20 ChaPter^1
in 1808, anticipated the United States becoming a powerful industrial capital-
ist country with an extensive transportation network, all of which would be
built with public and private monies. At that time, most Americans were still
farmers, and there was little “industry,” as most work was done by individual
craftsmen [shoemakers, carpenters, tailors, meatpackers, barrel makers, and the
like]. If one wanted a pair of shoes, for example, he would go to a master
shoemaker and get them custom made. In just a few decades, however, that
would change, as merchants, acting as middlemen, would buy shoes in large
quantity and go out in their wagons and sell them in nearby towns. Soon,
those middlemen eliminated the master shoemakers altogether and bought
raw materials and hired mostly young women to put the shoes together and
paid them by the piece, hence the term “piecework” system. By mid-century,
and especially after the Civil War, shoemakers, and those in other fields, would
complete the industrialization process by building factories and centralizing
the entire process in one place with a division-of-labor. In that way, the fac-
tory owner could produce a huge volume of his product and sell it to a grow-
ing, and eventually national, market. The skilled craftsman, however, fell by
the wayside; there was no way an individual could compete against the
machine.
Industrial Capitalism was almost exclusive to the North, as the South was
still agricultural and heavily involved in the export of cotton, tobacco and
other farm commodities. In the North, however, textiles had already been
established as the foundation of industrialization, and factories were becoming
more common by the 1850s and 1860s. With the end of the Civil War, the
development of the railroad, and the completion of the Transcontinental
Railroad in 1869, industry was clearly established as the foundation of the
national economy. Railroads, in fact, held over $4.5 billion in capital by 1880.
The Civil War had given real impetus to industrialization, as the Union used
its huge advantages in armaments, trains and rail, shipbuilding, and, of course,
capital, to overwhelm the confederacy. After the Civil War, factories in the
North emerged primarily for producers’ goods–iron, steel, heavy tools, railroad
machinery, and so forth–to further develop the new Capitalism [a consumers’
economy was still a ways off]. Capitalism became more internally-funded too.
In the first half of the 19th Century, and including the Civil War era, American
manufacturers often borrowed from British banks to build their industries.
Now, those monies were being raised in the United States to a much greater