It is evident that the Civil War in the United States was waged, primarily to preserve the Union, and establish the supremacy of the Federal Government over the individual States. Slavery, as traditionally practiced, was diminishing in the United States, including the South.
The African slaves were first introduced into the United States in 1618. At this time white slaves outnumbered black slaves by a ratio of four to one. Between 33% to 50% of the immigrants to Colonial America were indentured servants. At the height of indentured servitude, such persons comprised up to 75% of the population.
An indentured servant is a person who is forced into servitude by virtue of a debt or debts owed to a creditor. In Colonial times, such persons were either thrown into what is referred to as a debtor prison, or they were forced to pay off their debts to their creditor by performing physical labor.
An indentured servant was typically forced to serve for a period of 2 to 7 years. If the indentured servant was a child, then the child was forced to serve until the age of 21. 40% of the indentured servants died before serving their term.
Although the law mandated that the holder of an indentured servant was to provide the servant food, shelter and clothing, such provisions were substandard, as compared to the general population. The indentured servant was treated as poorly, as worse, than the slaves.
The indentured servant, however, had one advantage over a slave. The indentured servant was usually prescribed to serve for a defined term of years, where a slave was typically assigned as a slave during his or her entire lifetime.
However, slavery at the time of the Civil War was already in decline. There are numerous reasons for the decline of traditional slavery in the United States. Advances in technology and machinery, including in agricultural production, created less demand for such labor. Also, there appeared to be a growing awareness among the population that slavery and indentured servitude were unjust practices.
However, another factor that is seldom discussed, may have led to the decline of the practice of slavery in the United States. Slaves were expensive. According to some historians, in 1850, the average slave cost approximately $48,000 in today’s money. A prime field hand to a skilled slave such as a blacksmith, cost between $30,000 to $60,000.
For reference, in 1860, a horse cost about $10 to $25, land cost about $3 to $5 per acre, and a slave cost about $800 to $1,000. In 1860, a blacksmith working a 60 hour work week made about $10.68, a carpenter about $10.92, and a laborer about $5.98.
Because of the high relative cost of purchasing a slave, slaves were often treated better than the relatively inexpensive indentured servants. In addition to the high initial investment of purchasing a slave, a slave owner was mandated by law to provide for the shelter, food, clothing and medical needs of the slave.
Slaves in Colonial America were considered by the less than 1% of the population that were slave owners, to be sort of status symbol. Only a small percentage of the population had the financial means to own and maintain a slave.
The cost of purchasing and maintaining a slave did not produce a good return on investment. Most businesses consist of two factors, capital and labor. Capital represents all the elements outside of labor that are necessary for the continuation of the business. A factory that produces automobiles must have a building to produce the automobiles, machines to assist in their production, energy to run the machines, etc. Labor represents the workers that labor in the factory.
A good return on investment is typically considered to be 8% to 10%. If a field hand earned $5.98 a week in 1860 and a slave cost approximately $1,000, the slave would need to labor approximately 14 years for the slave owner to recapture his investment. When one calculates the added expense of providing all the physical needs of the slave, such as food, clothing, housing and medical, the slave would need to labor more than 14 years. In order to achieve a return on investment of 8% to 10%, the $1,000 invested by the slave owner in purchasing the slave must be recaptured in 8 to 10 years.
From a purely financial perspective, slaves were not a good investment. One advantage, however, of owning a slave over simply hiring a laborer, is that the offspring of the slave could further be monetized. Despite this advantage, slaves generally were not a wise investment, from the perspective of a plantation owner or businessman, because the return on investment was so dismal.
A field hand in 1860 could be hired to work for the plantation owner at the cost of approximately $5.98 per week. The plantation owner was only mandated to pay the laborer for his weekly efforts. There was no requirement that the plantation owner provide food, shelter, clothing, medical treatment or other needs of the laborer.
In addition, the return on investment provided by the laborer was immediate. If the performance of the laborer diminished, the plantation owner could simply terminate the laborer and hire another, with no loss of investment.
Indentured servitude and traditional slavery was eventually outlawed in the United States. One of the reasons may be because of a realization of the evils inherent in both practices. Another possibility is that the governing population realized that such practices brought a weak return on investment. Another form of slavery was and is much more efficient, carries a higher return on investment, and does not carry the stigma of institutional slavery. So, indentured servitude and traditional slavery were banished, and replaced with debt slavery.
Part III in our Series will discuss debt slavery, along with its formation, practice and advancement, in the United States.
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