Over the River and Through the Woods

Over the River and Through the Woods

John L. Larson, History Frontier Economy, Transportation, and the Prospects of Madison, Indiana

I. What Came NaturallyII. The Urge to ImproveIII. The Market Revolution

I. What Came Naturally A. Original landscapes B. Primitive export and import

A. Original landscapes By all accounts, a dense forest • Ancient beech-maple forests • Less underbrush than now • Much of it wet

Impediments to travel = • Poor visibility • Mud • Fallen timber • Creeks/gullies

B. Primitive export and import • Rafting downstream = primary way out . . . . . .often all the way to New Orleans

followed by arduous return • About 1000 miles on foot . . . • . . . twice that by keel boat • Natchez “down under” Weeks on the road—little gain to show

Natural waterways dictate terms • Settlers clung to navigable streams • Commerce centered on water • Poorly drained interior less desirable

Lawrenceburgh data 1826

II. Urge to Improve A. In whose interest? B. Available technology C. Links with statecraft

A. In whose interest? • Country merchants • Land speculators • Boosters, hucksters, persons of ambition • NOT subsistence farmers

B. Available technologies Madison waterfront in 1846 Steamboats: cheap, private, flexible, effective

Roads -Macadam -regular -stumps

Canals -Erie 1825 -Ohio >1827 -Indiana >1836 Still 3 miles per hour

Railroads: experimental until 1850 Mohawk & Hudson M&I’s #1  B&O Lafayette 1837 M&I’s Reuben Wells 1868  Look out! 23 mph and gaining

Special Madison feature: the 400 foot Inclined Plane http://mjcpl.org/rivertorail

C. Links with statecraft • Politicians offer developmental vision • Jennings, Ray, Noble = “state makers” • Pin private fortunes to public policy • Values of land and produce at stake • Production alone make land profitable • Markets alone make produce profitable • Land values raise tax revenue, not rate • Mammoth internal improvement program 1836

III. Market Revolution A. Specialization and diversification B. Cash overcomes barter/exchange C. Rise and fall of local advantages D. Market forces take command E. Who runs this “free” country?

A. Specialization & diversification • Market outlets  cash crops  cash purchases • Mills and processors spring up • Merchants carry better range of goods • store credit = local money • Local manufacturers thrive

B. Cash overcomes barter • Money (or credit) circulates more freely • inherently fungible • converts distance into price • Cash price subverts face-to-face exchange • impersonal • transactions stripped of relationship • Material life improves • lots of stuff • cheaper stuff • happy consumers

C. Rise and fall of local advantages Madison’s advantage: Ohio River steamboats -disadvantage? 400’ bluff -overcome with deep cut -open up Indianapolis? Over time, Indianapolis grew self-sustaining -Cincinnati, Wabash R. proved better outlets -Madison scrambles to stay in the game

Individual merchants & manufacturers: • enjoy early advantages of cheap transport (exact timing is local and varies greatly) • they expand scale and scope of operations • often invest in internal improvements . . . • removing barriers to distant competitors . . . • who swoop in to kill local vendors! (Oops)

Compare, then overlay

Again . . .

Improvement proves to be a fickle mistress!

D. Market forces take control • Maturing markets yield price stabilization • New York price of corn is what matters • Farmers become price takers • Rural merchants enmeshed in credits • Externalities invade local economies • Foreign wars, famines, disasters • Commercial panics, bank failures • Handlers get control of the float

E. Who runs this “free” country? Bryan campaign 1896  Granger print 1870s 

Over the River and Through the Woods