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America's land vs. Europe's labor

I'm about 200 pages into H.W. Brands's forthcoming "American Colossus," and so far, this is the most interesting paragraph:

Of workers, America had always had many, of course -- although never enough to meet the demand for labor. In fact, the historic dearth of labor was perhaps the central feature of the American economy in the seventeenth and eighteenth centuries. In Europe, land was scarce but labor plentiful; in America, the balance tipped the other way. This explained much of why Americans resorted to slavery (while Europe, for most domestic purposes, did not). It was also why labor was better rewarded in America (except for those slaves) than in Europe, which in turn explained much of the attraction of America to immigrants.

By Ezra Klein  | September 27, 2010; 9:30 AM ET
Categories:  Books  
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Comments

sounds like economics to me.

Posted by: bdballard | September 27, 2010 10:01 AM | Report abuse

It'd be interesting to see some of the data that goes with those "explain"-s :)

Posted by: Chris_ | September 27, 2010 10:11 AM | Report abuse

What's amazing now is that we have an adequate labor supply, but one that is overpriced in the new global labor market. We literally can't get people that grew up here to take the lowest tier jobs (as Colbert so eloquently pointed out) and the unions so eloquently proved. If you increase the wages to get people, the production will simply move to places that maintain a comparative advantage to our wage structure.

Illegal immigration is in some sense a natural response to the labor market here which is not internationally competitive. We need to continue to depress housing costs- as that is one key driver of the higher price of living here. Government subsidies just keep the prices high. (see also, higher education and medical care)

I'd recommend Matt Ridley's "The Rational Optimist" as another book that takes a good look at some of these topics.

Posted by: staticvars | September 27, 2010 10:46 AM | Report abuse

Historically we were raised to expect a higher standard than those poor devils in 'pauper Europe'.

Posted by: leoklein | September 27, 2010 11:01 AM | Report abuse

staticvars,

I don't think supressing wage growth here in the US should even be considered an answer. If those who give us the greatest competitive advantage could earn more going elsewhere, e.g. 'knowledge workers', then that leaves us what, WalMart and McDonalds at minimum wage?

Both China and India have surplus populations that each exceed the entire population of the US, who are willing to work for in a week, what many American workers are paid in an hour. We will never be 'competitive' with this kind of labor market. Our focus should continue to be on broad-based education and the kind of thinking that has allowed us to increase the productivity of our own workers.

I would also say it wasn't 'pauper' Europe. I think the word you were looking for was 'peasant', which wasn't too far from indentured servitude.

Posted by: Jaycal | September 27, 2010 11:26 AM | Report abuse

Brands might have added that the scarcity of labour contributed to the high rates of innovation in America, such that Benjamin Franklin, the inventor, was the archetypal American in European eyes (in the 18th c. and later): less labour created a strong incentive to develop technology (or whatever) that could increase productivity.

Read Twain's CONNECTICUT YANKEE IN KING ARTHUR'S COURT for an example of this kind of thinking, albeit an extremely late one.

Posted by: andrewmiller2007 | September 27, 2010 2:21 PM | Report abuse

Suggest you read, "White Cargo: The Forgotten History of Britain's White Slaves in America". All early labor was forced and most were worked to death, died from disease or were murdered starting even with Jamestown. This was almost universal until the early 18th century as white slavery tapered in response to hue and cry only to be replaced by an increase in black slavery. Ironic that blacks were treated better because whites were mere chattel but black slaves were property.

Posted by: BertEisenstein | September 27, 2010 3:54 PM | Report abuse

Yep, this is why indentured servitude was so popular and Europeans were willing to put up with it. 7 years of work and then you get your own land (provided you can take it from the Indians) was an un-heard of deal in Europe, where land ownership locked up by a wealthy class. Eventually, of course, the people running the farms realized that if you just didn't let people GO after 7 years, you could basically import the European agricultural model to US shores, so that's what they did in the south.

One of the most under-reported things about the American revolution was how ANGRY many English were at Americans for not appreciating their good fortune. Soldiers came over to the US, and were shocked at the absolute wealth of the average American compared to the people they knew. There's a great account of British conscripts seeing the family-run farms of Queens and Brooklyn and being like "how DARE these guys whine about taxation? They're all rich!" (Interestingly, tied to this "open land" observation was the fact that the US had wild animals that had long been hunted to extinction in Europe. Hessian troops in the revolution wrote mail about how terrifying it was to travel through the wild country of upstate NY, with rattlesnakes and other horrors, and how horrifying it was to hear the howling of wolves at night--and realize that at night, bears and wolves were eating the dead on the battlefield.)

Another interesting argument is the role that the US' lack of hard CASH played in opposition to taxes. Available land meant we were a very wealthy nation per capita, but the fact that currency needed to be shipped overseas meant the kind of money that could be used to pay taxes was literally worth more stuff in the US than in the UK. We were getting killed on the effective exchange rate.

Posted by: theorajones1 | September 28, 2010 1:02 PM | Report abuse

"Ironic that blacks were treated better because whites were mere chattel but black slaves were property."

This is simply not true.

European settlements in the 1600's were marginal operations at best. The uppermost classes frequently died of things like exposure and starvation, because they were living on the edge of their civilization, in a place with zero investment in the kind of infrastructure that made their society possible. This didn't happen in the 1700's and 1800's, when African slavery wholly eclipsed European slavery, because by then we'd tamed the freaking wilderness.

It's not that the institution of slavery became kinder and gentler, it's that Virginia went from being a backwater, marginal settlement in the wilderness on the edge of the British Empire to being the center of American civilization after more than 100 years of massive, massive infrastructure investments!

Slavery was still awful. Slaves were still treated inexcusably and exploited mercilessly, and viewed as sub-human: arguably, more when they were black than when they were white. The difference you're pointing to is because in the 1750's food didn't run out nearly so often as it did in 1607, so why let them your slaves starve to death (or kill them to keep them from eating the food you need to get through the winter) if you can get another season's work out of them? It was more economical, most of the time, to keep them alive than kill them.

But that doesn't mean slavery was kinder and gentler--what changed was that Jamestown wasn't a "holy crap, we're gonna starve to death this winter" frontier town anymore!

Posted by: theorajones1 | September 28, 2010 1:17 PM | Report abuse

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