THE MERCHANTS' MAGAZINE AND COMMERCIAL REVIEW. MAY, 1863. NATIONAL ACCUMULATION AND NATIONAL INCOME. Ir is quite a remarkable fact that during the nearly two hundred years before the beginning of the nineteenth century, the population of the present United States had barely reached 4,000,000 of souls, who were far from rich, and in the latter part of that period had become bankrupt by a war of independence by no means of itself costly. With the opening of the present century, however, the population and wealth of the country began to increase in a marvelous ratio, until the lapse of sixty years finds the former equal to that of the British Islands, and the latter equal to the most favored nations. The facts are startling, and the causes by no means clearly understood. The leading figures are as follows: We thus see that during the ten years previous to the close of the eighteenth century, the population, which was less than 4,000,000, had exported annually $29,800,000, or about $7 per head, and were manufacturing annually goods to the value of about $15 per head. Fifty years later the population had reached 23,000,000, and their exports were $5 per head per annum, and manufactures $50 per head per annum. the next ten years the exports rose to $9, and the manufactures to $64 per head. The manufactures at the begining of the century were mostly the rude productions of families, or home spun goods, whereas, at the latter date the productions were chiefly by means of machines, at low In prices; in other words, a much larger quantity of greatly better goods is expressed in the same sum of money at the latter period than at the former. The value also of land and houses during the sixty years increased from $155 to $400 per head. This great improvement in the value of landed property, (being in sixty years two hundred per cent more than in the previous one hundred and eighty years,) by no means equals the vast increase in other descriptions of property which was also accumulated by the people during the same period. These are manifest in the following table: Total 40,897,792 411,199,702 31,219,911 35,888,918 19,207,101 22,130,569 10,101,201 44,208,006 1,000,000 3,971,204 21,121,000 47,911,215 $70,500,000 $734,536,301 2,211,290,077 All these investments represent the combination or co-operation of individual capital to promote certain objects which were bevond the power of individual enterprise, but which are indispensable to the development of industry. In the case of the savings banks they are simply the accumulation of earnings that might otherwise have been expended or consumed. The same remark applies to the premiums on life policies, which to the extent of $60,000,000 were paid to life companies. The investments in the stock of insurance companies provide guarantees for the safety of individual property, while the assets of mutual companies are simply the accumulated savings of the premiums. In the case of railroads and lands, the capital has been applied to facilitating the transportation of goods, the interchange of which is promoted by the use of bank capital. The vast sum, therefore, of $2,211,290,077, has been earned and saved by the people in sixty years, and, being invested in the manner stated, has no doubt tended powerfully to promote further accumulation, which has progressed in an accelerated ratio, as may be seen in the fact that two-thirds of the whole amount has been gathered in the last twenty years. Those enumerated investments do not include mortgages, which are estimated at $300,000,000; but it is probable that one-half of the amount of these mortgages was applied to the construction of houses and improvement of property, of which the cost has been given. There is also an immense accumulation of capital in stocks of goods of all possible descriptions on the shelves of storekeepers, and of machinery for various manufacturing purposes. The aggregate of all these may be approxima ted by the sum of the risks taken by the fire insurance companies. Thus, in 1860, 228 companies reported $1,977,280,404 risks outstanding. This cannot be held to cover less than $2,500,000,000 of property, of which, however, a considerable portion is no doubt on buildings, but at least onehalf the amount may be taken as goods, etc. The property of the country will then be approximated as follows: THE WEALTH OF UNITED STATES IN 1860. This gives an aggregate of $16,588,356,438, or an accumulation of very nearly $16,000,000,000 in sixty years, or $266,000,000 per annum. It is not probable that the increased value of the land can be considered altogether as accumulation, since its value has risen in the hands of the possessors, without, in some instances, any volition of theirs. No doubt in many cases the advanced values have been paid by purchasers out of their savings, and in very many cases also, immigrants, who have arrived in the country to the number of 3,500,000, and have brought with them capital estimated at $500,000,000, have, to some extent, purchased land with the money they have thus brought. It is evident, however, from all these considerations, that by some extraordinary agency the power of production and accumulation has received an immense impulse in the present century, beyond what was ever the case in the previous history of the world, and wealth has poured in upon the people in an unprecedented degree. If we would seek the leading causes of this rapid accumulation, they will, we think, be found to be, 1st, the co-operative power of capital, which has in this country been carried to a far greater extent than in any other. All the savings of almost all classes, instead of being buried in metallic hoards, have been combined and applied to enterprises which have given value to labor by making it more available; 2d, the invention of steam transportation, which has virtually multiplied capital by causing its more rapid conversion; 3d, the numberless inventions which have so multiplied the products of industry; 4th, the abundance of cheap and very fertile land open to all comers. Cheap land has no doubt been the basis of the high wages which have ruled in this country from its first settlement. When an individual could procure for nothing land which gave a large return for his labor, artizáns wages must necessarily have been correspondingly high. Nevertheless, the fact that but little accumulation took place until the present century indicates that, even on cheap land under the old system of agricultural labor, although supplied with the plow, the harrow, and other simple labor-saving machines, the whole industry of an ordinary family barely sufficed to meet its immediate wants. The small surplus that might be accumulated was due to fair seasons or favorable soil. Hence the demand for other commodities was limited and their production laborious and costly. Suddenly, however, steam lent its gigantio power as a laborer, and a multi tude of machines entered into every branch of industry, multiplying almost indefinitely the surplus of all commodities that might be produced, and of course increasing in a similar ratio the exchangeable capital of the country. The use of labor saving machines in agricultural operations at the West, enables the unaided family of a farmer to work a large tract of land, and harvest the produce far in advance of his family wants, whereas formerly, with the greatest industry he would have little to spare. This circumstance, connected with the construction of railroads, making the Western lands accessible to market, has produced marvel ous results. Take, for instance, Chicago and Milwaukee. At those points concentrates a network of railroads which lays open the rich lands between the lakes and the Mississippi. The population of Illinois and Wisconsin was 1,156,861 in 1850, and 2,487,832 in 1860; at the former date there were in operation 130 miles of railroad, at the latter date 3,791 miles, involving an expenditure in ten years of $120,000,000. The receipts of grain at Chicago and Milwaukee in the same period increased as follows: 1856... 21,107,201 3,894,254 1860... 60,150,390 18,175,364 279,470,814 73,613,937 In 1840 the shipments had been 10,000 bushels. The value of this 299,470,814 bushels grain shipped in eleven years from Chicago was, in round numbers, $200,000,000; the 73,613'937 bushels from Milwaukee was $50,000,000; and this may be said to be the result of labor and machines applied to new land, under the influence of $120,000,000 expended in constructing means of transportation, and in employing a portion of the 1,331,000 new settlers upon those lands. Thus, we see to what an extent the co-operative power of capital with labor-saving machines and easy means of transportation have developed surplus food. So, too, in the manufacture of clothing materials, steam driven-machines have supplanted manual labor with the same results. The cotton trade powerfully illustrates this increase of capital by machine industry. In 1793, an industrious hand could in a day clean one pound of cotton from the seed for the use of the manufacturer. The invention of the gin enabled the same hand to clean 400 pounds in a day, or, in other words, by this invention, the product of the same manual labor bestowed upon cotton pickings was increased four hundred-fold. At the same time, inventions were made in carding and spinning by which one man could do the work that before required 2,200 men. Soon after inventions in weaving were introduced, by which a girl could do the work of 30 men. When the white cloth is made, it is printed by a process which enables one man to do better what before required 200 men. At the close of We make up these figures for Chicago from the Board of Trade returns. They differ somewhat from a table given in the last number of the Merchants' Magazine, which table was obtained from another source. the last century to print a piece of calico in one color required 448 applications of the printing block, all of which was done by hand. To-day a machine, with one man, will print 12 colors at the rate of a mile of cloth an hour, or 12,000 yards per day. Under the action of these and numerous other inventions the entire cotton trade in Europe and America has risen as follows: .1800.... Supply of cotton, pounds. 54,203,433 2,361,444,616 Price in Liverpool. 48 c. 6 Yards cloth made. 162,610,299 7,064,833,646 In the United States the people use about twenty-five yards of cotton cloth per head per annum, and at this rate the cloth manufactured in 1860 would have supplied 280,000,000 of people. Without the machines it would have required, to produce the same goods, 8,000,000 in cleaning the cotton and 70,000,000 to weave it. These are a few of the processes by which machines in the cotton trade alone have contributed to produce wealth. But this trade is not peculiarly affected; every branch of industry has had its productive power increased in a similar manner. Wagon making, as an instance, is so systematized that a well known factory turned out for the government one every forty-five minutes. There are other establishments where the steam power, concentrating the work of 300 men, converts rough lumber into pleasure carriages at the rate of one an hour. The power of production in the sewing machine is enormous. In a hearing before the commissioner in relation to Howe's patent, a shirt maker stated that he used 400 machines, and that they did the work of 2,000 hand sewers. A clothier stated that in his establishment the saving of wages by machines was $100,000 per annum, and that when the machines are generally adopted, the saving in the trade for the whole Union would be $75,000,000 per annum. It is estimated that 25,000 girls with machines will do the same work in a year that would require 300,000 without machines. Thus in every branch of industry where capital and labor have been employed to produce food, or clothing, or dwellings, or furniture, or any of the many articles which enter into civilized life, the effect of manual labor has been increased from ten to some hundreds of times through the inventive genius of the people. The whole productive power, therefore, of 6,000,000 active male inhabitants of the Union, in 1860, was, under all circumstances, equal to that of 60,000,000 in 1800. Doubtless the yearly consumption of these persons was also ten times as much as at the beginning of the century, (that is, each person enjoyed ten times as much of the products of his industry); but nevertheless the accumulating surplus was annually much larger, and has progressed in an increased ratio ever since-every application of capital stimulating a more advantageous production. The forms in which capital has accumulated have been, as we have seen, in dwellings and public buildings, gas, water, and other companies, in manufactures and machinery, and, to an enormous extent, in the means of transportation, in plank roads, railroads, canals, sailing tonnage and steam tonnage, all of which has tended to cheapen transportation and also to equalize the value of land, which, from the government price of $1 25 per acre, has gradually risen to an average value of $100 per acre for all east of |