Decline in the Deep South

The five key cotton states of the Deep South have been shown to have experienced the greatest setbacks (Table 14.3). This precipitous decline occurred for three principal reasons.

First, the highly efficient plantation system was destroyed, and attempts to resurrect plantation methods proved futile. Free blacks shunned assembly-line methods employing gangs that were driven intensively from dawn to dusk, as they always had been by free whites. In place of the plantations, smaller units arose—some owned, many rented, and many sharecropped (the owner of the land and the tenant split the crop). Table 14.4 shows the alteration in farm sizes between 1860 and 1870 in the Deep South. Whereas 61 percent of the farms had been less than 100 acres in 1860, 81 percent were under 100 acres in 1870. Economies of scale based on the intense driving of slave labor were lost.

A second closely related reason was the significant withdrawal of labor from the fields, especially labor by women and children. This reallocation of human effort undoubtedly raised household production and improved the quality of life, but it nevertheless contributed to the decline in measured per capita agricultural output in the Deep South by 30 to 40 percent between 1860 and 1870.

Finally, the growth of the demand for southern cotton slowed because of competition from India, Brazil, and Egypt, and because the growth of world demand slowed. The U. S. South had dominated the world cotton market in 1860, commanding 77 percent of English imports (see Ellison 1968, in Gavin 1974; also see Wright 1978, 1986). During the war years, however, when the door to the new competition was opened, only 10 percent of England’s cotton came from the South. The South’s market share rebounded well in the late 1870s, but it never reached its 1860 high mark.

TABLE 14.4 FARM SIZE DISTRIBUTION IN FIVE MAJOR COTTON STATES

Source: Ransom and Butch 1977, 71.

The decline in the Deep South immediately after the Civil War was to be expected. The tragedy was that southern agricultural production remained depressed for decades afterward. The most puzzling aspect of the decline in the Deep South was the increased concentration on cotton. Unlike small prewar southern farms, small postwar farms, especially those operated by former slaves, became highly specialized in cotton. In the five main cotton-growing states, 82 percent of nonslave farms (85 percent of all farms) had grown cotton in 1860 compared with 97 percent of all farms there in 1870 (Ransom 1989, Table 7-3, 257). Moreover, a greater proportion of the land on each farm was devoted to cotton production in 1870 than in 1860. Indeed, whereas many slave plantations had been self-sufficient in food before the Civil War, the Deep South now became a food-importing region. Black farmers were the most cotton dependent, with 85 percent of their crop in cotton compared with 60 to 70 percent for white farmers. White owners placed the smallest proportion of their land in cotton; white tenant farmers produced nearly twice that of white owners, and black tenants nearly four times that of white owners. Increased dependency on cotton occurred despite declining cotton prices in the 1870s.

Concentration on cotton production was not irrational. Stephen DeCanio (1974a and 1974b) has shown that the South had a comparative advantage in cotton production and that southern cotton farmers were about as responsive to price changes as northern wheat farmers were to wheat prices (Economic Reasoning Proposition 3, incentives matter). Nevertheless, the limited economic alternatives provided by the cotton economy sentenced many former slaves to a life of grinding poverty. To see why this happened, we must explore the transition from slavery to freedom and the new economic institutions that replaced the old.