ECONOMICS OF RECONSTRUCTION

RECONSTRUCTION AS AN ECONOMIC FAILURE

Reconstruction may have been a temporary political success. Symbolically, it did end the legal institution of slavery. Symbolically, on paper, it did assert the idea that blacks and whites should be equal as citizens, and have the right to vote. However Reconstruction was an economic failure. It did not provide for the economic upward mobility of the African Americans. It did not create economic opportunity. It did not fulfill the dream of creating a class of independent African American yeomen, or small landowners or farmers. The 4 million slaves and their ancestors had worked for nothing (no wages) from 1640 to 1865. Most received not so much as a dime for 225 years of labor. Lincoln had promised them 40 acres and a mule. But the vast majority never got it. They did not get the back wages that should have been given them for 225 years of free labor.

FIRST FREEDMEN’S BUREAU BILL (MARCH 1865)

In March 1865 Lincoln signed a bill creating a temporary relief agency. It was called the Freedmen’s Bureau. The former slaves, the ex-slaves, the freed slaves were called freeDmen (as in they have been set free). The bill contained a vague provision, "that from the abandoned and confiscated lands of the South, 40 acres shall be assigned to adult black males." The presumption was that the men, as heads of households, would take care of their wives and children. The land would be RENTED for 3 years, and could then be purchased. Lincoln meant well, but the problem was that there weren’t very many of these "abandoned and confiscated lands." *

CONFISCATION ACT

Also, previously, in 1862, Congress had passed the Confiscation Act. It provided for a judicial process called forfeiture. A claimant could go into court and bring charges against a landowner, charging him with aiding the Confederacy. If the court found the charge to be true, the Confederate would temporarily lose his land to the claimant. This was the punishment for aiding the enemies of the US. Forfeiture was a legal process, a form of due process (a court hearing), but the person lost their land only during their lifetime. Upon their death, the land reverted to their heirs. So it was not terribly useful.

In spring 1865 President Johnson issued his Proclamation of Amnesty and Pardon. Unless the process of forfeiture had already taken place, the pardoned ex-Confederates were now immune from further prosecution. The rich ex-Confederates asked for pardons, and by February 1866 Johnson had issued over 14,000 pardons.

SOUTHERN HOMESTEAD ACT

There was a provision in 1866 for a Southern Homestead Act. The federal government still held public lands in some Southern states, that could have been sold to African Americans. But this land was terribly inferior in quality. Often it was useless swamp land. That was why nobody had bought it previously, and the Fed. Government still had it. The impoverished freedmen were in no economic position to BUY these lands.

THE STEVENS PLANS

Representative Thaddeus Stevens, of PA, proposed to confiscate the land of the former slaveowners only (not all Southern whites) and to give land to the former slaves. He proposed to give 40 acres to each of 1 million freedMEN, which would be 40 million acres. The rest of the confiscated land, he proposed, should be sold to pay pensions to Union veterans and pay off the national debt. Congress voted this plan down. It felt that this was communism (Marx had advocated communism in 1848: it was well known by 1866). In Feb. 1866 Stevens offered a second, milder plan, asking for the confiscation of only 3 million acres. 37 members of the House of Representative voted in favor. 126 voted against. The bill was defeated. Stevens died in August 1868.

Stevens realized that the South had almost no industrial sector. Jobs in industry did not yet exist. To set 4 million black people "free" in an agricultural society, with no land, was a mirage. It was to give them the freedom to starve. How would they support themselves? How would they eat? He saw that freedom without land was a curse. Legalized slavery was replaced by a new, economic form of slavery called sharecropping. It was simply slavery by another name.

THE BLACK BELT

The great majority of black people in the South lived in counties with a black majority, where 50% or more of the population of the COUNTY was black. These majority-black counties were called the Black Belt. In some cases, such as Lowndes County, Alabama, it was 80% black. But whites owned all of the land. After slavery, the freed blacks became a class of landless serfs. They were like peasants. They lived on the land of a landowner, a landlord, and worked on the land, but they did not own it. They were like renters.

SHARECROPPING

The South continued to have many plantations. The rich landowners, the oligarchy, owned the land. The slaves worked on the plantations, as sharecroppers. The worker made a contract with the landlord. The landowner divided his plantation into several plots. Each family cultivated an individual plot of the plantation. The worker (and his family) did ALL of the work on the plot. In return, he received HALF (usually) of the crop (or half of the profit from the proceeds of the sale for the cotton crop). He supposedly would get some money, too. Half the crop (or the profit therefrom) was the wage that the worker received. In other words, the worker is working to get paid a wage that consists of a half share of the crop: hence the term share cropper: someone who works on the land in exchange for half of the crop; his wage is half of a share of the crop.

Most white farmers, the yeomen or "poor whites," DID NOT originally live in the plantation counties. In the plantation counties, in the Black Belt, (usually in the low country or the fertile river valleys or the tidewater regions) there was a small elite of rich landowners, and the masses of landless black sharecroppers. In the "upcountry", up in the hill country, the white family farmers lived (as distinct from rich white PLANTATION owners).

After the War, the blacks had labor but no land. The rich landowners had land but no longer possessed a labor force. They also had no MONEY with which to pay wages. Sharecropping evolved to "fill the gap." The sharecroppers, who were illiterate (in slavery it was illegal to teach a slave to read or write) signed a contract. They typically agreed to work for the landlord and receive their pay (half the crop) AT THE END OF THE YEAR (often November or December, after the crop has been harvested and sold). The "cropper" CANNOT leave his place of employment during that year to work for anyone else, and he cannot physically leave the plantation without the permission of the employer. If he does, he can be arrested by the sheriff and thrown in jail.

The sharecropper, just out of slavery, often did not own a horse or mule or plow or wagon. He had no cotton seeds. He rentsthese from the landlord, [for a fee], (who will deduct their cost from the worker’s salary (which is his share of the crop). The sharecropper has no money to buy food during the year, from Jan. to say November. The planters advanced goods (not usually cash) to their workers, at the local store (which the planter might also own), ON CREDIT, sometimes at a 25% interest rate. At the end of the year, when the cropper receives his "wage," he must pay back (repay) the cost of the goods that were advanced to him on credit (like repaying a "loan"). Thus, when the employee gets his "salary," the landlord/employer deducts the cost of the goods that were advanced (food, clothing) and the rental fees for the equipment. In practice, the sharecropper would find that his "pay" was something like $100 but his debts and rental fees were something like $200, and he ended up $100 in debt!

SHARECROPPING LED TO DEBT PEONAGE

This led to a cycle of perpetual debt. In time the sharecropper was OBLIGATED to work for the landlord just to pay off the debts he already owed (You owe me $200, so you have to work off the debt). A person who is obligated to work for another person is called a peon. The situation is called PEONAGE. A person who is obligated to work for another person IN ORDER TO PAY OFF A DEBT is called a DEBT PEON (DEBT PEONAGE). Sharecropping led to debt peonage for generations of African Americans. It was just a new form of slavery.

In 1900, 90% of all African Americans still lived in the South. The mass migration of blacks to the North did not begin until 1916 (World War I). Between 1916 and 1960 about 5 million blacks migrated to the North. In 1900, fully 75% of the blacks in the South were sharecroppers. Sharecropping remained the dominant occupation for Southern blacks right down to World War II (1940). Most Blacks went from legal slavery to the economic slavery of sharecropping until 1940. They were trapped in a perpetual cycle of debt and poverty, a dead end.

THE BOTTOM DROPS OUT OF THE COTTON MARKET

The reason that sharecropping turned into a dead end was that the "bottom dropped out of the cotton market." The world supply of cotton rose. There was a glut. And the price fell disastrously. It was a crisis of overproduction. There were two depressions after the Civil War (1873-1877 and 1893-1897).

Year Number of Acres of Price Per Pound

Cotton Cultivated

1873 9,350,000 14 cents

1894 23,687,000 4.6 cents

The more cotton that the South grew, the lower the price fell. And there was a glut on the world market, because since the Civil War, Egypt, India, Argentina—everybody and their mother—was growing cotton. In the 1870s and 1880s, the average agricultural laborer earned about $220 a year. If a sharecropper got HALF of that, he earned $110 a year (David Potter, Division and the Stresses of Reunion, p. 218).

Basically, the sharecroppers just fell further and further behind each year. To make matters worse, because they were illiterate they could be easily cheated and swindled. And it was a racial affront to question or contradict a white man’s word, or suggest that he was mistaken or in error about the numbers. Such an insult could lead to being killed.

The landowners wanted a cheap, dependent labor force that was trapped, and had no choice but to labor on their plantations. The Southern aristocracy learned that it was not SLAVERY that was indispensable, but rather access to CHEAP BLACK LABOR. Black labor created white profit, in the agricultural sector of the South, before the tractor.

WHITE FARMERS LOSE THEIR LAND, TOO

However the economic net that ensnared blacks also ensnared white farmers. The disastrous fall in prices destroyed profits for whites as well as blacks. It was just that blacks had started with nothing, and so had no cushion. In Mississippi, by 1900, one-third of whites were tenants and sharecroppers TOO. White farmers fell into debt to merchants and banks. They had to put up their farms as collateral for loans. As the bottom fell out of the cotton market, and the depressions hit, the banks and merchants foreclosed, and white farmers LOST THEIR FARMS to their creditors. THIS MADE THEM FURIOUS. Basically, the whole agricultural sector of the South was becoming impoverished. Profits were made by diversifying into textile mills, railroads, mining, lumber and steel (Birmingham). Blacks were hit harder than whites because they had started out with less to begin with (as far as assets). The economic distress, however, was blamed on the blacks. Some whites felt that the South had been prosperous when there was slavery. They blamed their impoverishment on the end of (the loss of ) slavery.

For African Americans, sharecropping was a step forward however. No longer were blacks in chains. No longer were their families broken up and children and loved ones sold away. Women no longer had to work in the fields. The main difference was in the protection of family life, which had been damaged and disrupted by slavery. On paper, blacks were human beings and citizens with rights, no chattel or property.

But emancipation, without land, was a cruel hoax or illusion. African Americans were free in name only. If the land had been confiscated, a greater number of blacks might have become landowners, and some might have "hung on" even during the depressions. But the fundamental problem was economic. Even farmers with land fell in to debt and lost their farms in the bad economy. The economics of postbellum (post Civil War)life undercut the political and symbolic gains, and made Emancipation an empty victory. Sometimes, in history, you "catch up" just in time to "fall behind" again. And sometimes, even when you win, you still lose. That is what led black people to create "the blues."

The sense of grievance that African Americans still feel about slavery, however, is not simply the idea that "we were wronged," or even "we were used" or "we were robbed." Part of the lack of closure comes from the feeling that the ancestors of African Americans worked for 225 years (from 1640 to 1865) and never received their back wages that were owed to them as human beings. They were robbed of the fruit of their labor, which was owed to them, and America has never acknowledged that debt, or paid it. (This is the issue of reparations).