Nick: I remember first reading about a controversy surrounding the New History of Capitalism scholarship when Dr. Edward Baptist’s book, The Half Has Never Been Told, released in 2014. It seems that The New York Times’ 1619 Project reignited this controversy. Would you mind giving a brief history of all of this?
Phil: Sure. In the early 2010s or so, a group of historians turned their attention toward the economics of slavery. Now, this is an issue that has been a part of scholarship for the better part of a century. But, this school of thinkers started to define themselves as the New History of Capitalism. Their work involved a reemphasis on cotton-based production as the centerpiece of American market capitalism, as was commonly thought by people in the 19th century. One of the main works of this was that Ed Baptist book. What Baptist did is that, in the course of his book, he purported to calculate the share of the U.S. economy that could be linked to cotton plantation production and therefore slavery. In calculating this, he engaged in a series of very unconventional, almost self-invented accounting practices that resulted in a figure where cotton production amounted to literally half of the United States GDP in the 1830s. In doing these calculations, he violated all sorts of norms and accounting conventions that economists use when calculating GDP, as the actual figure is more like 5% rather than 50%. Regardless, this calculation became the basis of his narrative, driven by the idea that modern capitalism today is supposedly built on this slave-centric production system of the 1800s that he’s grossly overstated the actual economic size of.
Nick: It seems like Baptist’s research and the research of the other New Historians of Capitalism was what the 1619 Project primarily relied on, rather than the older economic history work on slavery and capitalism. Is that correct?
Phil: Right. That’s absolutely the case. Pretty much the only treatment that the 1619 Project gave to the question about the economics and market relationship to slavery derived from these New History of Capitalism thinkers, Ed Baptist being foremost among them, but also Sven Beckert and Walter Johnson at Harvard, as well as a few others that have written in the same vein, all around the same thesis that cotton was the driver of the 19th century economy.
Nick: Do you know to what degree any other economic historians were consulted in the project?
Phil: As far as I can tell, none. There do not seem to be any other economists or, in fact, any economists at all who were brought in for that segment of the analysis. Instead, a sociologist at Princeton wrote an article which basically interviewed only historians that all came from the New History of Capitalism school. Practically no economic historians or economists were consulted. We can see that because any economist consulted would have corrected several of the false and misleading statistical claims that are presented in the project.
Nick: To move out to the broad picture, it seems like the crux of the issue is the role of slavery in the economic development in the US. How, very generally, do you think we should think about this?
Phil: I see slavery as, certainly, a major sector of economic production. It’s certainly a component of how the U.S. evolves across the early and middle 19th century. It’s a horrific institution and needs to be documented as such. But, the economic portrayal of it being the crux of capitalism or the mechanism that allowed for industrialization to occur is almost completely false. It’s actually a relatively small sector among many that are components of the U.S. economy in the antebellum period. And, none of those sectors, when taken alone, could be used as a single-issue explanation of why industrialization happened.
Nick: On that note, I found the example of Dr. Robert Fogel’s work on trains to be very interesting. Can you explain his work and how it relates to this discussion?
Phil: Sure. The standard narrative that many historians thought before Robert Fogel, a Nobel Prize winning economic historian, started to investigate this issue, was that railroads were the driver of industrialization in the late 19th century. The idea was that railroads allow for the mass transport of goods, people, and services all across the country, and that single-handedly triggered industrialization. But, what Fogel did was investigate the statistics and found that, first, the railroad sector is much, much smaller than you’d expect it to be if it were the single industry driving industrialization. And, second, when we do an economic analysis of the role of railroads, we have to actually compare them to what the next best means of transportation would have been had railroads never been invented. So, for example, prior to railroads, people shipped things on canals, riverways, and via the ocean. If you apply some statistical analysis as Fogel did, you actually see that the railroads added a very, very small share of economic value compared to these alternative means of transportation. So, that becomes its own internal test of whether the railroads are really this causal instigator or whether they were just one factor among many in industrialization. What his empirical evidence shows is it tends to be the latter: A factor among many. Indeed, Fogel’s work suggests that seemingly massive industries can only tell parts of the story when we look at an event as significant and widespread as industrialization.
Nick: You write that Harvard economist Dr. Nathan Nunn has demonstrated a strong negative relationship between the historical existence of slavery in a county or state and the level of income persisting in that county or state in the present day. Two questions: First, do the New Historians of Capitalism have a response to these findings? Second, is there a theoretical reason for why this might be true?
Phil: To the first, the New History of Capitalism crowd has become almost notorious for neglecting literature outside of their own little echo chamber. It is so bad that I actually had an exchange with the editor of the 1619 Project where she was completely unaware that there even was a controversy over Ed Baptist’s calculations. But, if you look internally at the New History of Capitalism crowd, they’ve made a habit of speaking almost flippantly in their dismissal of economists’ and other prior work. In fact, Stanley Engelman, who is probably one of the leading economic historians of slavery, took Ed Baptists and a couple of other New Historians of Capitalism to task in a massive review essay of their literature, essentially concluding that they were largely ignoring the past 30 or 40 years’ worth of academic research outside of their field. It’s really unfortunate because there are small elements of this wider range of academic research that align some of their claims. But, there are also major findings that contradict some of their core claims, like the notion that cotton was the central driver of industrialization. So, there is a real problem of a lack of engagement that is violating basic scholarly norms. The New Historians of Capitalism have gone in alone and asserted that their version of the history is the truth and they’re not paying attention to scrutiny that’s coming from other areas.
As to Nathan Nunn’s claim, he has done very rigorous empirical studies both within the United States and also in other countries. He’s found similar patterns when he traces economic development in states, counties, and regions that previously had a large plantation system present to ones that didn’t. What he finds is: After slavery is abolished, over time, you see an economic lag in the development of areas where slavery previously existed. So, it turns out to be this is kind of indirect evidence that slavery, rather than constituting a major economic driver of industrialization, development, or wealth as the New History of Capitalism presents it to be, is actually an impoverishing drag of an institution that has a legacy many decades or even centuries later that causes economic stagnation in its wake.
Nick: That almost sounds like a resource curse?
Phil: Yes, in some ways. When you start to think about it, the slave system itself is highly dependent on a massive appropriation of public resources to prop it up. You need police, slave fugitive slave patrols, enforcement mechanisms, even a militia or a military to put down slave revolts just to keep the system operational. When you start to bring that into the cost — all of the public expenditures — in addition to the private operations of the plantation system, it drastically changes the economic equation of what it takes to make a slave system operate. The slave system really shifts its costs and burdens of operation onto the public at large through the appropriation of tax revenue, not to mention the horrific misery that it inflicts on slaves themselves. So, what looks ostensibly profitable system when one looks only at the plantations is in fact no longer when you expand consideration to all the other secondary and tertiary costs and effects. It actually ends up being pretty impoverishing.
Nick: Sometimes the miscommunications in this debate seem to arise when historians who approach these issues from a Marxist framework and are interested in whether slavery was “pre-capitalist” or “capitalist.” Conversely, Dr. Robert Wright, the economic historian, wrote, “It has never been my practice to reify concepts like ‘capitalism’ and treat them as historical actors.” Yet, I’m wondering, what do you think it means to talk about the relationship between capitalism, as an economic system or institution, and slavery in a substantive way consistent with the economic history approach?
Phil: I tend to approach the question as a question within the history of economic thought. That is, asking the question of who were the capitalists in the 19th century? Who were the theorists behind a market based economic system of free competition or laissez faire? And, who were the critics of that system? If you do that, you find a very sharp divide among economists and non-economists over what capitalism even means in the 1840s and 1950s. The pro-capitalist side, pro-market liberal side of the debate has a distinctive historical feature in that it overlaps very closely with the emergence of the British abolitionist movement. So, if you went back to the 1830s or 1840s, you would find that the same people tended to be both members of the anti-corn law and free trade leagues in England and the abolitionist societies. There’s a very close overlap between the two, almost a philosophical connection. We can take this back even further to Adam Smith, who both in The Wealth of Nations and in some of his other published lectures, not only makes an economic case for liberalization in terms of free trade and free markets, but also makes an economic case against slavery itself. He writes that the plantation system has certain economic inefficiencies that that lag behind the market economy and free labor, not to mention that it’s a moral abomination that has spillover effects onto what it extracts from the state: It tends to entrench slave owners in powerful positions in government which makes slavery even harder to get rid of.
These are arguments laid out by Adam Smith in 1776, if not earlier, and they played out through what we would consider the laissez faire or free market tradition in the 19th century. So, by the eve of the civil war, what had emerged was an intellectual climate of pro-capitalist theorists in the economics profession who were also very, very outspoken anti-slavery advocates. There were ardent abolitionists. They were the people campaigning to end this institution. Yet, at the same time, some of the most vocal critics of capitalism were also some of the most vocal defenders of slavery in the United States. There was a figure by the name of George Fitzhugh who started writing in the late 1840s, early 1950s, as kind of a pamphleteer on the pro-slavery site. He was trying to answer William Lloyd Garrison and Garrett Smith and Wendell Phillips and all of these abolitionists in the North by making a philosophical and sociological argument for plantation slavery. The interesting thing about the two books that Fitzhugh wrote in the 1850s was they both open with an attack on market capitalism, on laissez faire. Fitzhugh writes that we need to discard the doctrines of Adam Smith and David Ricardo and all who came after them and toss their theories into the fire because not only are they economic nonsense and exploitative of the workers, but also that they are doctrines at war with slavery. Smith and Ricardo’s theories, in Fitzhugh’s telling, are bringing abolition, forcing it upon the South. So, he actually blames the free market economists for being the instigators of the abolitionist movement. Fitzhugh is one writer among many, but this seems actually to be a really common sentiment among both defenders of the slave system in the South. Even more broadly and internationally, there were intellectual defenders of slavery who were also very vocally anti-capitalist. So, the basic argument I make is that you need to consider this intellectual history to get the framing of what was going on in the 1840s and 50s when these debates were playing out. If you do so, you find the capitalists are on abolitionist side and that the anti-capitalists are largely pro-slavery.
Nick: Do you think that there are any points the New Historians of Capitalism have made that are both novel and true?
Phil: I tend to discount the novelty of their work. I think that they have reinvigorated a research drive to look at source documents such as testimonials and narratives from slaves themselves, which I think is very interesting and can be very productive, though historians have had access to these things for decades, if not longer, and have been writing in a similar vein. So, I don’t think it’s all that novel other than in bringing a few details to light that augment what we already knew. So, in that sense, it is a worthwhile avenue of research, but they also seem to be enamored with overstating their own novelty. You see that in Baptist’s title, The Half Has Never Been Told, implying that nobody ever wrote on the subject until he came along and discovered it. Several of the other New Historians of Capitalism have made similar claims. But, if you go back and look at the critique that Stanley Engerman wrote in his review, not only has this stuff been known and written about for decades, it’s actually the New Historians of Capitalism who, while claiming novelty, that have done a very deficient review of the existing literature on the economics of slavery.
Nick: Twitter seems to be the central medium of this debate, a medium of which you’ve been very critical. How do you think about Twitter as a place for academic debate?
Phil: It’s very much a mixed bag. I tend to have a more skeptical view of it. The one good thing, I will say, is that it does allow academic claims to be investigated and challenged in almost real time. So, as soon as an article is posted, like the 1619 Project, or as soon as a new book comes out, scholars can jump in and start asking pertinent questions of it, sometimes presenting them to the authors themselves. So, that’s the plus side of it. On the downside, Twitter has brought out some very unscholarly behavior, not only just into the heat of back and forth arguments but even more broadly has transformed some of what should be academic debate into political point scoring contests, where each side presents an almost political argument to the public rather than engage with their interlocuter on an academic level. So, something that decades ago would have been handled in letters or at academic conferences where people present papers and receive comments, are now turning into 280 character back and forth arguments. It’s very easy for those tweets, as we’ve seen, to devolve into name-calling. Or, if you don’t like your critic and their line of challenge, you just block them entirely or accuse them of being political motivated or some other malfeasance, rather than engaging with the substance of their criticism. So, it’s a mixed bag, but it tends to be mostly negative in my assessment.
Nick: If academics aren’t going to engage with each other in traditional ways, as you have accused the New Historians of Capitalism as failing to do, do you think Twitter is the best option at the moment? What would you like to see in the future of this of these debates?
Phil: I’d rather see a raising of the bar for rigor across the board. I think that, to some degree, the traditional approach of publishing articles and journals in academic presses strives to deliver a higher standard of rigor. Traditional academic conference presentations strive to deliver it. When you’re actually presenting your work before an audience of peers, other scholars who are experts in the same area, it urges greater caution when pushing a bold claim or an aggressive thesis, such as asserting that King Cotton was the dominant driver of the emergence of capitalism. That’s might fit nicely into a tweet, but in an academic conference under full scrutiny, that would be harder to sustain. In fact, you can only sustain it when you make it in an echo chamber of people who already agree with you.
Nick: Do you think there’s been any bright spots in the dialogue between historians and economic historians on these issues?
Phil: I think it has forced some of the economic historians to translate their empirical work into layman’s terms, which fortunately was a trend of the discipline and still is a trend of the discipline. It’s often the case that these debates get deep into the weeds of sophisticated empirical models. When this happens, you can risk losing the straightforward story for the public. You can lose the larger implications that can be very important which come out of the data. If the result is presented as a table of regressions, the average reader who is not an economist is not going to be able understand them. So, it seems that historians, by botching the story, have forced economists to actually translate their numbers into readable, accessible works so that they can present a counter-narrative before the public, allowing people to understand what’s actually doing in some of their empirical models. In that sense, the fact that economists are thinking more about making their work accessible beyond the boundaries of their discipline may be a silver lining.
Nick: If there were to be a later journalistic project like 1619 which strived to recognize the history of slavery and its legacy, how would you recommend journalists go about it differently?
Phil: First and foremost, I’d urge the editors of that future project to survey a broader swath of scholarship than what they did during this one. It struck me that the 1619 Project developed with the various editors and contributors seeking out a small group of historians that already confirmed their political beliefs and what they expected to find, which was an indictment of capitalism. So, that was the only swath of the academic literature they even paid attention to and drew upon. So, what I’d urge journalists to do is, instead of finding two or three experts who already agree with them, to go and read other works that actually challenge their views. And, after reading those other works and understanding the totality of the debate, to try to give a more accurate synopsis of the history.
Nick: Finally, if someone wanted to look for a book or a set of papers that were most up to date and accurate about the economic history of slavery and the Antebellum South, what do you recommend? Is Fogel and Engerman’s Time on the Cross still the preeminent work?
Phil: Time on the Cross is certainly a landmark work, and it’s important in the sense that it moves a lot of the debate from rhetoric into actual data and actual evidence. But, it is also a dated work. It came out in the 1970s and there have been multiple sophisticated advances since then. I think if you were to ask Stanley Engerman, the book’s coauthor, what has changed, he’d point you to a list of a dozen or more papers and books that have modified elements of his original thesis, although I do think that the general framework that they present in that book is valuable.
If I were to urge a reader today to find a good work – it’s actually fairly obscure in the sense that it hasn’t gotten the notice that I think this literature warrants – but there is a lengthy review essay by Jeffrey Rogers Hummel of San Jose State University. It’s on the Social Science Research Network as a working paper, and it’s a couple hundred pages long, but it surveys the whole swath of literature on the economics of slavery, both from classical sources and modern empirical models. It tries to synthesize them together to state what has been found, compares it to what the historians have said, and comes up with a general conclusion that tries to balance the economic effects of the slave market with the public sector effects in that the government is necessary to enforce and subsidize this horrific institution so long as it exists. Hummel works to come up with an interpretation between the two, the “10 second version” of which would essentially be that slavery can be economically profitable, but it’s not necessarily economically efficient and that inefficiency is revealed when we start to consider the public sector components of what was necessary to enforce slavery. That’s where you really start to see some of the negative legacies playing out economically in the present day.