, Hugh Templeton deposited in the office two plans, "a complete draft of a carding machine that will card eighty pounds of cotton per day", and "a complete draft of a spinning machine, with eighty-four spindles, that will spin with one man's attendance ten pounds of good cotton yarn per day."[5] In 1795 the legislature of this State passed an act authorizing commissioners to project a lottery for the benefit of William McClure in his effort to establish a cotton manufactory to make "Manchester wares."[6] The purchase by Southern States of the patent rights of Whitney's cotton gin is to be interpreted not as a design to leave off cotton manufacturing, but rather as an evidence of a prevalent spirit for mechanical improvement. A South Carolina appropriation bill for 1809 has a paragraph advancing to Ephraim McBride $1000. "to enable him to construct a spinning machine on the principles mentioned in a patent he holds from the United States."[7]

Much of this may be believed to have been directly in consequence of the necessity for economic self-sufficiency during the Revolution when the colonial commerce with England was stopped. Proceedings of the Safety Committee in Chowan county, North Carolina, for March 4, 1775, show that "the committee met at the house of Captain James Sumner and the gentlemen appointed at a former meeting of directors to promote subscriptions for the encouragement of manufactures, informed the committee that the sum of eighty pounds sterling was subscribed by the inhabitants of this county for that laudable purpose." Prizes were offered to encourage the manufacture of woolen and cotton cards and of steel, and proclamation money to the amount of ten pounds would be given by the chairman of the committee to the first producer in a certain time of fulled woolen cloth. The provincial congress the same year took steps to stimulate, by bounties, the manufacture of gunpowder, rolling and slitting mill products, cotton cards of wire, merchantable steel, paper, woolen cloth and pig iron.[8]

Although it is said that their objects were possibly political as well as industrial, mechanics' societies existed at Charleston and Augusta before and about the year 1810; in Augusta were made some of the earliest attempts in this country to improve the steam engine.[9] As early as 1770 there was formed in South Carolina a committee to establish and promote manufactures, with Henry Laurens as chairman.[10]

Before making an estimate of the character of the textile industry in the South in this Revolutionary period, it is well to take a glimpse at some of the individual establishments. The facts brought out by Mr. Kohn's painstaking research as to South Carolina serve well. Governor Glen's "Answers to the Lords of Trade", believed to have been written in 1748, in attributing some manufacture of stuffs like Irish linen to the inhabitants of the Irish township of Williamsburgh, can have no point except to indicate domestic industry.[11] Remarking the considerable manufacture of cloth in the province prior to and during the Revolutionary period, it is pointed out that "In those days it does not appear to have been popular to organize corporations and the manufacturing was done by individuals—most of the planters being amply able to conduct such operations."[12] Daniel Heyward, a planter, in a letter in 1777, declared with reference to his "manufactory" that if cards were to be had "there is not the least doubt but that we could make six thousand yards of good cloth in the year from the time we began." And Mr. Kohn comments, "This certainly shows that the Heywards conducted a considerable plant for the manufacture of cotton goods", and allows that "no doubt other individual planters made their own cotton clothes in the same way."[13]

Domestic production is clearly seen in a statement in the same year that a planter to the northward in three months trained thirty negroes to make one hundred and twenty yards of cotton and woolen cloth per week, employing a white woman to instruct in spinning and a white man in weaving. "He expects to have it in his power not only to cloathe his own negroes, but soon to supply his neighbors."[14]

This student has satisfied himself, in spite of the admitted fact that no traces of the plant survive, that "in 1778 Mrs. Ramage, a widow, living on James Island, Charleston District, established a regular cotton mill, which was operated by mule power."[15] Another plant which would seem to have approached a commercial character is seen in the assertion in 1790 that "A gentleman of great mechanical knowledge and instructed in most of the branches of cotton manufactures in Europe, has already fixed, completed and now at work on the high hills of the Santee, near Stateburg, and which go by water, ginning (?) carding and slubbing machines; also spinning machines, with 84 spindles each, and several other useful implements for manufacturing every necessary article in cotton."[16] Detail description shows, however, that while some long staple cotton for this establishment was imported from the West Indies, and while a variety of goods were made, it was conducted as an adjunct to a plantation, parts of the equipment were later removed to and set up on another plantation, and much yarn was spun for persons in the vicinity. It is, however, notable that the machinery was made in North Carolina.[17]

It has been said probably very justly that "It was not until far in the nineteenth century that manufactured cloth could be bought because of its scarcity and because of its price, and a vast majority of our grand-mothers were thus forced to make their own cloth, and many of them preferred the domestic article to the manufactured,"[18] and Mr. Clark says that "prior to the war of 1812 the advance of Southern manufactures was principally in what were then household arts—those that produced for the subsistence of the family rather than for an outside market. These manufactures continued generalized and dispersed rather than specialized and integrated."[19]

This author is to be accepted in his general dictum that "The official return of cotton manufactures in 1810 is too inaccurate either to measure the extent of the industry or to describe its location. Probably many census agents did not know what a textile mill was; and they classed as factories, plantation loom houses and the cottages or shops of village jenny-spinners. This explains the large number of establishments reported from the South and West. Advertising then to the mills just noticed and to water-driven spindles near Fayetteville, he continues: "Less study had been given to the industrial records of the South than to those of the North, and during the subsequent period of indifference or hostility to manufacturing in that section some annals of the earlier interest in those pursuits were doubtless lost. Small mills may have been started in the Carolinas and Georgia, and after a brief infancy have vanished and left no name; but, if so, the fact is curious rather than significant for it had no relation to the subsequent history of the industry."[20]

While it is thus seen that the textile industry in the South in the latter part of the eighteenth and earlier part of the nineteenth centuries was stamped with every hall-mark of domestic production, and while they were ephemeral in their operation, it is to be remembered that a century and a half ago the industry in England as well as in America bore more or less of the domestic character;[21] and Southern States showed instances of power-driven machinery before Samuel Slater built the first Arkwright mill in Rhode Island. The South had planter-manufacturers it is true, but this striking link with agriculture as contrasted with New England is easily explained in the more general fertility of the soil and the effect this of course had upon the occupation of the people. Furthermore, the very fact of this coupling indicates the inclination towards economic balance and the promise in these years of a rational development.[22] Bearing these things in mind and viewing the wastage which he conceived to have been wrought by slavery, Helper was probably within justified bounds when he declared:

"Had the Southern States, in accordance with the principles enunciated in the Declaration of Independence, abolished slavery at the same time the Northern States abolished it, there would have been, long since, and most assuredly at this moment, a larger, wealthier, wiser, and more powerful population, south of Mason and Dixon's line, than there now is north of it."[23]

Sentiment as to the right description of the mills of the Revolutionary years is clear. Coming now to those of the period later than 1810, a subject is entered in which some controversy is involved. These plants may be denominated in general the "old mills". While the two ideas are closely related, a distinction must be held in mind between the influence of these factories upon the later great development and the proper character which is to be ascribed to them as of themselves. Only the latter object is primary in the present chapter.

A North Carolinian, who, while of post-bellum experience only, has been closely identified with one of the foremost industrial communities of the South, told the writer that in his opinion it had been "a clear case of arrested development; it would have all come sooner, but for the war. It might be said that had slavery continued, manufacturing would never have come in the South; but it is also true that slavery was doomed. There is no use in talking about what might not have happened had slavery continued."[24] To uphold this view that the Civil War interrupted a course which was clearly laid down in the years previous, it ought to be capable of demonstration that the old mills had essentially the same character as those of the great period, with only those lacks which were inherent in the industry of the formative stage. A manufacture which is forerunner in time is not necessarily antecedent in effect.[25] The South had small cotton farmers of a prevalent sort before ever Knapp taught efficient production. If the old mills were of a substantially different stripe from those of the period of fifteen years after the war, the genesis of the industry, economically speaking, vests in the later date.

Another North Carolinian asserted that "In the older mills before the war, the seed had been planted, and cultivation was renewed after the war. The ante-bellum mills were pretty well known throughout the country. The woolen mills at Salem, and the cotton mills in Alamance and a few in Gastonia were known. The fact that such goods as 'Alamance' had a name already was an advantage."[26] But the mere fact that the old mills were known is not enough; it is further interesting that he continued to speak of them in close conjunction with the names of the families and manufacturers who owned them—the personal factor stood out in his mind. It is easy to find a number of undescriminating statements, as that the mills of Concord were the natural outgrowth of the old McDonald Mill, that there was a manufacturing tradition in the place.[27]

Not a few plants in the South have been in continuous operation since an early date. Mr. Kohn believes that the one with the longest record is that founded at Autun, near Pendleton, South Carolina, in 1838, by F. B. Sloan, Thomas Sloan and Berry Benson.[28] But this does not mean that many of these, so far from inspiring the later development, were not themselves by its stimulus so greatly changed as to be radically different from their former character. In addition to the general neglect accorded the old mills by public estimation, there is evidence that positive local dislike fell to one long-established enterprise at a date even as late as the seventies.[29]

It seems hardly necessary to controvert, in the light of the spirit with which mills were built about 1880 and the demonstrated total newness of the hands to the processes and even the idea of textile manufacture, an opinion that not only did the ante-bellum mills serve as a starting point for the later great development, but domestic weaving had accustomed the people of the industry.[30]

A clear distinction, and one too often lacking, was made by Carroll D. Wright between first establishments and genuine factory development in reference to the industry of Philadelphia and New England. Using English spinning inventions, "During the war (Revolution) the manufacturers of Philadelphia extended their enterprises, and even built and run (ran) mills which writers often call factories, but they can hardly be classed under that term. Similar efforts, all preliminary to the establishment of the factory system, were made in Worcester, Massachusetts, in 1780."[31] While it is not pretended that the Southern mills of a later period were of quite as limited a character as is here meant, it is wholesome to bear this point in mind.

The history of the Southern cotton mills of the period embracing the thirty years following 1810 is rather hazy.[32] Facts important to this discussion, however, stand out. In the first place, there seems to have been a good deal of moving about from this water-power to that, the machinery being hauled from place to place with apparent convenience.[33] A founder would sell an enterprise, build another and sell it and build a third.[34] It was difficult to convey machinery to the factory when purchased at a distance. That for the Mount Hecla Mills about 1830 was shipped from Philadelphia to Wilmington, North Carolina, up the Cape Fear river to Fayetteville, and then across country by wagon to Greensboro. Machinery for the Hill factory in Spartanburg county, consisting in 1816 or 1817 of seven hundred spindles, had to be brought by wagon from Charleston.[35] Some of the machinery for the Michael Schenck mill, built near Lincolnton, North Carolina, in 1813, was bought in Providence and hauled by wagon from Philadelphia.[36] For this mill a portion of the machinery was built by a brother-in-law of Schenck, and when the dam broke and it became necessary to rebuild further down the creek, a contract was made with Michael Blom, a local workman, for additional machinery.[37] Other mills had locally manufactured equipment. Spindles for the original Bivingsville mill are said to have been made in a blacksmith shop.[38] "Much machinery for the early cotton mills was made by the local blacksmiths. They were important men in the community and often grew prosperous."[39] In those days the blacksmith was a more skillful mechanic than in these, but the machinery they produced must have been crude even for that period.

While elaboration of the point falls elsewhere in this study, it is worth notice here that there is a difference between the old and the later mills in the character of their promoters and managers. In the earlier period men came to cotton manufacturing, it would seem, by more normal channels than at the outset of the subsequent development. Like Michael Schenck they had foreign industrial habits and traditions back of them, and they set up mills in communities populated by Swiss, Scotch-Irish and Germans. Or like William Bates and probably the Hills, Shenden, Clark, Henry and the Weavers they came from the industrial atmosphere of New England, then particularly stimulated by the encouragements lent to textile manufacturing by the embargo laid on English goods in the War of 1812.[40] Or through collateral business collections or marriage they were drawn into the business. Simply private investment enlisted participation of men in various callings. A manufacturer would be such as incidental to other and perhaps diverse interests. It is of course true that these same forces operated afterwards, but in the earlier time there was no response to a public enthusiasm or a social demand creating a magnet that drew into the industry men who otherwise would never have entered it, certainly not as entrepreneurs.

In connection with the Schenck mill there was operated a plant turning out iron products.[41] Cotton factories conjoined with gins and saw mills are not unknown in the South even today, but in whatever instance this occurs there is indicated a lack of specialization.

The marketing and consumption of the output of the old mills is a matter of broad interest. The statement which serves, perhaps, to indicate most nearly a genuinely commercial character in this regard, is that of Mr. Clark growing out of his reference to the establishment of General David R. Williams, near Society Hill, Darlington County, South Carolina. It was on his plantation, and was water-driven. "... in 1828 he was turning his cotton crop, of 200 bales annually, into what was said to be the best yarn in the United States. He marketed part of his output in New York and wove part of it into negro cloth for home use.... Twenty years later the factory was still shipping yarn to New York, and also making cotton bagging for the neighboring plantations.... By the middle of the century their (small Southern mills such as this) product is said to have controlled the Northern yarn market. This market they were able to enter because they had been supported through infancy by the local demand for yarn for homespun weaving—a support they did not entirely dispense with until after the war. Yarn was traded by the mills for homespun linen warp, and woven with that warp into strong cloth for country use. The family weavers who did this work were paid for their labor in cotton yarn."[42] Other evidence hardly supports a belief that the Southern mills of this period took so large a part in supplying the yarn market of the country; on the other hand, local consumption and the link with domestic industry, which even in the quotation above goes side by side with the wider sales, was prevalent. How closely these old mills were joined with the countryside is seen in the fact that into their coarse, homely fabrics went hand-spun linen warp. The domestic character was ingrained. Of the Rocky Mount Mill in North Carolina it is said that "For some years prior to and during the Civil War, the mill was a general supply station for warps which the women of the South wove into cloth on the old hand looms. A few of the braver women who were left at home with only the feminine portion of their families or the sons too young to fight, sometimes made trips alone many miles through the country to get warps for themselves and neighboring families." So beneficial did this old habit prove during the war that a cavalry troop of six hundred federals was sent up from New Bern in 1863 and burned the mill.[43] Mr. Thompson says of this same mill that until 1851 slaves and a few free negroes were worked in it. This distinguishing difference of the old mills from those of the great period, when the labor of negroes was far from the thoughts of the builders and managers, will be dwelt upon in another place. Here again is noted the fact that the mill supplied coarse yarns for neighborhood consumption, and it is said moreover that making only twelve to fifteen hundred pounds of 4s to 12s daily, the mill could not get a steady market for its wares.[44]

It is reported of the first independent venture of Francis Fries, at Salem, North Carolina, in woolen manufacture, that it "was but a small one, consisting of a set of cards for making rolls from the wool raised by neighboring farmers. This mill also contained a small dyeing and fulling plant for coloring and finishing the cloth woven by the farmers' wives and daughters."[45] A large cotton manufacturer says that he recalls only three mills operating in Spartanburg county before the war; there were Bivingsville and two very small plants, one of them on the Tyger River spinning yarns on half a dozen frames, people driving from twenty to twenty-five miles to the door of the mill to get the product, although it was sold too in the stores.[46]

The Batesville factory was built with about 1000 spindles. Before the Columbia and Greenville railroad came to Greenville about 1852, the product of the mill was 8s to 12s in ten-pound "bunches" covered with blue paper. The yarn in this form passed current almost like money. The mill marketed it over the mountains in North Carolina and in Tennessee, as far as Russellville, "mountain schooners" with six-mile teams being used for the purpose. The wagons used to bring back whatever they could to constitute a return load; usually it was meat, all of that article consumed about Greenville coming, it is said, from North Carolina. Sometimes rags were brought back. In this way yarns were sometimes taken as far as a hundred and fifty miles.[47]

A banker who is intimately connected with the textile industry in one of the oldest industrial communities in the South and who is a member of a family to which many writers are quick to point as founders of cotton manufacture in the South through agency of conspicuous participation in the business since the early thirties, said: "The mills built after the war were not the result of pre-bellum mills. This is trying to ascribe one cause for a condition which probably had many causes. The industrial awakening in the South was a natural reaction from the war and reconstruction. Before the war there was first the domestic industry proper. Then came such small mills about Winston-Salem as Cedar Falls and Franklinsville. These little mills were themselves, however, hardly more than domestic manufactures. When, after the war, competition came from the North and from the larger Southern mills, the little mills which had operated before and had survived the war lost their advantage, which consisted in the possession of the local field. They had been able to barter for the small quantities of local raw cotton which they used. The standard of exchange, the par, was one yard of three-yard sheeting for a pound of raw cotton, which was a third of a pound, made into cloth, for a pound in the raw state. But this was a retail and not strictly a manufacturing profit.... The old Winston mill, established in 1840, finished the wool product spun by the country housewives. This mill also supplied carded wool for domestic manufacture. The ante-bellum domestic-factory system did not produce the post-bellum mills."[48]

So strongly was he impressed with the essentially local character of the old mills, that he was inclined to look with pessimism upon the prospect of success for the present plants which have transcended the small sphere that in its very restriction protected them in privileged enjoyments.

It must be obvious from the foregoing considerations that a census enumeration of mills of the period cannot show internal characteristics which are all-important. But even the census returns, counting one plant like another, display the Southern industry at this stage in a feeble light. Some primary descriptive factors are lacking in the earliest reports of the census which are at all useful, but taking the four Southern States which were farthest advanced in the years 1840 and 1850—Virginia, North Carolina, South Carolina and Georgia—the showing may be summed up thus:

In 1840 Virginia had 22 establishments, $1,299,020 invested, 1816 operatives, 42,262 spindles and the plants consumed 17,785 bales of cotton. In 1850 the same State had twenty-seven mills, with a capital of $1,908,900 and 2,963 operatives.

In 1840 North Carolina had 25 establishments, $995,300 invested in these, 1219 operatives and 47,934 spindles.[49] Ten years later this State showed three more establishments, an investment of $1,058,800, 1619 operatives employed, 531,903 spindles and the number of bales consumed was 13,617.

South Carolina in 1840 had 15 plants, representing an investment of $617,450; there were 570 operatives and 16,353 spindles. By the next decade there were 18 establishments, the investment in them was $857,200, the operatives numbered 1,119 and the bales of cotton consumed 9,929.

Georgia at the earlier date contained 19 mills with an invested capital of $573,835,779 operatives and 42,589 spindles. In 1850 the number of plants had increased by sixteen, making 35; the investment had risen to $1,736,156; the operatives totalled 2,272; unfortunately the number of spindles is not contained in the census returns, but the consumption was 20,230 bales.

The Southern States as a whole in 1840 were able to report 248 establishments with a capital of $4,331,078; operatives were 6,642; spindles (an obviously incomplete summary) were 180,927. The same year the New England States as a whole showed 674 mills, with investment of $34,931,399, operatives numbering 46,834, and 1,497,394 spindles. The Southern States again, in 1850 had 166 plants, $1,256,056 invested, 10,043 operatives; the consumption was reported at 78,140 bales. At the same date the New England development was measured by 564 plants, capital of $53,832,430, 61,893 and a consumption of 430,603 bales.[50]

Many single mills in the South today represent more than the extent of the whole industry in the most forward Southern State in 1850.[51] Comparison of facts for all the Southern mills with those for the industry of New England perhaps serves to reflect back some light upon the status of the former plants specifically, which has been dwelt upon.

Of the plants in the South in this period it has been well observed that "The number of small carding and fulling mills and of little water-driven yarn factories, in this section before 1850, may have approached the number of textile factories in the same region today; ... but few of these establishments became commercial producers."[52]

Some evidences of industrial activity in the period to 1840, partly conscious and partly not so, which may be held to presage the later development are to be noticed. A localizing tendency of the textile industry in the decade from 1830 to 1840, held to have been guided by the conjunction of raw cotton, waterwheel and steamboat along the fall line of rivers—at such points as Richmond, Petersburg, Augusta, Columbus, Huntsville, Florence and the vicinity of Montgomery, Mr. Clark holds to be a "slow and unconscious development", during which William Gregg, "a single pioneer of large industry", made a systematic effort to "awaken the South to the peculiar advantages it enjoyed for cotton manufacturing."[53]

George Tucker, in his "Progress of the United States in Population and Wealth in Fifty Years", published in 1843, was the first to show that at 1840 in the older South slavery was displaying signs of decay from economic causes and that as a system it would finally lapse of its own accord.[54] Niles' Register, May 2, 1840, declared: "The South is rapidly becoming independent in almost every branch of manufacture. There are in North Carolina alone, at this day, a greater number of different kinds than ten years ago there were in the whole of the Southern States", and two weeks later the same paper took from the Raleigh, N.C., Register the assertion that "The enterprise of the citizens of this state is rapidly enabling it to become independent of the North in almost every branch of manufacture."[55]

Mr. Pleasants believes that agitation by press and public for a charge in industrial activities resulted in awakening North Carolina in the early thirties from the lethargy that had prevailed since 1810, so that "The people of the state became interested and soon a class of small manufacturers such as makers of carriages, wagons, and farm implements, coopers, wheelwrights, distillers, tanners, hatters and makers of boots and shoes, cabinets and chairs came into prominence and continued to thrive down to 1860. In addition to this class were the cotton, wool, and iron manufacturers who now began to appear and who became quite prominent after the building of railroads began."[56] It is, however, questionable whether it may be said truly that "the people of the state became interested"; certainly there was nothing like the sweep of public sentiment that appeared in 1880. Several years earlier the Tarboro, N.C. Free Press had carried this item: "A few days since twenty bales of cotton yarn were shipped from this place to the New York markets. They were from a manufactory of Joel Battle at the falls of Tar River.... Should the tariff bill meet with equal success with that of internal improvements, necessity will compel the people of the South and of North Carolina to join in the scuffle for the benefits anticipated from this new American system, and they will have to bear a portion of its burdens and buffet the Northern manufacturer with his own weapons."[57]

Influenced by the pre-emption of land into large estates with the consequent need of the people to find other means of livelihood than small farming, by the discovery of gold and establishment of the mint, by the agitation for and construction of railroads and by the improvements in cotton manufacturing machinery, the people of Mecklenburg county, N.C., "Many years before the war", said Mr. Tompkins, "were beginning to realize the importance of diversified industries.... An industrial crisis was imminent, and the problem would have solved itself by natural agencies within a few more years, had not section differences brought on the war."[58] In connection with this statement, which approaches as nearly to the ascription of an industrial impulse to the ante-bellum South as any other by this writer, it is to be noticed that the fact that the war did come to render it impossible of effects shows the relative weakness of the spirit at this time. The pre-occupation with intersectional differences was of greater potency than the intra-sectional change of mind, if such there were.

A South Carolina newspaper in 1847 reckoned up with pride eleven cotton factories in the State, with others building on the water powers of the back-country.[59]

The foregoing paragraphs have been designed to lead up to a very interesting view expressed by an author often quoted in these pages. Speaking of the years 1840-1860, Mr. Clark has said: "In the South the most striking feature of this period was the gradual breaking down of a traditional antipathy of manufactures. This hostility was opposed to the obvious interests of a region where idle white labor, abundant raw materials, and ever-present water-power seemed to unite conditions so favorable to textile industries. Cotton planting engaged the labor of the negro and the thought and capital of a directing white class, but the natural operatives of the South remained unemployed, and the capital of the North and of Europe was mobile enough to flow to the point of maximum profit without regard to sectional or national lines, were such a profit known to be assured by Southern factories. Slavery as a system probably had less direct influence upon manufactures than is commonly supposed, but the presence of the negro through slavery was important." It is noticed that white immigration from Europe, which at this time supplied the most considerable mechanical skill, avoided districts heavily populated with negroes; that plantation self-sufficiency meant isolation with small need for good communicating roads; that the market for middle-grade goods was restricted by the servile character of the colored population; that the credit system, by which factors controlled the directioning of productive capital, rested upon cotton culture by negro labor; that while the corn laws held in England, reciprocity between the Southern States and the mother country tended to discourage manufactures in this section while the conditions of commerce favored manufacture in the North. "These business interests, supported by social traditions and political sectionalism, were strengthened in their opposition to new industries by a wide-spread popular prejudice against organized manufactures.... Nevertheless the South chafed continually under the discomfort of an ill-balanced system of production...." He speaks of the canal at Augusta and of cotton mills at Charleston, Mobile, Columbus, New Orleans and Memphis directly following the writings and object lesson of William Gregg in his Graniteville factory and declares: "Though some large undertakings were wrecked by the financial crisis of 1857, more from weak banking support than from faults of operation, modern cotton manufacturing in the South dates from the founding of Graniteville rather than from the post-bellum period.... However, viewed in comparison with the cotton manufactures of the North, those of the South were still insignificant.... Nevertheless, the present attainment of the industry assured its definite future growth, and ultimate national importance."[60]

And Mr. Kohn has said that "The real and the lasting development of cotton mills in South Carolina might be started with the Graniteville Cotton Mill...."[61]

It is difficult for the present writer to see the distinction which Mr. Clark desires to draw between the effect of the presence of the negro and the presence of slavery. Well enough to assert that the capital of the North and of Europe was mobile enough to flow across the Atlantic and across Mason and Dixon's line were a profit in manufacture in the South known to be assured, but the fact is that capital did not flow in for industrial purposes because bright manufacturing prospects had not been proved out, and this largely because home enterprise was a laggard while slavery claimed the section's capital resources for cotton cultivation. The absence of immigration was as certainly the effect of slavery.[62] While it is true that for long years after emancipation, and continuing to this day, the influence of the presence of the negro in restraining inflow of immigrants, particularly of artizans, it is evident the lessening of this deterrent and the removal of other nearly equal drawbacks could not proceed or commence while slavery existed. It should be clear to anyone that from the point of view of the independent white workman the presence of the negro in slavery held as a far more forcible objection than the presence of the negro in freedom. His killing economic competition and his radiated social poison were beyond any dispute and beyond prospect of remedy until he was made at least a free producer. There could not, in the second place, be development of schools and roads, and there could not be fraternization of work-people, while slavery continued. And the prospect for immigration for the South has taken its rise from the Civil War.

It was slavery that made plantation self-sufficiency in primitive needs universal, that made isolation and physical barriers to intercourse. The credit system in its hey-day rested in large degree upon supply by the factor of all industrial products, which needs must be sustained so long as every local energy was foredoomed for absorption into cotton growing.

It can not rightly be said that the traditional antipathy to manufactures in the South was "opposed to the obvious interests of a region where idle white labor, abundant raw materials, and ever-present water-power seemed to unite conditions so favorable to textile industries", if Southern consciousness and purpose is meant. This applies particularly to the labor factor. It will be shown later in this study that in the period before the war the mills often employed slaves as the exclusive operatives in the factory, either when belonging to the management or hired from their owners; in some cases slaves or free negroes were employed as operatives in the same mills with whites; and finally, and more importantly, through the reconstruction years and at the very outset of the cotton mill era the thought of the establishers of mills nor infrequently groped out in the inclination again to engage negro hands and to induce white operatives to come from the North and even from England and the Continent—overlooking the native Anglo-Saxon population as a useful supply of workers as though it had not been there. Before the war the presence of raw cotton was certainly looked upon more usually rather as a guarantee of economic independence than as a stimulus to produce within the section those products of manufacturing which the staple was potent to purchase.

It is not implied that conspicuous promulgators and exemplars of the need for a change in economic activity, such as William Gregg and others, and more still of lesser consequence of whom we have fewer evidences, were not products of a reaction that showed itself from the long continuance of slavery, but they stand out, impotent as they are striking, against a dull and motionless background of prevalent system.

Materials and viewpoint are both too well understood to require here demonstration of the preventive influence which slavery and cotton had upon industry in the South. And yet some observations may be brought out for the special purposes of this study, looking especially through the eyes of Southern men. Henry Watterson has said: "The South! The South! It is no problem at all. The story of the South may be summed up in a sentence; she was rich, she lost her riches; she was poor and in bondage; she was set free, and she had to go to work; she went to work, and she is richer than ever before. You see it was a ground-hog case. The soil was here, the climate was here, but along with them was a curse, the curse of slavery."[63] Probably not over-induced by bitter animus is Helper's direct charge: "And now to the point. In our opinion, an opinion which has been formed from data obtained by assiduous researches, and comparisons, from laborious investigation, logical reasoning, and earnest reflection, the causes which have impeded the progress and prosperity of the South, which have dwindled our commerce, and other similar pursuits, into the most contemptible insignificance; sunk a large majority of our people in galling poverty and ignorance, rendered a small minority conceited and tyrannical, and driven the rest away from their homes; entailed upon us a humiliating dependence on the Free States; disgraced us in the recess of our own souls, and brought us under reproach in the eyes of all civilized and enlightened nations—may all be traced to one common source, and there find solution in the most hateful and horrible word, that was ever incorporated into the vocabulary of human economy—Slavery!"[64]

Tompkins saw clearly, and in effect said again and again, that "the result of the introduction and growth of the system of slavery was revolutionary; it turned the energies of the people almost wholly to the cultivation of cotton; it practically destroyed all other industries...."[65] And again, "By the influence of the negro the South lost its manufactures and largely its commerce, and became practically a purely agricultural section of the nation."[66] Speaking of the effect of the cotton gin and the cultivation of the staple by slave labor, he said: "The shops which had been productive of trading were closed to the public, and were utilized only for what was needed on the plantation.... There were no industries requiring skill or thought, and there was no necessity for scientific farming or anything else scientific.... Slavery not only demonstrated that people will not think unless it is necessary, but also that they will not work unless it is necessary.... Within three decades after the invention of the cotton gin, slavery had accomplished its revolution. The people whose minds had been occupied with diversified industries and industrial expansion, were narrowed down to the development and growth of cotton.... The mills and shops lay idle, the abundant natural resources were ignored, and everything staked upon one occupation...."[67] This writer was fond of linking the economic trend of the South in 1800 with that which emerged after Reconstruction, as thus, "In the latter part of the eighteenth century and the early part of the nineteenth there was a well-developed and extensive manufacturing interest in the South. White mechanics were numerous, and lived well. The growth of the institution of slavery had nearly destroyed all manufactures ... by the middle of the nineteenth century.... After the abolition of slavery, and after a period of disastrous experiment in trying to legislate on social and political conditions 'without regard to race, color or previous condition of servitude,' education, intelligence or moral character ... manufactures were quickly re-established in the South, and the descendants of the mechanics of former days ceased at once to be 'poor white trash' and became with marvelous quickness as good carpenters, machinists, carders, weavers, etc., as their ancestors were."[68]

Something of Tompkins' newspaper published and publicist habit comes out in this conclusion of his advice against the usefulness of negroes in cotton mills: "Dependence upon the negro as a laborer has done infinite injury to the South. In the past it brought about a condition which drove the white laborer from the South or into enforced idleness. It is important to re-establish as quickly as possible respectability for white labor."[69]

Not only is it to be said that "the growth of slavery stifled manufactures",[70] but it is noteworthy that while this baleful influence lasted no improvements were made in the methods or appliances for the preparation of raw cotton for the market. Except in size and superficial appearance there was no change in the ante-bellum gin, gin-house and screw from 1820 to 1860. "The cotton was packed by hand, carried into the gin-house in baskets by laborers, carried to the gin by laborers, pushed into the lint-rooms, carried to the screw, packed in the box of the screw and bound with ropes, all by hand." But after the war came a feeder, a condenser, a hand-press to be used in the lint room, and cotton elevators. "... the spirit of enterprise, invention and improvement in the people of the South has not only revived, but the entire method and all the machinery and appliances for preparing cotton for the market have been revolutionized."[71]

A propagandist of the early eighties desiring to organize a development of small cotton mills in the South quoted with approval a correspondent of the Morning News of Savannah, setting forth that before the war the planters saw the advantage for little establishments and were only deterred from manufacturing because "slavery and the factory were declared to be incompatible institutions. They could not exist together."[72]

CHAPTER II

THE BACKGROUND (Continued)

So far from proclaiming cotton as king, there is evidence that some of the wisest Southerners saw that it was in many respects a curse. Said William Gregg in 1845: "Since the discovery that cotton would mature in South Carolina, she has reaped a golden harvest; but it is feared it has proved a curse rather than a blessing, and I believe that she would at this day be in a far better condition, had the discovery never been made. Cotton has been to South Carolina what the mines of Mexico were to Spain...." The "day is not far distant, yea, is close at hand, when we shall find that we can no longer live by that, which has heretofore yielded us ... a bountiful and sumptuous living.... Let us begin at once, before it is too late, to bring about a change in our industrial pursuits ...—let croakers against enterprise be silenced—let the working men of our State who have, by their industry, accumulated capital, turn out and give a practical lesson to our political leaders, that are opposed to this scheme. Even Mr. Calhoun, our great oracle ... is against us in this matter; he will tell you, that no mechanical enterprise can succeed in South Carolina—that good mechanics will go where their talents are better rewarded—that to thrive in cotton spinning, one should go to Rhode Island—that to undertake it here, would not only lead to loss of capital, but disappointment and ruin to those who engage in it."[73]

"The invention of the cotton gin", said Tompkins, "... Before 1860 ... was nearer anything else than a blessing. It was primarily responsible for the system of slavery.... Cotton ... in its manufacture ... is the life of the South, but we could probably have done as well without it until we began to manufacture it."[74]

Not too dogmatic is the opinion expressed that "It seems as clear as day that ... cotton made the South a free trade section and the North protective; cotton lured the South back to slavery;[75] cotton drove the South to an extreme States-rights position ... and cotton at last drove the South to translate extreme States-rights into the terms of Secession...."[76] And with regard to internal policy, "Perhaps the most striking economic change that the new industry (cotton culture) effected in the South after the reintroduction of slavery was the speedy abandonment of manufactures ... what was the use of nerve-racking investment in elaborate and costly machinery when a land-owner could reap ten per cent net profit from a few negroes and mules and a bushel or two of the magical cotton seed? and yet the South had unusual manufacturing facilities ... manufacture soon fell into decay; the Piedmont region being still dotted with the moldering ruins of iron works and other mills that bear witness to the overwhelming power of the new agricultural absorption."[77]

It has been observed that the social difference between North and South before the war, so often looked upon as something existing as of itself apart, as a matter of fact may be fully accounted for simply by the institution of slavery, which arrested development on Southern soil of the industrial type of American civilization.[78]

Very convincing in his fact findings and often strikingly happy in his interpretations is Olmsted; his work benefited by being saved from the passion of Helper and the venom of Sidney Andrews. In accounting in 1856 for the reason for the stagnation in Virginia as compared with the industrial activity of New England and old England, he wrote, "It is the old, fettered, barbarian labor-system, in connection with which they (Virginians) have been brought up, against which all their enterprise must struggle, and with the chains of which all their ambition must be bound. This conviction I find to be universal in the minds of strangers, and it is forced upon one more strongly than it is possible to make you comprehend by a mere statement of isolated facts. You could as well convey an idea of the effect of mist on a landscape by enumerating the number of particles of vapor that obscure it. Give Virginia blood fair play, remove it from the atmosphere of slavery, and it shows no lack of energy and good sense."[79] He took to be an average expression of the views "Not of the majority of the people (of Virginia)—they are not quite so demented as yet—but of the majority of those whose monopoly of wealth and knowledge has a governing influence on a majority of the people", the statement of a paper of the State that it was glad to find its contemporaries willing to discuss "the true and great question of the day—The Existence of slavery as a permanent issue in the South. Every moment's reflection but convinces us of the absolute impregnability of the Southern position on this subject. Facts, which can not be questioned, come thronging in support of the true doctrine—that slavery is the best condition of the black race in this country ..."; and from another newspaper in the year previous (1854): "African slavery ... is a thing that we can not do without, that is righteous, profitable, and permanent, and that belongs to Southern Society as inherently, intricately, as durably as the white race itself."[80]

Olmsted was at pains to show how the people were duped by Charlatan guidance of their political leaders; this comes out particularly in his quotation of and comments upon the famous election speech in Virginia in the fifties, in which the aspirant declared to his audience that "Commerce has long ago spread her sails, and sailed away from you ... you have set no tilt-hammer of Vulcan to strike blows worthy of the gods in your iron foundries; you have not yet spun more than coarse cotton enough, in the way of manufacture, to clothe your own slaves. You have had no commerce, no mining, no manufactures. You have relied alone on the single power of agriculture—and such agriculture! Your sedge-patches outshine the sun.... Instead of having to feed cattle on a thousand hills, you have had to chase the stum-tailed steers through the sedge-patches to procure a tough beef-steak. (Laughter and applause.) ... The landlord has skinned the tenant, and the tenant has skinned the land, until all have grown poor together," "and how," asks Olmsted, "does the fiddling Nero propose, it will be wondered, to remedy this so very amusing stupidity, poverty, and debility? Very simply and pleasantly. By building railroads and canals, ships and mills; by establishing manufactories, opening mines, and setting up smelting-works and foundries. And, 'Hurrah!' shout the tickled electors; 'that's exactly what we want.'" And then he showed that it was much like the quack telling the confirmed paralytic to live generously, take vigorous exercise and grow well; that with the disease of slavery in its vitals the South could not do else than languish; that in holding out promise of wholesome measures which contemplated everything but the attacking of slavery,[81] the politicians were just laughing at the people.[82]

A reflection just as sorrowful as the confirmed bias of the people, however, is one that Olmsted did not see in this and myriad other episodes, namely, the blindness of the leaders that, with no doubt strong elements of quackery, showed even stronger signs of being themselves duped by a situation. Not that the crowd was believing, but that the leaders were so largely sincere, was most melancholy. As to both considerations, however, a passage of Sir Horace Plunkett in comment upon Irish politics, is much to the point: "Deeply as I have felt for the past sufferings of the Irish people and their heritage of disability and distress, I could not bring myself to believe that, where mis-government had continued so long, and in such an immense variety of circumstances and conditions, the governors could have been alone to blame. I envied those leaders of popular thought whose confidence in themselves and in their followers was shaken by no such reflections. But the more I listened to them, the more the conviction was borne in upon me that they were seeking to build an impossible future upon an imaginary past."[83]

As opposed to the brightening signs which some have seen in the years just preceding the Civil War, it has been said, "yet with the line around slavery being drawn more closely ... the cotton South lagged in the industrial race, and the border States were hampered by the institution that they felt to be a burden, but which they could see no safe way to abolish. Compassed as it was by political compromises, slavery must ultimately have topped through its own overweight; but in 1860 it was so valuable for the plantation that it was not only not readily converted into the factory, but was an obstacle in the way of the employment of capital and of other labor in that direction."[84]

The deterrent effect of slavery upon immigration of white laborers has been noticed above. In 1860 only 6 per cent of the white population of the South was foreign-born, but immigrants made up nearly 20 per cent of that in the North. In the decade from 1850 to 1860 the South's quota of foreign-born in the whole country dropped from 14 to 13 per cent.[85] The South was deprived of her share of foreign mechanics, so largely responsible for the industries in this country in the first half of the nineteenth century, not only by the fact that independent artizans avoided competition with slave labor, but because few of them had the means of acquiring slaves, and disapproved of the institution besides.[86] The increase in population in North Carolina in the single decade of 1870 to 1880 about equalled that of the four decades preceding. The comprehensive influence here upon immigration by the abolition of slavery is not greatly modified by the fact that in the period before 1870 fell the losses from the Civil War.[87] The tide of immigration to Mecklenburg County in this State dwindled from the introduction of slavery as a system until 1825, and thereafter set in the emigration of persons from the county, an even severer influence and stronger indication of the baleful labor system.[88]

In the fifties it was declared that the most prosperous community in South Carolina was a settlement of Germans in the western part of the State. Here had been founded an educational institution, varied manufactures, farming was conducted with successful enterprise and capital was found to be invested in a railroad venture. Slavery was not relied upon.[89] Sidney Andrews in 1865 found the northwestern counties of Georgia, which were held to be strongly opposed to secession in 1860-61, and which furnished a good many soldiers to the federal armies, probably better disposed to the national government than any other part of the State. Slaves had constituted less than a fourth of the total population, the people were industrious and hardy; though cruder than those from the lower parts of the State, the delegates from this section to the constitutional convention of 1865 were said to have a well-informed outlook for the Commonwealth. After the war the industry displayed by the white people of this region was taken as attesting their better traditions of ante-bellum years.[90]

At a time when the average wages of female operatives in the cotton mills of Georgia was half that of the same workers in the mills of Massachusetts, factory girls from New England were induced by high pay to go to the Southern States to enter newly-established plants, but soon returned North because their position was unpleasant in the midst of "the general degradation of the laboring class."[91] It was observed very truly that competition of the slave was not distantly matched in hurtfulness by the example of the more prosperous white men, with whom acquisition of the comforts and dignities of life did not proceed from daily toil.[92]

The dependence of the ante-bellum South upon the North and upon Europe for the most substantial and the most trivial appurtenances of civilization, is perhaps less in dispute than any topic here treated. The extent of this dependence, with the accompanying neglect of provision for production of the commodities at home, is evidenced by its continuance for years after the war. It might be said, not only in justification of this practice, but in apology for the total one-sidedness of the old South, that the section was animated by a natural and universal law, in responding to and acting upon the principle of comparative economic advantage. And certainly the most absolute conception of the territorial division of labor could not require a more exclusive devotion to the making of cotton and a more complete reliance upon other less peculiarly favored districts for supply not only of manufactured goods but of food stuffs and other raw materials, than the South displayed. But, however, strictly in conformity with the superficial dictates of this policy from an international and even national point of view, the program was ruinous to the section, the country and, in a broad sense, to the deeper economic welfare of the world. Easy yielding to the principle did not suggest to the great bulk of the South's statesmanship the reflection that the section after all was in only partial compliance; that even for the most efficient production of cotton as such, there needed to be a wholesome admixture of manufacturing and of other agricultural interests. Accompanying and directly by agency of the post-bellum activities in industry is seen not a less but a more economical and larger output of the staple.

Some of the most humorous passages in the literature of the economic history of the South were called forth by the need of the section to go to the North for a thousand and one essentials of daily existence, and in their very humor they serve to show the seriousness of the situation.

William Gregg, too lonely in his advocacy of home industry to treat the subject in other than its fundamental considerations, declared in 1845 to his own community, than which there was no greater sinner: "It ought to make every citizen who feels an interest in his country, ashamed to visit the clothing stores of Charleston, and see the vast exhibition of ready-made clothing, manufactured mostly by the women of Philadelphia, New York, Boston and other Northern cities, to the detriment and starvation of our own countrywomen, hundreds of who may be found in our own good city in wretched poverty, unable to procure work by which they would be glad to earn a decent living."[93] And again: "A change in our habits and industrial pursuits is a far greater desideratum than any change in the laws of our Government...."[94] His point of view comes out well in this passage: "if we continue in our present habits, it would not be unreasonable to predict, that when the Raleigh Rail-Road is extended to Columbia, our members of the Legislature will be fed on Yankee baker's bread. Pardon me for repeating the call on South Carolina to go to work. God speed the day when her politicians will be exhorting the people to domestic industry, instead of State resistance; when our Clay Clubs and Democratic Associations will be turned into societies for the advancement of scientific agriculture and the promotion of mechanic art; when our capitalists will be found following the example of Boston and other Northern cities, in making such investments of their capital as will give employment to the poor, and make them producers, instead of burthensome consumers; when our City Council may become so enlightened as to see the propriety of following the example of every other city in the civilized world, in removing the restrictions on the use of the Steam Engine, now indispensable in every department of Manufacturing...."[95]

A decade later Helper reproached a South that had not given heed to Gregg: "It is a fact well known to every intelligent Southerner that we are compelled to go to the North for almost every article of utility and adornment, from matches, shoe-pegs and paintings up to cotton-mills, steamships and statuary ... this unmanly and unnational dependence, ... is so glaring that it can not fail to be apparent to even the most careless and superficial observer. All the world sees, or ought to see, that in a commercial, mechanical, manufactural, financial, and literary point of view, we are as helpless as babes...."[96]

Gregg remarked the supply by the North not only of the articles of major manufacture, but of articles of those makes which should naturally be the adjuncts of agriculture—axe, hoe and broom handles, pitch-forks, rakes, and hand-spikes for rolling logs, shingles and pine boards; and even that "the Charleston market is supplied with fish and wild game by Northern men, who come out here, as regularly as the winter comes, for this purpose, and from our own waters and forests often realize, in the course of one winter, a sufficiency to purchase a small farm in New England."[97]

An orator at the Southern Commercial Convention, New Orleans, 1855, adapted for the occasion, thought Olmsted, a speech made in the British Parliament on taxes, familiarized in "Child's First Speaker", and beginning, in the Southern version, "It is time that we should look about us, and see in what relation we stand to the North. From the rattle with which the nurse tickles the ear of the child born in the South, to the shroud that covers the cold form of the dead, everything comes to us from the North. We rise from between sheets made in Northern looms, and pillows of Northern feathers, to wash in basins made in the North ..." and continuing in the strain that was a favorite one with platform and pen, and many examples of the employment of which may be found.[98]

A Virginia land-owner wrote to a farm paper regretting the widespread and intimate dependence upon the North, and stated quite as clearly as was observed thirty years later that goods which could be bought in the North, paying a profit to the manufacturer there, then transported to the South at heavy cost and sold at a profit to the tradesman, might surely be manufactured in the South in the first place, saving maker's profit to home industry and obviating charges of carriage altogether.[99]

A newspaper in Richmond chronicled the sale to Northern interests of a large coal field in the State, and in unconscious irony placed in juxtaposition to the notice this confident exhortation: "It is plain that a new and glorious destiny awaits the South, and beckons us onward to a career of independence. Shall we train and discipline our energies for the coming crisis, or shall we continue the tributary and dependent vassals of Northern brokers and money-changers? Now is the time for the South to begin in earnest the work of self-development! Now is the time to break asunder the fetters of commercial subjection, and to prepare for that more complete independence that awaits us."[100] But another and wiser paper in the same State, urging manufacturing development for Virginia towns and cities, and particularly the textile industry for Richmond, anticipated with a different mind the event invited in the excerpt above quoted, and foretold with prophecy all too good, what later was patent to everybody: "It must be plain to the South that if our relations with the North should ever be severed—and how soon they may be, none can know (may God avert it long!)—we would, in all the South, not be able to clothe ourselves. We could not fell our forests, plow our fields, nor mow our meadows. In fact, we would be reduced to a state more abject than we are willing to look at, even prospectively. And yet, with all these things staring us in the face, we shut our eyes, and go on blindfold."[101]

It is thought well, in summary of the decidedly non-industrial character of the ante-bellum South, to set forth some material and some observations of a general character. In spite of its length, it is useful to give in its setting an episode related by Tompkins. It shows more aptly than almost in anything in spite of its incidental happening, just the point of preoccupation with politics to which the Southern mind came, the degree of trifling with which the most sober proposals were met, the hopelessness of change from this state of affairs by anything short of a fundamental moral awakening.

"I heard of an incident, that occurred in a political contest between Mr. Gregg and Chancellor Carroll, for the place of State Senator from Edgefield District. It was the habit for candidates to appear together and speak to the people from the same platform.... On one of these occasions, Mr. Gregg spoke first. He stated that he solicited votes on the ground that he had built a factory, which gave work to poor white people. It enhanced the value of cotton by manufacturing it. He had planted peach orchards to develop new avenues of profit and advantage to the people, &c., &c. Whereas, Chancellor Carroll had never made two blades of grass grow where only one grew before.

"Mr. Carroll flowed Mr. Gregg. He was an accomplished orator, and praised in eloquent terms, Mr. Gregg's enterprise in building a factory. He eulogized his plans for fruit culture. He admitted, with humility, all the delinquencies Mr. Gregg charged against him excepting only one: 'He says I never made two blades of grass grow where only one grew before. Having faith in Mr. Gregg's plans and advice about orchards, I planted one, and if anybody is disposed to believe I never made grass grow, I simply invite them to go look at that orchard. It is literally run away with grass.' The crowd laughed, voted for Mr. Carroll and the cause of slavery went forward while Mr. Gregg staid at home and the cause of civilization languished."[102]

But Gregg preached his doctrine undaunted; his works are to be taken less as an indication of anything like general ante-bellum awakening to suicidal policies than as the bright exception that proves the melancholy rule.

He showed that even cotton, the great god, drove enterprise from South Carolina, for, with the returns from its culture under ordinary management amounting to 3 or 4 and in some instances only 2 per cent., the inclination for planters to remove with their slave capital to the richer south-west was strong, thus keeping the population of the State at a standstill.[103]

Mr. Ingle has stated the case broadly: "The economic history of the South from the Revolution to the Civil War is a record of the development of one natural advantage to the neglect of several others. Fitted by nature to support a large population engaged in a variety of pursuits based upon agriculture, it had a small population occupied in the production of raw material that contributed to the maintenance of a dense population in regions where artifice contended against harsh climate and a stubborn soil."[104] An "address to the Farmers of Virginia" read at a convention for the formation of the Virginia State Agricultural Society in 1852, adopted, reconsidered and readopted with amendments, and finally reconsidered again and rejected on the ground that it contained admissions, however true, which would be useful to abolitionists, contained the words: "... thus we, who once swayed the councils of the Union, find our power gone, and our influence on the wane, at a time when both are of vital importance to our prosperity, if not to our safety. As other states accumulate the means of material greatness, and glide past us on the road to wealth and empire, we slight the warnings of dull statistics, and drive lazily along the field of ancient customs, or stop the plow to speed the politician—should we not, in too many cases, say with more propriety, the demagogue!... With a widespread domain, with a kindly soil, with a climate whose sun radiates fertility, and whose very dews distill abundance, we find our inheritance so wasted that the eye aches to behold the prospect."[105]

In addition to the barrier to manufactures formed by cotton cultivation under slave labor, and the silent opposition which the prevalent system engendered, were not infrequent outspoken declarations against industry. William Gregg was one of the few in South Carolina or the whole South, for that matter, to rise superior to Calhoun's sway, and asserting that there were some who were better able to speak of the propriety of factories than even that statesman, faced him squarely but tactfully. "The known zeal with which this distinguished gentleman has always engaged in every thing relating to the interest of South Carolina, forbids the idea that he is not a friend to domestic manufactures, fairly brought about, and, knowing, as he must know, the influence which he exerts, he should be more guarded in expressing opinions adverse to so good a cause."[106]

And again, speaking of manufactures, he was regretful of the fact that "our great men are not to be found in the ranks of those, who are willing to lend their aid, in promoting this good case. Are we to commence another ten years' crusade, to prepare the minds of the people of this State for revolution; thus unhinging every department of industry, and paralyzing the best efforts to promote the welfare of our country." His footnote to this passage shows how calmly, in his comprehensive grasp of the whole situation, Gregg could estimate the bias of his opponents and point out to them how even their selfish ambitions could only be served by attention to such reasoning as his: "Those who are disposed to agitate the State and prepare the minds of the people for resisting the laws of Congress, and particularly those who look for so direful a calamity as the dissolution of our Union, should, above all others, be most anxious so to diversify the industrial pursuits of South Carolina, as to render her independent of all other countries; for as sure as this greatest of calamities befalls us, we shall find the same causes that produced it, making enemies of the nations which are at present, the best customers for our agricultural productions."[107]

Gregg felt keenly the opposition to cotton manufactures, which took point, moreover, from the failure of mills in the South, particularly in his own State. This he combatted by showing that not lack of natural advantages but gross mismanagement had been responsible for the fate of these enterprises.[108] He tried to take heart for the South in the reflection that those who commenced the textile industry in Rhode Island had the whole country against them and the experience of England closed to them, whereas his section had the encouragement of New England and access to the machinery and mechanical skill of the world, and he added, "It will be remembered, that the wise men of the day predicted the failure of steam navigation, and also of our own railroad; it was said we were deficient in mechanical skill, and that we could not manage the complicated machinery of a steam engine, yet these works have succeeded—we have found men competent to manage them—they grow up amongst us...."[109]

Because of the striking reversal of front of the city at a later date, which will be of central importance in subsequent chapters of this study, the estimate which Gregg gave in 1856 of Charleston's attitude toward home industry is interesting. As a delegate from Edgefield District in the South Carolina house of representatives he spoke against the grant of aid by the State to the South Carolina Railroad, stoutly declaring, although he was a stockholder in the venture and the men in control were his personal friends, that he believed every dollar the State might put into the scheme would be lost; he observed that the railroad was purely for the commercial aggrandizement of Charleston, and that, perhaps, not honestly, its spokesmen being unwilling themselves to take stock. Instead of commercial policies selfishly followed by "wealthy gentlemen, some of whom have ships floating in every sea", he declared "That her (Charleston's) destiny was fixed and indissoluble with the State of South Carolina, and that mainly her great investment in Internal Improvements should be made with a view to developing the resources of the immediate country around her. That certain and cheap modes of transportation from all quarters of the State could not fail to re-act on the general prosperity of the city. That the dormant wealth of Charleston might be so directed as to be felt in the remotest parts of the State, in stimulating agriculture, draining our great swamps and putting into renewed culture our worn-out and waste lands; diversified industry, stimulating the mechanic arts and increasing the population and wealth of the State."[110] Instead of this just ideal for leadership and helpfulness, he found it to be the unfortunate fact that, "There is no city in the Union which has accumulated more wealth, to its size, than Charleston—none that has shown so little inclination to put forth her wealth in such a way as to develop the resources of the State. Her millionaires die in New York. There is scarcely a day that passes that does not send forth Charleston capital to add to the growth and wealth of that great city. There is a silent and an imperceptible drain in that direction; the aggregate of which for twenty years would more than build a railroad from Charleston to Cincinnati."[111]

The economic thinking of the old South, with its inertia and its inconsistency, is well illustrated in a statement of Robert N. Gourdin, a cotton factor of Charleston and representative of the aristocratic type of its citizenship, made to the correspondent of the New York Herald in connection with the Atlanta Cotton exposition in 1881. After going over the old matter of the war, and the South's vanquishment by superior numbers only, he said: "We (in the South) did not manufacture because there was no necessity for our doing so. With our wonderfully productive soil, our marvellous climate, and with plenty of labor to cultivate our farms, we would accumulate wealth, live comfortably and even luxuriously without troubling ourselves with diggings for minerals or manufacturing cloth. We did not object to the inventions and manufactures of the North, but we did protest against being obliged to pay for them."[112]

The prohibition by city ordinance of the use of the steam engine in Charleston is an extreme evidence of a frame of mind that was general in the South. In order to appreciate how completely deflected from industry the Southern thought and habit had become, it is interesting to observe the seriousness with which in 1845 Gregg was forced to argue against this regulation which now seems so absurd that it could not have existed since the Middle Ages. Its opponent showed that he was linked in his sympathies with other sections and with later years, not only by his antagonism but by the humor which he could not fail to find in the situation.[113]

The characteristic inclination toward the individual rather than corporate form of enterprise which was noticed as showing itself in the textile and other industries in the South of the Revolutionary period, was still strong up to the Civil War. In 1845 Gregg inveighed against it, particularly as crystallized in legislative refusal to grant charters of incorporation, and, as in others of his pamphlets and speeches, he made analysis of the conditions that would seem to have been plain enough to convince the most stolid; he was quick to hold up New England as a business model to the South; in marked contrast to most men of affairs of the time, he saw economic institutions in their social perspective.[114] Those who have sought to magnify to the largest proportions the industrial activities of the old South have frequently failed to take account of the differences in organization which distinguished the ventures from those of post-bellum years. The textile industry could not be a movement in economic society so long as investment participation sprang from and ended with individual initiative. Until the widespread emergence of the joint-stock form, the mills could not embrace the generality of the community's resources. And in a period when this device was not largely turned to, it is plain that industrial stirrings were comparatively feeble.

Not only was there self-satisfaction coupled with dependence upon the North for manufactured commodities in the low-country of the ante-bellum South, but the up-country, that frugal population of which was better disposed for manufacturing development, was so segregated as to be kept in mean state, or actually dependent itself upon the coastal districts. Between the Piedmont and the sea was the barrier of plantations; between the Piedmont and the industrial North were no transportation facilities.[115] Olmsted was struck with finding at Fayetteville, "the point of transfer from wagon to boat, being at the head of navigation",[116] the long wagon trains of highland farmers. He counted sixty wagons in the main street of the town; this was the method of bringing produce to market. "Several of the wagons had come from a hundred miles distant; and one of them from beyond the Blue Ridge, nearly two hundred miles." The teams made less than a score of miles a day through the bad roads.[117] This isolation of one district in the South from another brought lack of concert in political and economic life. "Small landowners in the highlands could not always sympathize with men of princely domain in the low country; and misapprehensions were magnified by separation.... Diffusion of population ... was revealed in the scantiness of common-school facilities; in the division of capital among several small factories or mills, instead of its concentration in a few; in literary, religious, and social life. In 1860, for instance, the South had proportionately more church buildings than the North; but its 22,655 buildings had an average seating-capacity of 307, and an average value of $1,777, while the 31,344 of the North would accommodate 388 persons each, and were $4,183 on an average.... Isolation gave birth to individualism, as marked upon the mountain-clearing as upon the plantation; and beginnings of the co-operative spirit were dwarfed by nature and by human inclination...."[118]

Strong as is the proof of the non-industrial character of the old South as revealed by scrutiny of internal economic facts, evidence afforded by the reflection of this condition in aspects which may be called external, is quite as striking. So much is this the case, that it is believed that an examination of the social, political, educational and moral institutions, constituting the shell of the South, is satisfying as to the character of the egg without looking at the vital cell at the center. The fruits of the tree are conclusive of the sap.

Of these external phenomena, the political is that which will most readily occur to everyone. Pervasive economic conditions are shown crystallized in political pretensions; economic transitions are registered in alterations of front. The Protective Tariff of 1816 was introduced and defended, respectively, by two South Carolinians—Lowndes and Calhoun. The signature of a Virginia president—Madison—made it a law. This tariff was opposed by New England in the person of Webster. In 1828, in the debate over the "Tariff of Abominations", the situation was just the reverse—Calhoun opposed protection, Webster championed it. In spite of Webster's explanation that New England was acquiescing, against her inclination, in the expressed will of the country, it is the bottom truth that, as Lodge declares, "Opinion in New England changed for good and sufficient business reasons, and Mr. Webster changed with it ... when the weight of interest in New England shifted from free trade to protection Mr. Webster following it." And Mr. Scherer has done justice to the underlying forces in saying, "Calhoun was neither better nor worse. Both of them simply swung true to the economic interests of their respective constituencies."[119]

Cotton, nearly exclusively in the South, and to a notable degree in New England, was responsible underneath for the changes which were displayed in the superficial play of politics. It was the disintegration of manufactures brought about by the more and more extensive embracing of cotton cultivation that turned the South from protection to free trade; it was the growing absorption in industry, especially cotton manufacture, and the relative relinquishing of commerce, that made New England protectionist instead of, as before, the champion of free trade.[120]

This is not the place to remark at length how economic interests are changing the South back, in partial measure, to the first position. Cotton is again central. Cotton factories are largely responsible for the little leaven that is working in a large loaf, producing in the heart of the Solid South Republican adherents and voices for protection. "Slavery has been abolished. The South has re-established manufactures. Its interests in free trade and protection are changed from what they were in 1860. We need not only domestic trade, but foreign markets. We need, apparently, protection and free trade at the same time.... The South is as much interested in protection to home markets as New England is. New England is as much interested in export markets as the South is. In this situation we ought all to get together. We ought to get together for 'Protection and Reciprocity.'"[121]

In summary of the ante-bellum years, which have just been under review, Mr. Clark writes:

"Between 1810 and 1860 three periods of progress marked the factory development of the cotton states. During our last war with England ... mill builders from the North migrated to the Southern highlands, and with local co-operation established small yarn factories at several places in the Carolinas, Georgia, Tennessee, and Kentucky.... During the decade ending with 1833, when hostility to the tariff made the Southern people bitterly resent economic dependence on the North, there was a second movement towards manufactures, especially in South Carolina and Georgia, directed mainly towards the erection of larger and more complete factories. This agitation bore fruit in some corporate enterprises, most of which had but qualified success. Finally, in the late forties real factory development began simultaneously at several points, and had not two financial crises and a war checked its progress, we should probably date from this time the beginning of the modern epoch of cotton manufacturing in the South."[122]

Two objections against this passage have pertinence. In the first place, these three periods of comparative interest in manufactures can hardly be called "movements" in any social or economic sense. That of the twenties and running into the thirties may claim more color of this than the other two.[123] The plants set up by the New Englanders earlier were in response to individual enterprise, and that enterprise born out of the boundaries of the South. Co-operation with the newcomers was not of the sort that marks the considerable interest of a community. To the extent that mills were built in the forties as an effect of agitation, William Gregg was almost solely responsible. It has been pointed out above that Gregg was a voice crying in the wilderness—he was a missionary who spoke an unaccepted faith. He was not a social exponent. Also, while some real factories were built, it seems that to speak of these as constituting a "real factory development" is questionable. In the second place, it is rather gratuitous to count upon what would have been the case had not the war broken in upon declared industrial beginnings. The Civil War was not a fortuitous event. It had to come. It was the disastrous evidence of the dominance in the South of a system which gave no room to widespread industrial enterprise, and in which no beginnings could grow and become permanent. Could the war be regarded simply as an occurrence, an unfortunate happening, there might be ground for assuming that industrial enterprise might have been built into and finally changed wholesomely the economic regime of the Southern States, but facts show that it was a case where mastery between mutually exclusive plans had to be made on the basis of comparative strength; the spirit for manufactures had not sufficient force to avert the war, but only enough life to show, in expiring, that it had begun to be born.

The foregoing pages have not dwelt, except by chance, upon the decade 1850-1860. These years have been reserved for specific discussion because of the effort which has been made by two writers to invest them with a character of industrialism superior to that of the ante-bellum period generally. Not only is the argument defeated by external evidence, but an internal examination of Mr. Edmonds' presentation shows his own consciousness of serious modifications upon the doctrine, and explains in a very natural light the occasion for the point of view which he sometimes too dogmatically expresses. The late Mr. Edgar Gardner Murphy, in treating the subject, was heavily influenced in his opinion by Mr. Edmonds' work; it will be seen that in his discipleship, while he rid Mr. Edmonds' statement of one outstanding error, he failed to notice some of the major allowances made by him, and altogether Murphy's pronouncement is more positive and absolute than that of the source from which he chiefly drew his beliefs.

Mr. Edmonds is practically on all fours which Tompkins and others quoted in this study, in recognizing that certainly from early in the nineteenth century until the fifth decade industry was little attended to in the South. This he attributes to the high prices to be obtained from cotton, averaging for the years 1800 to 1839 a fraction over seventeen cents a pound. Then he declares: "Beginning with 1840 there came a period of extremely low prices and the cotton States suffered very much from this decline. In that year the average of New York prices dropped to nine cents, a decline of four cents from the preceding year, and this was followed by a continuous decline until 1846, when the average was 5.63 cents.... In 1847 the crop was short and prices advanced sharply, only to drop back to eight and then to seven and one-fourth cents, making the average from 1840 to 1849 the lowest ever known in the cotton trade for a full decade.

"These excessively low prices brought about a revival of public interest in other pursuits than cotton cultivation, and the natural tendency of the people to industrial matters, as evidenced by the history of the colonies prior to the Revolution, but which had long been dormant, was again aroused, and for some years there was a very active spirit manifested in the building of railroads and the development of manufactures.

"The decade ending with 1860 witnessed a very marked growth in Southern railroad and manufacturing interests.... In 1850 the South had 2335 miles of railroad, and the New England and Middle States 4798 miles; by 1860 the South had increased its mileage to 9897 miles, a quadrupling of that of 1850, while the New England and Middle States had increased to 9510 miles. The conditions were reversed by 1860, and the South then led by 387 miles.... While devoting great attention to the building of railroads, the South also made rapid progress during the decade ending with 1860 in the development of its diversified manufactures." Flour and meal, sawed and planed lumber mills are mentioned, with iron founding and the manufacture of steam engines and machinery. "Cotton manufacturing had commenced to attract increased attention, and nearly $12,000,000 were invested in Southern cotton mills. In Georgia especially this industry was thriving, and between 1850 and 1860 the capital so invested in that State nearly doubled." Noting that while most of the Southern manufacturing enterprises were comparatively small, those of New England in the early stages were of the same character, he says that "In the aggregate, however, the number of Southern factories swelled to very respectable proportions, the total number of 1860 having been 24,590, with an aggregate capital invested of $175,100,000.

"A study of the facts ... should convince anyone that the South in its early days gave close attention to manufacturing development,[124] and that while later on the great profits in cultivation caused a contraction of the capital and energy of that section in farming operations, yet, after 1850, there came renewed interest in industrial matters, resulting in an astonishing advance in railroad construction and in manufactures."[125]

Figures are set up to show the favorable economic condition of the South in 1860 as compared with the North, and these head up naturally in the observation that, "Blot out of existence in one night every manufacturing enterprise in the whole country, with all the capital employed, (he was writing in 1894) and the loss would not equal that sustained by the South as a result of the war.... New England and the Middle States, having grown rich by the war, almost trebled their property (from 1860 to 1870) while the South drops from the first place to the third. In 1860 it outranked the Northern section by $750,000,000."[126]

In criticism of these quotations specifically it is to be said that the early development in industrial pursuits and the thorough lapse before 1840 are properly observed. The present writer believes that Mr. Edmonds has exaggerated in his own mind both the spirit for manufactures, particularly in the decade from 1850 to 1860, and the extent of their establishment. The recital that there were 24,590 plants, with an investment of $175,100,000, seems at first to be striking, but a simple division shows that on an average this made the investment in each only $7,144.37, which is surely not indicative of considerable importance. Many of the enterprises must have been much smaller than would be represented by this average, and the few which were a great deal larger were rare exceptions. The very disparity in size of establishments points away from any concerted movement toward manufacturing. As to the railroad construction, much of it was narrow-gauge, and all of the facts tend to show that railroads were looked upon as facilitating commerce rather than manufactures; even after the war the pet scheme to build a railroad over the mountains gathered sentiment in the long-cherished desire to link Charleston with "the producing interior" typefied in Cincinnati; as rails were laid, piecemeal, through the Piedmont, advantages afforded by them for the erection of factories were seldom mentioned, and their utility in tapping pools of available labor was not considered. The easier transport of cotton and the development of the South Atlantic ports were the thoughts uppermost.

To vaunt property figures of the South of 1860 by including, as Mr. Edmonds has done, the value of slaves, is an obvious error; and especially because of the failure to note the inclusion of this factor, the spirit of the other exhibits is cast in doubt. Though legally they were property, in the social-economic sense the slaves did not constitute capital any more than their owners represented capital. The question is rather whether this part of the population, as productive agents under the system of enforced labor, did not mean a liability and not an asset at all.[127]

Mr. Edmonds is guilty sometimes of careless statement, as when he says, "The Southern people do not lack in energy or enterprise, nor did they prior to 1860.... From the settlement of the colonies until 1860 the business record proves this."[128] Or again, "the energy and enterprise displayed by the South in the extension of its agricultural interests was fully as great as the energy displayed in the development of New England's manufactures or that of the pioneers who opened up the West to civilization."[129] Such expressions, it will presently be shown, proceed from a loyalty to the South and a just desire to defend her against assault respecting her part in post-bellum development, but facts brought out in these pages show the mistaken zeal in seeking to place the old South abreast in industry or even agriculture.

Allowing what is perhaps the exciting cause of Mr. Edmonds' argument to appear from his own context, light is shed in the following sentences: "... 'The New South', a term which is so popular everywhere except in the South, is supposed to represent a country of different ideas and different business methods from those which prevailed in the old ante-bellum days.... Its use ... as intended to convey the meaning that the South of late years is something entirely new and foreign to this section, something which has been brought about by an infusion of outside energy and money is wholly unjust to the South of the past and present. It needs but little investigation to show that prior to the war the South was fully abreast of the times in all business interests, and that the wonderful industrial growth which has come since 1880 has been due mainly to Southern men and Southern money. The South heartily welcomes the investment of outside capital and the immigration of all good people ... but it insists that it shall receive from the world the measure of credit to which it is entitled for the accomplishment of its own people." And then he instances the cotton mills and Birmingham and Atlanta.[130] His explanation of the inactivity in the South for ten or fifteen years following the war, in the fact and causes of which he is entirely correct,[131] bears out the belief, clearly indicated in the passage just quoted, that it is his real purpose to accord to the ante-bellum South her deserved praise. However, he overreached in trying to establish anything like continuity for Southern enterprise over the ante-bellum years. The interpretation here given of the new South is now a platitude, but it may not have been a tilting at windmills when he wrote; indeed, its acceptance now may be due in no small part to Mr. Edmonds.

Altogether, it is best to rest Mr. Edmonds' theory with the following passage, in which there is no confusion of his own thought and no controversy with anyone: "Since 1880, although the South is still (1894) practically without great accumulated wealth, her people have turned to manufacturing with a facility that not only shows that they are in no way lacking in capability to compete in manufacturing pursuits, but, considering the limited capital, this section has exhibited remarkable gains in developing its resources under adverse conditions. In a little more than a decade from the time the work of development may be said to have begun, it is not a question whether Alabama can compete with Pennsylvania in iron, but rather whether Pennsylvania can compete with Alabama. Nobody now doubts that the South can compete with New England in the manufacture of cotton goods, but many do doubt whether New England can compete with the South.... Since 1880 the growth of manufactures in the South and their success has been more than astonishing."[132]

Edgar Gardner Murphy in his spiritual interpretation of the South showed himself discerning and gifted beyond almost any other writer. His conception of the economic history of the South may be held to have been secondary in his purpose and so in his thought. However, his position as an expositor of the section and the emphasis which he places upon his economic opinions regarding its past, make it incumbent upon the student to examine his views. In the following quotation the turn which he gave to the influencing argument of Mr. Edmonds and his personal slant in interpretation of this, are apparent:

"The present industrial development of the South is not a new creation. It is chiefly a revival. Because the labor system of the old South was so largely attended by the economic disadvantages of slavery, and because the predominant classes of the white population were so largely affected by social and political interests, it has often been assumed that the old order was an order without industrial ambitions.

"The assumption is not well founded. Instead of industrial inaction we find from the beginnings of Southern history an industrial movement, characteristic and sometimes even provincial in its methods, but presenting a consistent and creditable development up to the very hour of the Civil War. The issue of this war meant no mere economic reversal. It meant economic catastrophe, drastic, desolate, without respect of persons, classes or localities.... Thus the later story of the industrial South is but a story of reemergence."[133] There are then outlined the steps of Mr. Edmonds' argument, except that Murphy failed to make clear the almost total lapse of industrial activity by 1840.

The incentive to discover an industrial past for the section, which Mr. Edmonds found in the desire to establish the South as the magician of her ante-bellum awakening, is matched in Murphy's motive by a more subtle design. In one place he said: "... the most distinctive element in the economic movement of this period (1880 to 1900) is the increasingly dominant position of manufactures as contrasted with agriculture. This industrial revival is but the reemergence of the tendency which we found so manifest in the statistics of 1860. It is but one reassertion of the genius of the old South."[134] Here with his absolute conception of the ante-bellum South is hinted the purpose which really animated it. That in speaking of the post-bellum development as "one reassertion of the genius of the old South" he did not mean, as very easily might be supposed, that through the earlier history of the section had run a genius for industrialism, is made clear in the following passage, which, though it refers particularly to social relationships, is pertinent for the industrial bearings:

"The old South was the real nucleus of the new nationalism. The old South, or in a more general sense the South of responsibility, the men of family, the planter class, the official soldiery, or (if you please) the aristocracy,—the South that had had power, and to whom power had taught those truths of life, those dignities and fidelities of temper, which power always teaches men,—this older South was the true basis of an enduring peace between the sections and between the races." He regretted that this old South was not enabled to come into force until after Reconstruction because "a doubt was put upon its word given at Appomattox. Its representatives were subjected to disfranchisement. Power was struck from its hands. Its sense of responsibility was wounded and confused."[135]

This is a fine statement of a primary and outstanding truth in the development of the South that began about the year 1880. The old South did draw breath with the new. The permanent character of the South, the forces resident in the South of earlier as of later years, were those which largely made possible a complete change in viewpoint, which carried through the measures of, if not indeed giving birth to, the potent consciousness of a reversal of program. But, as Murphy failed to see clearly, there is a radical distinction between the continuity of this quality in the South and any continuity of its evidences in industrial pursuits. The new South did not receive from the old South a heritage of industrial tradition; what it received was a traditional and ingrained and living social morality, not marred in its essential characteristics and presence, and very likely even assisted, by the institution of slavery. As again Murphy said: "... this sense of responsibility, deepened rather than destroyed by the burden of slavery, was the noble and fruitful gift of the old South to the new, a gift brought out of the conditions of an aristocracy, but responsive and operative under every challenge in the changing conditions of the later order."[136]

In this apology for Murphy's view is splendidly apparent the best resource with which to turn from the South that was to the South that is.

CHAPTER III

CONDITIONS PRECEDENT TO THE ERECTION OF THE MILLS

To understand the establishment of cotton mills in the South, it is necessary to grasp the deeper impulses which actuated every policy certainly from the year 1880 onward, continuing in only modified degree to the present. Every phase of the movement for the building of cotton mills was conditioned by motives at once tender and heroic, universal in their applicability and too intimate in appeal to admit of more than passing argument. In a study of the actual erection of factories, the hundreds of problems that arose and the mass of practical detail attendant upon their solving constitute, it seems to the writer, a hopeless or at best profitless puzzle, unless it is clearly understood that these minutiae point back to something elemental and primal which gave them character. On the other hand, if this fact is recognized, the circumstances which accompanied the setting of mills in operation, such as the securing of capital, the obtaining of adequate labor, the selection of sites for the location of buildings and the like, from the very coldness of the subjects, and their unsentimental aspect as commonly thought of, strike into peculiarly bold relief the purposes that lay behind them. When it came to money-getting, psychical factors must be crystallized into something very forceful and admitting of unquestioned faith. It is the aim of the present paper to be an introduction to the study of the problems involved in the setting up of cotton mills, by giving the antecedent action, as it were, and by showing the motive force as it developed, operated and concentrated.

This responsible cause, catching the phrase from a writer of the day, may be termed "real reconstruction". The impulse for it came over the South in 1880 like a great ground swell, translating itself into a thousand activities and ramifications. "Real reconstruction" was spectacularly the outcome of the defeat of Hancock by Garfield in the presidential election immediately, but its roots run deeper and have their hold in the slow but sure recuperation of the South from the devastation of the Civil War through the troubles of radical rule, assisted by a brief breathing space from the termination of carpet bag government in 1876, when the lesson of fifteen terrible years soaked in thoroughly. It is sufficient here to say that in 1880[137] the South suffered a change of heart, a revulsion of conscience that was fundamental. The people turned on their heel, and faced about to find a new future of the largest promise.

A newspaper which before had bent every effort towards the election of Hancock, the Democratic candidate for the presidency, as securing for the South political independence and revenge for Northern mistreatment, a week after his defeat printed an editorial headed "Our Refuge and Our Strength", with these words:

"... we have been defeated in the national contest. In the administration of the national government for the next four years we need not concern ourselves, for as far as possible our councils will be ignored. What, then, is our duty? It is to go to work earnestly to build up North Carolina. Nothing is to be gained by regrets and repinings.... It is idle to talk of home independence so long as we go to the North for everything from a tooth pick to a President. We may plead in vain for a higher type of manhood and womanhood among the masses, so long as we allow the children to grow up in ignorance. We may look in vain for the dawn of an era of enterprise, progress and development, so long as thousands and millions of money are deposited in our banks at four per cent. interest when its judicious investment in manufactures would more than quadruple that rate, and give profitable employment to thousands of our now idle women and children.

"Out of our political defeat we must work a glorious material and industrial triumph. We must have less politics and more work, fewer stump speakers and more stump pullers, less tinsel and show and boast, and more hard, earnest work. We must make money—it is a power in this practical business age. Teach the boys and girls to work and teach them to be proud of it....

"Demand all legislative encouragement for manufacturing that may be consistent with free political economy. Work for the material and educational advancement of North Carolina, and in this and not in politics, will be found her refuge and her strength."[138]

The uselessness of attempting a political salvation as contrasted with the logic of giving all energy to the building up of the South materially, clearly shown in the passage quoted, occurs time and time again.[139] President C. C. Baldwin, of the Louisville and Nashville Railroad, born in Maryland but for many years resident in New York, and competent to take a comprehensive view of the South and its problems, said in an interview with the New York Herald in 1881, after the new program had gotten under way: "The commercial men of the states fully appreciate the situation.... They now see clearly how very little politics have done for them, and seriously turn toward the real 'reconstruction' which active trade will inaugurate. All the war issues are dead and buried except to a few politicians who misrepresent their constituents and merely use the language of the past to give them, personally, a passing prominence. True, we hear a great deal more about the men who stand forth prominently as the advocates of these dead issues than we do of the thousands of young and energetic Southern men who are building cotton and woollen mills; who are opening mines and starting iron, copper and zinc furnaces, or who are relaying the roads between the Atlantic and the Ohio and the Gulf. These men don't talk, they don't write books, they don't go to the Legislature or to Congress. They speak, trumpet toned, in results, however. The people of the South have suffered—it is not pertinent whether we regard their sufferings as just or unjust—but they have put aside mourning and are ready for work."[140]

The Sumter, S.C., Southern voiced the same idea: "The Southern people, outside of the professional politicians, care very little about Federal politics. They are endeavoring to develop the resources of the South and regain the broken-down fortunes left by the desolation of civil war.

"So taking the past and the present as indices for the future, it is plain to see that a dissolution of the Solid South will cut at the very roots of all these wrangles between the North and the South[141] in which sectionalism is involved."[142]

"The people of the South are beginning to learn that the true road to power is not through the White House, supported by a swarm of federal officials", said a Tennessee paper in March of 1880. "They are learning that solid wealth is power, and that wealth is attainable only by working up their cotton and wool into fabrics and their ores into metals."[143]

The clear-headedness of the following extract from an editorial which appeared in the Columbia, S.C. Register, at the time the city was putting forth every energy to realize a desire for cotton mills, is unsurpassed:

"But if we lost the victory, in one sense, we have won it in another. We have been taught what the South can do for itself if it wills to do it. If we have lost the victory on the field of fight, we can win it back in the workshop, in the factory, in an improved agriculture and horticulture, in our mines and in our schoolhouses.

"There is where our fight lies now, and the only enemies before us are the prejudices of the past, the instinct of isolation, the brutal indifference and harmful social infidelity which stands up in our day with the old slave arguments at its heart and on its lips, 'I object' and 'You can't do it'."[144]

In the broken and all but disheartened condition of the South after enduring the war, radical rule and defeat of political hopes, this conception of another economic future, once it burst upon the consciousness of the Southern people, amounted to nothing less than a religion.[145] Every one of the old pangs added devotion to the new purpose. The whole pride of the South seemed about to go to disruption, and the imminent danger of this lent a passionate loyalty to the changed program which appealed to everything that was best and noblest in the people.

The new spirit was strongest in North and South Carolina and in that portion of Georgia contiguous to South Carolina. Distance from this region as a center about marks the intensity of feeling and comprehensiveness of grasp with which the impulse was voiced. Florida and Mississippi felt it little, due probably to their position so very far South as to be still submerged in misery; Virginia was only slightly affected and Maryland hardly at all in the same sense as the middle South, because of proximity to the North and difference of character, by reason of the absence of cotton as the staple. North and South Carolina and the region about Augusta, Georgia, gave the plan its first conception and its most whole-hearted support because, it appears, North Carolina is by nature resourceful and hardy above any Southern State, and South Carolina, despite every discouragement, would have the heart to try again because she is thoroughbred in a company of thoroughbreds.[146]

Just as the philosophy varied in intensity territorially, so it varied in degree within the same region. Some wished salvation through material advance for the sake of the State; this was natural, as growing out of a well-known loyalty of the citizens of Southern commonwealths.[147]

Others with larger view proclaimed the new gospel for the whole South as a section, rather adopting an attitude of aloofness toward the North, wishing the Southern people to work out their great problem without assistance from those who would be predisposed to meddlesome criticism. It is true that reorganization for the South was the most national thing Southerners could turn themselves to at that time, and in the judgment of many still is, but speakers and writers often failed of just the most fortunate expression of their purpose in that they did not strike the national note very consciously.[148]

It is something to have gone through what the South went through and come out not dispirited utterly, not defiant against fate or enemies, not forgetful of the past, but, remembering the worst, determined soberly, quietly, thoroughly to do the fundamental thing and do it nationally. It was left for Charleston more than all others—noblesse oblige—to speak this greatest message:

"The Southern people must be national themselves, in their aspirations and conduct, if they would have the government truly national in spirit", and have Garfield "President of the whole country, and not of a section, or party, to have a government of 'the whole country', to be entitled to it, we must think of the whole country as our own, and demand no more than we are ready to give. It must come to this. In the near future the successful leaders, South and North, will be those whose first thought is for the Republic, men who are national in feeling and purpose; men who understand that the political and social strength and safety of each State depend not on isolation and separation, but on combination and union."[149]

By the late fall and winter of 1880 the mind of the South was ripe for progress and accomplishment. Perhaps the first gropings after procedure struck upon the consideration that manufactures would add another profit to the profit of agriculture. The big, general conception was first grasped without refinements or modifications or drawbacks; it was received with almost childlike simplicity and faith.[150] But it came to be ingrained. "The cotton which now comes into Charleston and is sold here pays commissions to the factors and brokers, and when shipped leaves behind it the price of the drayage, compressing and storage. Cotton which comes into Charleston and is manufactured here is doubled in value, and an amount equal, at least, to the value of the raw cotton when it reached the city boundary is distributed among the people of Charleston. This is the simple key to the prosperity which invariably attends the development of manufactures. Manufacturing gives additional value to raw material, and this additional value goes into the communities where the manufacturing is done. At present Charleston does nothing to increase the value of the cotton which comes here for sale. It leaves us as it finds us. The city lives on the pickings and scrapings....

"Cotton mills change all this. A bale of raw cotton worth forty dollars is spun into yarns or cloth worth eighty dollars.... The stockholders and the working people get the whole difference between the cost of the cotton and the value of the yarns or cloth, except what little may be expended for material that cannot be purchased here."[151]

President H. P. Hammett, of the Piedmont Factory, in a remarkable address before the State Agricultural and Mechanical Society and State Grange, of South Carolina, to which reference will several times be made, after describing the earlier absorption of the South in a single pursuit, and the ills that grew from this, said: "A new condition of things and a changed sentiment amongst the people prevail at present; with the changed relations of society and institutions a sentiment favorable to a diversity of pursuits has developed ... a disposition is manifested to develop the many resources heretofore lying dormant or hidden.[152] Capital when needed is furnished, and men of energy, enterprise and ability develop ... the general sentiment of the people is to utilize all the facilities within their reach.... Under such circumstances it is natural that the public mind should be directed to the manufacture of their great staple."[153]

There were a score of reasons making this course seem plausible.[154] They were advanced, scrutinized, at the South sometimes accepted with a grain of salt, at the North not infrequently flatly and stoutly challenged as absurd; they were patiently explained or difiantly, and not always with the closest reasoning, flung in the faces of their objectors—but finally they were proclaimed as gospel, and in this sign the South set out to conquer. Of these beliefs is to be placed first and foremost the conviction that, other things aside, manufacturing was most economical and so logically belonged, at the source of production. Here is the doctrine, given in all simplicity, and not without the force characteristic of newspaper correspondences of that day: "Sir, it matters not what anyone may say to the contrary, common sense tells us that other things—machinery, skilled labor, motive power and facilities of shipment—being equal, a cotton factory in the midst of cotton fields must prove more profitable than the same concern a thousand miles from its base of supply could possibly be."[155] Other factors there were—cheap labor, unused water powers, abundance of wood and coal nearby, local market for the sale of product, longer running time than in the North, a favorable climate, saving in fuel and light, absence of damage to cotton by compress, saving in bagging and ties, assistance to be given to women and children much in need of work—all of them bore their part in focussing the energies of the South upon that program which was to mean so much in so many ways—the "cotton mill campaign."[156]

The current passion for building cotton mills—it was nothing short of this—was stimulated and guided by press[157] and platform in urging, chronicling and praising advances.

The Columbia, Georgia, Enquirer, after recounting the progress of the city in spinning—it had 60,000 spindles—said: "These are the weapons peace gave us, and right trusty ones they are.... The story the spindles tell is one of joy to all, and show (shows) how rapidly we are climbing the hill of prosperity."[158] The affectionate tone of this item from the Rock Hill, S.C. correspondence of The News and Courier is unmistakable: "In conclusion let me say a few words in regard to the 'pet' of the town, the Rock Hill Cotton Factory. This factory is owned and controlled by the citizens of the town, (except $15,000 in stock owned in Charleston). It has a capital of $100,000, has over 6,000 spindles, with 1,500 more to be added in a few days."[159] The Marion, S.C. correspondent of the same paper a year earlier contributed this for his town: "Our wants: A bank, an academy, a cotton factory, a comfortable room for passengers at the depot, an iron foundery, and last, but not least, work upon our streets."[160] So much did cotton mills come to be considered the natural signs of progress that Raleigh made apology for not having a single mill. "There is not a cotton factory in Raleigh, but there are not less than five large planing mills, two foundries, two boiler factories ...", and there follows a list of everything in the corporate limits, including schools and even newspapers.[161]

Under its caption, "The Cotton Mill Campaign", the active News and Courier every few days listed new entries into the field of cotton manufacture. The issue of February 8, 1881, presented a particularly large number of items from different towns. The Newberry Herald exhorted the citizens with reference to Charleston's achievement thus: "Cheer for Charleston—A Movement all Along the Line. Charleston is in a fair way to have two large cotton factories in a short while.... Camden is preparing for a cotton factory. Hodges, Abbeville County, is preparing for a cotton factory. Rock Hill has a cotton factory. Greenville has several cotton factories. Newberry, the best location for a cotton factory in the State, and the place most needing one is not preparing for a cotton factory, and there is no present likelihood that she ever will." The method followed here, of citing the advance of other places in mill building as an incentive, was widely used, and not commonly with the rather complaining tone of the above from Newberry.[162]

That the spirit was in the air is clearly discernible in a Winnsboro contribution: "Why does not Fairfield (the county in which the town of Winnsboro is located) make the experiment? It is said that $15,000 will set in motion over five hundred spindles, and continual additions can be made." While recognizing that water power was difficult of access, steam might be used, for there was plenty of cheap fuel for years to come, and the Charlotte railroad offered easy communication with the world for a mill located along its tracks. The Hampton, S.C. Guardian struck the note: "Factories are springing up all over the State, and our people must not be found lagging in the race of progress."[163]

How the people were reaching out for cotton mills, with their attendant profits and advantages, may be seen in this advertisement appearing in the winter of 1881: "We will give to a Cotton Manufacturing Company, that will organize and locate at Landsford, S.C., with a capital of $300,000 a site, 20 acres of land and 3000 horse water power. Apply for particulars to T. C. Robertson, Allen Jones, Rock Hill, S.C.; Wm. R. Landsford; Edward McCrady, Jr., Charleston."[164]

A little earlier the cotton mill campaign had extended itself to the point of interesting class effort, for the most prominent German citizens of Charleston organized a mill in a short space of time.[165]

The cotton mill campaign had gotten well under way[166] when its further progress was greatly facilitated and its successful outcome made plain by the projection of a plan to display the resources of the Southern States in an exposition at Atlanta. The scheme was first proposed in October of 1860, and the International Cotton Exposition was opened in Atlanta October 5, 1881. The exposition, in organization, history and influence, is inseparably bound up with the name of Edward Atkinson, economist, publicist and manufacturer of Boston. He gave it its inception; in an unselfish and magnanimous spirit he guided its beginnings and brought it, by his advocacy and superintendence, to completion. He was "the father of the Atlanta exposition."[167] In a sincere desire to see the South extricated from the disorganization of the war and the years that followed, he planned this method of showing the people what he considered to be their true interest, namely, concentration upon better methods of cultivating and preparing cotton for market and for manufacture. With a fine comprehension of the most fundamental needs of the section in many directions, he conceived the care of cotton between the field and the factory to be properly the first concern of the Southern States, not temporarily, but for all time. The Atlanta exposition he proposed as the lens through which to focus attention upon this.

But Mr. Atkinson, most singularly for a man of his grasp, penetration and experience, had not reckoned upon the force of the enthusiasm for manufacturing cotton, which, as has been shown, came over the Southern people. That cotton mills were being built he could not but see; that they were making profits he could not deny—but in the economic wholesomeness and permanency of the factories he would not believe. In the International Cotton Exposition he created a Frankenstein to amaze and frighten and torment him. For once the resources, of the South were displayed in visible, tangible form in reasonable compass, and once the people were united upon an effort which should gauge their strength and possibilities, the invitation, or, as some put it, the duty to manufacture the staple in the fields where it grew leaped out as a fact more patent than ever. The people had felt the strength that came from union in a common purpose, and nothing could deter them from following the light that this brought to them. Mr. Atkinson, who had acted in the best of faith and with great ability, was surprised and chagrined; when he found that, while following his lead in showing the necessity of more careful culture and preparation of the crop for manufacture, the South, by the agency of the exposition, was fascinated in going beyond his goal, and building mills to make up the cotton for itself, he protested earnestly, and went to no end of pains to turn the people from their course. But the horse had taken the bit in his mouth, had glimpsed a broader highway open ahead, and the reins that had directed him once were of no avail to arrest his career.

Conscious of his New England milling and insurance interests, it is likely that Edward Atkinson felt the South, which he had tried to help, distrusted him. And though the fact of his connections, coupled with a manner of addressing himself to the Southern people at times unfortunate in its seeming superiority, and tendency to become impatient and didactic, might easily have led the section to regard him with enmity, it is to be remembered to the credit of the Southerners that they showed as great charity for his, as they regarded them, short-comings of judgment, as they held in esteem his friendship and constructive co-operation. The vision which the South had caught rose superior, in almost all cases, to any pleasure to be found in taunting those who differed in view, especially when so much was owing to a man as belonged to Mr. Atkinson. His position is one of the most important in the whole history of cotton manufacturing, not only in the South, but in this country, and it is the most dramatic and pathetic. He stood virtually alone after the exposition had run a few months, protesting impotently against a new state of things, every development of which seemed to cry the lie to his objections. His very antagonism lent impetus to the current setting toward cotton mills for the cotton estates. And, to make the sting even more poignant, instead of looking upon his opposition to Southern cotton manufacturing as representing a class of jealous industrialists at the North—and many things there were to lend color to such a belief—the South was appealing over his head to New England capitalists to come down and help erect factories.[168]

How Southern sentiment had grown beyond Mr. Atkinson's purposes for the exposition is to be seen in the words of A. O. Bacon, speaker of the Georgia House of Representatives, in welcoming a party of South Carolina legislators and their friends to the Exposition three months after its opening: "This exposition—marks an important epoch in the industrial history of the country. It has aroused the South to the value of new enterprises and of new methods of labor; it has awakened the North to a realization of the boundless resources and enormous industrial capacities of the South. It comes at a most propitious moment, for the South, in sympathy with the quickening energies which excite the continent, is even now trembling in the initial throes of the mighty industrial revolution that surely awaits her. A great change is about to come upon us. 'In the fabric of thought and of habit' which we have woven for a century we are no longer to dwell, and a new era of progressive enterprise opens before us."[169]

The place of the Cotton Exposition in furthering the cotton mill campaign, already attained to a healthy start, is seen in this from Clifton, S.C.: "It is to be hoped the Atlanta Exposition will not take all the enthusiasm out of our capitalists and enterprising men,[170] but that it will only tend to a greater and more steady development of our resources. There are new families coming in constantly (to the Clifton Mill) and the cottages as far as completed are occupied, and still they come."[171] And again: "A good work has been done, the benefits of which will be felt in every part of the country. The New South takes a fresh start at the Atlantic Exposition."[172] Here also is evidence of the very fortunate juncture at which the exposition happened to fall. The show did much for the South irrespective of its exhibits; indeed, before a shovelful of earth was turned, a real service was rendered. It proved to the people that they could organize and exert a force in common; the South was less individual from that day. It demonstrated besides that the South had resources and possibilities worth presenting to the world. Once the exposition was opened, three distinct influences were brought to bear in carrying forward the work already begun. The people of the South were shown for the first time as a whole the implements of cotton manufacture, capitalists in general were introduced to the opportunities of cotton milling in the section, and, in visualizing and making more than ever evident the industrial future, less effective reflex from the ultimate proposals of Edward Atkinson and others of his belief was afforded once for all.

The very day of opening, the exposition greeted crowds of visitors with these words from Daniel W. Vorhees, of Indiana; "There is a far higher remuneration than has ever been given by cotton yet in store for the laborer, the manufacturer, the South and the entire country. In the midst of the cotton plantations themselves there is a career for manufacturing development such as the world has not yet seen. With coal, iron and timber in perfection and inexhaustible, and water power everywhere, by what rule of political economy should the Southern people send their cotton, at an expense always deducted from its price, to distant sections and foreign countries to be spun and woven? If the manufacturer in Great Britain, transporting his cotton from India and the United States, can realize substantial profits, why may they not be realized here...? We have seen the manufacturer of New England, at a long distance from a productive base of supplies, turn a sterile country into the seat of culture, refinement and wealth. Why shall not the South put forth its energies and reap the same and a far greater reward? Here the cotton grows up to the doorsteps of your mills, and supply and demand clasp hands together. The average exportation during the last ten years, from these wonderful fields to England and other European ports, has been over 3,000,000 of bales per annum; while to the mills of New England and other Northern states another million have (has) been annually carried away from your midst, and from the best manufacturing region on the globe."[173]

So, even from the opening of the exposition, matters had taken a decided turn toward cotton manufacturing for the South. After the fair had been in progress three weeks, Mr. Atkinson and a committee from the New England Cotton Manufacturers' Association came down for their initial visit. From Mr. Hemphill's letter to The News and Courier[174] it is clear that the New Englanders appreciated most those parts of the exhibit which had to do with "ginning and preparing." Still considering all cotton manufacturing to belong to the North, just as all cotton growing belonged to the South, the verdict of the party on this first inspection was: "Nothing ever happened in the history of the country to prove so adequately the identity of the interests of the cotton grower and cotton manufacturer as this exhibition." Thus were visitors coaxed to examine into the increased efficiency and profit which lay in sending clean Southern cotton to Northern manufacturers.

Soon the situation demanded more drastic handling. Edward Atkinson, in a set speech on the exposition grounds, stated his position clearly: "You have depreciated every crop of cotton you have made at least 12 per cent. by want of care and attention in ginning, baling, pressing and caring for the cotton between the field and the factory. You can save half your labor and add 10 per cent. to the value of your crop if you will use the new tools and machinery here on exhibition and heed the words which I now speak.

"The Southern planter and farmer has no knowledge, as yet, outside of the sea island district, of the merits of a true roller gin. Clark's cleaner has just been introduced and is only known within narrow limits.... Now, I am going to touch a tender subject—cotton manufacturing.... I have never taken the ground that there were any climatic difficulties in many parts of the South. The real difficulty is that the margin of profit is very small on a very large capital, and unless you can work, in the long run, on a very small margin you cannot succeed. These times are no criterion.... May I say that the true preparation for success in cotton manufacturing must be in knowing how to save the fraction of a cent.... You cannot spin cotton when you do not know the difference between a cent and a nickel."[175]

The reception with which Mr. Atkinson's theory met is seen in an editorial comment on his December address: "The future of the South is described with great power in the ... speech of Mr. Edward Atkinson at the Atlanta Exposition.... Mr. Atkinson is misleading only when invincible prejudice keeps him from seeing clearly, and even Northern newspapers admit[176] that he is wrong in his belief that cotton manufacturing, on a large scale, will not pay in the South. The speech otherwise is suggestive and instructive."[177] In a review of an article by Mr. Atkinson on "The Solid South", appearing in the International Review for March, 1881, William E. Boggs, of Atlanta, wrote: "If one so sincere as Mr. Atkinson in the desire that the South shall flourish can so misunderstand the Southern people, what must be the mental condition of those who have prejudice without good-will? Mr. Atkinson is the father of the Atlanta Exposition, and is, in his way, a true friend of the South."[178]

There was one more condition precedent to the erection of cotton mills in the South. The people of the section might come to a determination to set up schools, run telegraph and telephone lines, construct railroads, stop political quibbling and back-biting, and, above all, institute manufactures as the surest release from a condition calling for the strongest action; they might turn themselves wholeheartedly to the building of cotton mills, calling forth every native resource and ingenuity, enterprise and sacrifice, and these would avail much. But the task was so huge in its proportions that sooner or later it must cease to be a sectional matter, and not only was this necessary, but it was proper that it should be the case. The North must be called upon for help. If there are two facts in the building of cotton mills in the South which stand out head and shoulders above all the rest, they are that the Southern people, impelled by inner forces, undertook the work, and that when it became apparent that outside capital and advice were needed and could be had, these were welcomed gratefully.[179]

There were certain forces which made for a national mind in the South—certain external influences aside from the reasonings of the choicer spirits. These bound the North and South together, and helped to make possible the augmenting of Southern energy and resources by Northern capital and experience.

Just as the International Cotton Exposition at Atlanta lent impetus to the sectional furtherance of the cotton mill campaign, so the shooting of President Garfield, his lingering illness through three months, and his death, occurring at approximately the same stage as the exposition, may be thought to have done much in preparing the way for receiving Northern, and, indirectly, European capital into the South.

"This (the South) is a region where manliness is held in superlative honor", said the Charleston paper so often quoted, "and assassination is loathed for its cowardliness even more than it is abhorred as an offence against law and society.... There could be no doubt then that Guiteau's dastardly act would be heartily denounced—and there was reason to look for some special indignation on account of the exalted official position which Gen. Garfield holds. It could not have been foreseen, however, that the outburst of sympathy and condemnation would have been universal in its manifestation, affectionate in tone and National in spirit. South Carolina does more than reprobate assassination. The people of the State, the whole people, resent the deed because the victim is the President of the United States, the Chief Magistrate of our country.... The process of reunion has gone on with a rapidity which few appreciated. All the elements of cordial friendship and of national good-will were there. It needed only the threat of a common misfortune to give shape and voice to the recreate but sturdy love of the Republic."[180]

The following appeared with the announcement of President Garfield's death. "In the history of the United States, President Garfield will be remembered as he whose nomination by the National Republican Convention strangled imperialism in its cradle, and as he whose assassination was quickly followed by an outburst of sorrow and sympathy which manifested to the North the true nature of the South, and do more than the arguments, the prayers and the common intercourse of thrice five years to bring together the peoples whom war had made separate. By the shedding of blood the North and South were sundered; and through the shedding of blood they are united.... In his wounding unto death passed away the alienation, the estrangement which prevented this country from being truly one, although men and millions had made it in appearance indivisible."[181]

Railroads, both because they allowed sentiment to become solidified in the South, and afforded great currents of intercourse with the North, were of first importance. And in the railroads, with the encouragement they gave to manufactures, and the stability they lent to trade in furnishing a strong commercial backbone,[182] appear early hints of the unifying force of Northern capital itself. A railroad, in which Northern men chiefly were interested, which proposed running up the James River Valley to Clifton Forge, was hailed by Richmond as bringing new prosperity. "We welcome the Northern gentlemen who are to co this invaluable work for Virginia, and we trust and believe that they may never have cause to regret the investment of their capital here. Every such investment is a new band around the States of the Union binding them more closely together."[183]

CHAPTER IV

CAPITAL

In the chapter on the conditions precedent to the erection of cotton mills in the South the attempt was made to show how the stage was set for the actual building of factories. The impulse for manufactures, and especially cotton mills was traced through its several more or less definite periods of development. The first of these was the recoil from the Hancock-Garfield election; the failure of the South's determined hopes for the success of the Democratic candidate, which would mean, it was thought, freedom from political insult and economic servitude, and an opportunity to wreak vengeance for the wrongs of radical rule, virtually marked the death struggle of the old exclusive social philosophy as the animating force in the South. This had been bred by the ante-bellum regime, called into concrete trial by the civil war, and intensified in character through each year of Reconstruction, and through each year proven more untenable. The questioned election of 1876, when Tilden was thrown out under circumstances peculiarly galling to the South, set the section as a unit and unalterable for the next four years in a passionate and dogged resolution against all odds to make a Democrat president in 1880. When Hancock was beaten in a fair fight by Garfield, the South was thrown prostrate; devastated by the war, pillaged and ridden in Reconstruction, to gather all her forces for a final defiant stand and have her last poor hope dashed was tragic. But this very extreme of bitterness was the South's salvation.

The leaders, with remarkable accord and almost simultaneously in all quarters, after recovery from the first inescapable shock, rallied to the situation like heroes, and called their less valiant brethren after them in a new resolution to build up another South founded on democracy and a purpose to employ every material resource for the building of a foundation which would bear the weight of the different structure that had to be erected.

Words unfamiliar in the South were heard on every hand; in this proposal of "real reconstruction" notions as novel as they were salutary were involved. Communication between States and parts of the same State, by railroads, telegraph and telephone; schools, churches, diversification of crops, deepening of harbors and rivers, municipal pride and civic reform were urged; it was demanded that politics and political wrangles be dropped forthwith, and that the section set about the course of material advancement as the only method of asserting rights against the North, and the only means of bearing her share of the national burden.

In the canvas of resources which this impulse brought, cotton mills were pounced upon as affording the readiest and most permanent instruments of success. It has been seen how platform and press and people concentrated their interest and attention upon the "cotton mill campaign", every new factory being hailed as another banner lifted in the fight. Two great impelling motives were patriotism—either local, state, sectional or national—and humanitarian considerations. These were held up in the plainest view of all, and impressed unceasingly. It was as a means to an end that cotton mills were argued for; their advocacy was grounded in the most splendidly fundamental beliefs and aspirations.

Descending from these lofty ideals, the practical inducements to the building of cotton mills as they were brought before the South and the country at large have been pointed out. It was shown that over and above all others stood out prominent and unquestioned the fact of the presence of the raw cotton. Proximity to the material of manufacture was felt to constitute the chief invitation to go into the textile business in a systematic way. But there were other arguments used, running out to great length—of these the leading one was an abundance of cheap and intelligent if untrained labor crying for employment, and this has been dwelt upon in its phases. A store of unused water powers, favorable freight rates, low cost of living, suitable climate, the supply of inexpensive fuel, and the innumerable gains to the community were made the grounds of advocacy of cotton mills. Estimates of the expenses of erection, maintenance and operation of hypothetical factories of all sizes were worked out in elaborate detail, the saving over manufacture of cotton in New England or in Old England being remarked at every juncture.

It is a nice problem to determine how far these advantages possessed or thought to be possessed by the South were aired as a result of deep-lying motives of patriotism and philanthropy, and to what extent they were themselves the exciting forces behind the crystallization of these motives. Did these superiorities of the South come to light mainly because the South had made up its mind to remake the section, or did the South enter upon a course of development because it possessed certain outstanding advantages? To strike a balance here would be an interesting speculative venture. But, however, this may be, it is reasonably clear, as has been previously pointed out, that when it came to putting their money into cotton mills, capitalists, North and South, acted usually upon the assurance given them in the physical assets obtaining. To the extent that general impulses placed in public view definite, concrete and tangible reasons why cotton mills could be made to pay dividends, the undercurrent was indirectly responsible for the erection of the factories.

It is not the purpose of the present paper to set out in any detail the unique resources of the South, either as they constituted the magnet for capital directly, or reacted through the general cotton mill campaign to swell the tide making toward a new character for the section. They deserve separate treatment, especially since they occupy so central a position and have such sensitive contact with the other forces present. Whether, however, physical advantages existing at the South crystallized out of an original philosophical impulse, or operated, more or less unconsciously in the Southern mind, to induce that impulse, it is perfectly clear that the movement for the building of cotton mills in the South originated with the South, and that at least contemporary with the attraction of capital, went an advocacy of the establishment of cotton factories that was consistent, permanent and practically universal.

From the very nature of the movement, Southern and in most cases strictly local capital was first appealed to, both by the actual projectors of the mills and the public organs which interested themselves in the enterprises, and local capital was the first offered. It might be questioned whether outside capitalists, perceiving in the Southern manufacture of cotton a favorable field of investment, did not come in as a result of the publicity of the cotton mill campaign, without waiting for either solicitation from the South or proof of the success of the new plants erecting in that section, but it will be shown that, as a matter of fact, this was not the case. At the time the South felt herself to be isolated, cut off from the national life, discriminated against by Congress and the country at large. In the beginning and in essence continuing to the end, the building of cotton mills was a sectional matter. It is not to be said that outside capital was an afterthought with the promoters of the Southern cotton mills, but every circumstance surrounding the movement, and every instinct of the hour, argued for the exhaustion of native resources before help should be sought from without.

The story of how capital was secured for the cotton mills of the South may be commenced with a sentence from a North Carolina newspaper which strikes the key-note: "All questions of domestic economy, and especially those involving the capital of our people, whether in the shape of labor or dollars, will necessarily be canvassed and scrutinized very closely in their bearings on our material progress."[184]

The nature of the appeals made to local capital will best appear by looking at some of them individually.

Patriotism, a consciousness of unity, and appreciation of the dynamic character of manufactures in the South, appear in a solicitation printed on the editorial page of the Charleston News and Courier for capital for a scheme for the development of water power and cotton mills at Columbia. The enterprise had a peculiarly appealing history, which will be recounted in considering the response of domestic capital. After a summary of these facts, the article concludes: "The work—is one of great magnitude and involves expenditure beyond the ability of this community (Columbia). Nor is the interest merely local, but reaches out to every part of the State. We call, therefore, upon all, from the mountains to the seaboard, to take part in this great central development, involving not only the prosperity of our capital, but, in its ramifications, affecting the prosperity of the entire State."[185]

A week earlier, in a Columbia dispatch to the same paper, Charleston was advised that books of subscription to the stock of the company would soon be opened there, and the argument for investment was placed on more practical grounds: "If the recent subscriptions to factories have left any money in the pockets of the people there (Charleston), it had better be saved for this purpose—a franchise like this is not obtained every decade."[186]

Implying that when the South should make a start in cotton manufacture, outside capital would flow in, but impressing particularly the need for the entrance of domestic interests into the field, a statement of H. T. Inman, capitalist, relative to the plan to purchase Oglethorpe Park, the site of the Atlanta Exposition, from the city authorities and use the buildings for cotton factories, is striking: "We must demonstrate what we have been saying, that there is money in manufacturing in the South. If we wait for others to come here and do it, it will never be done."[187] The argument that the South had faith in her ability to manufacture cotton profitably, as proved by putting her money into the projected mills, was frequently used in soliciting subscriptions at the North, and more frequently Southerners were urged, as here, to go into the ventures, with the specific reason that by so doing Northern capital would be induced to join in.

Money accumulating in bank at low rates of interest was often made the basis of observations on the great gain from manufactures, and was pounced upon as evidence of lack of sympathy with the spirit of the time, which was grounded in the deepest needs of the people. In such cases the cotton mill campaign and the gathering of capital as a matter of practical concern usually overlap. An instance quoted in another place is typical: "But with all its (North Carolina's) varied and splendid capabilities it is idle to talk of home independence so long as we go to the North for everything from a tooth pick to a President.... We may look in vain for the dawn of an era of enterprise, progress and development, so long as thousands and millions of money are deposited in our banks at four per cent. interest when its judicious investment in manufactures would more than quadruple that rate...."[188] Several months later the same paper[189] instanced the success of Edward Richardson, of the firm of Richardson & May, cotton factors of New Orleans, in running, in addition to ten or twelve plantations producing 15,000 to 18,000 bales of cotton a year, a nest of factories with 18,000 spindles, 400 looms and 800 hands in the town of Cresson, which he built. He was said to be worth more than $15,000,000—"all accumulated in the South, the poor South." The closing remark is significant: "His ... accumulations are but the results of forethought, enterprise and nerve. He has no heavy deposits in bank at four per cent."

This same galling fact of bank deposits lying relatively idle when they might be used to further the plans held so much at heart was lamented in cases where it hindered the cotton mill campaign, or the taking of initial steps toward realizing a desire for a mill; but it was made more galling where a venture, properly launched, stood still because the moneyed people held themselves aloof. In distinction to the position of Newberry, South Carolina, where there were "numbers of people ready to aid in the enterprise, convinced as they are that it will be a profitable investment, but ... nobody to take the lead,"[190] was Chester another town in the same State, of about the same size. In February of 1881, after the cotton mill campaign had gotten a fair start, the Chester Bulletin commented: "Just now there is a widespread and deep feeling amongst our people throughout the State to foster the manufacturing interests of the country. More than a year has elapsed since our people felt beat a pulse of enthusiasm for the home industries. (Reference was here had to the chartering by the Legislature of two mill corporations which attracted almost no subscriptions.) There is money enough in the county to start the hum of three thousand spindles. The large amount of personal deposits in bank indicate too truly the lack of confidence in home industrial enterprises."[191]

It may be well to consider a typical comprehensive appeal for domestic capital. For this purpose a leading editorial in The News and Courier asking support for the Charleston Manufacturing Company is particularly useful.[192] In the first place, this company marked the entry of Charleston into the field of regular cotton manufacture, and the enterprise took firm hold on the interest of the city from this cause. Also, South Carolina experienced the cotton mill campaign as a movement more highly conscious than in any other State; Charleston was the center of the campaign, as spiritual leader no less by reason of her sufferings than her heroism, and the News and Courier was the mouthpiece of Charleston.

To begin with, the editorial, headed "Everybody's Opportunity", sets forth clearly the division of arguments: "The Charleston Manufacturing Company addresses itself to the citizens of Charleston in a double capacity: First, as a means of making money for the stockholders. Second, as a means of enlarging the common income, stimulating the growth and increasing the prosperity of the city."

Proceeding under the first of these heads, it is pointed out that the mill will succeed because the management, in the hands of men known for their business sagacity and activity, will be both economical and progressive. There is no doubt that, along with other appeals to local resources, confidence in the projectors of a cotton mill, as personal acquaintances and men whose whole lives were familiar knowledge in a small community, had a powerful influence. Next it is shown that the profits of the South Carolina mills for the year 1879, probably the last available for citation, warranted a belief that the Charleston mill would succeed, having at least as good a chance as county plants. These profits had ranged from 18 to 25½ per cent. It is explained that steam power will be used, but that it is used in England, and that the trend of the better opinion is toward steam power rather than water power, as being more reliable and capable of better control. The approval of steam by the superintendent of the Camperdown Mills at Greenville in the same State, on these grounds and also because he knew that the Northern mills using steam made larger profits than those using water, is instanced. It is evident that the necessity of employing steam power, instead of being able to use the water power of the interior, was a hard obstacle to get over, for recurrence is several times had to it in the course of the argument, and the great advantages of coastal location are stressed as a counterbalancing consideration.

The favorable facts that the Charleston mill will be able to buy cotton all the year round, and so avoid carrying a heavy stock, that samples and tops may be utilized, that the rates of insurance will be low and water freights nominal, and lastly that no cottages or schools or churches will have to be built, city location avoiding this source of expense to a provincial establishment are recited, and the prospective stockholders are reminded that by State law the whole of the capital invested in manufactures is exempted from taxation for ten years.

On the second account, of increasing the prosperity and welfare of the community, it is shown how every $228 invested in cotton manufactures in South Carolina the year before supported one person, and how when people earn they have something to spend; house rents will go up as a result of the new demand. Besides, the State at large benefits from a new means of support for the people. The very potent argument of the addition to value which manufacturing brings about is next employed. "At a low estimate the value of cotton is doubled by the conversion into yarns." If the Charleston Manufacturing Company uses 10,000 bales of 400 pounds a bale, at 10 cents per pound, $400,000 will be returned to the growers of the raw cotton. When made into yarns the cotton will be worth $800,000. Every dollar of this $400,000 difference, except what will be spent for materials not to be precured locally, will be disbursed in Charleston in wages and dividends. "It is evident that the building of half-a-dozen cotton factories could revolutionize Charleston. Two or three million dollars additional poured annually into the pockets of the shop-keepers and tradespeople would make them think that the commercial millenium had come." The appeal concludes: "In a two-fold sense, then, the Charleston Manufacturing Company is entitled to support. For the stockholders it will earn money. To the city it will give the life and vigor which nothing short of manufactures will assure us."[193]

An editorial in the same paper the next spring encouraging subscriptions to the capital stock of the Columbia and Lexington Water Power Company, the enterprise already mentioned, which was opening books in Charleston, urged the two benefits already noticed, profit flowing from physical and economic advantages, and a social gain resulting from the indirect bearings of the plant.[194] The value of the franchise, the offer by the State of more than 146,000 days of convict labor at a low wage, the rebate of taxation on plant and improvements for ten years, and estimated earnings of 17 per cent, on a total outlay of $431,607, or running as high as 25 per cent. on an outlay of $725,000, were held up on the side of material things; in dealing with the gain expected to result to the State at large, the influx of immigrants and the employment of thousands of idle women and girls, already present, for whom it was so hard to find profitable work, were pointed out.

Not unusually, in place of the larger social sense, local pride as such furnished the point of departure in the proclamation of an enterpriser to his fellow-citizens. It is to be feared that sometimes this was made the means of demegoguery, the appeal to local spirit being linked with a disparagement of Northern assistance merely for effect. Instances of this will appear when the attitude toward outside capital is considered.

The case of Mr. Winn's scheme for Sumter illustrates the personal appeal to local pride. It is to be noticed that he reduced everything to an individual and immediate basis. He spoke through the paper of the town, the Sumter Southron:[195] "I am now engaged in getting up a mill of 2,500 spindles at this place. I do not expect to seek a dollar of foreign subscription, but I want our own citizens throughout the county to be interested in it and to help me build and operate it." There follows a description of his findings at several nearby mills which he visited. One is inclined to believe that he paraded the facts to impress his audience in a general way, rather than to appeal to strict business sense. He cites the earnings of the mill at Charlotte, North Carolina, owned by the Oates Brothers. With running expenses of $60, "we have the neat little profit of $155 per day". The Sumter mill could save haulage, and use one-third of its cotton not packed, thus saving in bagging and ties. A concluding sentence indicates his frame of mind: "Will a mill pay in Sumter? Why not?"

A statement of the advantages possessed by a mill already in operation as contrasted with those which would contribute to the success of a proposed mill was a favorite method of argument. Thus the Kershaw Gazette said: "Let us realize that what is good for Charleston in this respect is better for us. (Reference was had to the Charleston Manufacturing Company.) She has to use steam as a motive power, which, in the form of coal, has to be brought long distances and at great cost. We have but to harness the magnificent water-powers which are slipping idly by us, and the thing is done. In Charleston, it is the investment of capital on hand, seeking profitable employment. With us, it will be the creation of capital itself; for we venture the assertion that one hundred thousand dollars invested in a cotton factory at Camden would develop interests to more than double that amount." The saving of three-fourths of a cent per pound in the freight between Camden and Charleston would in itself bring a fair dividend upon the capital invested, it was said. "And yet Charleston expects to, and will, make money by what she is about to do. Let the people of Camden and of Kershaw County be up and doing in this matter."[196]

These, then, were the grounds upon which domestic and more strictly local capital were solicited. It is proper now to notice with what success the appeals were made.

In the most respectable trade summary published by any newspaper in the South, it was stated in September of 1881: "The industrial feature of the year is the rapid extension of cotton manufacturing in South Carolina in common with other Southern States (naming the plants and the capital invested in or subscribed to each.) A most gratifying feature connected with the establishment of cotton mills in the South is that the great bulk of the capital employed in their operation has been furnished by Southern people. Southern capitalists are putting their shoulders to the wheel.... More than three-fourths of the capital invested in the cotton mills since the war has been subscribed by our own people...."[197]

The conclusion of Mr. Thompson after a review of the rise of cotton mills in North Carolina is interesting: He says that capital for almost 200 mills that grew up in twenty years "has come chiefly from a multitude of small investors within the State"; again, "The development of the cotton industry in North Carolina is a striking instance of the manner by (in) which a people in poor or moderate circumstances can establish manufactures." He gives credence to estimates by those he considers best informed that 90 per cent. of the capital for mills in North Carolina has come from residents of the State. "The industry is distinctly a home enterprise, founded and fostered by natives of the State."[198]

The Rock Hill Cotton Factory was spoken of as the "pet" of the town. Its $100,000 of capital stock was owned in Rock Hill, with the exception of $15,000 held in Charleston.[199]

Most of the stock of the Belmont Manufacturing Company, the enterprise projected by Mr. Winn in Sumter, already noticed, was taken in the town, and the few thousand dollars needed to increase the capacity above 2,000 spindles would come from Charleston, where President Winn was soliciting support.[200]

The experience of Yorkville, another little town in South Carolina, is interesting, especially for the naive way in which it was related.[201] "... the 'Cotton Mill Campaign' is progressing satisfactorily in Yorkville. We heard an old citizen remark some days ago that he had never seen the town so thoroughly aroused and united.... Yorkville to all appearances is moving forward with a determined purpose to put into successful operation a cotton mill.... The shares have been placed at $500 each, and up to this writing about $25,000 have been subscribed. I would state that this amount has been raised within the limits of the town. A prospectus will be forthcoming this week and the doors will be thrown open to citizens generally of the county who may be able and disposed to assist in carrying forward the project."

A similar instance is that of Walhalla, South Carolina, a very small place indeed. The people began to talk about a cotton manufactory, and at an informal meeting of a few of those interested nearly $10,000 was subscribed. "It is believed that as much as $25,000 will be subscribed in that neighborhood, and if the people of the county will join in the enterprise as much as $50,000 might be made available."[202]

A typical notice is this one: "The enterprising citizens of the new town of Gaffney City have subscribed $40,000 towards building a cotton factory at that place."[203]

Columbus, Georgia, was held up to praise for her loyal support of the cotton manufacturing industry. Before the war she was a little Lowell, it was said. The Federal army captured the place in 1865 and burned 60,000 bales of cotton and all the mills. "The very heart of the city was burned out, but nothing could extinguish its indomitable spirit." In fifteen years the mills had been rebuilt until they were taking annually nearly 17,000 bales of raw cotton, which was almost trebled in value by manufacture. "But the proudest boast of Columbus is that she rebuilt her mills by her own aid and money."[204]

The statement of a railroad man in the New York Herald is valuable: "Mills for the weaving of the coarser cotton fabrics are now in successful operation in Tennessee, Georgia, Kentucky and several of the Atlantic Coast States, all of which have been built by native labor, mostly with local capital and are managed by Southern men."[205]

The Clifton Mill near Spartanburg, furnishes a fair example of the distribution of holdings of the capital stock of a larger enterprise. The joint stock company owning the mill operated under a special act of incorporation of the Legislature, exempting the property from taxation for a period of years, and relieving the stockholders of personal liability. The shares were of a par value of $100. and aggregated $500,000 of which $250,000 was paid in. The stock was held mostly in Spartanburg, Charleston, Boston and Baltimore. Spartanburg capitalists owned $200,000 worth of the stock, Charlestonians $150,000, and $50,000 was held in Boston.[206] To make the capital stock $500,000 most of the original stockholders had doubled their subscriptions.[207]

For a factory near Gaffneys, South Carolina, which would need $500,000 capital stock to the amount of $200,000 would be subscribed for in Chester County, it was thought, and for the remaining $300,000 the North would be looked to.[208]

Together with large subscription to the stock of the Atlanta Exposition from the North and East, went an early subscription of $20,000 in Atlanta.[209]

While it might be considered under the heading of the cotton mill campaign, or denominated "Southern enterprise", I believe it will be most interesting to relate at this point briefly the facts in the Columbia canal scheme, as illustrating how domestic capital threw itself into the situation in which the South found herself in 1880, and the years immediately following. It is especially instructive to notice how Northern enterprise, while, so far superior to Southern initiative at all times before, after 1880 failed where in the South sometimes native energy succeeded.

Columbia, the capital of South Carolina, is located at the falls of the Congaree River. Today there is a canal of about three miles in length, 60 or 75 feet in breadth, terminating at the lower part of the city. At the end of the canal is a duck mill. In 1868 the Messrs. Sprague, manufacturers of Rhode Island, took up a plan of developing this water power at Columbia, but "in consequence of their misfortunes, failed", and the whole matter of the canal passed to the hands of the State Canal Commission. Some prominent Columbians, hoping to revive the project, contributed money to the employment of one Mr. Holly, a first-rate hydraulic engineer of Rochester, New York. Mr. Holly was making surveys and progressing satisfactorily when, after three months, his engagement was discontinued. The reason for this was that Thompson and Nagle, engineers of Providence, on a tour of inspection through the South, were attracted to the water power at Columbia, and Mr. Thompson appealed to the State for franchises, in which appeal he was supported by the citizens of Columbia who had helped promote the modest work under Mr. Holly. On February 10, 1880, the final contract between Thompson and Nagle and the State Canal Commission was entered into; by its terms the engineers were to have the use of 200 convicts for three years, and at the expiration of this time they were to have developed at Gervais Street 15,000 horse power of water power, and have in operation a cotton mill of at least 16,000 spindles.

Thompson and Nagle thought the necessary capital could be had at the North. They failed to secure it, and attributed their failure to the turmoil of the presidential campaign which was raging. Though this was probably a valid basis for the appeal to the Legislature for an extension of the rights granted them, the application for extension was denied. At this juncture, modifying the scope of the plans somewhat, the foremost citizens of Columbia took up the matter themselves, and organized the Columbia and Lexington Water Power Company to bring about the development.[210]

Nightly meetings were held of those interested in the purchase of Mr. Thompson's charter. In one hour eleven subscribers gave $5,000 each—$55,000—toward the amount.[211] A few days later the subscriptions in Columbia had reached $117,600, and the expectation was that the sum set to be raised in Columbia—$125,000—would be exceeded.[212]

Mention has been made several times of the Charleston Manufacturing Company. At the end of the first day $120,000 of its capital stock had been taken.[213] A little later the subscriptions to the stock had become $200,000 and more, mostly "for small amounts, which is what is desired. At the present rate the whole capital required will soon be subscribed." On July 6, the News and Courier had these two editorial paragraphs, the justifiable satisfaction pervading which is not to be mistaken: "We are authorized and requested to say that the whole of the stock of the Charleston Manufacturing Company, being half a million dollars, has been subscribed, and that the books are closed. It is useless, therefore, to continue to send in subscriptions.

"We believe that more than three-fifths of the whole capital stock are held in Charleston, so that right here will come the bulk of the direct profit by the working of the company...."

But before the Charleston Manufacturing Company had completed its organization another corporation had come into existence. This was a mill company promoted and most largely subscribed to by the Germans of Charleston, headed by Captain Tecklenburg. Not much was said about the concern in the papers, but of its $100,000 of capital stock, $75,000 were subscribed between January and May of 1881. This Palmetto Manufacturing Company, as it was called, was apparently, the most restricted in its stockholders of any mill that had been projected in the South to this time.

Little towns, villages almost, did not fail of local enthusiasm and capital in small amounts.[214] In January of 1882 Fort Mill, in York County, was agitating the building of a cotton mill there, and $50,000 was set as the amount of stock to be secured.[215] Chester, a little earlier concluded her size would compel her to produce $300,000 for a mill within her borders.[216] A gentleman of Griffin, Georgia, offered to subscribe one fourth of the capital necessary to start a mill there.[217]

Having seen the character of the arguments used in attracting native capital to the Southern cotton mill projects, and the extent of the response to these appeals, it is next necessary to turn to the other source of assistance—outside capital. Practically this may be termed Northern capital, although Englishmen interested themselves in the Southern ventures, and much money came from what were strictly termed, the Eastern States. In the minds of the people of South Carolina, North Carolina, Georgia, Alabama and those States, capital stock of a Southern mill held in Baltimore would be classed as appertaining to the North.

It is proper first to consider the attitude of the South toward Northern capital; second, the appeals made to Northern capital; and third, the effect of these appeals or the response of them.

In many aspects the rise of cotton mills in the South was less an industrial development than a subtle drama, powerful in its great motives. As William Garratt Brown has said of the history of the Southern States in their struggle upward after the war, it is not only to be studied with diligence of research, but is to be viewed with passion. The story of the cotton mills is filled with elemental emotions; the moving characters are splendid, clear-cut dramatic types; there are the villain, the hero, the schemer, the lover of his fellow men. The vices and virtues take their part—self-sacrifice, jealousy, hate, charity, revenge, bravery, honor, patriotism.

The first act of the drama is constituted in the defeat of Hancock and the magnificent refusal of the South to be baffled—the oath to rebuild her shattered fortunes. The actors leave the stage with hope filling the future. The curtain rises on the second act to discover the chief spirits of the South setting systematically about "the cotton mill campaign"; their brethren converted to a belief that manufacturing the staple would transform the South, they turn in entreaty to their fellows for support, and the answer is loyal and gallant.

The third act opens with a situation which tests the greatness of the players' faith in what they profess. Domestic resources exhausted or exhausting, or slow in response to the need, should the object for which they were striving be lessened in its meaning, importance and desirability? Should the cotton mills which were to mean so much be restricted to the means of the South, urged to the front by a splendid pride and devotion? Should the esprit de corps which animated the Southerners, and the cheerfulness of their co-operation, with all that inspired these, when they failed of further effect, be considered to set the natural and proper limits to expansion?

Was this to close the action? Or was the South, remembering her vows, to cling to her ambition undiminished? In spite of wounds yet fresh and burning, which in the name of pity and honor and self-esteem cried out to be nursed and comforted at home, could the South face again her enemies, and this time not just to challenge, which was hard, but to entreat, which was hardest? Would the South rise superior to pride, and be content with nothing short of the fullest heroism? Would she go to the North for capital for her young cotton mills?

It was a silent struggle with herself. Little was uttered, but fundamental emotions were at play. When she decided to appeal for assistance in a work which she knew to be right, the climax of the drama had been reached. The crucial test had been endured, and the South had emerged triumphant.

As has been said, few lines are there to indicate the feeling. It is largely dumb show. But we may look at the expressions that did occur to show the attitude of the South toward the question of Northern capital.

The following manifesto is significant, involving as it does recognition of the necessity for a modification of political views if capital to be invested in the South, in the eyes of the North, was to be made safe: "In this state (South Carolina) we need capital and less party and politics.... Such men as Gould, Vanderbilt and Plant have invested millions of dollars in our railroads, manufactories and other enterprises, and have been remunerated in the face of a 'Solid South and a Solid North'. It is useless to say that millions have been driven off from like investments on account of personal whims and jealousies among prominent politicians in both parties. Can the South afford to remain solid? This is the great question of the day, and it can be answered in the negative.... We want all the capital possible to develop our hidden and inexhaustible resources...."[218] And again: "So long as we have section unity in politics in the South its material prosperity will be checked and an absolute injury will be sustained through its entire commercial and agricultural dealings by exciting distrust of capital.... So taking the past and the present as indices for the future, it is plain to see that a dissolution of the solid South will cut at the very roots of all these wrangles between the North and the South in which sectionalism is involved."[219]

The News and Courier wished to accord to every dollar of Northern capital invested in the South the same credit as was felt to be due home capital likewise contributed to the building up of the section. "Outside capital ... is beginning to seek this Southern field to aid in a more rapid and thorough work of restoration of dead or dormant enterprises. This movement needs a wise encouragement by public and private approval. Some of that credit which was accorded to the man who caused an additional blade of grass to grow should be given to everyone who affords facilities to manufacture an additional boll of cotton, or to carry it and other produce to market."[220]

A gentleman connected with the International Cotton Exposition said: "We people of the South should embrace every opportunity which, like the opportunity afforded by this Exposition, will bring among us intelligent and interested observers of our industrial condition, resources and aptitudes. We have in the midst of us the raw material, so to speak, of a magnificent prosperity. We lack knowledge, population and capital. These may be slowly accumulated in the course of years, or they may be rapidly by well directed efforts to obtain them from beyond our own borders. We advocate the latter plan."[221] This is as business-like as anyone could desire.

In an interview with the Atlanta Constitution, Francis Cogin reviewed the cotton manufacturing situation in Augusta, reciting the profits and asserting that the Southern mills had an advantage over those of the North such as would allow the former to earn dividends at a time when the latter would not be making a dollar. He concluded: "The future of cotton manufacture in the South will be limited simply by the good sense and courtesy of our own people. If we invite capital, make it safe here, and welcome those who bring it, we will get all we want."[222] The element of safety, here remarked, meant frequently safety to be brought about by political arrangements which would violate the established creed of the South; but sometimes ordinary business balance was pleaded for, as when a North Carolina paper quoted with approval from the Financial Chronicle: "Why cannot the South understand ... that the worst hindrance to her needed influx of industry and capital is uncertainty?"[223]

In another chapter the degrees of intensity with which the cotton mill campaign was urged were seen to vary, roughly, with the distance from Columbia, South Carolina, say, as a center. There is a casual note in the little that found its way into the Richmond papers. This is to be remarked in Richmond's attitude toward Northern capital. It was not a stirring, vital thing in Virginia. For instance: "When we consider that the takings of the Continent from Lancashire are not piece goods, but yarns, why cannot we in the South make these yarns for the Continent ourselves and save to ourselves the profit of conversion now enjoyed by the English buyer of the raw material? Why not have a large and successful cotton manufacturing industry?

"We are persuaded that once the folks in New England, who have surplus money awaiting employment, thoroughly investigate the points Richmond presents for a safe lodgment of that capital in manufacturing, the flow will start this way."[224]

The attitude of W. H. Gannon was peculiar, but serves as an introduction to the mention of a phase of the subject which is important. Mr. Gannon, referred to in other connections, believed that Northern capital ought to be welcomed at the South as helping to develop an industry in which the South could stand without a rival. He favored inducing Northern manufacturers to set up plants bodily in the South. But, being the agent of a society which sought to colonize New England consumptive operatives in co-operative mill villages in the South, the settlement to be financially backed by a Northern capitalist or manufacturer, Mr. Gannon wished to place a modification upon the influx of capital to the Southern States. He asked whether the South should encourage an economic system with "large stock companies with hundreds of thousands of dollars, in which the operatives have no pecuniary interest in the plant, and from the active management of which we ourselves would be virtually excluded? (It is to be borne in mind that, as at present organized, the treasurer and selling agents in those great concerns necessarily control their direction); or is it better that we aid small co-operative concerns wherein the plant is owned in great part by the operatives, and in which we might familiarize ourselves with manufacturing in all its details?"[225]

To contend for small mills, whether as above for the co-operative features suitable to them, or as a means of insuring proper caution in the development of the industry, frequently with entire sincerity, was nonetheless, I think, one evidence of dislike and distrust of Northern capital. H. P. Hammett, an old cotton mill man in South Carolina, said: "I do not share in the opinion commonly expressed that we must procure capital from the North to manufacture the cotton at the South. I would by no means exclude it, but gladly welcome it." But he worked around gradually to this concluding statement, relative to the report that English and Northern capitalists were seeking to locate mills on the water powers of the South: "—it would be unfortunate if most of the best powers should pass from the control of our own people before they knew it."[226]

One more characteristic quotation, and the point is clear: Objection had been raised to the legislation forbidding the pooling of railroads, producing corners in freights with rising rates—the Sherman Act was probably meant. This was too much for the Winnsboro, South Carolina, News, the reaction of which resulted in these words: "Well enough is it to talk about repelling Northern capital by discriminating legislation, but far better have no Northern capital than have it holding native noses down to the grindstone. The half-starved wolf refused to change places with the sleek mastiff that wore a master's collar. Northern capital that brings Northern collars is not what we wish, and we will not have it as long as the people send incorruptible legislators to Columbia. We welcome foreign capital down here, provided it recognizes that the State is supreme...."[227]

While it is easily understood how this attitude obtained—the wonder is, in fact, as already seen, that it was not more nearly universal than sporadic—the shortsightedness of such a policy for the South is apparent. For whatever outside capital reaped in dividends, the South reaped a larger advantage in collateral benefits socially. The gain to the communities where mills were located, supposing even that Northern capital was greatly in preponderance, were more than any money earnings, in sums however large, for it meant building for the future in material institutions that would prove dynamic. The cotton mills, and all they brought in their train, presaged a change in social ideals and economic outlook on which no price was to be set.

If Mr. Baldwin, the railroad president, was a little early in making the statement in the middle months of 1881, surely his purpose was good, and his hopefulness was justified, when he said: "I say on the strength of recent and extended observation that whatever of antagonism to Northern capital may have existed in the South has disappeared. I never met it, at any time, but (I) am willing to grant that it may have existed sometime and somewhere."[228]

As a corollary of the fact, recognized at the South, that whatever were the social gains resultant upon the establishment of cotton factories, capitalists put their money into these ventures because they believed the conditions of manufacture assured to them dividend, the South grounded its appeals to Northern investors in the hard physical advantages possessed by the South as a field for cotton manufacture, usually stressing superiorities over the Northern States. Northern capitalists were as eager to reap profits as were Southern projectors of mills to enlist their aid and interest, and so the claims of the South were easily investigated without the medium of propaganda. The widespread publicity given to the whole matter of Southern manufacturing in the cotton mill campaign, while no doubt it was registered in all parts of the North and East, was commenced and carried on as of concern to the South.

Correspondence of the New York Times from Atlanta well illustrates this. It is to be noticed how quickly the preliminaries are got over—considerations and speculations in which Southern papers indulged to any length: "Manufacturing in the South is the one subject on which thinking men here speak with entire confidence. They have, most of them, some qualifying doubts as to agricultural progress, the cheapening of cotton production, the raising of home supplies, immigration, mining, and the many other now ambitions and enterprises which have engaged so much attention since the opening of the new era of industrial development. But concerning the future of manufactures, particularly of cotton, all men of intelligence and business experience speak with the assurance of inspired prophecy. It is, in fact, not easy to see why the mill should not seek the cotton instead of the cotton seeking the mill." With this introduction, the plunge is made into the supporting facts, which ought to turn the flow of capital toward the South.

The first statement is that it is a dead waste to ship raw cotton to a mill 1,500 miles away, when it can be made into yarns or fabrics in factories distant from the field only short half-day's journey for a mule. The cost of sending the cotton to New England is reckoned, in expenses of bagging, ties, ginning, baling, storage, insurance, drayage, sampling, compressing, commissions of brokerage, waste in handling, and freight to amount to $14.90 per bale, or almost exactly 1½ cents per pound which the New England manufacturer pays for the cotton above the price received by the planter. The estimate of $100,000,000 is given as the charge on the cotton crop of the South of 1879, on Edward Atkinson's figures, for the items mentioned.

"... to the anxious capitalist tired of a petty 4 per cent. and seeking new and more profitable investments such facts are not without interest. They go to support the claim that the Southern mill has an advantage of from 10 to 20 per cent. over its New England competitor. But these advantages are by no means confined to the elimination of unnecessary charges for baling and transportation." Water power in the South, six dollars per horse power per annum, or in some instances given away for the location of a mill, as against a cost of twelve dollars in New England, is dwelt upon, with the greater utility of the Southern water powers due to the absence of freezes. The cheapness of labor is given prominent place, and the suitability of the climate of the South for cotton manufacture.[229]

Exemption from taxation was a regular method of inviting outside as well as encouraging domestic investment. South Carolina exempted from taxation for a period of ten years all new machinery put in a factory. The Observer, of Raleigh, said editorially: "... North Carolina might well learn a lesson from the liberal course pursued in South Carolina and exempt from taxation for ten years all cotton factories within our borders. The tax does not net the State more than a thousand dollars or so, and the counties only double as much. But then there may be a great deal in it tending to induce Northern capitalists to make investments with us. Once here, they will be so pleased with our advantages that they will never think of leaving us."[230]

As early as 1872 Georgia had passed a statute remitting taxes on cotton and woolen mills for a decade.[231]

An indication of the comparative coolness of the States near Northern influence, already remarked, in a little controversy which took place in the Richmond papers over exemption of mills from taxation. Said "Hanover": "It is true that a law exempting capital invested in manufacturing, even for a limited period, is unconstitutional. But if it is necessary to that end, the constitution can be amended." The farmers would not object, he thought, since increased size and prosperity of the cities would mean increased gains to them in sale of produce. Richmond, he said, in addition to her natural advantages, needed to offer exemption from taxation to secure the desired capital. But "King William", in rejoinder, asserted that the city was more dependent upon the country than was the latter on the former; that exempting manufactures from taxation would mean increasing the tax for farmers; and that Richmond was doing well enough as it was.

An indirect appeal to outside capital was felt to lie in a direct appeal to domestic capital, and the fact that foreign interest would be attracted by evidence of native faith in the mills was used as an argument in securing capital at home. Thus the Columbia Register, speaking of the plan of the Columbia and Lexington Water Power Company said editorially: "Columbia is now resolved to find money for herself, in the City and the State, for the development of the Canal and the establishment of factories. This will bring in outside capital later on. Nothing so attracts investors in other States as the knowledge that people on the ground have proved their faith in an undertaking by putting money in it."[232]

Again it was said: "More than three-fourths of the capital invested in the cotton mills since the war has been subscribed by our own people, and new enterprises are opening up the way to a proud and successful future. The Southern investment encourages Northern capital to come into the same field, and the rate of progress is far more rapid than if it depended on either Southern savings or Northern capital alone."[233]

A county paper told its readers: "We believe there is money enough in the county, here and there, to make at least a modest beginning so as to attract outside capital."[234]

Having sought to define the attitude of the South toward Northern capital, and to indicate the nature of the appeals made to the outside capitalist, the last topic of this discussion is reached in an examination of the response of investors outside of the South to invitations, and the influx of capital when the opportunities for profit had become apparent.

It must be plain that as the sections drew together with each year that removed the "reminders of the Civil War, the South was more welcoming in her attitude toward Northern capital, and the North more ready to invest in the South. This is recognized in an editorial of The News and Courier, headed The North and Europe Building Up the South": "It has been evident during the past two years that the distrust which had prevented capital from coming to the Southern States for investment has, in a large measure, been dissipated, and that the disposition to place money in the South in undertakings which promise a fair return is rapidly growing strong. Indeed, the process has gone on much more swiftly than is supposed by those who have not watched the course of events...." Continuing, the editorial quotes an estimate appearing in the New York Herald, that in the eighteen months preceding Northern and European capitalists subscribed to Southern enterprises located in the section east of the Mississippi and South of the James, $100,000,000. Of this amount, more than $90,000,000 was invested in railroads, without the $20,000,000 in the Cincinnati Southern. "Besides the investments in railroads there are the investments in cotton manufactures. There is hardly a city in the South in which there is not a new factory building organizing, and in nearly every case a considerable part of the capital is raised at the North."[235]

The Baltimore American said the same thing: "The South is now the focal point of trade aspirations for the whole country. Capital and industrial activity are crowding upon it from every point of the compass. Every railroad system in the land is struggling to reach it...."[236]

Outside capital invested in Southern cotton mills took two forms—subscriptions to the stock of mills managed in whole or in part by Southern men, and the actual setting up of plants in the South owned throughout by Northern promoters. Of these two, the second was of much the rarer occurrence. Capital not domestic came from two main sources, the North and East, and from England. There is no reason to believe that the English subscriptions, in spite of frequent allusions to England as a possible investor, were large or many.

Pawtucket being the pioneer cotton manufacturing place in the North, Providence, which had come to virtually absorb the smaller city, took a great interest in the new mills of the South after the Civil War. A Providence mechanical engineer designed the mills and machinery for some of the most successful plants, and that its men were thinking of setting up mills of their own in the South is evidenced by the visit of Mr. Boyd to Georgia in 1881, when on behalf of New England capitalists he prospected the State for the best location for a large cotton factory.[237]

A little later it was given as common knowledge that several of the largest manufacturing firms of Manchester, England, had secured sites for mills in the Southern States.[238] A London correspondent of the New York World remarked a clear disposition of English capital to seek investment in Southern manufactures.[239]

The railroads, both the minor lines connecting individual points, and the great systems penetrating the South in this period, were influential in fostering and inaugurating manufactures. The little railroads helped the mills by affording transportation facilities and by making the inland water powers accessible, but the big ones could lend money and did of course make it their business to encourage manufacturing along their lines. President Baldwin, of the Louisville and Nashville, distinguished three ways in which the railroads assisted the sections by aiding mills in reach of their tracks, by uniting the parts of the country, and by affording a strong commercial backbone.[240] Hon. Gabriel Gannon urged the claims of railroads upon South Carolina as bringing capital to the Southern field; he attributed the erection of a mill with $500,000 capital largely to the railroad connections of Spartanburg.[241]

An article already referred to said of the railroads in their bearing upon manufactures: "The railroad syndicates are of necessity interested in the general growth of the country through which the lines run, and will spare no pains to bring in immigrants and to encourage the opening of mines and the establishment of factories."

In the majority of instances, Northern capitalists subscribed to the stock of Southern mills after a considerable proportion of the shares had been taken at the South. Similarly, a very usual juncture for the investment of Northern capital was a projected enlargement of a plant, machinery manufacturers taking stock in payment for equipment. Thus the Rock Hill Cotton Factory, the $100,000 capital stock of which was owned in Rock Hill and Charleston, South Carolina, in doubling the capital secured a large part of the additional $100,000 at the North.[242]

A vigorous solicitor of Northern funds for Southern mills was D. L. Love, the pioneer cotton manufacturer of Huntsville, Alabama. Before going on one of his trips to New England "for continuous exertion for the establishment of factories in the South," he made a statement of his successes and plans. His project of a cotton mill at Vicksburg, Mississippi, was "on the high-road to success;" he had secured the organization of a company with $40,000 then subscribed to manufacture the staple at Jackson, Tennessee; he had about consummated a contract with New England capitalists to revive manufacture in a building at Corinth, Mississippi; a Connecticut manufacturer was looking for an opening at the South, and would be induced to settle at Huntsville; in all, he expected to bring about the investment of $1,000,000 in factories in Huntsville in the three years to come.

Mr. Verdery, of Augusta, telegraphed from New York news of his success in seeking capital at the North. He "placed $85,000 of the new stock of the Enterprise Factory, and expects to book from $25,000 to $50,000 more in that city. He has had urgent requests from Boston, Philadelphia and other cities to go to those places, and has no doubt he will be able to obtain large subscriptions...."[243]

Much is to be learned from a close study of the founding of the Charleston Manufacturing Company, which was a representative Southern mill, a child of the cotton mill campaign and an expression of the patriotism, statesmanship and farsightedness of the South of the day. It embodied in its history nearly every element and feature to be noticed in this study. In an advertisement calling for additional local subscriptions, the company made the statement: "Arrangements have been made with capitalists at the North to take such an amount of stock as may be necessary to ensure the success of this enterprise."[244] This statement is to be interpreted in connection with the announcement a fortnight later[245] of the complete organization of the company, with the exception of the election of a secretary and treasurer, two of the nine directors being W. H. Baldwin, Jr., and O. H. Sampson. "Maj. Smythe stated that a considerable amount of the stock was held in Baltimore and Boston, and for that reason Mr. W. H. Baldwin, Jr., of Baltimore, and Mr. C. H. Sampson, of Boston, had been nominated." Woodward, Baldwin and Norris were dry goods commission merchants of Baltimore, and "agents for the goods of several Southern cotton mills," and C. H. Sampson was the senior partner in the firm of Sampson & Co., of Boston, "dealers in yarns and also agents for several Southern cotton mills." Two days earlier Messrs. Sampson and Baldwin visited the site for the company's mill and expressed themselves as pleased with it. On the same day a meeting was held at which it was decided that the mill should manufacture standard sheetings and 3-ply yarns.

In this instance the commission merchants in all probability were those who agreed "to take such an amount of stock as may be necessary to ensure the success of this enterprise," it being either agreed that in return for this they should get the brokerage of the mill, or even, perhaps, receiving their pay as agents in shares of stock, which meant taking dividends instead of commissions. The practise was a common one, and machinery manufacturers followed the same plan. It is not at all clear that it could have been avoided, and the net profits which were earned by the mills of the South in this period would seem to dispute the statement, that the commissions charged by firms which had thus gained control over the product were exorbitant, and left the mills barely enough earnings to continue to turn out the goods which was the instrument of their own exploitation.

A final instance of Northern pecuniary interest in the development of cotton manufactures at the South may be noticed in the fact that New York bankers were expected to exceed the subscription of $25,000 to the International Cotton Exposition at Atlanta, alloted to the city. Among the large subscribers were Inman, Swan & Co., $2,000; Drexel, Morgan & Co., $1,000; Brown Bros. & Co., $1,000.[246]

CHAPTER V

FINANCING THE MILLS

The preceding chapter dealt with the capital of the Southern cotton mills in the period of their establishment. It was first noticed that local capital was naturally drawn upon before any other, and the character of the appeals to local resources and the response to these appeals were brought out. The second division of the report dealt with the attitude of the Southern mill promoters toward outside, usually Northern capital, the nature of the appeals made to Northern capital, and the extent of the response to these solicitations.

Altogether, the surface aspects of the securing of capital were dealt with in a large way; in denominating the present chapter and that following: "The Financing of the Mills", it is intended to bring out the minutiae of the process, and to set forth the mechanism of the problem in its detail.

In seeking to make clear the methods of securing capital in the South, it is convenient to consider first the soliciting of subscriptions to stock, and at the outset it will be well to give a notice that appeared in the financial advertising columns of the Charleston News and Courier at the beginning of the period of cotton mill growth. This notice is directed by "The Charleston Manufacturing Company to The Citizens of Charleston", and carries a contemporary flavor that is of service in an understanding of the problem. Given almost entire, it reads:

"The necessity of establishing manufactures in our city, not only as a profitable means of utilizing capital, but more especially for furnishing employment to many in our midst, has been long felt. To put this matter into practical operation, a few gentlemen applied to the last Legislature and obtained a most favorable charter for 'The Charleston Manufacturing Company'.

"The intention is to raise the capital necessary and to proceed forthwith with energy and activity to erect and put into operation a cotton factory and yarn mill which will be second to none in the South. The marked and rapid success of the Charleston Bagging Company shows what can be done here.

"The undersigned, therefore, being those named in the charter and their associates, lay the matter before you, and respectfully urge your co-operation in carrying the work into effect.

"For this purpose Books of Subscription to the Capital Stock of 'The Charleston Manufacturing Company', under the charter granted by the last Legislature, will be opened on Thursday next, 27th instant, at 10 o'clock A.M., at Office of the Carolina Savings Bank, corner of East Bay and Broad Streets, and continue open from day to day until the entire Capital stock is subscribed. Shares One Hundred Dollars each. Ten per cent. of the amount subscribed will be called for when all the Capital is taken and the Company organized. Further instalments will be called for as needed."[247] There follow the twenty names of those obtaining the charter.

The dignified yet homely character of this advertisement is made even more intimate by a dispatch from the capital, Columbia, to the same paper two months later, in which it is announced that over $90,000 had been subscribed in amounts of $2,500 and $5,000 to the project of "The Columbia and Lexington Water-Power Company" (a plan for a large development of cotton mills). The charter provided for a minimum capital of $500,000 and a maximum of $1,000,000. "The present object (in opening books of subscription before calling upon first subscribers for more) is to give everybody in the State an equal chance.... It is designed to visit each county of the State, with a view of making it as far as possible a State institution. It is expected that the $500,000 necessary can be easily secured in the State, but as much in addition will be welcomed to complete the capital stock ... nearly every man who is able will contribute to its (the undertaking's) speedy fruition." There is added the significant circumstance that "Governor Hagood will accompany the committee when they go to Charleston (to open books there) and use his influence in behalf of the enterprise."[248]

The plant of the Pelzer Manufacturing Company is in the so-called up-country of South Carolina, but its projectors were Charlestonians, and Charleston was the financial center of the State and of the South, indeed, at that time. Consequently books of subscription were opened in Charleston,[249] rather than in Greenville or Spartanburg, the little cities they were then, near the water power which should drive the mill. Ten per cent. of the amount subscribed would be required in cash.[250]

The time necessary to secure the needed subscriptions may be checked up by following the optimistic notices that appeared in the paper from day to day as the capital grew. In this instance books were opened on January 25th, and on the twenty-seventh it was published that "the subscriptions to the stock ... amounted yesterday to $30,000, leaving but $50,000 to be subscribed. The books remain open today...." Toward the Trough Shoals (South Carolina) mill project of Walker, Fleming & Co., $50,000 was subscribed in capital stock in one week.[251] Subscriptions to the Charleston Manufacturing Company, pursuant to the advertisement already quoted, were first received on January 27th; by February 4th, 189 subscribers had taken stock to the amount of $206,600.[252] Two days later the amount had reached $220,200 representing 195 shareholders.[253]

Mr. Converse, one of the proprietors of the Glendale Factory, which had proved itself successful, bought up the site of the Rolling Mill of Mr. Boles, at Hurricane Shoals, seven miles from Spartanburg; the first $200,000 was quickly subscribed for, and books of subscription for $300,000 additional stock were opened January 1st; February 14th they were closed, the amount having been taken.[254]

This suggests a practise which was and still is frequent in the development of cotton mills in the South, namely, that of increasing the capital stock over the amount first proposed, as soon as the original sum had been subscribed, or when subscriptions somewhat in excess of the intended maximum had been received. In the case above, the additional stock was larger by $100,000 than the amount first offered. The Cannon Cotton Mill, Concord, North Carolina, was organized with a capital of $75,000. Before the building was completed, the capital stock was increased to $90,000 or so, most of the stockholders adding to the amount of their subscriptions.[255] The Seminole Mill, now erecting at Gastonia, was designed to have $175,000 capital. Mr. Armstrong, its projector, saw that more persons wanted stock, and he increased the capitalization to $225,000. The plant was intended first to have 10,000 spindles, later increased to 12,000 or 15,000 spindles.[256] Similarly, some others of the new mills under construction in Gastonia are capitalized above the amount named in their charters.[257]