The development of an economy based on the use of slave labor to produce staple crops. Through a plantation system in the South and a more diverse economy in the North based on free labor set the stage for the development of two economies within one country. Increasingly after 1800 the needs of these two economies were incompatible. Southern plantations focused initially on tobacco in Virginia, and later in Maryland and North Carolina. And rice, indigo, and livestock in South Carolina. Africans were the major source of labor after 1619 in the Chesapeake. And the system of inherited life slavery developed in Virginia and Maryland by 1660 and quickly spread to the rest of the South. In South Carolina Africans were important not only as a source of labor but for their knowledge of cattle herding in the subtropical climate as well as their knowledge of the cultivation of rice. Tobacco was a crop that was hard on the soil, and from the beginning expansion into new land was an important part of the tobacco economy.
In 1793 Eli Whitney invented a machine that separated the seeds and the fiber quickly and efficiently. Whitney’s cotton engine, or gin, made cotton an economically viable crop for the South and revitalized slavery, which had been declining due to the decline of tobacco. The northem economy had moved in a very different direction from the South. While all of the northern colonies allowed slavery and merchants from several played important roles in the slave trade until it was abolished in 1808, slave labor was not a major element in any northern colony’s economy. Northern climate and topography were ill suited for the use of slave labor and the system never became an essential part of the economy.
The northern economy quickly became industrial during the first few decades of the nineteenth century, just as the South was becoming increasingly committed to cotton cultivation. The industrial economy attracted large numbers of people who sought work in the mills. Industrialists needed a reliable source of cheap food for this new industrial work force. The Midwest became the breadbasket of the industrial northeast, especially after the Erie Canal and, later, the railroad made it possible to move bulk cargoes east efficiently. The expansion of the industrial northeast required more and more territory for food-primarily wheat, corn, and beef. None of which were well suited to slave labor. These divergent economies were the basis for increasing sectional conflict over the territories in the West which both sections saw as essential to their continued development.
Opposition to the tariff was never as volatile as the issue of the expansion of the slave or the wage labor system into new territories and the formation of slave- or wage-labor states. This was because the creation of new states-slave or free states-was on the order of a foot-race between the competing labor systems. If the states adhering to one labor system became more numerous than the other, Congress could conceivably pass laws that would abolish the labor system of the less numerous block of states. This became the nightmare of the Republic.
It was during the debate over the Missouri Compromise of 1820 that the nation confronted the whole issue of this equilibrium between slave and free states for the first time. The Missouri Compromise allowed Missouri to enter the Union as a slave state (and balanced that admission with the recognition of Maine as a free state) but prohibited future slave states north of Missouri’s southern boundary. This was the first limitation on slavery in the territories since the emergence of cotton as a major crop and the revitalization of slavery that had followed from that. The Northwest Ordinance of 1785 had prohibited slavery north of the Ohio River, but it had been passed when the economic future of slavery was questionable and debate over the institution acceptable within the South. By 1820 the economic future of slavery appeared strong, provided new land for cotton could be brought into the system.