The outcome of many political events can be predicted by examining the economics surrounding them. For instance, the demonstrators of the Arab Spring that would go on to turn over their governments were extremely well correlated to purchasing power parity and GDP growth of their respective nations.
Likewise, the outcome of America’s Reconstruction era for African Americans was written by the political economics.
Most people, including those Arab Spring demonstrators and ex slaves of 1865, want to exercise their lives in the quiet pursuit of happiness. In the aftermath of the Civil War, after hundreds of years of oppression, in a land surrounded by groups of men who had nightly patrolled outside slave homes prior to the war’s end, and in which the President seemed bent on directing a lenient path back into the union, the last thing, ex slaves wanted was a major political disruption that would thwart the pursuit of happiness that was within their grasp. But they did need a way to survive if they were not just going to exist as before on their masters’ plantations.
To survive, these ex slaves would need a means to sustain themselves. To eat, to have a roof over their heads, and to clothe their families, at a minimum they would need to enter this new paradigm of an agricultural economy with either their own farm or a way to earn a living on another’s.
Without having to subject themselves to a continued plantation life, they would need to borrow the funds to live until a harvest produced. They would also need the means to purchase a farm, the tools to work it, and the seeds to plant on it. This would require a loan and some equity, if they were going to qualify to obtain a loan in America’s capitalist economy.
To obtain a loan typically requires some collateral, or at least some history of being able to repay the loan. A loan requires that the borrower have a job commensurate with the amount of the loan, own a business with some history, or at least have some form of education that would support the amount of the loan.
President Lincoln had promised the slaves 40 acres and a mule. This seemed a generous start to a new life in a world turned upside down politically and socially. In addition, the Freedman’s Bureau offered some financial and food assistance until they could gain an economic foothold. So the foundation for a new life seemed to be put in motion at war’s end.
However, the plantation owners did not want the ex slaves to gain this foothold for that would mean financial ruin to them and an end to the political economy of the south as it had existed for several hundred years. The single largest investment and equity of the South was the slaves. Emancipation destroyed that investment, leaving the plantations without an engine and the wealth of the Confederacy evaporated. They had no intention of letting this happen without a fight, even if they had just lost the war.
Fortuitously for the South, Lincoln was assassinated. In his stead, Andrew Johnson was made President. His sympathies were with the South, not the slaves. As such, he reversed the program of free land for slaves and gave it back to the plantation owners. Without land and without equity, ex-slaves would require generous loans to escape their old life. Neither were offered or even guaranteed by Johnson’s Presidency. Without even a guarantee to back loans, ex-slaves were relegated to some form of land lease, which reverted to odious share cropping across the South.
Granted, even though land grants were occurring along the railroads heading west, nonetheless, taking land from pre-civil war land magnates and giving it to ex slaves was a bit radical in our capitalist country. It also threatened northern lawmakers, who were also large landowners. The idea would not politically stand for precedence set would mean that sometime in the future when southerners regained political power, they could turn the tide on northern land owners.
While ex slaves were not given a quick fix to their poverty dilemma, over the long run, ex slaves held the power of change in that they now could vote in economic supports due to the passage of the thirteenth, fourteenth, and fifteenth amendments. They could enact laws to support land loans. They could fund schools to gain the education to build skills to afford loans and to eventually help ex slaves enter into the American economy.
Yet, southern plantation owners understood the politics of freedom as well and fought to thwart ex slave access to loans, to schools, and to political participation. Through legal, political, and subversive means such as the KKK, ex-slaves were denied the means to obtain loans and to decent education. And with the support of Johnson, their means of voting for change was subversively and violently denied.
Nonetheless, they hoped to sustain the slow and arduous path toward economic freedom, if the federal government could simply and, at least, moderately support their efforts. Sadly, economic events would erode the northern citizenry support of the federal government’s reconstruction. The erosion had standard elements of a greed caused boom/bust economic crisis that would divert national attention away from the tediousness of supporting a social goal that required a gradual lessening of prejudice from the North.
Similarly to the Great Depression that would follow, and the 2008 economic implosion that we all experienced recently, the discovery of gold in 1848 set up the economic failing of post civil war reconstruction when it started the mass migration West in search of riches. The migration to California was an impetus for the massive railroad-building boom after the war, including the transcontinental railroad.
Across Europe, a housing boom similar to America’s in the 2000’s was used to feed America’s railroad ventures, the size of the investment boom, which had not been seen before. Yet the rate of investment could not be sustained by the growth in America’s post war economy just yet. Unfortunately, as all booms do, it ended in a bust that caused a 20-year depression in Europe and the Long Depression in America, starting in 1873.
The depression caused a shift in public sentiment that resulted in political losses that signaled the end of support for Reconstruction. Pre Civil War southern political powers would regain their power in the South, and swift retribution plus starving of any economic progress for ex slaves would be the result.
America would then shift its attention to an economic revival that would simply bypass the sleepy South and focus on exploiting the rail system that had been laid. Millions of immigrants and an expansive growth of industry in the new industrial era would divert America’s attention on social justice for another 80 years.
The South would regain its plantation economy. Ex slaves would eke out a poverty-stricken existence, waiting for the next political upheaval that would not occur until the First World War. The chance at human progress had been thwarted. Decades of harsh treatment and social ingraining of prejudice both on the sides of the oppressor and the oppressed would ensue. How would this injustice affect race relations in America and how would it ultimately impact our inner cities?