Sun Baoqiang/Wen President also does not know the price of labor
In the summer of 1791, Arthur Young, a prominent British agricultural economist and editor of the British Agricultural Yearbook, sent a questionnaire to Washington, then President of the United States, asking for detailed data on the annual costs and incomes of medium-sized farms in the United States. Washington explained: "I can't tell you the price of labor, because all the land was cultivated entirely by slaves. ”
As president, Washington could only provide as much data as he could, but Young was still disappointed: "Your information is so unreliable for me. It is too difficult to analyze your livestock industry through this information. Is it possible for a resident to treat agriculture as a business, but never to calculate the rate of profit in terms of capital?" As Richard Peters, president of the Philadelphia Agricultural Advancement Association, put it, "We have countless farmers here who work so hard that they never think about yields or other elaborate calculations...... They work hard, enjoy life, and don't need to be carefully calculated. In other words, despite the development of agriculture, American farmers do not need to calculate their farm income. In the case of large farms, Alfred Chandler Jr., in his book The Visible Hand: The Management Revolution in American Business, argues that inaccurate calculations of economic returns are widespread, and that financial surpluses or losses rarely depend on accurate cost calculations, because farmers are powerless to deal with factors that affect earnings, such as bad weather and international market prices.
Some of Washington's information to Young came from a statistical questionnaire by then-Treasury Secretary Hamilton, who was himself disappointed and frustrated by the findings. In the summer of 1791, Hamilton began collecting data in order to write the Manufacturing Report, which would later shock the world, and he soon realized that he had overestimated the quantitative habits of Americans. Cox, Hamilton's like-minded assistant secretary of the Treasury and a well-known expert in industrial data, found that almost half of the 1810 manufacturing census was blank, frustrating his idea of adding up America's labor and natural resources in monetary terms.
Until the mid-20th century, many economic historians trying to calculate data on GDP during the North American colonies faced the same difficulties, so much so that the eminent economic historian Paul David referred to the period before 1840 as the "Statistical Dark Ages." Because, while there is a great deal of information available on the prices of commodities during the colonial period, little is known about the costs of factors of production, such as land, labour, capital and management skills.
Why is this so? In the final analysis, the United States did not have the need for accurate data at that time, which was directly related to the natural resource endowment of Britain and the United States, and also related to the level of technology. Britain has abundant labor resources and land is insufficient, and leasing land is the main form of production in agriculture. Around 1750, 70% of the land in England was cultivated by tenants, with the remaining 30% cultivated by owners or occupiers. In the United States, the numbers are reversed. At the time of American independence, only one-sixth of farm operators were sharecroppers for life and needed to lease land. In the early days of the United States, land resources were extremely abundant and cheap, the price of land was less than the annual rent of Irish land, and labor was scarce, so leased land was a minority. Of the 181 landowners surveyed in a sample survey in 1802, only 25 (13 per cent) leased land, and therefore no one paid attention to the price of labour. At that time, the United States was still quite self-sufficient, and most American households used the family workshop production method, and there was no need to calculate the output of the land in detail. Of course, the government did not have decent statistical indicators at the time, and before the 1850 census, even state governments relied on private data collection. In terms of technology, agricultural machinery, new fertilizers, new crops, and breeds of livestock had not yet appeared, and production could only be increased by increasing manpower or increasing labor intensity, and the situation gradually changed after 1850.
Under such historical conditions, it is naturally impossible to put a price on the factors of production, nor can it produce national income accounting. Only when every commodity, every piece of land, and even every labor force can be quantified into monetary figures, can the preconditions for national accounts be formed. England had the conditions to calculate the national wealth of England in 1660 with a single figure in 1665, but the United States did not have the conditions at that time. However, Petit has many protégés in the United States who are working hard.
Mate's American protégé
William Petty is now regarded as the originator of national income accounting. In the United States, GNP also sprouted, and before and after the founding of the country, there were Deity's protégés who worked hard to explore, such as James Glenn, Hamilton, Samuel Blodgett Jr., George Tucker, etc., most of whom had read Deity's "Political Arithmetic".
In 1743, before the independence of the United States, the British-appointed Governor General of South Carolina, James Glenn, arrived, and he created the most advanced political arithmetic in the 18th-century North American colonies. As early as 1720, the Commissioner of the House of Lords of England began to demand "the annual production of commodities in the provinces" of the New World, and in 1739, when requesting information on land prices and rental incomes, he also asked the provinces to report "how many blacks there were" in the last two years...... and their selling prices", these data are the basis for Glenn's calculations. In 1751, Glenn used the first national income account in American history to measure the national income of the entire state of South Carolina at 40,000 pounds, which was the first time that American farms were priced in money.
After the founding of the United States, Hamilton was the architect of American capitalism and the pioneer of American political arithmetic and the progress of "pricing". Hamilton's 1791 survey was a purposeful attempt to introduce the political arithmetic and method of "pricing" progress pioneered by Petit to the United States, but the level of capitalization in the United States was too low at the time to yield no results. Why did Hamilton not succeed 40 years later when Glenn could have done it? Because in Glenn's time, rice was grown in the South Carolina lowlands with economies of scale, and many of the planters came from the capitalized Caribbean, who were extremely wealthy and good at investing. Hamilton was more aware of the importance of measuring national income in shaping fiscal policy, and this is what he shared with Petty.
Before the American Civil War, George Tucker, the first professor of political economy at the University of Virginia, ahead of Harvard, pioneered a statistical analysis that included the first income and wealth statistics in U.S. history based on market output collected by the census, and the first original national income data from the census. Both Tucker and Hamilton grew up in a highly capitalized environment, and this particular experience led him to naturally see people as an income-generating factor.
Regarded as one of the few pioneers of U.S. GDP accounting, Brojet was a man who was ahead of his time. Historians often think of "economy" as a 20th-century invention because "economy" in the 19th century meant "frugality" or "frugality." But in those days, when Brojett spoke of the "national economy," he was referring to the total wealth of the United States, and he was particularly interested in how to keep the American economy growing. In his famous 1801 essay "Reflections on Increasing American Wealth and National Economy," he noted that the average American value was $400. He summed up the immovable property, movable property, and human capital to arrive at the national wealth of the United States at $2 billion in 1790. In his 1806 book Economics, Brogert priced the wealth of nations by pricing everything possible, including not only the tangible but also the capital invested in toll roads, canals, bridges, and banks. In addition to economic data, there have also been moral statistics in history, which sparked debates among the then US Secretary of State and lawmakers.
Debate between the Secretary of State and the House of Representatives
In February 1844, U.S. Secretary of State Carl Horn and Ohio Rep. Giddings engaged in a heated debate. Horn believed that the blacks in the North, who had been freed from slavery, had become morally depraved and impoverished. At the same time, without exception, there are physical and mental problems, such as deafness, blindness, insanity and dementia. Why is that? This is because at the time when the North and the South were in constant debate about the legalization or overturning of slavery, and demographics became a tool in the debate. The reason statistics were able to provoke such a heated debate was because both sides of the reform about slavery recognized that moral statistics had a huge impact on the American imagination. With the widespread dissemination of data, this risk is magnified and the situation becomes very tense.
The United States' attempt to conduct moral statistics was influenced by Europe, and the term "moral statistics" was also introduced from Europe, more precisely, from the United Kingdom. And why did Europe produce moral statistics? Mainly because of the rise of the Industrial Revolution. With the rise of the Industrial Revolution, traditional home factories disappeared and traditional apprenticeship relationships disintegrated and were replaced by new types of factories. Inside the factories, manufacturers tried to instill bourgeois ethics and work discipline in workers by ringing bells, checking attendance, and a strict set of rules and regulations. In the new factories, the workers were free, and they no longer lived in the master's house, as before. Apprentices and journeymen at that time not only had to work and learn their craft with masters who had mastered the technology, but also often lived together. Most of their work was done in workshops near the owner's house, but the new factory broke the pattern, and city life became a general society of strangers. As a result, these business elites feel that they have no way to rely on local governments to control society.
The bourgeoisie tried to find new ways to restrain the workers, so they turned to moral statistics. Unitarian pastor Henry Michael called moral statistics the "moral police" of corporations, which were used not only to improve the living conditions of workers, but also to increase profit margins. Without ethical statistics, profits will be eaten up by violations. In order to ensure that workers can accept a quiet and stable job, businessmen in these places use moral data as a means to guide workers to form norms, and instill the concept of self-discipline in skilled workers and laborers. These philosophies are the same as the production disciplines that began to be internalized in the 1920s by craftsmen-turned-manufacturers. The moral statistics of this period also included prostitution, education level, and so on. Still, Americans at the time were reluctant to "put a price" on it, and this was particularly evident in the 1840s. This is indirectly evidenced by the surge in the use of the word "priceless" between the 1830s and 1840s. However, as capitalization deepened, moral statistics gradually gave way to economic statistics.
Hangings caused by bestsellers
In the 1850s, Hinton Helmer published a book called The Looming Southern Crisis, a pamphlet strongly opposed to slavery that became the most effective propaganda tool for Republicans. The book was later reprinted in 1859 with the support of Horace Gretel, editor of the New York Tribune, and some powerful and wealthy people in New York, and in 1860 the book sold more than 200,000 copies, making it one of the best-selling books in American history. Historian George Frederickson argues that the book may well be "the most important book ever published in the United States" "in terms of political influence," and Southerners certainly understood the power of the book, so they arrested the book's dealers and even hanged three people in Arkansas who held it.
In contrast to previous books, Helper's focus is not on moral statistics, but on economic statistics. The book highly praises the capitalists of the American North by treating capital accumulation, market productivity, urban development, and industrial manufacturing as the main indicators of human progress. The book contains a series of economic indicators derived from the 1850 census data, and Helmper associates men with economic quantifications, and a particular form of "fact"—the market output data that prices the ability of the American people to produce goods—occupies much of the book. In the first chapter, which is more than 100 pages long, Helper measures the "progress and prosperity" of the North and South by tabulating the cash value of agricultural products mined from the lands of the South and the North.
Interestingly, the use of economic statistics instead of moral statistics to debate the merits of slavery became new at the time. Back in the 1840s, Virginia Elwood Fisher had an influential pro-slavery pamphlet in which Fisher used a series of market output and economic growth data as a "yardstick of progress" to prove that the South was far more advanced than the North. But when comparing wealth per capita, Fisher does not treat African-American slaves as "people" but only as capital, which artificially narrows the denominator and makes the per capita wealth figures in the South appear relatively high.
In Helper's view, slavery needed to disappear because it was "unprofitable" and not because it was "immoral enough." On this point, Helmer agrees with Tucker, who also argues that "slavery is not sufficiently exploitative compared to wage earners." A similar view was Edward Atkinson, a capitalist, economic thinker, statistician, and political magnate who, in his bestseller 1861, Cheap Cotton and Free Laborers, argued that the abolition of slavery would not bring about the end of American textiles, because wage labor would reduce the cost of labor in cotton farming.
Americans in the 1850s began to view monetary income as a decisive measure of moral integrity. After the cotton boom of the mid-19th century and the expansion of slavery in the West, slaves began to be viewed, organized, and valued as patriarchal property, and slaves began to be capitalized, seen more as liquid productive assets that could provide their owners with a steady stream of income that could be traded in domestic trade. As slaves were priced, sold, insured, mortgaged, leased, and securitized, the old ways and social relations quickly disappeared, and the way plantation owners priced slaves was little different from the way they priced other property. As plantation owners came to see slaves as capital, they began to see not only the plantation as an investment, but society as a whole, in line with Tucker's view of man as income-generating data and society as a capitalized investment.
Of course, there are also those who use economic statistics to justify slavery. James de Bogh in the 1850s saw the entire South as a vast profit-maximizing plantation, and his calculations were not only to legalize slavery, but also to attract more capital to the South. In 1856, Keitel published The Wealth of the South and the Gains of the North, a book that shocked the nation, in an attempt to prove that slavery, a lucrative institution, should not be abolished. It can be seen that both supporters and opponents of slavery are using economic indicators to argue, rather than moral indicators, and both sides regard people as capital and progress as economic data growth. So, is there any other force pushing to "put a price" on everything than this debate?
The key role of railways
Arguing that slavery was not the only major force driving the "pricing" progress of the American North, the other major force was the development of railroads in the 19th century. In many ways, railroads have revolutionized American society and are comparable to the Internet at the end of the 20th century. Railroads pioneered new forms of corporate management, management hierarchies, and cost accounting methods, establishing the United States as a large national market of urban nodes and rural satellite towns.
Railroads not only gave birth to national markets and corporate capitalism, but also to new statistical systems, producing a flood of new statistics that made it possible to analyze trade and production activities in detail, made it possible to analyze people and progress, and the inhabitants of the United States were reconstructed into abstract units of wealth that could generate income. Railroad companies trying to persuade capital from the eastern United States and Europe to finance a railroad line they may never take are moot to telling them that railroads can improve the civility or morality of communities thousands of miles away. Wall Street doesn't need moral statistics, what they need is money discourse that must reflect costs and benefits, backed up by consistent earnings statistics. Railroad statistics provide visibility into the market productivity of U.S. villages, towns, cities, and countries, and Americans learn not only about U.S. rail traffic, but also about the U.S. economy as a whole. Some see railways as a barometer of the entire industrial system, arguing that railway statistics "record the world's greatest achievements in material development."
Since then, America's elites, both in the South and in the North, have preferred to use currency-denominated productivity and economic growth data, and moral statistics are losing the support of elites. Economic indicators played an important role in drawing the American Northern elite into the anti-slavery camp, driving the growth of the anti-slavery system, promoting the founding of the Republican Party in the United States, and helping Abraham Lincoln become president.
The preference, of the president
President Lincoln favored improving the statistical capacity of the U.S. government, relying on quantitative economic information to make public policy and drive social change from the beginning of his political career until his death. In 1848, Lincoln advocated that the federal government should collect more market data, but his quantitative preferences were ignored by many biographers. In 1862, a few minutes before his second State of the Union address that shook Congress, Lincoln cited population growth data several times in order to demonstrate that future U.S. citizens could easily afford to pay for his progressively compensatory emancipation program. In order to implement a compensatory emancipation program in the District of Columbia, Lincoln began collecting price data.
Before the Civil War, the American Geographic and Statistical Association was active in pushing the federal and state governments to collect more and more business-related statistics. For example, the association persuaded the New York State Legislature to include industrial and agricultural statistics in the 1855 state census. Not only have they been very successful in this regard, but some of their members have also played an official statistical role. For example, in the 1850 Census, Russell, a member of the Society, designed the Agricultural Survey Form, and in 1857, Edward Mansfield, a member of the Association, was appointed Commissioner of Statistics for Ohio. It can be said that the joint efforts of private interests and national statistical agencies have contributed to the explosion of economic statistics.
It is important to note that the American Civil War greatly boosted the production and use of data. The American Civil War was a military nightmare as well as an economic nightmare. In 1860, the U.S. national debt was only $64.8 million, and by 1864 it was more than $2 billion. The fact that the Treasury debt is increasing by 1 million a day has created anxiety and fear among the middle class of the North who hold the Treasury bonds. One evening in the fall of 1864, David Ames Wells, who would later become the most popular economic writer of the Gilded Age, gave a lecture to merchants in the city of Troy, citing census data, fire insurance records, The report of the commissioner of the state bank, which even estimates the growth of the number of sheep in the country, is full proof that the United States is growing rapidly in terms of wealth and resources, and there is no need to worry about the problem of debt: after the reunification of the country, there will be $20 billion in capital in peacetime, and the increase in wealth will certainly not be less than $2 billion per year. The lecture was a success, and he made a name for himself by writing it in a pamphlet entitled "Our Burdens and Our Strengths."
A year later, Lincoln appointed Wells as the Special Commissioner for National Taxes, hoping that Wells would reproduce the complex calculations of his speech in the form of an annual report on major trends in the U.S. economy. Wells completed his annual report, which became a post-Civil War event with great influence and became the focus of much political debate.
(This article is based on the book "Pricing Progress: A Brief History of the Evolution of U.S. Economic Indicators")
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