must make itself industrially as well as politically independent of the old world. The state governments endeavored to foster the new industries by protective tariffs, and this policy was later continued, in a moderate form, by the federal tariff act of July 4, 1789. Prizes were offered by various societies, and even by certain state governments, for the introduction of the new machines and methods which were revolutionizing industry in England. Attracted by one of these offers, Samuel Slater, "the father of American manufactures," who had been apprenticed to a manufacturer of cotton machinery, and was particularly familiar with Arkwright's machines and processes, came to this country in 1789, and in the following year started the first cotton factory at Pawtucket, Rhode Island.

The factory system secured its first real foothold, however, between 1806 and 1815, when the Non-Intercourse Acts, the Embargo, and the War of 1812, by suppressing trade with Europe, forced the American people to do their own manufacturing, and turned large amounts of capital, which had previously been employed in trade and shipping, into manufactures. The growth during this period of isolation was extraordinary. In 1804 only four cotton mills were in operation. "In 1807 there were fifteen cotton mills running 8000 spindles and producing 300,000 pounds of cotton yarn annually. In 1811 there were eighty-seven mills operating 80,000 spindles, producing 2,880,000 pounds of yarn per year and employing 4000 men, women, and children. In 1815 500,000 spindles gave employment to 76,000 persons, with a payroll of $15,000,000 per year." It is hardly necessary to add that when resumption of peace with Great Britain opened the new American industries to the fierce competition of the older English manufacturers, increased protection was granted in the tariff acts of 1816, 1824, and 1828. A little later, in the Middle Atlantic and New England states, the period of factory production had fully arrived. A separate class of wage earners was appearing, who were especially appealed to by new arguments concerning wages in the tariff discussions; workingmen's parties were organized; strikes and trades unions multiplied, and the latter were combined

1

1 Coman, Industrial History of the United States, p. 181.

into municipal and state federations; in the thirties and forties radical reformers linked the "white slaves" of the North with the negro slaves of the South and worked for the abolition of both "wage and chattel slavery"; the factory town and the city slum became recognized economic conditions, and the dangers of the latter were multiplied by the heavy immigration after 1845. By the middle of the nineteenth century the Industrial Revolution was in full sway, and the economic triumph of modern capitalism was assured.

As might be supposed, the Industrial Revolution produced far less suffering and want in the United States than in England. The evils attributable to the Industrial Revolution in England were of two kinds. One arose from the rapidity and magnitude of the industrial change itself; the other was due, not to the change, but to the system under which the new industry was conducted the system of capitalistic industry working in a régime of practically unregulated competition. In our country the evils resulting from transition alone were slight. Our manufacturing industries were scarcely started when the spinning jenny, the power loom, and the steam engine were introduced, and so almost from the beginning the factory system seemed the natural one. Thus, the change which in England was a revolution was in America an evolution, a process of construction with little destruction. And for a time even those evils inherent in the system itself were mitigated and disguised by the immense natural wealth of this country, the ease with which land could be obtained, and the unusual mobility of our working people, which permitted them to take quick advantage of the unusual opportunities open to them.

But, as will appear in the following pages, these ameliorating agencies served only to check and delay, not to destroy, the evil possibilities of the new industrial system. As free land has become less and less abundant, the wage earners of the East have had forced upon them conditions of life which have kept down, although they have not absolutely lowered, their standard of life. Extremes of wealth and alienation of social classes have become so great as to arouse the apprehension of all thoughtful men. Labor riots that call for military interference testify to the fact

that we have not escaped, that in the future we can hope less and less to escape, the friction that accompanies all unfraternal relations among men. We have been greatly blest in that we have escaped the worst results so long.

The Development of Agriculture. The presence and power of those economic forces which softened the asperities of the new industrial system in America are revealed in a particularly striking way in the history of American agriculture. In England, it will be remembered, the changes in agriculture intensified the evils of the industrial revolution, led to the consolidation of small farms into large landed estates, and put the actual business of farming largely into the hands of tenants. In the United States, however, practically none of these tendencies has shown itself-at least, not in an alarming form. There is a constant migration from the country to the city, to be sure, but this is in no sense due to the consolidation of farms. Thus between 1870 and 1900 the proportion of all breadwinners (persons ten years of age and over gainfully occupied) engaged in agriculture fell from 47.6 to 35.6 per cent. On the other hand, more persons are still employed in agriculture than in any other branch of industry; and owing to the opening up of old Indian reservations for farm settlement, the constant alienation of the public domain, and the breaking up of Southern plantations and "bonanza farms," the number of farms seems to have increased quite as rapidly as the general population.

The great improvement which has taken place in agricultural methods and machinery enables the relatively smaller farm population to satisfy the demand for agricultural produce even more completely than in the past. That is to say, the machine power introduced into farming has more than taken the place of those persons and their descendants who have abandoned agriculture. It has been estimated, for instance, that in 1895 it actually required only about 120,000,000 days' work to produce the nine principal farm crops of that year, whereas, had they been produced by the methods and machinery of 1850, at least 570,000,000 days' work would have been required.1

1H. W. Quaintance, "The Influence of Farm Machinery on Production and Labor," Publications of the American Economic Association, Third Series, Vol. 5. No. 4, pp. 27-29.

Notwithstanding the improvement of farm methods and machinery, the agricultural industry shows no real tendency to assume a capitalistic form. The average farm of to-day is smaller than it was fifty years ago, and although it represents somewhat more capital, the increase of the capital investment is not great, is much less, in fact, than the increase in the wealth of the average individual. Moreover, a majority of American farmers own the farms they cultivate, and the statistics indicate that it is still comparatively easy for an enterprising farm laborer to rise to the status of tenant and from that condition into the ranks of the farm proprietors.1

Manufactures. In agriculture, as we have seen, the passage of time has not brought about a highly capitalized form of industry, the typical farm represents only a small investment and is tilled by its owner, there is no sharp distinction between employees, unions of wage earners are practically unknown, and passage from the wage earning to the employing class is still comparatively easy. In manufactures, practically all these conditions have been reversed since the end of the eighteenth century. And it is the tone of the manufacturing industry rather than that of agriculture which represents the keynote of the modern economic movement, because agriculture is constantly decreasing while manufacturing and allied industries are constantly increasing in relative importance. At the beginning of the last decade of the eighteenth century, seven eighths of the working population were employed in agriculture, and the manufactured products of the country were valued at $20,000,000. Half a century later, in 1840, 77.5 per cent of the breadwinners were employed in agriculture, 16.5 per cent in trades and manufactures alone, and the products of the manufacturing industries were valued at $483,278,215. Fifty years later, in 1890, 35.7 per cent of the workers were in agriculture, 24.4 per cent in manufacturing and mechanical pursuits, and the manufactured products were valued at

1 1 Tenancy seems to be increasing in the United States, but the authorities differ in their interpretation of the phenomenon, some regarding it as a favorable and others as an unfavorable sign. This and other questions touched upon in the preceding paragraphs are discussed at greater length in a later chapter.

$9,372,437,283. In 1905, to cite the latest figures, the value of the products had reached the enormous sum of $16,866,706,985. The change in the character of the industry has been even more striking than its growth and expansion. In the first place, machinery and capital have become increasingly prominent. In 1850, for instance, $556 worth of capital was invested for each wage earner, while in 1900 the average amount of capital per wage earner was $1850.1 In the second place, the organization of the industry has changed, so that the individual owner and ordinary partnership are rapidly being replaced by the corporation. At the beginning of the nineteenth century, corporations, though not unknown in commerce and banking, were very uncommon in the manufacturing industries. In 1905, incorporated companies employed 70.6 per cent of the wage earners and manufactured 73-7 per cent of the goods produced in all the manufacturing industries.

This change in organization has been a powerful factor in destroying the personal relation between the owners of capital and the wage earners who man their plants, and has thus helped to widen the growing breach between capital and labor. It has also contributed greatly to the concentration of industrial control. Law and custom in this country have combined to make the small stockholder in the largest corporations a virtual nonentity so far as practical participation in the management of the corporation is concerned; and the individual or clique of "insiders" who own a bare majority of the stock rule the business despotically. Incorporation, then, instead of introducing a greater measure of real industrial coöperation and thus democratizing industry, has too frequently turned out to be an ingenious device by which energetic promoters borrow or secure the spare savings of the community on the most flexible terms and with a minimum of responsibility. The corporation thus, while it appeared to be diffusing the ownership of industry, has in reality worked toward the concentration of industrial control.

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1 Owing to variations in the definition of "capital" and other similar changes, the statistical comparisons made in this and the preceding paragraph are not very accurate, and are to be accepted as illustrations rather than measurements.